9th Parliament · 2nd Session
Mr. Speaker (Kt. Hon. W. A. Watt) took the chair at 2.30 p.m., and read prayers.
.- I desire leave to make a statement, and in order, sir, to conform with a request which you have made, I may say that the subject-matter of the statement will be the attitude of the Government in the conduct of the business of this HoUse
– I object.
– I wish to ask a question of the Prime Minister in that capacity, and in his capacity as a maker of history. I ask whether, off hand and without notice, he can quote a single instance in the history of this Parliament in which the Prime Minister has refused leave to the Leader of the Opposition to make a statement?
Mi-. BRUCE’. - I shall have the records searched if the honorable member will put his question on the notice-paper.
– I ask the Treasurer has a new Repatriation Commission been appointed? If so, what are the names of the commissioners, and for what term have they been appointed?
– The answer to the honorable member’s first question is “.Yes.” If he will give notice of the other questions, I shall supply him with full particulars.
– About a week has elapsed since the Treasurer promised to furnish mo with a copy of the reply by members of the Repatriation Commission to certain charges made by mc. I have not received the document, and it has not been printed. I ask the honorable gentleman now whether he will let me have it, or is he living in the hope that I may forget about it?
– I may inform the honorable member that the reply was typed; and I regret very much that hehas not yet received a copy of it.
– I ask the Prime Minister whether any decision has yet been arrived at regarding the regulation of wireless broadcasting in Australia? If so, is he prepared to make any statement on the mutter to-day?
– This matter was very fully considered by the Cabinet yesterday. It is now practically finalized, and I hope to be able to make an announcement upon it in the very near future.
– I ask the Prime Minister is it a fact that considerable delay has taken place in the holding of the proposed conference of representatives of the states concerned in wheat production, to consider the establishment of a wheat pool. If so. will the right honorable gentleman use his best endeavours to expedite the meeting of such a conference?
– Some considerable time ago, I met a deputation in New South Wales that expressed a desire for assistance towards the establishment of four Wheat pools in four separate states. I pointed out that that was a matter which concerned the states, and suggested that they should consult the State Governments. They did so; and subsequently I was requested by the South Australian Government to summon a conference of representatives of the states concerned. I did- so, and the conference was to have boon held last Monday;. but on Friday .last I received an intimation from New South Wales, and also from Victoria, that it would be impossible for their representatives to attend the conference on the date fixed. The meeting of the conference had therefore to be postponed, and at the present moment the views of the states interested are being ascertained to see whether it is possible to arrange a date for the meeting of the conference that would be suitable to them all.
– I ask the Minister for Works and Railways if he is yet in a position to furnish me with the information for which I asked a week or so ago, with regard to. the prospect of early telephone communication between Esperance and Salmon Gums?
– I shall furnish a reply to the honorable member’s question ;is soon as possible.
– Some weeks ago, the Treasurer announced to the House that a royal commission was being appointed for the purpose, I believe, of. further delaying the collection of a considerable’ amount of land tax due by Crown leaseholders. Is it a fact that, although the honorable gentleman made a great profession of his desire to have the commission appointed as an urgent requirement, it has not yet begun to perform any of the duties for which it was supposed to be appointed?
– The honorable member asked yesterday when the report from the royal commission to examine the basis for calculating taxation to be paid by Crown leaseholders might be expected. I promised to ascertain, what progress is being made. I now find that the commission has not yet entered upon its duties, but it is expected to do so very shortly.
asked the Minister for Trade and Customs, upon notice -
Has any arrangement yet been arrived at with the Government of New South find with reference to the distribution in that state of Commonwealth wire netting t
– During my recent visit to New South Wales I took the opportunity of interviewing the Minister for Lands (Mr. Wearne) and discussing the matter fully with him. I hope to be in a position to make a definite statement in the near future, but meanwhile
I am assured no hardships are being suffered by the persons desiring netting, as state funds to the extent of over £80,000 arc still available for the purpose of supplying wire netting to settlers in that state.
DuTy on- AGRICULTURAL IMPLEMENTS
asked the Minister for Trade and Customs upon notice-: .
– The answers to the honorable member’s questions are a3 follow: -
asked the Treasurer, upon notice -
J5r. EARLE PAGE.-In the absence of details as to the department andbranch concerned I am unable to give the information desired.
asked the Treasurer, upon notice - 1. (a) What pension would’ be paid on retirement, under section 29 (6) of the Superannuation Act 1022, in the case of a Quartermaster of the Permanent Military forces retired on reaching- the compulsory age limit of 60 years,’ who -
had over ten years’ prior service in a permanent capacity under the Commonwealth,
– The answers to the honorable member’s questions are as follow : - 1. (a) The equivalent pension- at 6Q is £113, Is. 6<±. (*) £208 per- annum, bat the officer would pay contributions extending-, over an- additional service of five years and bis pension period would be reduced by five years.. 9. (a) The actuarial equivalent of the contributions made or to- be made by the officer is an important factor in the calculation of the pension. Contributions must increase, as the officer receives promotion because he will be compelled’, until’ he attains the age of 40, to take up additional units as his salary advances: to higher salary groups. Pensions on retirement at the ages for retirement for the ranks specified cannot therefore be calculated without fall details of increases in salary (hiring the officer’s service.
A pension of five units payable on retirement at 65 is £130 per annum. 3. (a) Yes. (6) No. 4, (a), Yes, provided the. ten. years’ continuous service was permanent.
asked, the Prime Minister, upon notice -
– The answers to tb® honorable member’s questions are as follow.”’ -
Acting Monitors’ INCREASES Mr. CUNNINGHAM asked the Minister representing the PostmasterGeneral, upon notice - l.. Is it a fact that the acting monitors in New South Wales are not yet receiving” the Increases awarded to them by the- Public Service Arbitrator in his recent award, which came into operation ou the 28th April, 1924 !
– Inquiries are being made, and replies will1 be furnished as soon as possible.
– On. the 27th- June, the honorable member for West Sydney (Mr. Lambert) asked the following questions: -
I am now- in a position to supply the following information: -
– On the 3rd July, the honorable member for the Northern Territory (Mr. Nelson) asked the Minis ter representing the Minister for Home and Territories the following questions : -
In reply to these questions the honorable member was informed that the Minister had seen only a press report of the proceedings; that he had notreceived any’ official advice respecting the statement attributed to Judge Roberts, but that he was making inquiry of the Administrator in regard thereto. As a result of the information respecting this’ matter which has been obtained from the Administrator, the following additional answers to the. honorable member’s questions are now supplied: -
Motion (by Mr. Bruce) agreed to -
That leave of absence for three months be given to the’ honorable member for North Sydney (Mr. W. M. Hughes) and the honorable member for Wentworth (Mr. Marks) on the ground of urgent private business, and for one month to the honorable member for Riverina (Mr. Killen) and the honorable member for Franklin (Mr. Seabrook) on the ground of ill-health.
The following papers were presented : -
Audit Act - Transfers of Amounts approved by the Governor-General in Council - Financial year 1923-24 - Dated 1st July, 1924.
Lands Acquisition Act - Land acquired at - Drysdale, Victoria - For Postal purposes. Penong, South Australia - For Postal purposes.
St. Helens, Tasmania - For Postal purposes .
Mr. BRUCE having declared that the Commonwealth Bank Bill is an urgent measure -
Question - That the Commonwealth Bank Bill be considered an urgent bill - put. The House divided.
Majority … 8
Limitation of Tims.
That the time allotted in connexion with the Bill be as follows: - (a) for the committee stage of the Bill to the end of clause 6, until 0.30 p.m. on Thursday, 10th July, (0) for the committee stage of the Bill to the end of clause 0, until 11 p.m. on Thursday, 10th July; (o) for the committee stage of the Bill to the end of clause 15 until 12.50 p.m. on Friday, 11th July; (<2) for the remainder of the committee stage of the Bill until 3.15 p.m. on Friday, 11th July; and (e) for the remaining stages of the Bill until 3.50 p.m. on Friday, 11th July.
Honorable members on both sides of the House will realize that it is essential that this measure should be finalized at the earliest’ possible moment. This is desirable whether honorable members agree with its provisions or not. The necessity for disposing of the measure as soon as possible is the state of uncertainty which is inevitable-
Honorable members interrupting,
– Order! I appeal to honorable members to assist the Chair in preserving order.
– The necessity for finalizing this measure-
– I move -
That the question bo now put.
– Order] The honorable gentleman surely knows that the closure cannot be applied to a guillotine motion.
– It is desirable that we should dispose of this measure without delay, owing to the atmosphere of uncertainty that is being engendered in the public mind as to the financial proposals of the Government, and the basis upon which its banking system is to be conducted in the future-
Honorable members interrupting, Mr. SPEAKER- I warn honorable members on both sides that the Chair will have to exercise its authority if its calls for order are disregarded. I wish to be relieved from the painful necessity for that, but if circumstances demand it, I shall certainly take the necessary action.
– Quite right.
– I shall be obliged to name the honorable member for Bourke if he persists in interjecting.
– If honorable members will examine the schedule of the times allotted to the different stages’ of the bill they will, I think, agree that reasonable opportunity is provided for the proper discussion of the larger principles of the measure. Therefore, I appeal to honorable members to allow the business of the committee to proceed with reasonable dispatch.
.- I have to say that I am surprised at the action of the Prime Minister and the Government. I had intended, at an early stage of to-day’s proceedings, to mention the procedure that was adopted last evening. There is not a scintilla of justification for the Government’s proposal and for the support of it by Ministerialists. From the opening of the present session, the Opposition has not delayed the business of the country in any shape or form. If ever an Opposition gave a Government reasonable facilities for the passage of measures, we have done so. This bill is a very important one. It should receive the most careful consideration. What has been the procedure? If hembraable members examine the records of Hansard, they will ascertain that the second-reading debate was not unduly protracted. Comparatively few honorable members spoke, and I think it was a case almost of man for man from each party. I -do not want to labour that aspect of it, for it is not creditable to honorable members if they do not participate in the discussion of important legislation. Last week, the Prime Minister mentioned to me that he desired to fet this bill through the House this week, n order to meet him, although no understanding was come to between us, I mentioned the matter to my followers, and asked them to endeavour to assist in’ passing the measure this week. Only yesterday, I said to the Prime Minister .- “ I think we shall be .able to give .you the second reading of the bill to-night.” I was much surprised, therefore, when lie applied tho “ga.g.” . Nothing incenses the Opposition more than to be “gagged,” particularly when the fair thing is being done. The Government should not attempt to fritter away honorable members’ rights. So far as I know, only two honorable members desired to speak last night when the honorable member for Batman (Mr. Brennan) sat down,- They were the honorable member for Reid (Mr. Coleman) and the honorable member for Kalgoorlie (Mr. A. Green).
– Has not every honorable member the right to speak if ho desires to do so?
– Yes:; but to my knowledge only those two honorable members desired to speak. Had they been permitted to do so in the ordinary way, we should have taken the division on the second reading last night, and got home .much earlier than we did. The bill would also have been .given fair consideration in committee. Three or four principles in it which, in the view of honorable members on this aide, are vital, would have been keenly debated, and if our proposals had then been rejected, a considerable number of consequential amendments would not have been moved. Altogether, we should have dealt with the measure more effectively than will be possible if this motion is agreed to. I ask honorable members whether it is fair to declare .such an important bill as this an urgent measure? I do not think that the committee stage of the bill should be limited as to time, for the only opportunity honorable members have to move amendments is at that stage. The Prims Minister proposes _ to allot a certain time to the consideration , of specified groups of clauses. Assuming that it is reasonable to limit the time during which the bill shall be before .the committee - which I do not admit-I think that it is quite wrong to divide up the time as is proposed. Two or three of the main clauses on which debate is likely to occur may fall in one period, and the- principles involved will thus only be debatable for a couple of hours, and then the mouths of honorable members will be closed so far as those clauses are concerned. This method of dealing with legislative proposals will not commend itself to the general public, nor will it increase the regard in which this deliberative assembly is held outside. Surely the Prime Minister will not contend that we can mould satisfactory legislation by applying the closure! There might have been some excuse for his motion bad honorable members unduly delayed the passage of the bill, but they have not done so. No time has been wasted. I ask honorable members who may .intend to support the motion to consider what their position will be in the eyes of their constituents if they do this. When important measures are introduced to Parliament, honorable members, in many cases, go to a good deal of trouble to examine them carefully, and read up, in the library and elsewhere, the subjects with which they deal, to assist them in forming their opinions, and they have a right to expect that they will be afforded an opportunity to state their views on the legislation to which they have devoted their attention. It is most unpleasant “for them to discover that, because they did not speak early in the debate, they are denied the right to speak at all by the application of the “ gag.” Is such treatment likely to prove an incentive to them to give their best talent in the interests of their country ? If honorable members are uncertain whether they will be allowed to speak in debates, they will soon cease to take an interest in the ‘business before the House, and Parliament will resolve itself into an assembly in which one or two members make all the speeches, and the others are mere automata. That will not be in the best interests of the country. I say without the slightest hesitation that there is no warrant whatever for the introduction of this motion. Had the Prime Minister permitted the debate to take its ordinary course last night, the bill would have been passed through this House by Friday. Actions like this simply create bitter feeling among honorable members. I thought that the Prime Minister had had sufficient experience last session to teach him the undesirableness of applying the closurein order to force business through the House. After this kind of action was taken last year, the House was continually in disorder. It is not to be expected that honorable members who are in the minority will submit quietly to the curtailment of their rights by the majority. That has never been tolerated, nor will it be. The leader of a government may apply the closure with .impunity once or twice, but honorable members who consistently support a leader in forcing business in this way will be required to answer to their constituents for their conduct. One thing that the Australian people like above another is true sportsmanship. They like men to be fair to one another. I venture to say that when they are given the opportunity they will indicate in no uncertain way that there is no justification for this action, particularly in view of the negotiations that had taken place. I endeavoured to assist the Prime Minister io get the bill through this House by Friday because he had no work to occupy the attention of another chamber. I do not think many opposition leaders would have been willing to act as I did.
– The Leader of the Opposition has been too fair to the Government.
– When one endeavours to do the fair thing, the Government confronts it with motions of this kind. The position is intolerable. It makes one wonder what will happen during the remainder of the session. If this measure is as urgent as the Prime Minister says it is, why was Parliament allowed to remain in recess for so long ? It should have been called together earlier, io that proper considers ‘ ‘ an could be given to the business to- be placed before it. This Parliament has been in session for a shorter time than any Federal Parliament that I can remember. Notwithstanding this, an attempt is being made to’ prorogue it as soon as possible. Honorable members have only been in sessionfor a few weeks this year, and what have they accomplished ? Very little. Yetthere is a disposition on the part of the Government to end the session speedily.
– Whose fault is it that so little business has been done ?
– It is the fault of the Government for not calling honorable members together earlier.
– That is no answer.
– Let the honorable member ask the people who sent him here what he is paid for. Is it to sit in Parliament for a couple of months in the year, or to give proper consideration to the interests of the country? The Government is not justified in attempting to prorogue Parliament for another five or six months. Of course, it is easy to understand why such action is proposed. There is always safety in recess, and danger when Parliament is- sitting. The Government does not know what is likey to occur. If the doors of Parliament House are closed, the criticism to which the Government is subjected will not concern it very much; but if Parliament is sitting, the Government knows that it will have to listen to criticism. In these uncertain times there is always danger, particularly to a composite government like this. The Government is setting a very bad example. Probably it has been driven to it by the existing circumstances. Not having a majority in this House, Ministers are endeavouring to govern this country by compromising with their own views and principles as expressed upon the public platform, in order to get the support of another party which is not favorably inclined to those views and principles.
– The honorable member’s time has expired.
. -r-It is difficult, indeed, to reconcile the words of the Leader of the Opposition (Mr. Charlton) with his opposition to the motion moved by the Prime Minister (Mr. Bruce). He said in his speech just now that the Government had accomplished very little since the beginning of the session ; but now that the Prime Minister has attempted to expedite the passage of this measure through the House, there is an outcry against his action. We have the startling admission of the Leader of the Opposition that if it were not intended to guillotine the bill through committee it would have been passed by Friday. Well, the Government is allotting until Friday afternoon for its consideration in committee.
– Do not misrepresent my words.
– The Leader of the Opposition has placed himself in a remarkable position.
– Tho Minister told a deliberate lie on Friday last, and he is now telling another.
– The Leader of the Opposition knows that such remarks are disorderly.
– They may be disorderly, but they happen to be true, if the report in the public press of this country is correct.
– I. demand the withdrawal of the remark that I told a deliberate lie.
– The statement of the honorable member for Hunter is not in .accord with parliamentary propriety, and he must withdraw it.
– I withdraw it, and 1 do not qualify my withdrawal; but I wish to say that I did not make the statement that the Treasurer was attributing to me. I said that I promised the Prime Minister to endeavour to get the bill, through by Friday night. The Treasurer should be fair.
– The Leader of. the Opposition complained that so little, had been done this session.
Honorable members interjecting,
– Will the honorable member be good enough to resume his seat. I make another appeal to the House. Honorable members know that parliamentary debate cannot proceed while interruption is continuous. The Standing Orders lay it .down that every honorable member is entitled to be heard, in silence, and I ask honorable members to observe our rules.
– The Leader of the Opposition complained that the business of this Government was proceeding at a slow rate, yet the Labour party claim the right to oppose all business that the Government brings forward. The honorable member for Batman (Mr. Brennan) said last year that it was the duty of the Opposition to prevent the Government from carrying out any business at all,’ and that it would be quite within its rights in doing so. I object, not to the Labour party exercising its rights, but to their protestations against the action of the Government in trying to get business considered.
– The Government is following the same line of action in this matter as it did on the question of Imperial preference.
– Honorable members opposite refrained from expressing their views on the question of preference. They sat like dumb, driven cattle, when a few words of commendation for the efforts of the Prime Minister might have made all the difference to the vote in the House of Commons. Tho resolution for a. preferential’ tariff on dried fruits was lost there by six votes, and a. turning of three or four members from one side to the other would have carried it.
– I rise to a point of order. Is the Treasurer in order in referring to the. Imperial Conference resolutions, which are not relevant to the question before the House?
– I must frankly confess that I do not know to what the honorable the Treasurer was -alluding, because I could’ not hear him clearly. If honorable members will be good enough to keep silent, I. shall be able to form an opinion ‘ about the relevance of his remarks.
– I thank the Opposition for giving me points upon which to hang my arguments. I shall place the facts before the country at the proper time.
Honorable members interjecting,
– I ask the honorable’ the Treasurer again to resume his seat. Unless honorable members are prepared to listen in silence to the expression of conflicting views, I shall vacate the chair until the House has come to a better sense of the occasion.
– The Treasurer told a deliberate lie.
– The honorable member for Gwydir must withdraw that statement.
– If I am not permitted to make the statement inside the House, I shall certainly make it outside.
– I am not concerned with what the honorable member may say outside, buthe must not make use of disorderly expressions inside the chamber. I ask him to withdraw his remark.
– I withdraw it.
– Proceeding with the question whether sufficient time has been given to honorable members to debate this subject, I wish to point out exactly what length of time has already been taken up in discussing the bill.
Honorable members interjecting, .
– I caution the honorable member for Werriwa (Mr. Lazzarini), and the honorable member for Gwydir (Mr. Cunningham).
– On the 13th June, nearly a month ago, the bill was brought down to the House. On the 20th June, the debate on the second reading commenced, and was continued on the 27th June.
– -I move -
That the honorable the Treasurer be no longer heard.
– I cannot take the motion.
– On the 2nd, 4th, and 8th July the bill was further debated. It is being discussed to-day, and will be discussed again to-morrow. That should be quite sufficient time for the consideration of its provisions. Yesterday, the discussion was kept going only with considerable difficulty.
– That is not true.
– On a point of order, I object to the statement of the Treasurer that the debate yesterday was kept going only with difficulty. It is not correct, as three or four members on this side desired to speak when the gag was applied.
– The honorable memis surely sufficiently acquainted with parliamentary rules to know that because he objects to a: statement he cannot rise on a point of order to interrupt it. If it were in order to’ do that there would be no such thing as parliamentary debate possible. I object to many of the statements that I am compelled to hear.
– At the time the debate was carried on with difficulty the honorable member for Gwydir was not present.
– That is a lie.
– The honorable member for Gwydir must withdraw that remark. It is his second offence within a few minutes.
– I wish to say that I was present during the debate.
– The honorable member must not make a statement when asked to withdraw an expression that is unparliamentary. I ask him again to withdraw his remark.
– In withdrawing it, I ask that the Treasurer shall be required to withdraw the remark that was offensive to me.
– The honorable member must first withdraw his remark.
– I withdraw it, and direct your attention, Mr. Speaker, to the fact that the statement of the Treasurer was offensive to me.
– What statement?
– The statement that X was not present during the debate yesterday.
– I am not entitled, on a point or order, to compel the withdrawal of a statement on the ground that it was not accurate. If the statement of the Treasurer was not accurate, I ask him to consider, as a matter of taste, whether he should withdraw it.
– I regret that the honorable member for Gwydir has misunderstood me. I did not say that he was not present during the debate, but that he was not in the chamber at the time the debate was being carried on with difficulty.
– The honorable member for Gwydir must not interject further. “ Dr. EARLE PAGE. - It is evident from their conduct that members of the Opposition approve of the bill in the main. The amendment of the Leader of the Opposition (Mr. Charlton) differed from the Government’s proposal only to the extent that it suggested an internal instead of an external board.
– The honorable gentleman’s time has expired.
.- I can readily understand that there are times when governments must force measures of urgency through Parliament, and must apply the “ gag” to prevent the business of the country being delayed by a fractious opposition. But when I look at the motions of urgency that have been moved, and consider the cause of them, 1 ask myself, and I ask the Government, what class of bills does the Government regard as urgent? Since this Parliament assembled many matters of no great importance have been brought forward by the Government, and the discussion upon them has been allowed to meander on day after day without any suggestion of applying the “ gag.” On the Post and Telegraph Rates Bill, and the Service and Execution of Process Bill, no motion of urgency will be submitted. No attempt will be made to “gag” bills of minor importance. On them members will be able to speak without limitation by the Government. From the beginning of this Parliament the Government has sought to apply the “ gag “ only when those measures that would carry out its bushranging policy were under consideration. Any honorable member who cares to look up the records can see on what measures the Government has applied the “gag.” Such bills as the Australian War Museum Trust Fund Bill, and the Boy Scouts Association Bill, we shall be. allowed to debate from day to day, all the hours the Lord sends, but when the Government wants to hand out public money to its friends, ,and to use all the forms of legislation for lining their pockets, the business becomes urgent, and it is necessary to coerce the Opposition into silence. This bill, the object of which is to determine how the funds of the Commonwealth Bank shall be manipulated in the interests’ of private individuals, is of vital importance, and the Govern*ment’s object in applying the “gag” is to prevent the Opposition from demonstrating to the country that certain politicians on the Government side are abandoning principles for which they once stood, and are betraying ‘those whom they are here to serve. The object of the motion of urgency is not to save time, but to prevent a word being spoken that would reveal the true position to the people. The Government does not wish the public to know the true purpose of the bill. The honorable gentleman who has just left the chamber (Dr. Earle Page) has inaccurately described members of the Opposition as “ dumb, driven cattle.” Yon, Mr. Speaker, are a witness to the contrary. Whatever may be our shortcomings and limitations, we are certainly not dumb.
– And not driven.
– And not driven” either. Last year, when the Prime Minister desired to go to England, the Government, not to expedite the discharge of public business, but to stifle the discussion of questions of vital importance, applied the “ gag.” The Government now offers us an olive branch, and talks of peace throughout the world, and in order to show that there is no partisanship, it offers us the gift of a trip for our leader to the other side of the world. But we know what is in store for us when our leader is out of the way. The “ gag “ will be rigorously applied, but we shall resist it until every member of this party ha3 been expelled from the House. The outstanding fact is that the “ gag “ is applied in connexion, not with matters of no importance, but with bills that are designed to give effect to the bushranging policy of the Government, and to rake off some of the public funds for their friends. Those are the measures upon which the Opposition is not .allowed to have a voice. The Government can suppress us here, but upon the platforms of the country it cannot silence us.
.- This bill is urgent - extremely urgenttc a section of the vested interests of Australia, but it is not urgent to this Parliament nor to the people of Australia. It is urgent to the financial institutions, the associated banks, the insurance companies, and a few of the leading financiers of this country. Members of the party opposite promised, in June, 1922, that immediately upon their election to office they would pass a bill to emasculate the Commonwealth Bank. They are now uneasy because eighteen months have passed and the bank has not been emasculated. As a result of the pressure that is being applied to certain members of the anti-labour party, the Ministry to-day, apparently at the instigation of tho forces that are responsible for the existence of the Government-
– The honorable member’s remarks are wide of the motion.
– It is sought to declare the measure urgent in order to placate a certain section of the community - the section that is responsible for supplying the fighting funds of the anti-labour party. Any pressure that is being applied comes from that section, and that section only. That is why the Prime Minister wishes to declare urgent a bill that should be carefully and thoroughly discussed. Upon what bill can we speak if not upon this?
– Upon anything of no account.
– The honorable member for Bourke .(Mr. Anstey) stressed that point. It is a sinister fact that, when a matter of vital importance to the people of Australia is before the House, the “gag” is applied. When the Prime Minister first applied the “gag” last year, I attributed his action to his youthful inexperience in his present position, but apparently I was wrong. It appears to be temperamental with him. It is probably a habit acquired in the commercial world, where, as a superior Mussolini, he sits at his desk, presses this or that button, and issues orders to his minions. He forgets that he is now not in the commercial, but in the political world, where he cannot do as he does in his private business - not, at least, without a protest from this side of the House. The promise given by members on the government side, in June, 1922, is about to be carried out, and by 3.15 to-morrow afternoon the associated banks of Australia, in return for the money they put into the fighting funds of the National and Country parties, will get their quid pro quo. What is actuating the Prime Minister? Is it that he and his colleagues are afraid of what the Opposition may say in regard to this bill? When I came into this House eight years ago, I thought that a good deal of time was wasted in discussing certain measures, but. having seen the mistakes perpetuated by this and other Parliaments in placing ill-digested legislation upon the statute-book, I am convinced that it is necessary that we should spend a considerable time in discussing important measures. It is not right that we should be “gagged” and our delibera lions curtailed in this way, because by passing legislation hurriedly under the compulsion of the tactics adopted by the Prime Minister and his supporters, faults frequently occur. Costly legislation is . often involved, and the people have to suffer. Last year, a War Service Homes Bill was dealt with in this unseemly manner, 22 clauses of which were passed without discussion and without a vote. It was a ridiculous position. That legislation j3 now on the statute-book of the Commonwealth, and in consequence of the unnecessarily rapid rate at which it was passed by this House, its provisions have had an adverse effect upon those who have participated in the War Service Homes scheme.
– That is not so.
– It is. I have had. no fewer than three .complaints concerning certain provisions of the War Service Homes Act, for which this Government is responsible. The bill was a most important one involving the expenditure of hundreds of thousands of pounds, and 22 clauses were disposed of in the time in which the sand passes through the time-glass. Many of the seventeen clauses of this bill in which important amendments are to be made to the principal act deal with vital principles, and according to the motion submitted by the Prime Minister, certain stages must be reached by 6.30 p.m. and’ 11 p.m. to-night, and others by 12.50 p.m. and 3.10 p.m. tomorrow. When the time arrives for putting certain clauses, many provisions vital to the people of Australia and to the Commonwealth Bank will have to be passed without discussion or the opportunity to submit amendments. We can only offer our strongest protest . against this iniquitous procedure, and hope that another government will have an opportunity of amending this particular legislation at a very early date.
– During the last session of this Parliament, a time limitation was imposed upon certain legislation, as is now proposed in connexion with this bill. I wa& then a new member, and unaccustomed to seeing time wasted. But I soon realized that five-sixths of the time allowed for the discussion of certain portions of measures was taken up in debating the proposed limitation, and only onesixth was used for discussing the subject-matter of the bill. I appeal to the common sense of honorable members opposite not to adopt that policy in this instance. We have three hours with which to deal with three clauses, and to allow that time to be taken up in discussing the motion now before us is a useless waste of opportunity and effort.
– It is remarkable that we should be lectured in the way we have just been spoken to by an honorable member on the corner benches. The attitude of the honorable member for Gippsland (Mr. Paterson) is characteristic of that adopted by other members of the Country party . towards honorable members of this House who represent the masses. Of course, the cry of the honorable member is typical of that which we hear from the “ kookaburras “ on the corner benches. It is remarkable that the Treasurer (Dr. Earle Page) who, before he was a member of the Government, was going to “ switch on the light and make the burglars drop the loot,” has. now joined the gang known as the “ flying angels.” He is now concerned not with the switching on, but with the switching off of the light to enable his “ pals” in the gang to get away with the boodle. The motion submitted by the Prime Minister is to enable this bill, which vitally affects the Commonwealth of Australia, to be passed without adequate discussion. The great banking interests and institutions see the writing on the wall and realize that the policy of the Labour party is to make the Commonwealth Bank a real bank of the people of Australia. The representatives of the private financial institutions are determined that the Commonwealth Bank shall not be able to continue its good work on behalf of the people;
– The associated banks are involved.
– The associated banks, of which the honorable member for Darwin is a representative, have had their claqueurs in the building during the last few weeks, and one can hardly walk along the corridors without coming in close contact with some of them. These men are “putting the acid” on the Government. They are their masters, and have told them that they have delayed too long in doing the work they were sent here to perform. They have said, “ Too long have you allowed the Commonwealth Bank to stand in the path of the private banks. Too long have you prevented us from getting our talons into the Australian note issue.” They have said, “ You have been.going slow on the job ; you must hurry up.” The cry from these men is “ On, Stanley, on ! The fountain which pours out its gold is drying up, and our supplies will be cut off at the source unless you act promptly.” The associated banks are afraid that Labour will soon be returned to. power in the federal arena, and that they will then have no chance of robbing the people any longer. If this bill is passed they believe that during the next eighteen months they will be able to reap a rich harvest, and will be able to sit back when a Labour government is in office. One honorable member after another, sitting behind the Government - some belonging to the “kookaburra” party - has occupied the time, so that honorable members on this side may not have an opportunity of debating the bill. Our elegant Prime Minister, with all the mannerisms of the English “ johnny’’–
– Order! ‘
– The Prime Minister says, “ These Labour fellows have no rights or privileges in this chamber.” He does not think that we should discuss this question, and has therefore made the bill an urgent one. The guillotine is to be applied, those who represent the people shall not be heard, and the exploiters shall continue to rob the people.
.- I am very much surprised at the mock indignation displayed by honorable members opposite at the decision of the Government to curtail debate on this bill. The fact that we are discussing a .Commonwealth Bank bill, in connexion with which the handling of large sums of money is involved, is given as a reason why longer time for discussion should be allowed. Honorable members opposite, who deprecate a spendthrift policy, have themselves given an exhibition of extravagance. Their expenditure of speech is far in excess of their income of ideas. No strictures of mine this afternoon could be so strong as those of the Leader of the Opposition (Mr. Charlton). The honorable member for East Sydney (Mr. West) and the honorable member for Werriwa (Mr. Lazzarini) are two selfconfessed experts in banking and finance, yet their leader remarked that, unfortunately, the House contained no experts. He did not, as he might have done, look directly at those two honorable members and other honorable members opposite who on every possible occasion demonstrate their lack of knowledge. If the proposal now before the House will put an end to farcical amendments such as were moved yesterday by honorable members opposite in a flippant and jocose manner it will serve a good purpose, and allow the House to proceed with the business of the country.
.- The attitude of the Government .towards this bill is in marked contrast to its attitude a few months ago when the Prime Minister (Mr. Bruce) returned from a tour round the world and submitted to the House a report which was a confession of failure. The Government then said to us, “ For God’s sake, talk ; give us your ideas.” We were bullied and insulted because we did not consider it necessary to discuss the Prime Minister’s failure. The Commonwealth Bank Bill strikes at the fundamentals of a policy which honorable members on this side of the House have been elected to enact, and we claim that we have a right to express our opinions” upon the Government’s proposals. I resent the attitude of the Prime Minister, this political exquisite, this Beau Brummel of Parliament, who saunters into the chamber with an arrogant air of supercilious superiority and applies the gag.
– Order !
– His is the attitude of a shop-walker when he talks of measures.
– Order ! The House is discussing, not the appearance of any honorable member but a definite motion to allot time. I have, in accordance with custom, allowed great latitude during the discussion, but it must not be transcended.
– I feel keenly- on this subject because, last night, the Prime
Minister, by applying the gag, prevented myself and others from addressing, ourselves to the motion for the second reading. The views I desired to express were at least important to the people I represent. I entered this Parliament believing that it was a deliberative body, but through the actions of the Prime Minister it is gradually degenerating into a parliament of Fascisti, with a brutal majority applying the gag and stifling discussion. The Government is prepared to allow unlimited time for the discussion of measures that are of no importance to the body politic. There are some measures to be submitted this session which we claim the right to discuss fully, and the Commonwealth Bank Bill is one of them. Last year the War Service Homes Bill was bludgeoned through the chamber by tactics similar to those which the Government is adopting to-day, and as a result the returned soldiers are filled with discontent. The Prime Minister will, at the next general elections, reap the reward of his present actions. Like Dr. Guillotin, he will perish by the instrument that he ha3 devised to destroy others.
.- The honorable member for Reid (Mr. Coleman) has complained that this is not a deliberative chamber. If, following the example of the South African Parliament, we were to abolish Hansard the House might become a deliberative chamber, and the measures submitted to it might be discussed on their merits. In August, 1922, when the gag was not applied, honorable members opposite were content to see the Estimates and Appropriation Bill, involving an expenditure of £60,000,000, passed through the House in twelve hours.
– Because the money had been already spent.
– It had not. ‘ In 1923, the Government applied the gag, but allowed 60 hours for a discussion of the Estimates, and honorable members opposite wasted the whole of that time in complaining of having been robbed of the opportunity to discuss the financial proposals. Thus, when debate was unlimited honorable members occupied only twelve hours in voting £60,000,000, and last year when the gag was applied they complained that 60 hours was not enough for the consideration of the Estimates. The honorable member forReid has made remarks which I think he will regret in calmer moments. Ifwe can eliminate personalities and discuss the proposals before the House upon their merits we shall get on much better. I do not think any member of the Opposition really believes that the Prime Minister went on a picnic tour of the world. Would honorable members opposite consider it fair of me to say that I think the Leader of the Opposition (Mr. Charlton) is going on a picnic tour? I do not think he is. I believe that the honorable gentleman will worthily represent Australia at the conference of the League of Nations, and, whether his mission was a success or a failure, I should be the last one to say on his return that he had not done his best. I say that the Prime Minister did his best for Australia when he attended the Imperial Conference. The honorable member for Darling (Mr. Blakeley) said this afternoon that honorable members on this side have stifled discussion on important measures, and have curtailed debate. I have already explained that last year we gave the Opposition 60 hours for the discussion of matters which they dealt with in twelve hours in the preceding year. The honorable member for Dalley (Mr. Mahony), who is generally fairminded, says that the associated banks are behind the party I represent. In reply to that statement, I can say that in connexion with the measure now under consideration they are behind the party on this side with an axe. The honorable member has said that representatives of these interests are to be found in the corridors of this building, button-holing honorable members. So far none of them have button-holed me, and I know of no honorable member on this side whom they have interviewed. As the honorable member for Dalley knows that they are in the corridors, it may be inferred that he is the person who has associated with them. If money is being given away, I have not seen any of it. Every honorable member must be aware that under the bill the proposed directors of the Commonwealth Bank will be given more power than the management of the bank possesses to-day. I give honorable members opposite credit for the introduction of the Commonwealth Bank Act, which provided for the establishment of the bank.
– We thank the honorable member for that.
– I receive the honorable member’s thanks with great pleasure. If we give the management of the bank greater powers than it possesses at present, shall we not be improving the institution ? 1 hope to see it become the great national bank of Australia, and I should like to see it handling the whole of the exchange business for Australia.
-The honorable member’s time has expired, and, the time allowed for the debate having also expired, I must now put the question.
Question put. The House divided.
Majority … … 7
Question so resolved in the affirmative.
In committee (Consideration resumed from 9th July, vide page 1986) :
Clause 4 -
Section 4 of the principal act is amended -
by inserting after the word “ appears “ the following definitions : - “ Director” means a director of the bank, and includes the governor; “ Local Board “ means a local board of advice; and
by adding at the end of the section the following definition : - “ The Board “ means the board of directors appointed in pursuance of this act.
Section proposed to be amended -
In this Act unless the contrary intention, appears - “ the Bank “ means the Commonwealth Bank of Australia established by this Act; “ the Governor “ means the Governor of the Bank.
.- This is a very important clause. The bill contains only two or three important amendments of the existing act, and this is one of them. I propose to move -
That paragraph [a) be omitted.
In order to indicate my object in submitting this amendment, I may say that I intend later on to propose the omission of the words, “Directors appointed in pursuance of this act”, in paragraph b, with a view to inserting in lieu thereof the words, “ Management composed of the governor and two other officers , all of whom shall be permanently employed in the bank.” Should my amendments be agreed to, clause 4 would read -
Section 4 of the principal act is amended by adding at the end of the section the following definition: - “ The Board “ means the board of management composed of the Governor and two other officers, all of whom shall be permanently employed in the bank.
I hope my amendment will receive reasonable consideration from the committee. I believe it will be an improvement on the clause as drafted. The bill provides for a directorate of eight members, six of whom are to be persons appointed from outside the bank. Two of the proposed directors are to represent the rural industries, two the manufacturing and commercial interests, two are to be expert financiers, and the remaining two are to be the governor of the bank and the Secretary to the Treasury. In my opinion, a board so constituted would be very unsuitable for the successful working of this institution. If the Commonwealth Bank is to be conducted on lines which will make it a truly national bank, operating in the interests of Australia, we must have men at the head of it who will be permanently employed in the institution. No one can convince me that we can expect satisfactory results if there are on the board of directors representatives of interests in this country which, speaking generally, are opposed to a national bank in any shape or form. In proof of their opposition, we have only to look back to the time when the original act was under consideration. The representatives of those interests said that the Labour party did not know what they were doing, and that if they had any knowedge of finance, they would not have brought forward a measure which would lead the country into financial chaos. The bank, in spite of all such gloomy predictions, has stood the test of time. It is generally admitted now that the bank has proved of immense advantage to Australia, saving it many millions of pounds during the war period, and yet it is solemnly proposed to appoint to its directorate a number of men many of whom know less about banking than do honorable members of this Parliament. There is nothing in the bill to say that those who are appointed to the board of directors must possess financial knowledge. Many professional positions are gained only after years of training and after the passing of many examinations, yet it is proposed to appoint to the control of this most important financial institution men who have not had years of training in banking, and who, possibly, have no knowledge whatever of it. Can such appointments be in the best interests of the development of the bank? I am free to admit that the Commonwealth Bank in its operations has left room for considerable improvement. It should be a truly national bank, capable of assisting the people by advancing money to them, but it cannot be contended that the best interests of the country will be served by the appointment of six directors with no knowledge of finance. In view of other provisions of the bill in regard to the note issue and reserves, it is particularly essential to have on the board of directors competent men free from the possibility of being influenced by any outside body. Can any one say that if two men are recommended by a certain section of the community for appointment to the board of directors of the Commonwealth Bank, they will be absolutely freeof outside influence? Will they not always be inclined to recognize the fact that their appointments have been brought about by the exercise of a certain influence? Will the suggestions of those who have recommended their appointment go unheeded by them? I venture to say that their chief concern will be the interests of those they represent, and not those of the bank. They will be very much like members of Parliament. While they may be wedded to certain ideals and principles, and may be doing their best to give effect to them, they will always be trying to serve the interests of those people who were instrumental in placing them in their positions. Those remarks will apply to those who represent the commercial and manufacturing interests on the directorate, and also to the two experts recommended by the associated banks. The only directors who will be free from any outside influence in this way will be the governor of the bank- and the Secretary to the Treasury. Except for those two gentlemen the public will have no protection. Is it in the best interests of the country that men who have no experience of finance, butsimply represent certain interests, and who are not permanently employed in the bank, shall have the right to say what notes are to be issued, and whether the issue is to be inflated or restricted ? The directorate should be confined to men with knowledge of finance, who will realize their responsibilities to the whole of the people of Australia, and not to a section of them only. The directors will not be free from outside influences if they are not permanently employed in the bank. Although the bank has done very good work hitherto under the control of a governor alone, the Labour party thinks that that officer should have assistance. We should have no objection to the appointment of three directors regularly employed, but we are opposed to the appointment of eight men, six of whom will not be regularly employed, but will meet at least once a month and draw salaries of £600 a year each. These salaries, together with the remuneration to be paid to the members of the state boards, will involve the bank in a very heavy expenditure. It is an intolerable position that men who are not really responsible to the bank or to this Parliament should be practically in control of the bank. I believe that all honorable members are sin cerely desirous of considerably widening the functions of the bank, so that it may be in a position to stand at the back of Australia, not only in times of emergency, but also in times of peace, when the people are endeavouring to develop the country; but that can only be achieved by having men in control of the bank who will see that it is conducted on lines that will enable it to do all it was intended to do when it was first established. The proposal before us gives colour to the suggestion that this legislation is intended to hamstring the bank. It is evident that the Government are prepared to allow matters to drift when they make it possible to appoint men who have no knowledge of financial institutions to administer the affairs of the Commonwealth Bank.
– The procedure proposed is not unusual.
– It may not be unusual in regard to many affairs, but the honorable member knows that the class who will be represented on this board of directors are those who opposed the establishment of the Commonwealth Bank, and never have had any love for such an institution. There will be nothing to prevent the shareholder of an existing bank, whose interests are wrapped up in the welfare of that bank, from becoming a director of the Commonwealth Bank.
– If such an appointment were made, it would be a very bad selection.
– But why should we make it possible for such a selection to be made?
– Will not the representatives of the pastoralists be of great assistance to the governor of the bank in matters affecting pastoral interests?
– I shall not be satisfied until men who have a knowledge of banking are permanently in control of the bank. We can hope for success only if those in control of the bank are men who will serve it day after day, taking as keen an interest in it as if it were a child they were rearing, men who will do their best in the interests of this national undertaking, realizing that its future depends to a very large extent upon their administration.
– Surely the representatives of the primary producers will be of assistance in consultation with the governor of the bank.
– That all depends upon what powers they have. If they are merely appointed to advise the governor of the bank they may serve a useful purpose ; but the honorable member for Fawkner, who is a legal man of standing, will admit that it does not follow that ‘the representatives of the primary producers will know anything about finance. He will also admit that, men with such knowledge are essential in the administration of a national financial institution. If the proposal were merely one to set up an advisory board in connexion with the administration of the bank, there might be some justification for appointing representatives of certain interests to act in an advisory capacity, in spite of the fact that they might have no financial knowledge; but in that case I might just as well claim that there should be two representatives of labour on the board. If I were to put forward such a claim, I should be laughed at.
– People would say, “ What do these men know about finance ? They may be all right wielding a pick or using a shovel, bub they know nothing about finance.” Nevertheless, I have, just as much right to claim that two men should be on the board of directors of the Commonwealth Bank to represent the workers of Australia as honorable members opposite have to claim that other sections of the community should be represented on the board by persons with no knowledge of finance. This institution deals with millions of public money, it is expected to stand at the back of the credit of Australia, and in disastrous times at the back of the associated private banks. Everything, therefore, depends upon its proper management, and men without experience ought not to be put upon its board of directors. I should do as well as a director of the bank as would some men outside, but I have no: experience of banking, and I say at once that I am not qualified to fill the position.
– Does the Leader of the Opposition suggest that because a man is connected with the primary producers he can have no> knowledge of finance?
– I do not make that suggestion, but the trouble is that the bill does not say that only men with that knowledge will be appointed.
– A little must be left to the judgment of the administration.
– We generally find that when a matter is left to the judgment of the administration men are appointed to boards who: look well after certain private interests. I should not be surprised to hear that Sir John Higgins had been appointed as one of the directors.
– Would the honorable member say that Sir John Higgins has no knowledge of finance’?
– No; but after what has happened in regard to the wool transactions I say, without hesitation, that he should not be on this board, and that if men of his ilk are appointed the time will come very quickly when they will lose their places. Too much robbery of public funds has been perpetrated to allow men of the type of Sir John Higgins to be filling these positions. If legislation is to be passed, and no notice taken of solid criticism, the day will quickly come when it will all be undone. It is evident from the remarks of the honorable member for Macquarie that there is a probability of Sir John Higgins being appointed.
– I neither said it nor suggested it.
– No man without a knowledge of finance should be a.ppointed to this board. We should have men on the board who are ready to devote every day to the work of tie institution. I am not satisfied with the proposal that men should be appointed at a salary of £600 each, to meet twelve times a year, to do what the governor of the bank recommends them to do, because, of course, they will have no knowledge themselves of what ought “to be done. How can they be in touch with the various ramifications of a national bank if the board meets only once a month ? It seems to me a question of finding positions for men. Besides the board of directors, there will be sub-boards in the different states. : These will have to meet once a month, and for this they will draw certain allowances. The whole thing is a farce. The proposal does no credit to the man who devised it. So far from the bill being designed to make the Commonwealth Bank a truly national ban*. the reverse is the case. I have not the slightest hesitation in saying that if the measure is given effect to in its present form, it will prove wholly unsatisfactory. What could be better than a board composed of three permanent employees of the bank? I do not suggest that any person at present in the employ of the bank should be selected. All I am contending for is that three capable men - I do not care who, so long as they are capable - shall be appointed and expected to bring to the service of the bank sound knowledge of finance. They should be required to devote the whole of their time to the duties of their office, so that the Commonwealth Bank may become national in its character and this country’s bulwark in matters of finance. This can only be done by the appointment of a permanent board. Every session this Government introduces measures for the appointment of boards. I do not know where the business is going to end. It is, however, apparent that the time is coming when there will have to be a change, and that many of these boards will have to go. We have too many, boards. Sufficient responsibility is not being taken by Ministers. This Government is continually sheltering itself behind one or other of the boards that have been appointed. Honorable members are told that Parliament in the final analysis is supreme in authority, and can deal with the reports submitted by those boards.- How often do we get these reports ?
– That principle is not involved in this “measure.
– It is in connexion with the proposed board. We shall have to depend upon reports submitted by the board of directors. If it follows the practice adopted by other boards, the reports will be twelve months late, and will be of little value. The document will be placed on the table of the House, and that will be the end of the matter. In this way the Government will evade its responsibility.
– Governments come and governments go. In this case the board would be a permanent body.
– I appreciate the interjection made by the honorable member for Darwin. Some governments can hasten their going. That is what this Government is doing. The people will not much longer stand this sort of legislation. I move -
That the words “ Directors appointed in pursuance of this Act “ be omitted, with a view to the insertion of the words “ Management composed of the Governor and two other officers, all of whom shall be permanently employed in the Bank “ in place thereof.
– The policy of the bank is too important to trust to the political fortunes of any government.
– The Leader of the Opposition (Mr. Charlton) has raised a question which has already been dealt with. The amendment defeated in the secondreading debate was substantially the same as the amendment which he has now submitted. The whole question at issue is whether we shall have an internal board of management or a board of directors upon which the chief executive officer of the bank will be the executive arm of the board. The general experience in this country, and indeed of every other country, is that in concerns of such magnitude as the Commonwealth Bank the only satisfactory system of management is to draw upon the widest experience, and get the best brains available. We. are hoping that, as a result of this legislation, the Commonwealth Bank will become a central bank, in other words, that it will be the pivot of the Australian banking system. It is necessary, therefore, that we should secure for the directorate men of the widest knowledge of Australian commercial, industrial, and financial conditions. The insinuations that have been made in this debate, that men engaged in manufacturing, in commerce, and in pastoral pursuits are necessarily ignorant of finance, are rather absurd, because their success in the industries mentioned must necessarily be due to a sound knowledge of finance and wide experience in the handling of important financial problems. The* proposed board will be called upon to come to important decisions in matters of finance. It will be necessary to bring together men possessing a wealth of experience and knowledge. For this reason the Government has brought down a proposal which will ensure the representation on the board of all the big industries of the Commonwealth, and, in addition, it will co-opt the services of the Secretary to the Treasury, who will have an intimate knowledge of what is transpiring, from the point of view of the national finances, and help the board to come to a decision. This course has been adopted by every other government that has dealt with this problem. Many central banks have been established in various countries within the .last twenty years. The Federal Reserve Bank Board of the United States consists of seven members, of whom two, the Secretary to the Treasury and the Comptroller of the Currency, are ex officio members, the five other members being appointed by the President of the United States. In selecting the five appointive members, not more than one of whom can be selected from any one Federal Reserve District, the President is directed to have due regard to a fair representation of the different commercial, industrial, and geographical divisions of the country.
– There is no analogy at all between the two proposals.
– It shows that when people have their own capital at stake they take the precaution to ensure its safety. In this bill the Government desires to ensure the safety of the people’s capital. We propose that the board shall be representative, in the widest possible sense, of the whole of the interests of the country. In South Africa the Central Bank Board has eleven members, of whom two are official and nine representative of various industries. The policy adopted by the Argentine Government, which was quoted by the honorable member for Batman (Mr. Brennan) during the second-reading debate, furnishes a complete answer to the contention of the Leader of the Opposition in connexion with the manner in which such a bank should be controlled. Before 1891, when there was a tremendous banking crash in the Argentine, there were many official banks under the control of inner executives. Owing to the fear that political influence might exercise a greater measure of control than was desirable, the Government adopted the suggestion which we have introduced into the present .bill. I had an opportunity during the present year of discussing the Argentine position with Dr. Prebisch, who was sent by the Argentine Government to Australia to examine the taxation systems of the Commonwealth. He was good enough to prepare for me the fol lowing statement giving a summary of the banking position in the Argentine : -
After this bad experience, the idea of official banks fell into great discredit, so that when the new government, arising out of the political revolution co-incident with the crisis, started with the plan of a new bank, half official’ and half private, nobody dared to subscribe any share of the proposed capital. The Government then issued a quantity of paper money, without any gold reserve at all, and gave the paper to the new establishment as a capital. Notwithstanding this spurious foundation, the new bank, as a result of the prudence displayed from the directors (appointed by the Executive with the approval of the Senate, but selected, this time, among honorable business men and farmers), and of the sound financial policy, both public and private, following the crash, the Banco de la Nacion developed gradually and surely its operations, and now, after 30 years, is the most powerful banking institution of the country.
This furnishes a complete answer to the contention of the Leader of the Opposition. Actual .experience has shown the wisdom of appointing outside boards with a wide knowledge of commercial, manufacturing, and the primary industries, in order to strengthen the position and to- improve the status of the bank. Before I resume my seat I should like to combat another statement made by the Leader of the Opposition. He suggested that there is an intense feeling of hostility and enmity towards the Commonwealth Bank on the part of the other banking institutions of Australia. That is not the case at all. I am privileged to know that during the latter part of last year, and the early part of the present year, the private banking institutions of the Commonwealth left considerable deposits with the Commonwealth Bank to enable it to discharge its functions the more satisfactorily. I say this without fear of contradiction. The very fact that these banks allowed their deposits to remain with the Commonwealth Bank shows that they are not animated by feelings of hostility at all, as has been suggested by the Leader of the Opposition. In the financing of wheat and wool pools, and in proposals for the assistance of Australian industries, the managements of the Commonwealth and private banks have been able to come together in an honest and sincere desire to do the very best in the interests of the Commonwealth, and to secure uninterrupted progress in the development of Australia. I am glad of the opportunity of being able to put this statement on record. .1 protest against these continued insinuations and recriminations against private banks, which have done a very great deal indeed to bring Australia to its present condition of prosperity. The institutions referred to should not be so often condemned and held up to execration.
.- I was about to say last night, when the right honorable the Prime Minister (Mr. Bruce interrupted by moving the closure on the second-reading debate, that I did not pretend to be a financial expert; Nevertheless, I have made it my business, during the last few weeks, to get into touch with bankers who could express an independent judgment upon this bill. I therefore profess to be able to offer at least some constructive criticism at this stage. Firstly, let me say that I am opposed to the clause as submitted by the Treasurer. I am opposed to most of the measures of this Government, because its political doctrines are totally opposed to those which we on this side of the committee profess. The policy of the Government is to buttress the interests of private enterprise and capitalism. Our policy is the nationalization of the means of production, distribution, and exchange, which of course, includes the banking system. We consider that the proposal to appoint a board of directors for the Commonwealth Bank is an attempt by the Government to destroy the value of the bank as a popular institution, and to make it an instrument of capitalism. I regret that I cannot attribute to the Treasurer any earnest desire to make the bank function effectively in the general interests of the people.
When devils will the blackest sins put on, They do suggest at first with heavenly shows.
The words of I’ago in “Othello” may be aptly applied to the’ Treasurer. He is full of pretensions as to his idealistic purposes; but as he is the champion of vested interests and private enterprise, he forces me to distrust his motives. I am prepared to vote for the modified proposal made by the Leader of the Opposition, but I cannot accept the proposal to create a board on the lines laid down in the bill. Such a board would make the bank even more conservative than it has been in the past. I must express my profound disappointment at the failure of the. bank to enter into active competition with the private banking institutions. Its policy in the past has been ultra-conservative. Instead of attempting to bring about the nationalization of banking by the gradual elimination of the private banking companies by offering attractive terms to investors, and liberal advances to struggling settlers and manufacturers, it has done exactly the reverse. Every suggestion that its policy should be liberalized has been strenuously resisted. Had a Labour Government been in power, changes would have been made in the policy and the management to ensure that the bank would function in a much more liberal way than it has clone. One result of such a policy would have been that many of the smaller banks would have been pushed to the wall or compelled to merge. That would have brought our objective of nationalization nearer to realization. The Government is inconsistent. It believes that the amalgamation of government departments will reduce expenditure, but it will not reduce the overhead charges of the banking system by forcing the amalgamation of the smaller banks. If those overhead charges could be reduced, the conditions under” which advances could be made to the general public could be liberalized, and the national credit would be stabilized. The bank has offered very little inducement to private investors and depositors to trade with it. ‘ It is generally recognized that the backbone of the institution at present is its savings bank deposits, which exceed £38,000,000. Those deposits should have been used to promote the welfare of the workers from whom they were derived by advances to build homes and to aid struggling farmers and manufacturers, but they have often been spent in assisting interests which were not in any real need of assistance. I shall quote one instance. The late Sir Denison Miller, as governor of the bank, advanced £50,000 to the Royal Sydney Golf . Club, the members of which are the commercial magnates of New South Wales; but he could not advance money to farmers and manufacturers who were in real need of accommodation. I speak with some feeling about the difficulty of obtaining advances from the bank, for I had difficulty in getting any promise of accommodation from it though I had fairly good security to offer. It is regrettable that the bank has not assisted the people who most needed help. I consider that the conservative policy of the past will be accentuated if a board of directors is appointed in a’ccordance with the provisions of the bill and by the present Government. The savings bank deposits of the Commonwealth Bank could have been materially increased had the management offered a higher rate of interest to encourage workers to entrust their savings to it. I understand that the savings bank rate of interest offered by one bank in Tasmania is 4£ per cent., but the Commonwealth Bank offers only 3-J per cent. While I was in Sydney recently, I made some inquiries respecting the comparatively newly organized Primary Producers’ Bank. It has a progressive policy which has won for it a large amount of support from the primary producers throughout Australia. I do not know whether the Treasurer is interested in that bank, but if he knows anything about it he will admit that it largely represents the primary producing interests. It was inaugurated in consequence of the inability of many struggling pastoralists, farmers and others, to obtain liberal advances from the Commonwealth Bank, and to-day it is in the vanguard of progress. It offers 2 per cent, interest on current accounts, with quarterly interest payments, and makes no charge for keeping accounts. Had an attractive policy like that been adopted by the Commonwealth Bank, it would have been accorded very great public support, for many people would have transferred their business from private banks to the Commonwealth Bank. The Primary Producers’ Bank has not departed from recognized banking principles, for many banks in other parts of the world pay interest on current account. When one recognizes that the associated banks of Australia have accumulated a very large sum of money on current account, which they have used to a considerable extent, one must admit the reasonableness of the payment of interest on it. According to the Commonwealth Year-Book the total amount of deposits and securities held by the cheque-paying banks of Australia is £295,432,630. Of that enormous total £123,819,184 is held on current account, and much of it is advanced by the banks to borrowers at fairly substantial interest, Notwithstanding that the banks use the money of their depositors, they make a charge, in very many instances, for keeping their accounts, if the amount at deposit falls below a certain level. Had the Commonwealth Bank offered interest on current accounts, it would have won a large proportion of the custom that now goes to private banks. I also made it my business recently to discuss with a number of eminent men in the banking profession in Sydney the vexed question of the exchange difficulties. As the exsecretary of an association of clerical workers, I come into close contact with many men who are engaged in the .banking institutions of Sydney. When I asked them about the internal workings of the exchange market they informed me, with more or less cynical amusement, that no matter what steps were taken by the Government to cope with the difficulties of the position, the banks would not lend very much general aid. The banks are able, on account of the exchange situation, to make 3i per cent, on short-dated advances to importers, and they can only make a profit of 7 per cent, per annum on money advanced to manufacturers. It was pointed out to me that it was much more profitable for them to make 3£ per cent, on short-dated advances of 60 days, or less, than to make 7 per cent, per annum on advances to manufacturers. The banks, I was told, made as much as 50 per cent, profit per annum on these short-dated advances. It is not likely, therefore, that they will readily forgo this class of business to accept the comparatively niggardly profit of 7 per cent, per annum, on advances to manufacturers; and it must be admitted that there is some logic in their attitude. The appointment of a board of directors for the Commonwealth Bank, as proposed in the bill, will lead to a closer inter-relation of the private banking institutions with the Commonwealth Bank*, and so accentuate the difficulties of the financial situation. The Commonwealth Bank should have attempted to cope with these difficulties.
At any rate extensive investigations could have been made with a view, to grappling with the problem. Honorable members are doubtless aware that there is widespread resentment and dissatisfaction among employees of the Commonwealth Bank owing to the tyrannous control exercised over them - by the management. I refer, of course, to the opposition that has been shown by_ the management to the bank’s clerks joining the Bank Clerks Association. The proposed board may be an even greater danger to the liberty and freedom of the employees than is’ the present management. The employees of the bank should have the same right as the employees of private institutions to join an industrial organization if they so desire. I know of two or three cases - there are many others as well - in which responsible officers of the Commonwealth Bank were practically dismissed because they joined the Bank Clerks Union. They were transferred under objectionable conditions to other states, and forced to resign because of the humiliating circumstances. I know one man who is now practically “ down and out “ as a result of this brutal interference with individual liberty. Among those appointed to the board, I hope, will be a representative of the banking employees, to protect the interests of the bank’s staff, although such hopes are in vain. The bank employees, like public servants, should also be absolutely free to join an industrial organization. As the Leader of the Opposition has stated on previous occasions, we claim that the workers are entitled to ‘representation in the management and control of institutions, more so in this particular case because of the confidential positions held by the employees. I recognize that discussing this measure is like pouring water on a duck’s back, and will get us nowhere, as the Government’s docile majority will determine the issue. Our only hope is the next election, after which the number of boards that have already been created by these Ministers will provide sufficient timber to make coffins for the political remains of most of them.
– The amendment moved by the Leader of the Opposition lends itself to honest discussion. I am glad that it has been moved, because it has removed a misapprehension under which I was labouring.
I thought from his speech on the second reading of the Bill, that he was opposed to the appointment of a board of directors.
– Not at all.
– I am glad that that impression has been corrected. We are on common ground in that we all recognize that the Commonwealth Bank has advanced to a stage at which it is imperative to appoint a board of directors for its management and control. The question at issue is how the board is to be constituted. If we study the early history of the Commonwealth Bank, it will be found that that institution owes a great deal of its success to the selection of the first governor and, later, his appointment of very fine men of ability to fill the subordinate positions in the bank. The late Sir Denison Miller was a man of ex- ,ceptional foresight, and did not confine his choice to any one of our trading banks. He chose men from practically all of them. I know of three banks from which the late governor of the Commonwealth Bank selected men, and to a great extent they helped him to place that institution in the successful position that it is in today. If he had confined his selection to the employees of his old bank, the Commonwealth Bank would have been kept in a similar groove, and its . expansion restricted. By selecting from every trading bank, he was able to obtain men with a wider knowledge of financial conditions than perhaps he himself had. We are all of opinion that the time is ripe for appointing a board of directors. The Government now proposes to follow the example laid down by the late governor of the bank, to select men for the directorate of the bank from various avocations. As the Treasurer has pointed out, we must look to other countries to ascertain what has been done there under similar circumstances. Following their example, it has been laid down in the bill that men intimate with the financial interests of our primary and secondary industries shall be appointed to the board. In this way we are likely to get on the directorate men who will bring with them a wide knowledge of their business, and be of the greatest value to the institution. In a country like Australia, whose prosperity is entirely ‘dependent on the prosperity of the- primary industries, it is essential that we should have on the board of directors men with financial and practical knowledge of the requirements of - the primary producers. The Leader of the Opposition, when speaking on the second reading, said that it was impossible for this Government to secure men with a knowledge of both primary production and finance. I contend that we have in Australia some very successful financial experts with a direct knowledge of primary production.
– Looking after their own interests.
– I am not one of those who think that every person approved by the Government for appointment to the board will be an infernal scoundrel, using his position for his own benefit, and that every member approved by the “Labour party will wear a halo round his head and look after national interests only. There is a certain amount of honesty in this country, in addition to that which exists in the ranks of the Opposition. The. Government will select men of undoubted honesty, notwithstanding their practical knowledge of primary and secondary industries and their qualifications as financial experts. In my second-reading speech I said that, having watched the banking system of Australia very closely for a number of years, I realized the safe and conservative lines on which it had been run. The banking institutions very often have not been so sympathetic with the primary producers as they might have been. This was apparently due to the fact that the management lacked men of experience, such as those the Government now propose to ap-point to the board of directors. The Leader of the Opposition alluded to the appointment of. local boards. I am entirely opposed to local boards, and I hope the majority of the committee will support me when I move an amendment to omit the definition of local boards.
– The honorable member will not have an opportunity to do so, owing to the application of the “ gag.”
– In that case I shall have plenty of company. We shall be well advised to do away with local boards. The appointment of a board of directors, as proposed under the bill, would do a great deal to further the interests of the bank. I claim as much- personal honesty as the next man, and I wish to see the Commonwealth Bank progress. I am sure that we all do, and, therefore, we should frankly admit it, and not suggest ulterior motives to honorable members who do not happen to sit on. the same side of the House .as ourselves. The statement, that behind this bill is a desire on the part of the trading banks to undermine the stability of the Commonwealth Bank, is absolutely unwarranted. During this debate, when the name was mentioned of a certain gentleman who watches the financial interests of the primary producers of this country in a way that has earned him our undying respect, I interjected, “ Would any one say that that man has not a knowledge of finance ? “ In my opinion he is a financial genius. I was immediately told that I had knowledge that the gentleman in question was to be appointed to the board. I know no more than does a child unborn about the proposed appointees to the board; in fact, I have not the slightest interest in its personnel. I object to the Leader of the Opposition, . while taking part in thi3 debate, maligning a man who has the respect of those whose interests he has carefully watched for many years. I shall oppose the amendment.
. . - I did not have an opportunity of speaking on the second reading of the bill because of the appli’cation of the closure. The Government proposes to appoint a board of directors consisting of eight members. The amendment of the Leader of the Opposition provides for the appointment of three members. The Government would sustain no loss of dignity if it agreed to a compromise.
– We are trying to do the best we can,- and we think eight is the requisite number of directors.
– Rather than stand hard and fast to the printed bill, the Government should accept a compromise which is suitable to the committee. It must be admitted that the Commonwealth Bank has, under one governor, been very successful in its operations. The Government is now seeking to increase the number of directors from one to eight. Surely there is no justification for such a drastic change in the management. Under one manager the bank was more successful than was any other bank in Australia. It has handled more business, and has assisted the municipal councils and shires to a greater extent. It has proved a blessing to the country, specially to the farmers, graziers, squatters, and others. The proposal of the Government will not be to the advantage of the Commonwealth. Why should there be appointed to the board two representatives of the graziers, two representatives of commercial houses, two experts of the note board, apart from the governor and the Secretary to the Treasury ? I understand that the Commonwealth Bank is to be a bank of exchange, a clearing bank, and a bank of issue. 1 hope that it will compete with the private banks. If a man who was appointed to the proposed directorate was interested in another bank, or another business, it would be only human for him to place his own interests before those of the Commonwealth Bank. It is only commonsense to assume that if I were a member of the board of management of the Commonwealth Bank, and was interested in primary or secondary industries, I should give my first attention to the business in which I had placed my money. The eight directors proposed by the Government will not have their money invested in the bank; they will handle only the people’s money. The amendment of the Leader of the Opposition is reasonable. His proposal is that three men trained in the banking business shall give the whole of their time and attention to the management of the bank, and shall be held responsible for it. When I want a house built I do not give the job to a clerk or a labourer. I engage an architect to draw the plans, and a builder to carry . them out. The business of the Commonwealth Bank is to develop this country, and to deal with exchange and other important financial matters. For such a business the best brains that we can get are not too good. The squatters or commercial men that the Government proposes to appoint may be quite capable in the management of their own businesses, but they will not be bankers. The business of the Commonwealth Bank is banking. The Government has made up its mind to have a board of eight persons. That is a policy that has not been submitted to the electors. The appointment of such a board was an after- thought. The people of this country look with a great deal of suspicion upon the Government’s proposals. I agree with the proposal to in crease the capital of the bank from £4,000,000 to £10,000,000, and to extend its functions. A national bank provides the lifeblood of a community. A strong, vigorous bank, which assists the industries of the country, is a blessing, but if it contracts the currency and speculates in bills instead of attending to its legitimate business, it does not perform its proper functions. Members of the Opposition are anxious that the bank should be a success. If two pastoralists, and two members of the commercial community are appointed members of the board, there will be no guarantee that they are the best possible men for the work. The honorable member for Macquarie (Mr. Manning) said that when Sir Denison Miller was building up the business of the bank he did not do it with his own officers. Of course he did not, because the bank was new, and he had no choice but to go outside for his staff. He drew from other banks the best possible brains he could get, and the result was very satisfactory. The men he engaged are still in the bank, and it is only necessary to change them from employees to directors. The manager of the Melbourne branch of the bank is a trained banker, who knows all the details of the business of banking in this city. I do not know him personally, but I am prepared to say that as a director he would be an asset to the bank. The same may be said of the manager of the bank in Sydney; he has grown up with it, and his heart and soul are in it. The acting governor of the bank would also be a desirable man on the board of directors. If the board of directors consisted of the governor of the bank and the managers of the two largest branches in Melbourne and Sydney, efficiency would be assured. Some of my friends have complained that the bank has not made more rapid progress. Since the death of Sir Denison Miller it has not made the strides it should, but that has been because the head of it has been only an acting governor.
– The explanation is that every one, including the Commonwealth Bank, is short of money.
– That is an oftrepeated argument, but it does not weigh with me. If I spend £100 with the Treasurer, that money is still in existence. Money does not disappear because it is deposited in a bank or invested in a business, but remains in circulation. ‘ If a bank tries to create a shortage of currency by raising interest rates, and demanding better securities, it may be made to appear that money is short, although actually it is not. If I spend £100 with the honorable member for East Sydney (Mr. West), it does- not go down a sewer. The cry about the shortage of money is “ moonshine.”
– If the honorable member will try to borrow some, he will soon find out whether it is short.
– I can assure my honorable friend that there is no shortage of money in this country. Members of this committee lack faith in their country They are always decrying it. This is a young country, full of vigour and life, and we should show courage in developing it. It will prosper if we put our hands to the plough, and have faith in ourselves. As yet we are only on the threshold of our prosperity. If the people would realize what a rich heritage they have, there would be no difficulty about progress. Australia should become the brightest gem in the crown of Empire, but we do’ not help it by crying out about the want of money and the need for retrenchment. We should go ahead with a policy like that enunciated by the Labour party in 1910. When the Labour party returns to power it will take up that policy again, and the people will never i egret it. We have faith in the country, and believe it will prosper. The amendment of the Leader of the Opposition is a step in the direction the Government wishes to go. If the Treasurer would accept it, he would find the committee in complete agreement with him, and the people would be satisfied that both the Government and the Opposition had done what, was right.
.- I find it somewhat difficult to understand the attitude of members of the Opposition to this clause, which provides for the appointment of eight directors, and I find it especially difficult to understand their opposition to the representation on the board of the great primary producing interests. I gather from the amendment that the honorable member for Bourke (Mr. Anstey) desired to move yesterday that the Opposition wants the Commonwealth Bank to pay far more attention to the interests of the primary producers.
– There is no provision for that in the bill.
– What . better provision can one make than the appointment to the board of management of the bank of men representing those great’ interests ? Surely, if we want to advance the primary producing interests, the best thing we can do is to have them well represented on the board of management of the national bank. I can imagine that it would be of very great assistance to the governor of the bank, when he was considering those interests, to have the assistance on the board of men with a practical knowledge of them. A most unworthy’ insinuation has .been made - the insinuation that men who will be appointed by the Government will sit on the board to promote the advantage, not of the bank and the people of the Commonwealth, but of the interests they are supposed to represent. Some honorable members have imputed to the Government the intention of placing men on the board who will do that, and they have invited the assumption that the appointees will be dishonest and dishonorable, and will sit on the board, not to advance the interests of the Commonwealth, but to see that those whom they represent are benefited at the expense of the general public. As I said in my second-reading speech, wo ought to assume that the Government is actuated by the sincere intention of choosing the very best men, so that the various interests concerned shall be conserved by the bank in its future operations. A member of the Opposition interjected a little while ago that the clause under discussion was the kernel of the bill. It is extraordinary that members of the. Opposition who, a little while ago, were desirous of having every part of the bill thoroughly discussed, and every clause of it closely examined, and who crowded the benches when protests were being made against the proposal of the Government to curtail the time at their disposal, are not now present.
– Where are the Ministers?
– Of course, Ministers are everything that is bad, but I expect members of the Opposition to act differently, for they have such high ideals.
– Reference having been made to the attendance of honorable members, I direct attention to the state of the committee, and to the fact that more Opposition members are present than Government supporters. [Quorum formed.”] ‘ Mr. MAXWELL. - I am exceedingly obliged to the honorable member for Angas for calling attention to the state of the committee, and I invite his consideration of the fact that during the discussion of this most important bill he has had occasion more than once to .draw attention to the state of the House. There has been the greatest possible difficulty in keeping a quorum, and that fact should be publicly known.
– Those who sit on the same side as the honorable member are mainly responsible for that.
– Tha,t does not matter. I am not apportioning blame, but am merely drawing attention to the fact that members of the Opposition, who professed to be panting for time to discuss the bill, departed and left it to be discussed by only a few honorable members. Members on this side have not asked for more time, because they say that the bill has already been exhaustively discussed, and, in their opinion, need not be discussed further. Having called attention to that fact, I announce that I shall have much pleasure in supporting the clause.
.- Since the Government has decided to apply the closure, direct evidence has been forthcoming of the mistake it has made. The honorable member for Macquarie (Mr. Manning) said he did not know what was the intention of the Leader of the Opposition (Mr. Charlton), and he was surprised to find that the Opposition was not advocating the appointment of one bank manager, but of a board of managers. The Opposition has never been opposed to the appointment of a board of directors, but it has asserted the principle that members of the board should be bankers employed in the service of the bank. That would be following the practice of banking institutions throughout the world. Honorable members should not forget that the Commonwealth Bank holds the revenue of this country, and we. are asked to give the Government power to appoint men who will control the people’s money. I do not know what has induced the Government to bring forward the proposal, but I understand that the Minister for Customs (Mr. Pratten) has had the same pressure applied to him as has been applied to me. I believe he has been informed that the bankers of Australia are not favorable to holding intercourse on banking matters with men who are not bankers.
– I can assure the honorable member that no’ pressure has been brought to bear upon me.
– Perhaps I stated the truth too bluntly. I shall say that the Minister’s attention has been drawn to the fact by men whom he represents, and who have some knowledge of Australian finance. Australia’s progress depends largely upon the manner in which its commercial and banking institutions are controlled. During recent years considerable changes have occurred in the methods adopted by the banks and financial institutions, and owing to the war and fluctuating exchanges, the present system varies considerably from that Which was in vogue in the early days.
– A’s this is only a definition clause, the honorable member should allow it to pass and debate the main question later.
– The honorable member for Swan (Mr. Gregory) is probably unaware that the Leader of the Opposition has suggested that we on this side should debate the constitution of the board of directors on the definition clause. The Bank of New South Wales, with which the Treasurer (Dr. Earle Page) is familiar, is one of the largest financial institutions south of the line, and its operations extend not only throughout the Commonwealth and New Zealand, but to the Pacific Islands, including Fiji. That bank, which handles the business of the Colonial Sugar Refining Company, and other large commercial undertakings, is managed by one person. It is true that it has a board of directors, the members of which attend meetings once a week, for which they draw fees, but they have little to do with its management. The late Sir Thomas Dibbs was in control of the Commercial Banking Company of Sydney for 50 years, and if any one had endeavoured to interfere with his administration he would have been politely asked to retire. I cannot understand why the Government should offer any objection to the proposal submitted by the Leader of the Opposition (Mr. Charlton), because no one could rightly accuse that honorable gentleman of desiring to do anything detrimental to the interests of the Australian people. Just as the operations of the Commonwealth Treasury are controlled by permanent officials subject to the direction of Parliament, so we should not allow persons interested in commercial undertakings to interfere in the management of the Commonwealth Bank. It is reasonable to surmise that the gentlemen to be appointed to the proposed board will be the political supporters of honorable members opposite. The honorable member for Fawkner (Mr. Maxwell) knows that some of his clients are often judged by the company they keep, and it is reasonable to assume in this instance that supporters of honorable members opposite will be appointed to the positions to be created. The principle is not a good one. It has never been my practice to cast aspersions, but if certain gentlemen in the community are placed in control of the note issue and the handling of large sums of money, it is possible that they may act in a manner which may not be in the best interests of the Australian people. It will be impossible to appoint to the board an outsider who is’ not connected with private business interests, and is it likely that any man will sacrifice other interests for the sake of the fees he will draw as a director of the bank ? The reason why the Labour Government appointed Sir Denison Miller as the first governor of the bank at a salary of £4,000 per annum was that he might be free of all temptation to engage in private business enterprises, and yet be able to maintain himself socially in a way befitting his ability and the position he held. The national bank of this great country, with its vast possibilities, is a sufficiently big responsibility to keep three permanent directors fully occupied. The amendment moved by the Leader of the Opposition shows a keen business perception of the needs of the bank, and pressure should be brought to bear on the Treasurer by ministerial members to induce him to agree to the alteration. Another advantage of a permanent directorate would be that the retirement of a director would provide opportunities for promotion, and thus the ambition of the officials of the bank would be stimulated. The Commonwealth Bank is capable of making or breaking Australia. In my lifetime .1 have had experience of three big bank smashes - that in the Argentine ; the Glasgow Bank failure; and the Australian bank crisis, and in each instance the banks were controlled by boards of directors. In the big crisis of 1893, the pastoralists were largely responsible for the failure of one bank, because they brought influence to bear on the directors to invest large sums of money in the Grafton district of New South Wales. It is a pity that honorable members on the ministerial side allow themselves to be prejudiced against an amendment simply because it emanates from this side of the House. Aa far back as 1906, I was advocating the establishment of the Commonwealth Bank, and the whole of the Labour candidates kept that proposal in the forefront of their election platform in 1910. That was one of the reasons why our party won 31 out of 36 seats in the Senate, and a majority of the seats in this chamber. In effect, the establishment of the Commonwealth Bank was endorsed by a plebiscite of the Australian people; and we are confident that if the commencement of this bill were postponed until 1927, as the honorable member for Darling (Mr. Blakeley) proposed, the Labour party would be returned to power with a mandate from the people to place the finances of Australia on a sound basis through the instrumentality of the Commonwealth Bank. I do not blame the bankers and their friends for what they have induced the Government to propose; I rather admire them for making use of the opportunities which the stupidity of the Government has afforded It is not too late for the Government to avoid the wrong it is about to do. The criticism of the bill by honorable members on this side has been such as should command respect, and the Leader of the Opposition has shown that a permanent directorate of three bankers who thoroughly understand their business would ensure the success of the bank. In the course of my speech upon the second reading, I dealt with the folly of handing over the control of a bank to a board of feed directors. The late Senator Walker was on six directorates, and was a trustee of a big hospital as well, and it was physically impossible for him to give proper attention to the welfare of those concerns and also do his duty as a parliamentarian, especially as during his six years’ membership of the Senate he was absent in
England for twelve months. The management of the- Colonial Sugar Refining Company by Mr. Edward Knox, and by his father before him, shows what can be done by one man who devotes the whole of his time to a business. There are people other than members of the Labour party who endorse our view. When I was in Sydney last week, many men spoke to me regarding this bill, and said that they would prefer the bank to be controlled by expert bankers. The’ Leader of the Opposition is seeking by his amendment to ensure that the bank shall function in the best interests of Austral let
.- Is this amendment in order? The clause now before the committee deals with definitions, whereas the management of the bank is dealt with in clause 11. The amendment seems to have been proposed on this clause either through ignorance of parliamentary procedure or for the purpose of embarrassing the Government and occupying time so as to prevent us from seriously discussing the question of ‘ management when clause 11 is reached. I should like to know whether it is in order to discuss the management of the bank on this clause ?
– It is perfectly in Order, according to a decision given in the House of Commons.
– In my view an essential in the conduct of a bank of this sort is continuity of policy, and on this ground I am anxious for the welfare of the bank and of the country, that a satisfactory directorate should be provided for. It is suggested from the other side that we should have a board of directors consisting of the governor of the bank and two other officials. If that course ..were followed, the two other directors would be subservient to the governor.
– No, they would be codirectors with the governor.
– But honorable members opposite would select them from the- officers of the bank.
– We do not say so. Mr. GREGORY.- I understand now what honorable members opposite propose, but I still consider that the two other directors would be to a certain, extent subservient to the governor of the bank, and the proposal might prevent the consideration of outside influences essential to the development of the industries of the country. I think the Treasurer was somewhat in error in proposing the appointment of directors from various parts of Australia and connected with various industries. It might not always be possible under his proposal to secure the best man associated with a particular industry. No doubt, the GovernorGeneral in Council would be desirous of making the board of directors as representative as possible, but it is not wise to tie his hands in the way proposed. We do not want to have a close corporation dealing with the lending of millions of money. Whilst I do not consider that a directorate as large as that proposed by the Treasurer is necessary,, a directorate of only three persons might become a close corporation, and that might be dangerous. When the Commonwealth Bank was started I should have preferred to have it established as a reserve bank, and not as a trading bank. Now that it is a trading bank there is no going back upon that, and we must do what we can to make it a success as a trading bank. I remind honorable members that the board of directors will have control not only of the operations of the bank, but also of the note issue of Australia. If we are to have an assurance of . something like perfect management, we should have a board which will embrace the interests of the various industries of the country.
– We are proposing that when the management of the bank is dealing with the note issue, the Secretary to the Treasury shall be a member of the board of directors.
– While I have nothing to say against the Secretary to the Treasury and believe that he should be a member of the board, I do not care very much for officialism.. The control of the note issue is of the greatest importance, and anything that might tend to paralyze the trade and commerce of the country must be inimical to the welfare of the people. I hope that honorable members will let the definition clause go through. If when we come to the clause providing for . the directorate, the Leader of the Opposition desires to move an amendment, he may do so; and if any alteration we make in that clause requires an alteration of the definition clause, the bill can be recommitted for the purpose.
Commonwealth Bank is the creation of the Fisher Government, and it is to the next Labour Government of the Commonwealth that -I look for a proper enlargement of its powers and the extension of its activities. When the bank was established, considerable opposition to it was displayed by many honorable members opposite, and by the party they represent. In the circumstances, I am unable to accept the many assurances of their good intentions given by government supporters in dealing with this measure. I am forced to the conclusion, that any attempt by them, to alter the management of the bank is made, with a view not to strengthen, but to injure the institution. I believe that the bill is designed to strengthen not the Commonwealth Bank, but the associated banks. I do not support a continuance of one-man control of the bank. I believe there should be an internal board, consisting, say, of the ‘present actinggovernor and two other men selected from the very capable staff which the late governor, Sir Denison “Miller, gathered round him. I believe that there are officers of the bank, such as Mr. Hull and Mr. Armitage, who are quite capable of carrying out the responsible work of managing the bank. Whilst I favour the appointment of an internal board, I recognize the advisability of appointing with the governor of the bank, as chairman, two other directors who might be drawn from the private banks. It should be possible to secure a very valuable man from one of the private banks who would have considerable banking experience, and would be of great assistance to the governor. We might also select a man having a special knowledge of currency. If such men could be secured, I should have no hesitation in paying them decent salaries, and also in increasing the salary of the present acting-governor of the bank. The Treasurer has proposed a board of directors consisting of the governor of the bank and seven other members, two of whom must be associated with manufacturing industries and commerce, and two with agricultural, pastoral or other primary industries. The bill does not provide that the directors shall give the whole of their time to the work of the bank. Honorable members on this side believe that even if seven directors were appointed in addition to the governor, they should give the whole of their time to the management of the bank. They should on no account be associated with any outside interests. It has been persistently rumoured that Sir John. Higgins is likely to. be appointed to the directorate of the bank. Let me remind honorable members that by his work during the war years in connexion with the Metal Exchange and the Wool Pools, that gentleman antagonized very influential sections of the community. If “he were appointed a director of the Commonwealth Bank, many of these influential interests and business people would withdraw their business from the Commonwealth Bank. I urge the Government to hesitate about entertaining the proposal to appoint Sir John Higgins to the directorate of the bank.
– He will lose his memory again.
– There is a danger that he may lose his memory, as he did many years ago in connexion with a mining venture with which he was associated. If we are to have on the board of directors men representing the -agricultural and pastoral industries, let us select men whose reputation is all that could be desired, and whose experience qualifies them for the position. It is proposed that the directors shall receive payment at the rate of £600 per annum each. If they are necessary they should be paid a higher salary. Under the bill, the board of directors is to meet at least once in each month, and that will necessitate twelve meetings during the year. In my opinion, no man worth his salt who would be appointed to this board because of his special knowledge and association with industries, would accept the appointment for a miserable remuneration of £600 per annum. As these directors will be drawn from the whole of the. states the time spent in travelling and attending board meetings once a month will occupy about twelve weeks in a year, and we cannot expect a man, who in ordinary private life could earn an income at the rate of £2,000 a year, to take an appointment in which he would earn only £600 for three months’ work. The responsibility of the Commonwealth Bank is so great that we should endeavour to secure the services of men of greater capacity than those who could afford to set aside a quarter of a year for a remuneration of £600. We should therefore -strive to get the best possible men available. The appointment of local state boards is unnecessary. The Commonwealth Bank has 71 branches, yet it is proposed to have eight directors and six state boards with three state directors on each. The Bank of New South Wales, with its 400 branches, has a board of directors of seven, and has not found it necessary to appoint state boards. Inorder to secure efficient management under a control which will at all times have due regard to every section of the community, the expense which will be incurred in connexion with the appointment of state boards is unjustified, and it seems to me that an attempt is being made to find positions for certain interested parties. The Treasurer has been in consultation with Mr. Kell, acting governor of the Commonwealth Bank, in regard to this bill, and I regret that, in reply to a question I submitted the other day, he refused to make available to honorable members the views -of that gentleman. Mir. Kell’s association with the management of the bank for many years past should have enabled him to give honorable members most valuable advice. I hope that the Government will consider the advisability of limiting the number of directors to three, chosen from among those who have had banking and accountancy experience, with a view to continuing the work of the bank so ably commenced by the late Sir Denison Miller.
.- There is a wide divergence of opinion on the Government benches with regard to the attitude of the private banks towards the Commonwealth Bank Bill. The honorable member for Parkes (Mr. Marr) has informed the committee that because of this measure representatives of the private banks have been “ after him with an axe.” On the other hand, the Treasurer (Dr. Earle Page) has declared that those institutions are favorably disposed to wards the bill, and that their representatives have met him in a very friendly spirit. This declaration is confirmed by several statements made by the Treasurer in the speech he delivered when he moved the second reading of the bill. He said that he had been in conference with the general managers of the banks. He made it clear that there had been considerable discussion, inquiry, and conference with the representatives of the private banks. He told us that during his discussions with the representatives of the private banks their right to get cash in case of need was recognized to be of the greatest value to banking. Although the honorable member for Parkes may think that the private banks are opposed to the Commonwealth Bank Bill, believing that it menaces their interests, or that it will enable the bank to become of real value to the people, they have been in consultation with the Treasurer as to how far he should go. Why is this? This afternoon the honorable member for Fawkner (Mr. Maxwell), as he usually does, instead of addressing himself to the measure, delivered an attack upon the Labour party, on the ground that we had suggested that the men appointed to the board of directors would be unmitigated scoundrels, doing what this Government required them to do. I admit at once that we have reason to believe that the present Government, which is not anxious to have a Commonwealth Bank hostile to, or competing with, private banks, would instruct the directors that the policy of the bank must be not to extend its trading operations, no matter to what extent tho bank might develop, as a general bank. That policy would be in accordance with the avowed intentions of the honorable member for Swan (Mr. Gregory). The question arises whether honorable members on the Government side of the chamber are less moral, and have less regard for ethical considerations than we. They are not. So far as their perspective goes they are, in business matters, just as honest as we are; but it cannot be gainsaid that they represent the vested interests of the community, whereas honorable members of the Labour party believe that the control of the finances of the Commonwealth should be wholly in the hands of the people. If we could achieve that, no one would be menaced, trade would be unrestricted and the country would progress greatly. Whatever may be the private views of honorable members on the ministerial side they cannot act contrary to the wishes of the friends with whom they are associated. In that respect they are lite honorable members of the Labour party who stand for the Labour policy which they came here to carry into effect, and which they cannot go against. Similarly, our friends opposite cannot go against the policy of the National party. The Age, which is a reputable newspaper, and “which is not likely to over-state the position from the National party’s stand-point, in its issue of the 25th October, 1922, said: -
The inner circles of the masters of finance had met to raise funds for the Nationalist party’s federal campaign. ….
That is why the Government will see that the trading functions of the Commonwealth Bank are not extended.
The National Union is the head and front of the money power. It receives fabulous cheques from snipping, pastoral, commercial and financial concerns, and in dark secrecy it allocates the money to branches of the
Nationalist party….. Mr. Bruce was the lion of the gathering. His connexion with Flinders-lane is sufficient to guarantee him a cordial welcome at all such conventions. Air. Bruce impressed on the meeting that they had everything to gain by clinging to the Nationalist party.
I have never said anything so strong, in regard to the Prime Minister, as that statement of the Age. However, I do not blame the right honorable gentleman for adopting an attitude that accords with the wishes of the interests represented by his party. Instead of bringing down a bill that would increase the useful services performed by the Commonwealth Bank for the people, his purpose is to hamstring the bank. To show what the bankers think of the Treasurer’s proposal, I quote the following comment upon his present proposal from a circular issued by Edward Dyason and Company, stock and share brokers, Melbourne, and issued on the 30th June last : -
His account of tho sources of the profit of the Commonwealth Bank, in which it appears that those have 1their origin primarily in the huge deposits, without interest by the Government, and which have run as high as £40,000,000, should to some extent disarm its antagonists. In the decline of these deposits may he seen one reason for the reduced profits of the institution.
I take that to mean that the opponents of the Commonwealth Bank - that is to say, men in the .banking circles - declare that the Treasurer has made it clear to them that the fact that their interests are not to be menaced by this bill should disarm their antagonism. The circular goes on to say -
The promulgation of the long-awaited Commonwealth Bank Bill now before the legislature, and dealt with later in this letter, has not had any pronounced effects on bankshare prices. It is very unlikely that the extraordinarily strong position which the Australian banks hold in regard to domestic hanking business will be greatly affected, at any rate in the immediate future, by the competition of the central institution, and, moreover, curtailment rather than expansion of this competition is suggested both in the design of the bill and the policy-speech .of the Treasurer.
The opponents of the bill, “the friends of the Government,” according to the Age, have declared through an official circular that the Commonwealth Bank Bill will curtail the functions of the Commonwealth Bank. Now I come to a paragraph in this circular headed “ The General Effect,” which says - The bill ds remarkable-
The friends of the bankers are speaking for what it .leaves out as much as for what it contains. There are no provisions for a mandatory return to the gold standard, for a fixed percentage of trading bank reserves, for the preservation of parity with sterling, or the presiding of cheap exchange or financial accommodation for all. There is not even the prohibition against ordinary trading, which is not usually carried on by a central bank. Of course, there is not. The intention of the Government, on the showing of its own friends, is to curtail rather than to expand the functions of the bank. We come now to the membership of the board of directors. My leader (Mr. Charlton) pointed out that if the manufacturing and other employing interests were represented on the board, the workers would have an equal claim to representation. This proposal, which would have been considered revolutionary if it had had its genesis on this side of the committee, is referred to in this circular, which states: -
There is room for difference of opinion in regard to the sectional and geographical composition of the board. If these provisions are made subject to the necessity of making the wisest choice of personnel, they may not do harm, but a rigid application is not likely to produce the best result. Wage-earners may easily claim representation with other sections of the community, for changes in currency conditions vitally affect the wage-earner.
– Read also what it says about my speech on the bill.
– I wish to refer to more important matters. I have shown that these representatives of the bankers fear nothing from this bill. Whatever may have been the attitude of the Treasurer in the past in this matter, at the present time, at all events, he is entirely at the mercy of these people, and is doing their will. They were satisfied that the workers might reasonably demand representation on the board. This bill does not propose anything so democratic as that. The Treasurer endeavoured to persuade us that the bank will be on allfours, as to the constitution of the proposed board, with the Bank of England and the Federal Reserve Bank of the United States of America. I have yet to learn that democracy has anything to gain from the example of the United States of America. That country is largely in the grip of the big money power, which has entirely stifled democratic thought. As a matter of fact, money power -rules the United States of America to-day, but even in America, where vested interests predominate, the representation on the Federal Reserve Bank is more democratic than is contemplated in this proposal. The Treasurer, dealing with the United States of America Reserve Bank directorate, pointed out that no director of class (b) or (c) could be an officer, director, or employee, or stockholder of any other bank. There is nothing in this measure to prevent the director of any trading bank in Australia, or any man holding shares in any corporate bank, from being appointed as a member of the proposed board. If the Treasurer is wedded to the present proposal, the Commonwealth Bank will be in the hands of the big money power in Australia. Those interests, in my opinion, are practically responsible for the bill.
Question - That the words proposed to be omitted stand part of the clause (Mr. Charlton’s amendment) - put. The committee divided.
Majority . . 7
Question so resolved in the affirmative.
– The question now before the Chair is that clauses 4, 5, and 6 of the bill, as amended by the printed amendment circulated by the Government, be agreed to.
– Is this the usual procedure, Mr. Chairman.
– Yes. We have precedents for the course now being taken.
– This procedure only shows the farce of the whole proceedings. The amendments have not even been discussed, and yet they are to be passed by the committee in this manner.
Question - That clauses 4, 5, and 6, as amended by the printed amendment circulated by the Government, be agreed to - put. The committee divided.
Majority . . . . 7
Question so resolved inthe affirmative.
Clauses, as amended, agreed to.
Sitting suspended from 6.40 to 8 p.m.
Clause 7 -
Sections eleven to fifteen, both inclusive, of the Principal Act are repealed, and the following sections inserted in their stead: - “11.- (1.) The Bank shall he managed by a Board of Directors composed of the Governor and seven other Directors. (2.) Subject to this Act, the seven other Directors shall consist of -
the Secretary to the Treasury;.
two persons who are or have been associated with manufacturing industries or commerce ;
two persons who are or have been associated with agricultural, pastoral or other primary industries; and
two persons who have a knowledge of currency and are declared by the Governor-General to have been chosen because of that knowledge.
– (1.) The Governor and a Deputy Governor shall be appointed by the GovernorGeneral, and shall hold office for a period not exceeding seven years, and shallbe eligible for re-appointment. (2.) In the making of the appointments of the Directors, specified in paragraphs (b) and
of sub-section (2.) of the last preceding section, due consideration shall, as far as possible, be given to the fair representation of the geographical divisions of the Commonwealth. (3.) The Directors specified in paragraphs (b), (c) and (d) of sub-section (2.) of the last preceding section shallbe appointed by the Governor-General. (4.) Of the six Directors first appointed in pursuance of paragraphs (b), (c) and (d) of that sub-section, one shall he appointed for a term of seven years, one for a term of six years, one for a term of five years, one for a term of four years, one for a term of three years, and one for a term of two years. (5.) Thereafter each Director shall be appointed for a term of seven years. (6.)Each person who is appointed a Director shall, upon the expiration of the term for which he was appointed, be eligible for reappointment.
12a. - (1.) The Governor shall be the Chief Executive Officer of the Bank. (2.) The (Deputy Governor shall perform such duties as are directed by the Board. (3.) The Governor and the Deputy Governor shall severally devote the whole of their time to the duties of their office. 12b. - (1.) In each principal city of the Commonwealth specified by the GovernorGeneral, by notice published in the Gazette, there shall he a Local Board of Advice. (2.) A Local Board shall be appointed by the Governor -General, and shall consist of three members, at least one of whom shall, if practicable, be a Director. (3.) The members of a Local Board shall, subject to this Act, hold office for two years and be eligible for re-appointment. (4.) Each Local Board shall have power to examine the affairs of the Bank in the District specified in respect of it by the Governor- . General by notice published in the Gazette. (5.) Each Local Board shall submit to the Board of Directors, at least once a month, a report in writing concerning the affairs of the Bank in the District in which it exercises its powers.”
.- This clause is very comprehensive. The first part of it deals primarily with the matter that we disposed of before the suspension of. the sitting, but the proposed new section 12 sets out the periods for which the directors are to be appointed. One is to be appointed for seven years , and the others for terms which vary from six years to two years. Proposed new section 12b provides for the appointment of local boards of advice, and I intend later to move an amendment to it. For the present, I shall confine myself to the question of the term for which the directors are to be appointed. I submit that seven years is altogether too long a time to appoint an untried and unknown man. The Government will have no opportunity to form a reliable opinion on the capabilities of the men it selects, and therefore they should only be appointed for a short term. I suggest that three years would be quite long enough. If in that time the men proved their ability they could be re-appointed, and I would not then object to a seven years’ term. I certainly do not think that the country should be committed to an expenditure of £600 per annum for seven years for the services of a director of whose capability the Government can, in the nature of things, know very little. It is proposed that the board shall sit once a month. The gentleman who secures appointment for seven years will, therefore, sit perhaps 84 times. If he happens to be the chairman of the board he will draw £7,000 for his 84 sittings; and if he happens to be an ordinary director, he will draw £4,200. I need hardly call attention to the necessity for appointing thoroughly qualified men, but I do not see how the Government can possibly convince itself that it has secured capable men until it has actually tried them. It may happen that one or more of the appointees will be failures, but under the Government proposal it will be impossible to dismiss them, unless they do something very wrong in other respects. The Governor-General may, in that case, take a certain course. If the members of the board were appointed for three years, the Government could dismiss the incapable men. at the end of that term.
– Shall we get capable men without offering them a long engagement? ‘ Mr. CHARLTON.- I think so, because a really capable man will have no fear about securing re-appointment. There may be 50 applicants for positions on the directorate. Only actual experience of their work will prove their capacity. If men are appointed for three years, and, by energetic and successful administration promote the success of the bank, they need have no fear about their re-appointment. If, on the other hand, it is found, at the end of that term, that the bank is not making the desired progress, the Government should certainly be able to make changes in the directorate. Let honorable members ask themselves what private persons would do if they were appointing a board of directors for a company.
– They would certainly reserve the right to dismiss any man who proved to be incompetent. The appointees would be engaged for a probationary period.
– I believe they would. It will be in the best interests of the country and the bank if the Government acts in the same way. The members of the Government are not financial experts,, and have to be guided in financial matters by experts. In view of the importance of these positions, it is only fair to the country that the appointments should not be for longer than three years.
– Would the Leader of the Opposition make the period three years for all the directors?
– I would; but I would not object to their re-appointment, for seven years if they proved satisfactory.
– It would be a bad thing to completely change the directorate at one time.
– It would be a very good .thing if the men appointed in the first place did not make a success of their work.
– Sir Denison Miller was appointed for a second term.
– He was appointed for seven years in the first place.
– The circumstances of his appointment were very different from the circumstances which will govern the appointment of these directors. The Labour Government which appointed Sir Denison Miller went to very great pains to secure the best man possible. Mr. Andrew Fisher, who was then Prime Minister, interviewed many prominent men in the banking world before selecting him.
– Does the Leader of the Opposition suggest that this Government will not be equally careful in choosing these directors?
– The circumstances in this case are entirely different. The original bill provided for the appointment of a financial expert as governor. Fortunately, a good man was chosen. The late Sir Denison Miller did excellent work as governor of the bank.
But in appointing this board the Government will be looking for men of varied interests. The proposition is altogether different from that which faced the Labour Government when it set out originally to find a governor for the bank. It is much easier to find a financial expert than to find half a dozen men who will adequately represent other interests. In all probability most of the directors appointed to the board will be, not financial experts, but outsiders with no banking experience at all. Therein lies the danger to the bank, and that is why I object to this clause. It is a drastic alteration to change the management from one to eight. My earlier amendment provided for the appointment of three directors. This number is ample, although the work is too much for one man. If we appointed three experienced men, who were constantly employed in the bank, they would do everything possible to further its development. Will any one contend that a board of eight directors, sitting spasmodically, will take the same interest in the welfare of the bank as would a board ‘of three composed of financial experts from inside the bank? Such a board would work with its eyes open, knowing that it was carrying full responsibility for the success of the institution. There is a vast difference in the two positions. The Government proposes to set up new machinery altogether, and for that reason I intend to move that proposed new section 11, and paragraphs 1, 2, 3, 4, 5, and 6, down to the word “re-appointment” of proposed new section 12, be omitted. If that amendment is carried I intend to move other amendments, so as to bring the clause into conformity with my views. I shall certainly move to omit the provision for local boards from the clause, and to alter the proposed periods of appointment to a term of three years.
– I have already given notice to omit the proposed new section 12b, providing for the appointment of local boards.
– The honorable member will have my support. I ask the committee not to swallow the clause holus-bolus, merely because the Government is submitting it. We have a duty to perform to this country, and we should endeavour to discharge it faithfully and intelligently. I fail to understand why, in addition to eight directors on the board, it is proposed to appoint in each state local boards, the members of which will meet once a month and draw up to £200 per annum each. If the clause is passed as it stands, the impression will go out to the general public that local boards are to be appointed merely to create jobs for a number of men in the different states.
– What does the honorable member propose to substitute for these provisions if his amendment is carried ?
– If my amendment is carried I shall, before the bill leaves the committee, redraft it, making provision, among other things, for the appointment of the members of the board for only three years. “ It is difficult to redraft the clause without deleting almost the whole of the proposed new sections 11 and 12. The honorable member for Macquarie (Mr. Manning) states that he has given notice of an amendment to leave out the proposed new section 12b, relating to local boards. The unfortunate position is that although I am in sympathy with the honorable member, and would like to support his amendment, neither he nor I, under the conditions existing in this committee at present, know whether an opportunity will be given to move it.
– The honorable member can move a similar amendment if the honorable member for Macquarie is shut out from doing so. The clause is being dealt with in sections.
– The honorable member will appreciate my difficulty. In order to move my amendment I must move to omit almost the whole of the proposed new sections 11 and 12. I do not wish to eliminate the power given to the Government to appoint the governor and the deputy governor of the bank. It is not my wish to nullify the whole of clause 1 of the bill ; therefore I cannot move for the deletion of the whole of the new sections down to and including 12b. I sympathize with the honorable member, but he assisted in bringing about this position. The Government this afternoon decided to limit the time for the discussion of the bill, and the closure was applied. As a result, insufficient time is given to debate important clauses. Clause 7 of the bill is a very long clause having many objectionable features, and if the time allotted for its consideration is taken up by the debate on my amendment, the honorable member for Macquarie (Mr. Manning) will be shut out from moving his amendment. The closure cannot be applied to important legislation like this without doing some injury even to the Government supporters. The bill will be passed in a crude state, without receiving proper consideration from honorable members. The period of two and a half hours has been allotted for the consideration of important clauses in this bill, and it is absolutely impossible in that time to discuss them intelligently. No time has yet been wasted by the committee. As far as the Labour party was concerned, only three questions of principle were involved, and if the amendments respecting them had been defeated in committee all other amendments would have gone by the board. We are now in a dilemma because proper consideration cannot be given to the measure owing to the action of the Government. The honorable member for Macquarie, if he is shut out from moving his amendment, will have the satisfaction of knowing that he contributed to it by supporting the Government in its application of the closure. These things come back like a boomerang and strike at every member of the committee. I am not speaking from a party point of view. When dealing with a measure which is not vital to the Government every member should have the privilege of discussing it and the right to exercise his judgment as to whether any particular clause, if agreed to, will be in the best interests of the community. No one wants to obstruct the bill. As a matter of fact, I requested my supporters to endeavour to get it through by Friday night, in order that it should be ready for the Senate when it resumes on Wednesday, and no one was more surprised than I when the Government applied the closure. I move -
That all the words of the clause, from the words “ Sections eleven to fifteen,” line 1, down to and inclusive of the word “ reappointment “ in sub-section 6 of proposed new section 12. be left out;
– We shall not get very far in this debate if, on every clause that is discussed in committee, the whole question of the operation of the guillotine is debated at length. I wish to point out that in the mother of Parliaments the application of the closure, allowing a definite time for the consideration of the various clauses of a bill, has been found to be the only practical way of transacting public business. If honorable members will persist in discussing the closure during the full time allotted, there is no alternative but to put the clause as it stands. The remedy is entirely in the hands of honorable members. I congratulate the Leader of the Opposition on his dogged determination to disembowel the bill. This is the third attempt that has been made to destroy the proposal for a board of directors for the Commonwealth Bank. First of all a motion was moved in the House to appoint a board of experts from inside the bank. On the last series of proposed new sections an amendment was moved to appoint a board of three, and now the honorable member is moving a further amendment to delete certain proposed new sections without substituting anything in its place.
– I said that if my amendment were carried I would move other necessary amendments to provide for certain alterations, including the appointment of the board for three years.
– I asked the honorable member on at least three occasions exactly what he meant to do. The effect of his amendment, if carried, will be to wipe out the board. Two previous attempts to do so have already been defeated. There is no need to further debate the question of the appointment of a board of directors. We are now discussing the periods of appointment. Every honorable member will agree that, in the control of the bank, it is essential to have continuity of management and policy, so that the financial interests and the whole of the people of Australia will have complete confidence in the institution. The clause provides for terms of appointment ranging from two to seven years. Of the outside appointees, three are to be appointed for a term of not more than four years. This is almost the same length of time as is provided in the amendment moved by the honorable member for Hunter (Mr. Charlton). This House deliberately decided upon a period of five years as the term of appointment for members of the Notes Issue Board.
– The Government, and not the House, decided that.
– The House decided it, and put it into active operation. When the Commonwealth Bank was originally constituted, the Labour Government of the day appointed the governor of that, institution for a term of seven years. The Government had no control over him, but in the present case we shall have the opportunity every year to remove an unsuitable man. We have six times as many opportunities to rectify possible mistakes as the Government had that appointed the first governor for a period of seven years. The committee is asked to decide, first, whether it will support an outside board; secondly, what should be the character of that board; and, thirdly, what should be its tenure of office. The clause will ensure continuity of policy. Each year it will be possible to change one man, but at no one time can the whole board be swept out of existence. There will always be some member remaining on the board who will know why previous decisions were made. For these reasons I trust that honorable members will support the Government’s proposal. The Government has given a great deal of anxious thought and careful consideration to the question of appointing local boards, and I have taken the opportunity of discussing it with commercial men and members of banking institutions. I found a very great consensus of opinion, amounting, I should say, to 80 per cent., in favour of local boards. It is not the intention of the Government to create a local board immediately in every capital city of the Commonwealth, but there are some centres where a board is necessary. Melbourne, for instance, is an important centre in the commercial life of this country, and in that city it is desirable for commercial and financial interests to get more closely into touch with - the management of the bank. The provision for the establishment of local boards will not necessarily be exercised in all the principal cities of the Commonwealth, but only in those cities that are proclaimed.
– Does any private bank have different directorates in different states ?
– Yes; the Bank of New South Wales has directorates in certain states. Many of the insurance companies have . separate boards in each state, and there are local boards for certain English banks and English financial institutions. The amendment would emasculate the bill.
’.- When an amendment is -moved from this side the Treasurer (Dr. Earle Page) endeavours . to convey the idea that the leader and members’ of the Opposition are insincere. He said that the amendment was a deliberate attempt to disembowel the bill. Evidently he is measuring other people’s corn by his own bushel; he is so patently insincere in swallowing every principle he has advocated that he thinks every one else is the same. I strongly resent his imputations. The allegation of insincerity seems to be the only parrot cry he has, but he let the cat out of the bag quite inadvertently when he said that the financial institutions of the country wanted continuity of management. Obviously, they want to force on the Government some one whom it will be difficult to remove. The Government, in its death throes, is trying to foist this proposal on the country in the hope of handicapping and ham-stringing a future government. Its attempts may be futile, but it is making the effort. Members of the Government have made the proposal in order to please their friends. The financial institutions are not so much interested in the man who can be thrown out in three or four years, but they want to ensure that the gentleman who remains on the board for seven years is one of their friends. Those who are there for one, two, or three years are a minority, and can be thrown to the wolves; but the others, appointed for from four to eight years, will be expected to look after the big interests that the Go- .vernment represents. Tens of thousands of pounds will be wanted in the coffers of the party funds of honorable gentlemen opposite at the next election, but it will not be forthcoming unless the interests of certain people are secured. We are told that there will be two representatives of rural interests on the board, and that is the excuse, the getaway, the open door, bo enable members of the Country party to explain their action in eating every word of the manifestoes issued by them to the electors during the last election. We are told that two of the members will be men who are or have been associated with primary or rural industries. Under that head the Government can pick two of the closest friends of the associated banks, for most of them have been interested or engaged in rural industries at some time or other. Those were the institutions that battened on the primary and rural industries of this country during the land boom and the crash which followed, and possibly representatives of them will be chosen. The honorable member for Macquarie (Mr. Manning) said that we must not question the rights of big interests.
– That is only a product of the honorable member’s fertile imagination.
– Nothing of the kind. The honorable member for Macquarie will have to swallow his amendment. He will not have an opportunity to submit it, because of the action of the Government, which he supported this afternoon in applying the closure. I presume that he will go to his electors and endeavour to get them to swallow the poor excuse he will give honorable members. In order to placate the honorable member, the Treasurer told us that local boards might not be appointed in every capital city, and I suppose that that will be another excuse which the honorable member for Macquarie, who is anxious to see local boards eliminated, will use for not pressing his proposal. We are asked to give the Government a blank cheque, and in this matter, with which - we are all deeply concerned, the Treasurer has informed us that he has come to certain decisions after consultation with financial experts and others. It is remarkable how the Treasurer seeks the opinions o’f representatives of financial* institutions in connexion with the framing of a bill the basic principle of which should be to curtail the power of those very interests by which he is guided. We have been informed by the Treasurer that the representatives of certain financial and commercial institutions are of the opinion that local boards may be of service. Which of the associated banks in Australia have boards of directors in every capital city of the Commonwealth ? Each- of the associated banks with which the Treasurer conferred has one board of directors, which controls the operations of the bank throughout the whole Commonwealth. The Treasurer says that he has acted on the representations of these gentlemen.
– He has acted on their instructions.
– Yes. On the instructions , of those whose interests the Government should oppose. The Government say that it is necessary that we should give them ‘ a blank cheque to the extent of providing them with the right to appoint, if necessary, local boards in the capital cities, which really means giving them the right to find jobs for some of their political supporters, who will meet, perhaps, once a month and receive fees amounting to £200 per year. The Government are asking Parliament to give them the power, to use if necessary, but it is more power than I am prepared to grant them. We are informed that the proposed board of directors will consist of two gentlemen representing the rural interests, two representing the manufacturing interests, and two with a knowledge of currency. We want to know who these gentlemen are. The name of one gentleman has been frequently mentioned in the House, and the honorable member for Macquarie was incensed, when an honorable member said something concerning that gentleman.
– I did not mention his name.
– I want to know who is to be appointed to the board. Sir John Higgins, whose name has been mentioned, is one of the most dangerous men who could be selected, as he will probably lose his memory, as he once did in connexion with a big mining deal in which he was involved. If we are to have on the board men of his calibre, whose commercial and financial record is stained as that gentleman’s is, I can only say, God help the Commonwealth Bank !
– He lost his memory on one occasion, and the people lost their money.
– Yes, and people lost their money. Too many measures authorizing the appointment of boards to control interests vital to the Commonwealth are introduced into this chamber without the disclosure of the appointees’ names. It is easy to say that a board is to be appointed, but the success of the Commonwealth Bank depends upon the calibre, honesty and integrity of the men who are to control its operations. How can we give an intelligent vote on this important clause unless we know who are to be appointed ?
– The honorable member supported the appointment of a governor who had greater power.
– That appointment was made 10 or 15 years ago, and it is only fools who> do not benefit by experience. That was an experiment unique in the history of banking. The Government of the day had no precedent, to guide them. In those days we were working in the dark, but to-day the road is clear and we know what is required. In introducing a bill of this character the Government should have admitted that the life and financial status of the nation depended upon the honesty and integrity of the men who are to control the institution. It is unreasonable to ask honorable members to support the clause in its present form unless we are to be given the personnel of the proposed board. Who are to be the experts appointed with an extensive knowledge of currency? Who is to judge their capabilities? Is the Treasurer to be the judge? Measuring him by the speech he made in introducing the measure he is about the worst judge that could be obtained in the Commonwealth. Any old man in the street would be more capable of selecting a person with a knowledge of currency than the Treasurer, if. he is to be judged by the speech he delivered in introducing the bill. He has not the capacity or ability to judge the qualifications of any one. The Leader of the Opposition has shown that if the members of the board were appointed for only three years their services, if unsatisfactory, could be dispensed with and their places filled by more competent men before they had time to cripple the institution. If in that period of probation they proved that they were able to successfully handle the problems with which they were confronted, their appointments could be renewed for a further term. But to say that we require eight directors to carry on this work is absurd. The directors who will meet once a month for say two hours, and will draw £600 per annum, will also be connected with other business interests. We are told that we must not question the ability and capacity of certain men associated with big pastoral institutions, of which there will be two representatives on the board. Honorable members in the Corner benches presume to represent rural or big pastoral interests, but big pastoralists never do anything to advance rural development. The big financial interests will have representatives on the board, but they will be men who have always fattened on rural production. These are the people whom the Government will appoint for a period of seven years to control the Commonwealth Bank. It is more than a mistake. There is undoubtedly something sinister in the action of the Government. It is a deliberate attempt of a dying Government, the supporters of which have been routed in every state of the Commonwealth in which the people have been consulted, to foist something on to the people which will have to be borne for the next seven years.
– The honorable member should not hit men when they are down.
– Honorable members opposite are down and out politically, but are rattling their dead bones in an endeavour to destroy this institution. They are political skeletons. The honorable member for Dalley (Mr. Mahony) characterized honorable members opposite as a lot of jackasses on a perch, and their idle laughter is a strong indication of the truth of his imputation’. The amendment submitted by the Leader of the Opposition is a reasonable one, notwithstanding that the Treasurer questions its sincerity. The (Treasurer has been so insincere in his political career that he does not know what sincerity means. I repeat that the members of the! board should be appointed for three years, and if they prove themselves equal to their task they should be reappointed. If they fail to successfully carry out the stupendous task allotted them, their services can be dispensed with at the end of that term, and others more capable appointed. I support the amendment submitted by the Leader of the Opposition, as it is a sincere attempt to improve the bill in the interests of the people.
.- I regret the Government cannot see their way clear to accept the amendment by the Leader of the Opposition, which has been submitted with the intention of improving the bill. I regret that directors are to be appointed in the manner suggested, for after all, in a big national bank with a future such as few banks have, it is time that we had, instead of mere “ guinea pigs,” whole-time officers working in its interests. It has been stated that fifteen years ago we did certain things, but there is no one opposite who can deny that the step taken at the inception of the Commonwealth Bank was one of the most momentous ever taken in Parliament. With all its faults, what has ‘the Commonwealth Bank achieved ‘! Will any one deny that, in the crash of the awful war, our position would not have been ten times worse than it was after the land boom if we had not had the assistance of the Commonwealth Bank? I want the Treasurer (Dr. Earle Page) to understand that those who favoured the Commonwealth Bank at its inception desired that the whole of the states should be in partnership with the Commonwealth, and should share in the profits.
– We should like to see that done.
– The Treasurer has the opportunity of making provision in that direction in this bill. As a majority has decided that we shall not have three directors chosen from the officials of the bank, the Government should arrange for each of the states to nominate a member of the board, the Commonwealth representative to have equal voting power with the six state directors, and also a casting vote. In ‘New South Wales and in Victoria our national bank is strongly opposed by the state savings banks. That should be eliminated, and the states brought in as partners in this great national institution. If every honorable member spoke as his conscience directed, he would admit that he wished this great financial institution to rise to the highest point of activity. This is not the way in which that can be achieved. At one time an associated bank in Victoria had one board of directors in Melbourne, and another, consisting of three directors, in Geelong. What was the consequence? As soon as the manager, who could not be dismissed, passed away, the Geelong board was immediately abolished. It had always caused irritation between Geelong and the head office. The Treasurer stated that the Bank of New South Wales thought it necessary to have a board of directors in Melbourne. I think that bank has also branches in South Australia, where there is also a directorate. Why should not the banks have boards of advice in every little town in which they have branches? If that were the position we would go on indefinitely until the position became absurd. If we have a local board in Perth, consisting of three men, they will be attenuated “ guinea pigs,” who will not receive a decent living wage. Is it not possible that the members of local boards will have private interests, and that their opinions will sway the management in the matter of granting overdrafts to companies in which they are interested? Any honorable member who knows anything about banking in country towns realizes that private information is disclosed, and for that reason small branches have only a manager and a sub-manager. There are no advisory boards, and such an absurd proposal has not been previously made in the whole history of banking. I resent strongly the applica1.lon of the guillotine to restrict debate upon this bill. It should have been introduced as a non-party measure, and members on both sides of the House should have been asked .to contribute from their wisdom to its improvement. Instead, of that, with only two more members to speak, the guillotine was applied, and that naturally caused resentment. The Commonwealth Bank has potentialities not possessed by even the Bank of England, because the latter is controlled by a private body, and cannot compare with a national bank backed by every hill, valley, and river in Australia, which, moreover, is a goldproducing country. The directors of the bank should be under the absolute control of the Government. Already mighty advances have been made by the bank, although it was not under the best management. The late governor was responsible for the most glaring case of nepotism in the history of Australia. I had hoped to be able to move for the insertion of a clause to provide that every Australian architect should have a chance to compete in the preparation of plans for bank buildings, instead of that work being the perquisite of one firm . consisting of relatives of the late governor. Is that infamous firm to continue to be the bank’s architects? If so, the people of Australia will look upon this Government with contempt. Already public opinion throughout the Commonwealth is ringing the death knell of the National party, which even in the Parliament of this most conservative State of Victoria has recently lost six seats. The Country party has held its own, but who knows what will happen to even its representatives in this House? If this bill had been introduced as a non-party measure, and every honorable member had been invited to suggest improvements, we might have achieved a measure in which all of us could have gloried. Even though tho provision for the appointment of local boards is agreed to, they need not be, and I hope will not be, appointed. Let the directorate of the bank be in Sydney, which by rail is only a few hours distant from Melbourne, and will be brought even closer by the development of aviation. Let the governor of the bank be in Sydney, and the deputy governor in Melbourne, and let there be managers or sub-managers in each of the other state capitals. Tasmania and Queensland have handed over their savings bank business to the Commonwealth Bank, and I hope that soon Western Australia and South Australia will follow that example. Every honorable member must regret that the two largest states of the Commonwealth, whose populations practically dominate Australia, should be conducting savings banks in rivalry with the Commonwealth institution. Fully £10,000,000 worth of Victorian Government assets are deposited with the associated banks. A clause should be inserted requiring that they be deposited in the national bank. The directors to be appointed under this bill will be swayed by outside influences, and they are not likely to recommend any incoming government to alter the system of control. However, in the words of Danton, if we must die, let us die gloriously, and even though the guillotine may fall,
I assure the committee that when the Labour party attains to the treasury bench we shall not be bound by the provisions of this bill. Tom Paine has said that no generation has the right to make laws for future generations, and when we assume office we shall exercise our right to repeal or amend any clause in this measure which we consider wrong.
Mir. A. GREEN (Kalgoorlie) [9.8]. - I trust that the Treasurer (Dr. Earle Page) will be prevailed upon to accept this amendment. The bill was introduced with the professed idea of eliciting the opinions of the representatives of the Australian people. It could have been the most important measure submitted to this House for a long time, but the measure now before us does nothing to extend the benefits conferred by the bank. Later I shall move a further amendment to disqualify for membership of the board of directors any person who is a director “ or shareholder “ of any banking corporation. Are we to appoint to the directorate of the Commonwealth Bank persons who have large financial interests in other banks that are in competition with the Commonwealth Bank? Such a proposal is absurd, and I cannot understand how the Treasurer could have proposed it. The honorable gentleman quoted the American law governing the Federal Reserve Bank, which, he said, provides that, “No director of class B or class C can be an officer, director, or employee, or shareholder of any other bank.” Why has the Treasurer omitted that very necessary precaution? If he is earnestly desirous of passing a bill that will serve the best interests of Australia he will agree that no person shall be eligible for appointment to the directorate who is a shareholder in any private bank. Honorable members opposite have expressed surprise that we on this side should be so frankly suspicious of the influences that apparently have been responsible for the framing of this bill. The Treasurer admitted that he had been in close conclave with the managers of the associated banks when drafting the bill, and I am afraid that in his anxiety to meet their requirements he has overlooked several safeguards that are very necessary in the interests of the Commonwealth. If he had intended to increase the usefulness of the bank there are several respects in which this bill might have been improved. The Commonwealth Bank could be made a model for other banks. Its watchword should be, ‘“‘Service to the people.” As a national bank, it should be sympathetic and quick to help its clients by advances on undoubted security. I know of many men who were depositors in the Commonwealth Bank, but who, because of their inability to get overdrafts on undoubted security, became disgusted with the management of the institution, and transferred their business to private banks. The conservative policy of the past should obtain no longer. The orders to the acting-governor of the Commonwealth Bank - and he must have certain directions from the Government regarding the policy to be followed - should be to make the administration more sympathetic, and give to the people facilities at least as good as are given by the private banks. The Commonwealth Bank should also bring about a reduction of exchange rates. It can only do so if its functions are extended beyond what has, so far, been proposed. Perhaps the most serious burden upon primary producers and manufacturers in Australia, who have to’ export their products, is the adverse exchange rate, and the functions of the Commonwealth Bank should be so extended as to enable it to bring the exchange rate within reasonable limits. I do not say that we can completely solve this difficulty, but we > should at least make some attempt to solve it. Then there is no reason why the number of branches of the bank throughout Australia should not be increased. It is clear to me that the present management of the bank, acting under direction, the source of which I do not know, is actually hostile to the extension of the services of the bank. I may inform the committee that there are only three branches of the Commonwealth Bank in Western Australia. I have repeatedly written to the Treasurer, as the honorable gentleman is aware, to ask that a branch of the Commonwealth Bank should be established at Geraldton at the request of the business people of that important shipping port, a town of 10,000 inhabitants. I was told by the honorable gentleman that nothing could be done because the bank is entirely beyond political control, and the establishment of new branches is a matter for the acting governor of the bank. I wrote to the acting governor of the bank, but could get no reply. I induced a friend of mine in Sydney to interview him and put my request before him. By this indirect way I learned that, in his opinion, the establishment of a branch at Geraldton, or of any new branches in Western Australia, is not, at present, advisable.
– Did the ‘honorable member say that he received no reply to a letter addressed to the acting governor of the bank?
– That is so. I got a reply only in the indirect way I have mentioned. I have repeatedly in this House asked questions of the Treasurer to learn whether the policy adopted by the Primary Producers’ Bank of paying interest on current deposits could not be followed by the Commonwealth Bank. It is to the lasting disgrace of the present management of the Commonwealth Bank that it should have been left to a private bank to initiate such a reform. If it is the desire that the Commonwealth Bank should assist primary producers and manufacturers, one step which might be taken to help them is to establish branches of ‘the bank where they do not exist at present, or where the exactions of private banks are such as to constitute an onerous burden upon industries. I asked the Treasurer whether he would convey to the acting governor of the bank the desirability of paying interest on current accounts.’ I asked questions on this subject over a period of seven or eight months. I could not get a reply from the Treasurer for five or six months. Had I not believed that a Minister would feel it to be his duty to answer truthfully questions put to him by honorable members, I should have suspected that, in the answers given to my questions, I was being told what was not true. I cannot understand the acting governor of the Commonwealth Bank so flouting the Treasurer of the Commonwealth as to refuse .to reply to his letters. Yet the Treasurer told me that this gentleman had refused to reply to representations he twice made to him suggesting the advisability of the bank paying interest on current accounts. Whilst the Government is putting a half -nelson on the
Commonwealth Bank, other banks are springing into existence in Australia. The Primary Producers’ Bank started with a very small capital, and inside of seven months, by the adoption of a progressive policy, it has established 40 branches. I have been told that we cannot get one new branch of the Commonwealth Bank established in “Western Australia. I challenge the Treasurer to say what influences are at work to strangle the operations of the bank. I do not like to show temper in dealing with those from whom I differ politically,, but there is more than a difference of political opinion in this case. There are forces behind the Commonwealth Bank that are hostile to its expansion, and yet, as I have shown, while the Government proposes to appoint to the board of directors representatives of interests hostile to the bank, it does not in this bill make the provision which is made elsewhere to prevent those .representatives being interested in other financial institutions. If the Treasurer was prepared to do a fair thing, he would make some reply to the proposals from this side, but, at the present time, he is trying to persuade the independent member for Fremantle (Mr. “Watson) to make up his mind to vote with him for this nefarious bill, instead of crossing the floor.
– I rise to a point of order. I ask for a withdrawal of the honorable member’s statement. The honorable member is in error. The Treasurer and 1 were not discussing this matter at all.
– Does the honorable member regard the statement as offensive ?
– Absolutely. I am not being persuaded, nor would I be persuaded.
-What is the statement to which the honorable member for Fremantle objects’? I have the greatest respect for the honorable member, and I do not want to see him “nobbled.” . The TEMPORARY CHAIRMAN.- I understand that the honorable member objects to the statement that the Treasurer was trying to persuade him to vote for the bill.
– I accept the honorable member’s explanation.
The TEMPORARY CHAIRMAN.^Does the honorable member withdraw his statement ?
– Yes. I withdraw it: I was saying that there are many directions in which the bill might be amended’ to make the Commonwealth Bank a use-‘ ful institution for the workers and for those engaged in trade and commerce in Australia. To show that there is room for expansion along the lines I have mentioned, let me tell honorable members something of what the proprietary banks did in the way of big business during 1923. I quote from no less an authority than a pamphlet recently issued by Dyason and Company, to whom I have referred before. They say that the profits made by the banks in Australia in. 1923 amounted to ?5,109,000, and that they paid ?3,539,000 in dividends. The profits made represent a ratio of 9.-I-9 per cent, to capital and reserves. That is a very heavy percentage of profit, and constitutes a considerable burden upon in?dustry. Interest- is not derived from the clouds. It is not produced by the money* spinners who1 live on the interest of the large sums of money they possess. These profits are made from the unfortunates who are in difficulties in their businesses and must borrow money from the banks to keep them going. Such high profits be-, come a tax upon industry. Some honor > able members opposite say with quavering voices that honorable members on this side are against industry, and do not stand for production, but they have been told so often on this side that they must know that the great burden upon industry is that imposed upon it by financial institutions such as the private banks of Australia, exacting undue profits from our wealth producers. The amount paid in dividends by the banks represents only a portion, of the profits of these in? stitutions. In preparing their balanced sheets, they adopt methods which make italmost impossible to analyse them in such a way as to discover what business they are really doing. They adopt various methods from time to time, and amongst them the watering of stock, and the. see ting aside of big reserves. In 1923 the banks in Australia as usual set aside -a large amount to reserves. The dividends accounted only for 69 per cent.- of -the profits they made, and the. other ;31 per cent, went to reserves, -so- that the actual percentage was over ; .30 per cent. The big financial institutions of Australia handle vast sums of money which, really belong to the people, and impose a high tax upon, industry. It should not be left to the Labour party to make this fight against the big financial interests. Members like the honorable member for Gippsland (Mr. Paterson) and other honorable members of the Country party should raise their voices against this tax upon industry, and should not assist a man who has turned Judas Iscariot on their party to pass a bill which will bring no help to the producers of Australia.
.- The clause we are now discussing-
– Are we discussing it?
– I hope we are, and I wish that honorable members on the other side would contribute to the discussion some of the views they hold on this important matter. This is a fundamental clause of the bill, because it has to do with the management of the Commonwealth Bank. On the management of the bank, as in the case of every other institution, depends its existence and its future success, or otherwise. In discussing .this clause, one has to consider the whole aspect of the bank. I cannot help contrasting the discussion upon this bill with that which took place when the Fisher Government introduced the existing act, many years ago. On that occasion I was sitting behind a Government that allowed weeks for the discussion of the bill. I believe that every honorable member then in this Parliament took part in the debate. There was no suggestion of the use of the gag or the guillotine, but the Government got its measures through because it was in earnest, and was prepared to sit for many months to get them through. The present Government has only one object in view, and that is to get into recess as rapidly as possible, and thus avoid the just criticism of its administration and legislation. We have had some examples of how its administration during recess has cost this country millions of money. Things have been done during recess without consulting the representatives, of the people in Parliament until it was too late to undo ‘them. That’ is why Ministers are in a hurry to get into recess, and are not prepared even to’ give honorable members sitting behind them an opportunity to discuss a measure of fundamental import ance to the prosperity or otherwise of this great nation of ours. To tinker with the management of a great institution like the Commonwealth Bank is to strike at that which may make it a success or- retard its development. I cannot help recalling the speeches delivered by the representatives of the same interests represented by the Government party to-day when they were hostilely criticizing the bill introduced by the Fisher Government. Every opportunity was given to the Opposition to place on record the views they had already voiced on the hustings at the preceding election. Honorable members reiterated their predictions that the bank would be a failure. “ What,” they asked, ‘” do these men know about banking ? What does- Andrew Fisher, a common miner, know about the great intricacies of public finance? What do these men who come from the fields and the factories know about financial questions and the control of banking institutions which handle millions of money 1” And when they asked, “ Where will you get the capital with which to establish this bank?” we replied that millions of pounds would not be required to provide capital for the bank, and that all that would be required was the confidence of the people and their money on deposit. They laughed when we told them that the people’s money would provide the capital of the bank, as it would provide its trade. They said we were dreamers and visionaries, who would run the country over a precipice. They said that we were inexperienced, and knew nothing, but at any rate we were the first party to lay the foundations of a Commonwealth bank for Australia. What has been its history ? The Labour party was swept out of office in 1913, and the first thing that the Fusion Government, which took office, did was to detail Senator McColl, its Honorary Minister, to traverse the country, not to boost up the Commonwealth Bank, but to denounce it. He seemed to have nothing else to do but to pass from one place to another pointing to a so-called loss sustained by the bank, and saying, “ This is what the Labour Government established.” What was that loss? The capital expenditure necessary to open branches of the bank in the various states and pay for the requisite furniture was taken out of the bank’s, income, and on paper an actual loss of something like £40,000 was shown on the first eighteen months’ operations. Senator
McColl, supported by other Fusion Ministers, declared that this deficit would be doubled in the next year, and that it was better for the Commonwealth to cut its loss at once and save money. He declared that this was the result of Government interference with private business, especially in such an important matter as public finance. Fortunately for the future existence of the bank, the Fusion Government in turn was swept out of office at the general election which followed the double dissolution in 1914. Had it not been for the victory of the Labour party at that time the Commonwealth Bank was doomed. It got its respite because of that victory. The war which was then in progress gave it its opportunity. Honorable members on the Ministerial side, in their efforts to belittle the great work done by this bank, ask what it would have done to earn a profit but for the chance the war gave it. But I ask them what would have been the position of Australia during the dark days of the war if it had not been- for the Commonwealth Bank? The amount it saved the people of Australia can be measured by many millions of pounds. In addition to making a profit of £4,500,000, it saved Australia over £6,000,000 in commission on the flotation of war loans. Such is .a brief survey of the history of the bank, the management of which we are now told must be changed because it is the Government’s policy that the Commonwealth Bank shall not encroach upon the profits of private institutions. To-day, the honorable member for Fawkner (Mr. Maxwell) took some of the members of the Opposition to task for suggesting that the Government would be guilty of doing anything which would retard the progress of the Commonwealth Bank, or that they might appoint directors who would exercise their power to do so. I hope that I would be the last to suggest that any Government or body of men appointed by a Government would be individually guilty of dishonorable actions, but when we know that it is the policy of the Government to bolster up private, and not public businesses, it is natural’ to assume that they will not be prepared to establish a Commonwealth bank on lines that will enable it to compete successfully with those private institutions in which they . are more ‘ interested than . 1 in public institutions. Therefore, if is also natural to assume that the directors they will appoint will have the same’ objective as the Government have. What is the Government’s policy? I shall not do as they would do - take it from the lips of opponents or from the pages of a journal opposed to them. I take it from their own declaration, and apply it to the Commonwealth Bank as they have applied it to many other Government activities. Their declaration,, made not once but scores of times, is that Government .interference with private interests must cease. Interference with private enter-prise is against their policy. According to them, the Commonwealth Government must* get right away from Government control and nationalization of every description. That is their ideal and their objective, to give effect to which, they have in their short career gone far. Before they met this House seriously as a Government, even before they had a chance to bring down any legislation, their first administrative act was to sacrifice one of the most prosperous woollen mills” in Australia to their friends in Flinders-lane, and the argument they put forward for their action was not that the concern was losing money - because it was- showing a profit of 20 per cent.
– I must ask. the honorable member to connect his remarks with the clause.
– I shall do so. The Government’s action in disposing - of the Commonwealth Woollen Mills is fundamentally connected with their proposal to appoint a board of directors for the Commonwealth Bank. Their argument in disposing of the mills was not that they were losing money or not rendering a great service to the Commonwealth, but that they could only be carried on by competing with private enterprise. Through the mouth of the Minister who had charge of the measure, Ministers said, “It is against the policy of the Government.” If it was against the policy of the Government to carry on one of- the most successful manufacturing operations we have ever had in Australia because it meant interference with .private enterprise; likewise it is also ‘against their policy to interfere with private -banking enterprise and the profits -of private banking. Therefore, we are . justified . in being suspicious when a. great change is proposed in the ‘control of the Commonwealth Bank, and when we. find that the directors, who are ‘to represent private interests, are not to be permanently employed in the bank as public servants, but are to be part-time men, engaged for 90 per cent, of their time in controlling trade and business outside. It will be their concern to preserve private interests as against the interests of a public institution such as the Commonwealth Bank. I am reminded that they will have access to the private affairs of competitors, but I leave that aspect, of the question without further comment. One has only to go to the office of the Registrar of Titles and examine the share lists of private concerns to see that there are the same groups of controlling shareholders in banks, insurance companies, Flinderslane warehouses, shipping companies, pastoral firms, and all the different ramifications of the capitalistic system. These interests are all interwoven. Although the bill provides that no one who is also a director of a private bank can be appointed as a director of the Commonwealth Bank, a representative of a pastoral or commercial interest may be appointed, whose interests are interwoven with those of men who are directors of private banks. In fact, I would go further, and say that there is just as much harm, and as great a danger, in appointing a shareholder of a private bank to the directorate of the Commonwealth Bank as there would be in appointing to it a director of a private bank. Yet there is no provision in the bill to exclude shareholders of private banks. Tt only provides that directors of private banks shall bo excluded from the directorate. Thus, a man may be the largest shareholder of a private bank in Australia, and still be eligible for appointment as a director of the Commonwealth Bank. I have read the circular published by Edward Dyason and Company, sharebrokers of this city, whose policy, “if I may judge by their publication, is akin to that of this Government. They state clearly that the intention of the bill - and the remarks of the Treasurer, when introducing it, support this .view - is not that it shall increase, but rather shall limit competition with private banking institutions. This bank, we are told, is to. be. a banker’s bank. I say that the Commonwealth Bank should be a national bank; that it should control the credits of the whole people, and that its influence should extend throughout the length and breadth of this country, until one day it will be doing the whole of the banking business of the Commonwealth. That was the intention of the framers of the original act, but that is not the intention of the present Government. The purpose of this Government is to hand over control to people representing outside influences; people whose policy is against public control in any shape or form. Under this bill two representatives of Flinders-lane will be eligible for appointment to the board of directors. Two others may represent the pastoralists, or Bawra. about which we have heard so much of late, and will probably hear a good deal more before Parliament rises. These people, who have their representation in this Parliament in the persons of the Prime Minister and the Treasurer, will have their representatives on the board to retard the future progress and prosperity of the Commonwealth Bank. The bank itself is not more than ten or twelve years old. It opened its doors in 1911, and yet we have seen a great deal of bitter hostility towards it. There is in power in state politics to-day, a party of exactly the same type as the party in power in this Parliament. Whether it be called a National, Liberal, or Composite party, its ideals are the same.
– Decomposite !
– It will be that by and by. These people are against the public interest. Fundamentally, the .Labour party and anti-Labour party of Australia are divided. One, the Labour party, stands for the interests of the people; the other, the anti-Labour party, stands for the interests of the profiteers. This sums up the position in a few words. If there was a sincere desire for the prosperity of the Commonwealth Bank, the party in power in this state would not use the millions of pounds collected through the various departments to bolster up private banking institutions. There is a deliberate boycott of the Commonwealth Bank. “Not one penny of public money raised by state departments in Victoria, and in other states also, finds its way into the Commonwealth Bank, which is the people’s bank. Throughout this state, with one or two exceptions, not one penny of the ratepayers’ money collected by the municipalities and other public bodies, such as the H.arbour Trust, Metropolitan Board of Works, and the Water Supply Commission, goes into the coffers of the Commonwealth Bank to bolster . up its business. And yet, because the Commonwealth Bank has Commonwealth funds at its command, forsooth, it is criticized by these people who stand for private enterprise in finance. We are told that it is no wonder the bank has been able to make substantial profits, since it has had control of Commonwealth money. That is quite true. But how much greater would those profits have been had the bank been permitted to handle, in addition, State Government funds and moneys raised by municipalities and other public bodies? We are not asking the people who control these various institutions to place their own private money with .the Commonwealth Bank. They can, if they like, bolster up private institutions with their own money ; but I say that when they use the people’s money to bolster up private concerns, they are misappropriating public funds. This is being done to-day by many public men in this country. If the Government appoints the board of directors from representatives of private interests, the bank will not operate in the best interests of the people. Members of the board should be permanent employees, they should receive adequate salaries, and give the whole of their time to the .service of the bank. If, however, control is handed over to eight men, comprising a central board, and to a number of local boards, representative of outside interests, the policy will be to bolster up private interests rather than the interests of the bank. Although one member of -the board may be appointed for seven years, another for six, and another for five yours, and so on, I say ‘that when a
Labour government comes into power, as assuredly it will, although it may. not be possible to dismiss these men without compensation or other consideration, this party will not hesitate to make a change, if the board is antagonistic to the progress of the bank. If necessary, we shall place in power others who will have the interests of the Commonwealth Bank and the country at heart.
.- We have had a good deal of criticism of this clause, which deals, not only with the manner in which it is proposed to manage the bank in the future, but also with the method of appointing directors, and their period of office. On this question it is interesting to compare. the proposal with what has been done in other countries. Dr. Prebisch, a high official of the Argentine Government, has furnished the following interesting information with regard to the Banco de la Nacion, Argentine -
Prior to 1891, the official banks of Argentine Republic had the function of note issue in addition to the general operations of commercial banking. The body of directors, appointed directly by the executive power, never proved of sufficient strength to resist the politicians’ demands for money_ and the increasing requirements of the inflationist sections of the business community. So the official banks lent very freely, issuing large quantities of paper money of decreasing gold value, which Stanley Yevons called very correctly “ wretched scraps of paper.”
Tho abundance of means of payment determined principally a considerable increase of land values, out’ of proportion with the price of products, if any.
And the whole of the speculative structure fell suddenly when an adverse balance of payments (caused by the excess of the services of public and private debts to be paid in foreign countries, in addition to the unfavorable balance of trade, over the new foreign loans contracted), was responsible for an intense banking panic, which brought a great restriction of credit at first, and the noisy failure of the official banks after some months.
In 1891, after this bad experience of official banks which issued notes, the idea of official banks fell in great discredit. So that, when the new government arising out of the political revolution coincident with the crisis, started with the plan/of a new bank, half official and half private, nobody dared to subscribe any share of the proposed capital.
The government then issued a quantity of paper money without any gold reserve at all, and gave tho paper to the new establishment his a capital.
Notwithstanding this spurious foundation, the new bank, as a result of the prudence displayed by the directors (appointed by the executive with the approval of the Senate, but selected this time, among honorable business men and farmers), and of the sound financial policy, both public and private, following the crash, the Blanco de la Nacion developed gradually and surely its operations, and now, after 30 years, is the most powerful banking institution of the country.
The Banco de la Nacion also handles the clearing-house at Buenos Aires - the centre of the life of Argentine - voluntarily constituted by the other institutions,- which deposits in the former in a special account (custody account) large reserves of money considered as cash on hand (on the same lines as the London clearing).
As the banking services of the whole country are carried on in its great part through the branches of the Banco de la Nacion, and the private banks, whose head offices and main reserves are in Buenos Aires, and as the former concentrates also part of the reserves of the latter, practically the Banco de la Nacion is our central reserve bank.
– I rise to order. Is the honorable gentleman in order in continuing to read his speech ?
– The honorable member for Gippsland is in order in reading matter which he desire3 to incorporate in his speech.
– Do you rule that an honorable member may read his speech?
The TEMPORARY CHAIRMAN.No ; but I rule that an honorable member may read references in support of his arguments.
– I take the point that the honorable member for Gippsland is reading his speech. I do not know if it has been , supplied by the Treasurer, but from its tenor I presume it has. It has been laid down by other authorities that an honorable member may read brief extracts. I am sure that, with your knowledge of parliamentary procedure, you will agree that what I am saying is quite correct. .An honorable member may read brief extracts, but he is not entitled to read all the time he is making his speech.
– I have just ruled that the honorable member is in order.
– I am merely selecting extracts from a fairly long statement which describes the manner in which the Argentine bank operates. The statement continues -
It is claimed that this institution must become the “banco de los bancos” (the bank among the banks). This would be achieved through the rediscount function. This function is now exercised by the Banco de la Nacion, but on a very narrow scale, because the other banks do not like generally to show the commercial documents of their clients to the competitor institution, and because the latter have not sufficient financial means to rediscount.
It is proposed to solve the first difficulty as above pointed. In respect to the second, the lack of means for rediscounting purposes, the plan is to put in the hands of the re-organized banco the control of the note issue now mechanically done by the Caja de Conversion. The gold now in this - representing at the present 80 per cent, of the value of the note issue, would be transferred to the banco, whom, at the discretion of the body of directors, should he able to issue paper for rediscounting purposes; -but never below a proportion of 30 per cent, of the gold reserve,- and always with collateral commercial documents covering the difference. These documents must have the endorsement of the bank that asks for the. rediscount, and -also the signature of two sound business men, farmers, &c, arid must not.be of more than 180 days.
Through the functioning of the rediscount system controlled by the movements of the rediscount rate, it is hoped that the banco shall be able to control the money market and the general mechanism of the credit of the country; and though in much less extent the movements of foreign exchange.
– I respectfully rise to a point of order. I ask to what limit -is an honorable member in order in reading extracts, and whether a complete speech may- be given in the form of extracts?
The TEMPORARY CHAIRMAN.The honorable member for Hindmarsh i3 not in order. I have just ruled on a similar point of order, submitted by the honorable member for Dalley, that the honorable member for Gippsland is justified in reading extracts which are relevant to the amendment under discussion.
– -The Bank of Argentine was re-organized on somewhat similar lines to those proposed by the Government for the re-organization of the Commonwealth Bank. The effect of the re-organization in the Argentine was good, and I can see no reason why it should not be good here. The proposal that the commercial, industrial, pastoral and agricultural interests of the country should be represented on the board of directors is reasonable. In 1922 the value of Australia’s production was as follows: - Agricultural, £81,890,000; pastoral, £69,254,000; dairying, poultry, and bee3, £44,417,000; forestry and fisheries, £10,373,000; mining, “ £19,977,000 ; and manufacturing, £120,751,000; total, £346,662,000. Of that sum primary production accounted for £246,000,000, m round figures. It is reasonable, therefore, that the primary producers should be represented on the directorate of the bank. If the figures I have given are not a sound argument in favour of such representation, I do not know what a sound argument is. Honorable members opposite have criticized the proposal that the members of the board should be appointed for terms varying from seven years to two years, but the Governmenthas a precedent for its proposal in the appointment of members of the Federal Reserve Board of United States of America.
– Give us something Australian.
– The Opposition is fond of directing attention to America’s fiscal practices. I shall now say something about its banking practices. Its Federal Reserve Board is composed of seven members. The Secretary to the Treasury and the Comptroller of the Currency are ex officio members, and the other five members are appointed by the President. In selecting these five appointive members, the President must have due regard to a fair representation of the different commercial, industrial, and geographical divisions of the country, and not more than one member may be selected from any one Federal reserve district. The proposal in the clause under consideration is that the board of the Commonwealth Bank -shall be composed of eight members, consisting of the Secretary to the Treasury and the governor of the bank, two representatives of the commercial and industrial interests, two representatives of the pastoral and agricultural interests, and two persons having an expert knowledge of currency matters. The Government, proposes that the appointments shall be for terms varying from seven to two years. The Leader of the Opposition objects to any appointment being for longer than three ‘years. The members of the United States Federal Reserve Board were appointed in the first place as follows: - One for two, one for four, one for six, one for eight, and one for ten years. The proposal before us, therefore, is modest. The Government has been subjected to some criticism for omitting to provide for a system of rural credits, but I have not the slightest doubt that at the proper time the Treasurer will introduce a bill to deal with that matter.
.- I should not have participated in the debate on this clause but for the remarks made by the honorable member who has just resumed his seat. He discussed the banking systems of the Argentine and the United States of America. May I be permitted to point out to him that the Labour party established the Commonwealth Bank to deal with Australian conditions.
– The honorable member for Batman (Mr. Brennan) told us last night that the Argentine Bank was better than the Commonwealth Bank.
– I am not concerned with what was said last night. The Leader of the Opposition (Mr. Charlton) in moving his amendment pointed out the danger of appointing certain members of the board of directors for a term of seven years. All of us who travel on railways and trams have noted the prominent warning “ Safety first.” The Leader of the Opposition’s chief aim in moving his amendment was safety first, and the Government should have assisted him to this end by accepting his amendment. I am sorry that the Government has not seen fit to do so. I do not believe for one moment that the government supporters are really favorable to the bill as printed, but influence has been brought to bear upon them to vote with the Ministry. Not only those interested in commercial and industrial activities, but also the majority of the citizens of Australia are heartily in . accord with the spirit of the amendment moved by the Leader of .the Opposition. I understood that the proposed new section 12b relating to the appointment of local boards was to be deleted at the instance of the Treasurer. It now seems that my impression may be wrong. I would point out that the Mutual Life and Citizens Insurance Company has branches throughout Australia. “Not one of the managers of those branches is able to depart from recognized methods of business without a reference to and instruction from the head office. The same applies to the Bank of New South Wales, and to the National and Union Banks. Yet, under this bill, the Government proposes to appoint in the various states, local boards, who in- a measure will act independently of the board of directors. The officers in charge of branches of the Commonwealth Treasury in the various states cannot act without instructions from the head office. Mr. J. R. Collins, Commissioner of Pensions, has under his control the deputy commissioners in the different states. The Government under this clause proposes to grant to local boards powers that would not be given to a branch of any commercial or banking house in Australia. I ask the Government to agree to delete the proposed new section 12b relating to the appointment of local boards. The honorable member for Macquarie (Mr. Manning) is prepared to submit such an amendment. Firms like Paterson, Laing and Bruce have sub-managers of their state branches who are subject to instructions -from the head office in Flinders-lane. The firm of Burns, Philp and Company is controlled by one general manager, although its shipping business is the largest in Australia, and its ramifications extend throughout the islands. It is the usual practice for all state agencies to carry out the instructions of their head offices. It seems to be the intention of the Government not to press this proposed new section in this chamber, but to insist upon its inclusion in the bill in another place. This is a further argument in favour of having one instead of two Houses of Parliament. If that is the intention of the Government, it should say so. The honorable member for Macquarie (Mr. Manning) told the House that he did not favour local boards, and the honorable member for Swan (Mr. Gregory) saw an element of danger in removing the control of the bank from the head office and allowing local boards to have a finger in the pie. A bank has to be very strict in conducting its business. It cannot be run like a fish shop or a. potato emporium. . I am very anxious to know, whether the Government intends to allow another place to settle this question. I feel sure that the local boards will create an undesirable and unnecessary retinue of servants, and 1 enter my emphatic protest against their appointment. The bill proposes to give them very large powers, and they will, no doubt, quote the bill in exercising their authority. It is a strain on the imagination to suggest that it takes three years to find out whether a person is suitable for the position. I have heard it said that those who are opposed to the Commonwealth Bank realize that this is the last chance they will have to kill it, for when the Labour party gets into power at the next election, their hope of strangling the people’s bank will be gone for ever. When we next go before the people, we shall tell them frankly that we intend to make the bank what it was intended to be. I do not worry about what other countries are doing. Australia cannot find an object lesson elsewhere; she is an object lesson to others. Her social legislation is superior to that of any other country. At the last election in England, the Commonwealth Bank was pointed to as a model of perfection, with the result that millions of votes were cast for the Labour party. References were made to our noble sons who, without being conscripted, went across the seas to assist the Mother Country in a, distant land. We arc creating precedents, not following them, and I suggest that we should create a further precedent by extending the usefulness of the Commonwealth Bank. The party opposite got into power, not by the votes of the electors, but by an unholy combination; and, having done that, why should it be permitted to emasculate the national bank, so that in years to come the country will suffer loss and be retarded in its progress. m As a man who has studied politics earnestly, I make an appeal to the Government to abandon the idea of local boards. I admit that I studied in a humble sphere of life - that of a plumber. A plumber’s opportunities of judging human nature, however, are greater than those of a man in any other calling. The ramifications of his calling make him a student of questions affecting the social life of the people’. The Government would be well advised not to wait until the bill reaches the Senate before amending it. If it does not listen to my opinion it is casting an aspersion, not upon me, but upon 45,000 electors in East Sydney, who will tell the Prime Minister’, if he asks them, that they want respect paid to me, not as an individual, but as their representative. I ask, on behalf of them,why cannot something be done ? Why should we be denied the opportunity to prevent something detrimental to the bank being done? Why should honorable members talk so much about studying the other banks ? We are here to serve the interests of those who sent us here. The associated banks do not study us, so why should we study them? The firm of Goldsbrough, Mort, and Company occupies a palatial building, and its original principals were millionaires. Prom whom did they obtain their money ? From the stupid people who allowed themselves to be exploited. Stock and station agents occupy comfortable offices, and their country clients from whom they obtain their support may be compared with the fly which enters the spider’s web. The Government should take this opportunity to depart from the present system, and secure the complete control of that institution which should guide the destinies of the Commonwealth. An effective Commonwealth banking system is the only way in which we can protect Australia’s interests, and make her the admiration of other nations. I read in an able article - not in a Labour paper, but in a conservative journal which has been published for many years - to the effect that only 171,000 new settlers entered Canada last year, and that every month 20,000 men and women were leaving Canada, and crossing the American frontier. The Canadian authorities have to admit that the wages and conditions offering in America are better than those prevailing in Canada. An effort should be made to attract new settlers if employment can be found for them, and employment can be created under this bill. If that is done the people from other countries will flock to the Commonwealth, and not only improve their positions, but add to the general prosperity of Australia. For the last 30 years I have been associated with labour councils which have advocated a comprehensive banking system. The members of these councils have comprised men of more than the average ability, and, although various proposals have been submitted, I do not know of one better than that of having the finances of Australia controlled by the Commonwealth Bank. Frequent reference is made to the sovereign, but we could no more carry on business with other countries with the use of sovereigns alone than we could undertake a flight to Denmark. The commercial transactions of nations are carried on under a system of credits based on confidence. The firm with which the Prime Minister (Mr. Bruce) was associated dispatches indents to Great Britain, but does not remit a 3d. piece. I suggested to a friendly society which required goods that were to cost £1,000 that the goods be indented. A member of the society said, “ We have not £1,000.” I said, “If I am given authority to send to England for the goods I shall negotiate the purchase.” I sent the secretary to the Bank of New South Wales, and he explained that a British firm would send the goods if we had a bank security. I was also informed that the bank’s representative wished to see me, and on calling I was told that the transaction could not be undertaken without the authority of the head office - that proves that a branch bank has no power to act on its own initiative - but that the bank would act if I signed a certain document, which I did, and the goods were eventually dispatched. No money passed between us, but arrangements were made for payment to be made on presentation of the bills of lading. I have endeavoured to impress upon honorable members that this measure, which they treat so flippantly, and which has been framed to destroy the Commonwealth Bank in the interests of the friends of the Government, is fraught with the greatest possible consequences to the people of Australia. The supporters of the Government discuss this and other important measures in their clubs, friendships are made, and legislation in the interests of a particular section is submitted. The time has come when that practice must be discontinued. The business of the country should be conducted in such a way that the whole of the people will benefit.
– The honorable member’s time has expired.
– The reading of speeches is not in order, but, as a concession to a Minister new to office, the Treasurer has always been allowed to read his important speeches. This evening he has taken advantage of that concession by handing a speech to the honorable member for Gippsland (Mr. Paterson), and telling him to deliver it to the committee. I do not blame the honorable member for Gippsland for having followed his leader. The amend. ment submitted by the Leader of the Opposition is a practical and commonsense proposal. Honorable members of this House are elected for not more than three years, and even a Government is liable to dismissal in three years or earlier. That being so, we should hesitate to appoint directors of the Commonwealth Bank for a period of seven years.
– Is not the honorable member advancing a good argument for extending the life of Parliament?
– I would give favorable consideration to such a proposal. Nonbusiness firm would appoint for seven years a man whose capabilities had not been proved. The Government proposes to place upon the board of directors two ‘ representatives of the pastoral, industry, and, although they may prove to be unsuited for the work expected of them, their appointments will stand for seven years. Private banks appoint their directors for not more than two years, and the chairman is elected annually. The general manager of a bank is appointed for only so long as he can do his work efficiently. Let us appoint the directors of the Commonwealth Bank for three years, and there will be no doubt that their terms of office will be extended if they do their work well. To appoint unproven men for seven years would be too risky. A judge is appointed for life, but that is because it is essential that he shall be placed beyond the necessity of currying favour with any influences. It is proposed that the Commonwealth Bank shall control exchange. I have been informed on good authority that the private bank’s are organizing to prevent the Commonwealth Bank exercising that control, and if the directors should prove to be weak men, unwilling -to compete with the chartered banks, commerce and industry will be still at the mercy of the latter. To-day the exchange rates are a big tax upon the country, and I had hoped that the board of directors of the Commonwealth Bank would be able to bring about a reduction to pre-war rates, but that pos sibility will be jeopardized if weak men are appointed for a definite period, of seven years. I do not believe in appointing a board of eight directors, or in the creation of local boards, but if these appointments are to be made, they should be limited to a reasonable period. It is wrong to bind future parliaments in this respect. The Governor-General is appointed for only five years, and the tenure of the Prime Minister is at the will of the House, but the directors of the Commonwealth Bank are to hold office for seven years, for if they are dismissed they must be compensated in full. Parliament should have the same control over these men as it has over other public servants. The Government proposes to appoint to the board of directors two currency experts. The experts are supposed to control the note issue, and they can defy the other members of the board.. That is not a fair position, and if I have the honour to be in the next Parliament, supporting a Labour Government, I shall take advantage of every opportunity to put an end to that state of things and place this bank on a sound financial basis in the interests of the people who really supply its capital. Do honorable members , opposite believe that it will be possible to secure first class men to attend to the management of the Commonwealth Bank for a salary of £600 a year when they will! . have to look after their private businesses as well? They -will give the first consideration to their private businesses. I should prefer to pay high salaries to the members of the board of directors and’ expect them to give the whole of their time to the management of the bank. We> cannot expect to secure the best brains, especially in the financial world, without paying handsome salaries. As the axe is about to fall, I shall conclude my remarks.
.- We have had a fine exhibition of banking intelligence. I do not believe that honorable members opposite know even the first principles of banking. I have had thirteen years’ experience of banking, and I never listened to such piffle in all my life. Men who have knowledge and experience, and are prepared to carry on the business of the country on business lines, would have passed ten bills in the time that has been devoted to this measure. Honorable members opposite would be beautiful organizers of financial institutions. They wish to annul the exchange value of gold, even to the point of nihilism. This is a form of demoniacal socialism which means combativeness, destructiveness, nihilism, anarchy, suicide, and death to the body politic. They would rob me’ of my individuality, sap also the personality ‘ of the electors of Australia, sweep away all . their talents and achievements, and introduce chaos, most confounded, generally. I am ashamed of them for disgracing, as they have done, the fair name of Australia.
– The honorable member omitted to mention the marriage-tie!
.- I expected that before the honorable member for Darwin (Mr. Whitsitt) resumed his seat he would place his hands upon his heart and thank God that he was not as other men. are. Here is the heaven-sent genius who is going to solve the financial problems of Australia. His remarks come well from a representative of a state that has to come cap in hand to the Commonwealth Government to save it from financial ruin.
– How does the honorable member connect his remarks with the amendment?
– By the remarks made by the honorable member for Darwin and by those which he omitted to make. I hope that in future the honorable member will not fail to place his. hand upon his heart and thank God that he is not as other men are. The proposed new section 11 provides that -
Subject to this Act, the seven other directors shall consist of -
– I think the personalities might be confined to Ministers. The Secretary to the Treasury might very well be left out of the discussion.
– The Secretary to the Treasury is a gentleman, and an excellent officer. I give him every credit for his work, but he is the servant of the Government of the day. Tho Government proposes to put him on the board of directors as its servant, because its masters cannot approach him directly. He would resent it if they did. The masters of the Government come to them and they will pass their orders on to the Secretary to the Treasury, and tell him that the board of directors must manipulate the Commonwealth Bank in the interests of the people who provide the electioneering funds for the Government. I need say no more, because the Government have their executioner ready. He has the whiskered mask upon him, and he has been brought in to manipulate the guillotine to- chop off my head.
– I call the attention of the committee to the fact that the time allotted for the committee stage of the bill, up to and inclusive of clause 9, has expired.
Question - That the words proposed to be omitted (Mr. CHARLTON’S amendment) stand part of the clause - put. The Committee divided.
Majority . . . . 6
Question so resolved in the negative.
Question - That clauses 7, 8, and 9, as amended by the printed amendment circulated by the Government, be agreed to -put. The committee divided.
Majority . . . . 5
Question so resolved in the affirmative.
Clauses, as amended, agreed to.
House adjourned at 11.15 p.m.
Cite as: Australia, House of Representatives, Debates, 10 July 1924, viewed 22 October 2017, <http://historichansard.net/hofreps/1924/19240710_reps_9_107/>.