10th Parliament · 1st Session
Mr. Speaker (Hon. Sir Littleton Groom) took the chair at 11 a.m., and read prayers.
– I received this morn ing the following telegram from Messrs. Paton, Morris, and Shellabeer, public accountants, of Perth: -
Amending War-timeProfits Bill merely removes most glaring anomaly. P lease make it remove all returned soldiers’ hardships by granting exemption to all profits exempt under section 13 old Income Tax Act.
Will the Treasurer state whether that telegram is based upon a misapprehension of the bill before the House?
– When the bill is again before the House the matter raised by the honorable- member’s question can be discussed at length. The bill proposes to remove an anomaly to which attention was drawn last year. The request contained in the telegram quoted by the honorable member is quite unreasonable.
– Will the Minister for Works and Railways say whether the Government intends to allow suburban municipalities through which main roads pass to participate in the Commonwealth main roads grant?
– According to a statement published in the press, the negotiations between the Commonwealth and the States, in regard to the grant of £20,000,000 for the making of main roads, have broken down. Will the Prime Minister inform the House what conditions the Commonwealth Government sought to impose upon the States in regard to the proposed grant?
– Apparently the honorable member has gained a wrong impression from the statement published in the press.-. The negotiations to which he refers have not broken down. Representatives of the States met the Commonwealth Minister for Works and Railways in conference and discussed the formulation of a policy for the expenditure of the amount which the Government is prepared to ask Parliament to grant. The conference lasted two and a half days, during which the views of the State representatives upon the proposals submitted by the Commonwealth were fully expressed. They made various suggestions which the Commonwealth Government has undertaken to consider, with a view to embodying them in our scheme. The proposals of the Commonwealth have been published, and the fullest information is already available to the honorable member as to the conditions upon which Parliament will be asked to make the money available to the States.
– Will the Prime Minister place upon the Library table all papers relating to the honours granted to certain gentlemen in connexion with the Wembley Exhibition?
– All honours are granted by His Majesty the King, and the Government has no papers in connexion with them.
– Did communications pass between the Commonwealth and the British Government in regard to the granting of such honours ? If so, will the Prime Minister place copies of those communications upon the Library table?
– The Commonwealth and British Governments exchange no communications in regard to such matters. The granting of honours is entirely a matter for the King and his representatives in the various Dominions.
– Did the Prime Minister make any recommendation to His Majesty’s representative in Australia in connexion with the granting of such honours ?
– I can afford the honorable member no further information in regard to the granting of honours. I have tried to make clear to the honorable member that this matter is wholly in the discretion of His Majesty the King, who is the fount of all honours granted in the Empire.
– Will the Prime Min- . ister make available to the public the’ periodical reports upon the oil prospecting operations in Papua, in order to prevent the circulation of inaccurate statements by interested persons?
– Such reports are made available. The November report was placed upon the table of the House recently, and the Minister for Home and Territories has promised that the December report will be made available as soon as it has been received.
– Having regard to the shortage of houses throughout the Commonwealth and the efforts of the State Governments to relieve it, will the Prime Minister state whether the housing proposals mentioned in his policy speech will be submitted to the House before the Easter adjournment?
-The Government’s proposals for assisting people to purchase homes, ‘ which were referred to in my policy speech and in the speech of the Governoi-General, are receiving the consideration of Cabinet at the present time, and a measure embodying them will be brought before the House at the earliest possible opportunity.
– The statement has appeared in the press that an agreement has been reached by the representatives of the Commonwealth and the States of New South Wales and. Queensland in regard to the commencement of the Kyogle to South Brisbane railway. Is the Prime Minister able to make any further information available to the House?
– At the present juncture I can make no further statement on the subject. The Railway Council is now
Bitting in Melbourne to discuss this matter, which was considered recently at a conference of the Commonwealth Minister of Works and Railways with Ministers for Railways of New South “Wales and Queensland.
– The newspapers state that an agreement has been arrived at.
– The Commonwealth Government has not yet received any in,timation to that effect, from the Railway Council.
– I have received a telegram from Rockhampton urging that the Federal Government should utilize Ulam Carrara marble in the construction of the new telephone exchange at Brisbane. I have forwarded the telegram to the Commonwealth Chief Architect. Will the Minister for Works and Railways inquire whether the wishes of those engaged in the marble industry can be complied with?
– The departmental officers are now considering whether Ulam Carrara marble will be suitable for the telephone exchange building. If it is, due consideration will be given to the possibility of using it.
– The Rural Credits Act merely provides for advances in connexion with the marketing of products. Does tho Government propose to extend the benefits of the Act to those who have produce in cool stores, and in other ways to establish a real rural credits scheme ?
– The question relates to a matter of Government policy, which will be announced to Parliament at the proper time.
– Arising out of the recent disastrous bush fires, I have received a telegram from the secretary of the Myrtle Creek and Sutton Grange Bush Fire Brigade asking that in theevent of bush fires telephone exchanges may be immediately opened at ordinary rates, and that calls relating to fires may take precedence over all other telephone business. Will the Post master-General say whether the department has made any regulations relating to such conditions?
– Preference would always be given to telephone calls relating to bush fires, but the opening of exchanges at ordinary rates would not be justified. The charge for opening an exchange is only ls. . 6d., which nobody would object to pay in time of emergency. The money *is received, not by the Department, but by the person conducting the allowance office.
asked the Minister for Trade and Customs, upon notice -
What is the cost per day of the s.s. Lady Loch while provisioning lighthouses in South Australian waters?
– £49 18s.
asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follow: -
Residential Blocks : Housing Scheme
asked the Minister representing the Minister for Home and Territories, upon notice -
– The answers to the honorable member’s questions are as follow : -
The basis upon which the Commonwealth Bank will advance moneys to the general public for the purchase or erection of homes and business premises, has already been agreed upon. The terms, which were announced in the press in October last, are as follow : -
asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follow: -
Canada. The question of the appointment of trade representatives in South Africa and other countries is receiving consideration. 2 and 3. The suggestions will be considered.
Rand wick Experimental Section.
asked the Minister for Defence, upon notice -
What has been the total cost of the experimental section to date, for -
– The information is being obtained and the honorable member will be advised as soon as possible.
asked the Minister representing the Minister for Home and Territories, upon notice -
-The answers to the honorable member’s questions are as follow : -
asked the Minister for Trade and Customs, upon notice -
With reference to his statement re supply of petrol kerb pumps on the 3rd instant -
Is it a fact that the Commonwealth Oil Refineries first established these pumps in Australia and used imported machines, and that this example was afterwards followed by the Neptune Oil Company and the British Imperial Oil Company before such action was taken by the Vacuum Oil Company?
Is it a fact that the Broken Hill Proprietary Limited also installed imported pumps for distribution of their benzol? .
Did he impose any of the restrictions in these cases which he now threatens to apply to the Vacuum Oil Company?
Is it a fact that Sir Robert Gibson, expresident of the Victorian Chamber of Manufactures and president of the Associated Chamber of Manufactures, is also chairman of the Commonwealth Oil Refineries, and, therefore, apparently acquiesced in the use of imported pumps in spite of the fact that the legislation constituting the Commonwealth Oil Refineries prescribes the use where possible of Australian or British goods?
– This matter will be brought under the notice of the Minister immediately on his return to Melbourne;
– On the 22nd January, 1926, the honorable member for Hindmarsh (Mr. Makin) asked the following questions : - 1.What number of ex-members of the A.I.F.. certified upon admission to the Bedford Park Sanatorium to be suffering from tuberculosis and after being there eight, nine, and ten months have been discharged, certified as suffering from bronchitis and not tuberculosis?
I am now in a position to inform the honorable member, in reply to his questions, as follows: -
Debate resumed from the 20th January (vide page 193), on motion by Dr. Earle Page -
That the bill be now read a second time.
– During the second-reading speech of the Treasurer (Dr. Earle Page), he made what I consider to be an unfortunate statement. He said that last year the Commonwealth had paid for various services in “Western Australia £745,000 more than it had received from that State in revenue. If that were so, it would be unreasonable for Western Australia, to ask for a grant from the Commonwealth Government. If Western Australia were getting an advantage of £745,000 during the financial year 1923-4, she ought to be in a highly prosperous position.
– And the Commonwealth Government would not be. justified in making a grant to that State.
– That is so. Western Australia, however, is really in financial difficulty. Before federation her finances were extremely buoyant. I recently asked the Treasurer how he made up his figures. He said that the statement was to be found on page 665 of the minutes of the evidence taken before the royal commission. That statement was put before the commission by Mr. S. G. MacFarlane, who was representing the Federal Treasury. It was successfully refuted by the representative of .the State Treasury, Mr. Simpson, who produced to the commission figures showing in relation to the transactions between the State and the Commonwealth a credit balance in favour of Western Australia for the year 1923-4 of £4.48,000. He expressed regret that the Commonwealth Treasury officers who had supplied the figures were not there for examination. The accuracy of the item “ Post Office “ appearing in Mr. MacFarlane’s statement was contested by Mr.Simpson. It showed that in Western Australia the postal revenue was les3 than the expenditure during 1923-4 by £133,000. Mr. Brown, Director of the Postal Department, said that the loss was £87,000. The difference between the two amounts is £46,000. There may be some excuse for the discrepancy, because there is no separate method of bookkeeping to show the respective disbursements and receipts in each State.
– The discrepancy is due entirely to the fact that Mr. MacFarlane was quoting Treasury figures from the statement presented to Parliament, wherein moneys received by the post office are treated as revenue.
– According to Mr. MacFarlane’s statement, in 1923-4, out of a total Commonwealth expenditure of £16,000 for new buildings for the Health Department, £15,000 was debited to Western Australia. Mr. Simpson said that those figures were absurd. Mr. MacFarlane also showed that the Trade and Customs expenditure for the whole of the Commonwealth was £1,158,000, pf which amount Western Australia was debited with £112,000, or about onetenth, although the population of Western Australia is one-sixteenth of that of the Commonwealth. On the other hand, although the figures of the Trade and Customs revenue, according to Mr. MacFarlane, show that for every £1 expended in the Commonwealth £30.9 was collected, Western Australia was credited with only £15.7. The figures supplied by Mr. MacFarlane respecting per capita collections were equally sur7 prising. They show that the collection in the Commonwealth was £6 4s. 4½d. a head, Western Australia being credited with the amount of £6 0s. 3d. a head, a difference of 4s. Hd.
– There was an error in Mr. Simpson’s calculation.
– The Treasurer will have his opportunity to reply later. I am pointing out the errors in Mr. MacFarlane’s figures. Western Australia should collect as much a head as the rest of the States, because she has a larger proportion of male population. The Treasurer knows that over half the Customs revenue-
– It is the women who help the Customs revenue.
– Over half of the Commonwealth Customs revenue is derived from narcotics’ and stimulants, which are consumed principally by men. Mr. MacFarlane’s figures are also contested by the fact that during the period of bookkeeping the collection per capita in Western Australia was quite as high as in the rest of Australia.
– It was much higher.
– That is so. When dealing with . taxation Mr. Simpson pointed out that many companies in Western Australia are claimed, as branches by parent companies in .Vic1 toria, and their profits are absorbed by bookkeeping methods into the receipts of the eastern State business in order to evade the high taxation which is levied on .the profits of companies in Western Australia. Mr. Black, who acts for the Federal Taxation Department and the State Department, mentioned one case in which £50,000 in taxation had been collected by the Melbourne taxation officer which really applied to profits made by Western Aus- - tralian companies. Mr. Simpson claimed that out of an amount of £820,000 representing war service interest paid on behalf of the States, £209,000 was paid by Western Australia. I do not propose to contest that figure. Money was expended to assist our soldiers, and although a considerable loss occurred, still there was a desire on the part of Western Australia to shoulder her share of the burden. Whatever may be the real position, we find that the commissioners themselves, in view of Mr. Simpson’s statement, rejected the evidence of Mr. MacFarlane.
– They also rejected Mr. Simpson’s evidence.
– They rejected the conclusions of the special man appointed bv the Commonwealth Government to. state its point of view. I do not. insinuate that Mr. Macfarlane was unfair. He was sent there by the Treasurer to make out a case for the Commonwealth, and he did his job as best he knew how. He stated in his evidence that the time available to him for preparing the figures was extremely short, and, in the course of crossexamination, he was not able to explain satisfactorily how they had been arrived at. The bill provides for a grant to Western Australia of £450,000, and it is brought forward because Western Australia has suffered as the result of federation. The amount provided is not so large as it appears to be, and the Treasurer did not try to hide that fact. Under the provisions of section 5 of the Surplus Revenue Act, Western Australia receives £100,000- as a special grant for this year, so that the actual monetary grant provided in this bill is £350,000. The bill is the result of the findings of the “ Royal Commission on Finances of Western Australia as Affected by Federation.” The Government’s proposal differs essentially from the recommendation of the commission. A majority of the commission, Messrs. Higgs and Entwistle, recommended -
That until the State of Western Australia is granted the right to impose, its own Customs and Excise Tariff, the Commonwealth shall pay to the State a special payment of £450,000 per annum in addition to the 25s. per capita payment made in accordance with clause 4 of the Surplus Revenue Act of 1910, the aforesaid special payment to include the special annual payment now being made to the State of Western Australia in accordance with clause 5 of the said act, the above special payment of £450,000 to commence on the 1st July, 1924.
The Minister for Works of Western Australia recently expressed the opinion that that State would never control its own Customs; but it was, nevertheless, a recommendation of the commission that Western Australia should be given her own Customs, and, until that was done, that she should continue to receive the grant. According to the commission’s recommendation, a sum of £500,000 is already owing to Western Australia, as the grant was to date from July, 1924. The bill provides no permanent remedy for the disabilities under which Western Australia labours, and to that extent it is extremely disappointing. I am not dealing with the question from a party point of view. Whatever Government may happen to be in power, it will always be the duty of Western Australian members to come to the Parliament and, without acting the part of mendicants, to voice the disabilities under which their State labours. The Treasurer said -
Any further sum is to b& left to a conference of the State and Commonwealth to consider the financial relationships between the Commonwealth .and all the other States.
That is a very poor excuse. The conference will deal with other matters besides the disabilities of Western Australia, including the adjustment of the existing financial- relationship between the Commonwealth and all the States. Sena-‘ tor Pearce, in his opening election speech at Kalgoorlie on the 15th October last, said -
The Commonwealth Government, having appointed the Western Australian Disabilities Commission, felt bound to give effect to the Commission’s recommendation, and no matter what arrangement was proposed by the conference as .to the basis of future finance, it would be made clear that Western Australia needed and must receive this £450,000 a year, outside any other arrangements between the Common; wealth and the States.
There was- no equivocation about that statement; but when the Treasurer was asked by the honorable member for Perth (Mr. Mann), “ Are they on the same basis as is now proposed “ - as Senator Pearce said they were - the Treasurer replied, “No.” I submit that Western Australia is justified in expecting, in fulfilment of the promises that have been made, more than is provided in the bill. We want not charity, but justice.- The Premier referred to “ largesse.” I am not the man to come as a mendicant to this chamber and ask for pity, sympathy, and help. To do so would be against my nature, and I feel sure that it would be against the nature of other Western Australian representatives. We do not wish to be regarded as men with a perpetual grievance. I know that Western Australia has Che sympathy of honorable members. In no other State were the people keener for federation. Most of the people in that State at that time had come from Victoria, and they had the “federal sense” very largely developed. In these ‘ circumstances we are justified in asking those who are at present in charge of federation not to forsake those who didso much to bring it about. While the royal commission was sitting in “Western Australia, the Western Australian Government appointed an advisory committee that submitted other claims by the State. There were about seventeen main claims, most of them, in my opinion, well founded: but, perhaps, from the point of view of tactics, it would have been wiser to drop some of the less important ones. One objection to the commission is that it did not contain a Western Australian. No one, however well-equipped as a business man, can properly understand the problems of a State unless he lives there. All the members of the commission were not specialists in everything.
– They were quite unbiased.
-I readily admit that, but I would not expect the honorable member for Corio (Mr. Lister) to accept a deputation of gold-miners, however unbiased they might be, as a competent body to investigate problems affecting the woollen industry. ‘ Conversely, Iwould not expect him, without any previous knowledge of Western Australia, to give a correct judgment on’ all matters affecting that State. The commissioners were absolutely fair so far as their knowledge went; but they disagreed among themselves about most things. The proposal for the gold bounty was rejected by Messrs. Entwistle and Mills. Obviously, technical knowledge has to be applied to solve the problems of such an industry. In. part 8 of the commission’s report relating to the Commonwealth Customs Tariff, we find that the chairman and Mr. Entwistle recommended -
That the State of Western Australia shall, during a period of 25 years, and thereafter until the Parliament otherwise provides, have the absolute right -
To impose its own Customs Tariff as in pre-federation days, provided the State of Western Australia shall not impose higher duties upon the importation into the State of Western Australia of any goods produced or manufactured in or imported from other States of Australia than arc imposed on the importation into the States of Western Australia of the like goods produced or manufactured in or imported from other countries;
to impose its own Excise Tariff
From that view, Mr. Mills dissented, but there was a majority recommendation in favour of it. The chairman and Mr. Mills made a brief reference to the difficulties resulting from overlapping industrial awards, but refused to recommend any disturbance of the present relationship between the Federal and State Arbitration Courts; but Mr. Entwistle thought that the jurisdiction of the Commonwealth Court should be confined to shipping and shearing. The chairman and Mr. Entwistle favoured the proposed grant to Western Australia, but Mr. Mills recommended a grant of £300,000 for ten years, so that even in the minority report a grant of £200,000 net, for ten years, was recommended. Indeed, Mr. Entwistle said frankly that he considered there was no possible remedy for Western Australia but secession.
– Does the honorable member agree with him?
– I do not. The people of Western Australia have the federal spirit, and while they remain loyal to federation, it is the duty of this and every other federal government to see that they are treated fairly. I quoted Mr. Entwistle to show that in the mind of one whom the honorable member for Corio regards as an unbiased observer, the prospect of getting justice for Western Australia is so remote, and the difficulties’ of the State are so great, that the only solution is secession. It will be seen that the proposal to make a grant to Western Australia, and the proposal to give that State control of its own tariff, are put forward as alternatives. The royal commission’s recommendation is that until Western Australia has its own tariff, the grant should continue. Later on I shall deal briefly with this matter, and also with the proposal for the payment of a bounty on gold. Another recommendation of the royal commission is the transfer of the control of the northwestern part of Western Australia to the Commonwealth. That can be adjusted by a conference between the Federal Government and the State Government. Although I am convinced that Australia must have a protectionist tariff, I recognize that the chief disability under which Western
Australia labours is the effect of that tariff upon its industries. In 1924-25 the value of imports into Western Australia from the eastern States, not taking into account goods from overseas landed in the eastern States and re-shipped to Western Australia, was £7,105,000, whereas the value of exports from Western Australia to the eastern States during the same period did not exceed £1,091,000. The eastern States would be very slightly affected by the imposition of a Western Australian Customs tariff, seeing that their trade with the western State is only £7,105,000 out of a total importation of £107,000,000. There would be no possible chance of industries being established in Western Australia, even if the population were five or six times what it is. The reason for this, as shown by the royal commission, is that goods from the eastern States are dumped on the Western Australian market. Our fruits are second to none in the world, but when Mr. Rayner, an expert in the manufacture of jam, established a factory for making fig jam, Adelaide jam was sold in Perth at a price lower than it was fetching in Adelaide, and our little factory was put out of business. Manufacturing industries in operation prior to federation could not exist afterwards because of what we regard as unfair competition from the eastern States. I do not expect my freetrade friends from Western Australia to agree with me on that point.
– They do not understand the position.
– They understand it from their own point of view. When men of diverse political views risk the odium of being designated as State righters by standing up here for what they believe to be absolutely necessary for their State, there must be something in the claim they put forward. The effect of federation is reflected in the finances of Western Australia. Before the Commonwealth was established, its financial position was buoyant, but since then, no matter what Government has been in power, no matter what political party has been in control, the same depressing story has always been told at the end of each financial year - there is a deficit. The accumulated deficit is now £6,140,000. The average deficit over the Inst five years has been £544,000. The other evening the Treasurer quoted figures for December to show that the State was apparently out of the financial wood, but according to the Argus of the 2nd February, the deficit for the present financial year WA: £505,000 at the end of the seventh month. Therefore the State is really in a worse position this year than in previous years. The people of Western Australia have tried hard to balance the State finances. The sacrifices they are making are reflected in the rate of the income tax, -the maximum being 4s. 7d. in the £1, whereas in the State of Victoria it is only 6£d. in the £1. The effect of this heavy impost is that many people who have made money in the western State, possibly in pastoral pursuits, one of the most lucrative industries in Australia of recent years, send their money to Victoria for investment. It may be unpatriotic to their State for them to do so, but it is good business for them, and it is likely te continue so long as the State finds it necessary to impose such an onerous tax upon its people. Another disability under which Western Australia labours is .the fact that it has too large a territory for its population. Up to the 30th June, 1924, we had spent £3,680,000 on that portion of the State lying to the north of the 26th parallel of south latitude, and there is not very much to show for it. The development of the north of the continent is a Commonwealth problem. In that area, which covers 562,000 square miles, there is a white population of 5,147.
– What is keeping population away?
– The difficulty of opening up the Australian hinterland. In 1910, at Bencubbin, in the Swan electorate, the settlers were obliged to dig wells to get salt water to condense for drinking purposes before they could commence farming operations. To-day those men are a prosperous community of farmers. In the Australian hinterland it is difficult to open the closed fist of Nature; but we believe that ultimately the northern portion of Western Australia will be successfully developed. The population of Queensland, above the 26th parallel of south latitude, is 500,000. Speaking in the State House, on the 9th December, 1924, Mr. P. Collier, the Premier said -
The north-west portion of Australia required special treatment. It was an obligation of the Commonwealth to assist Western Australia financially to develop, the north-west. It was beyond the financial powers of the State to develop the rest of the State and the northwest as well….. It was the duty of the Commonwealth to assist the State in developing the north-west, just as it was its duty to find very considerable sums for the development of the Northern Territory. There was not much .hope of this State (Western Australia) giving the north-west much assistance for many years. *
Before I pass away from the problem of the north-west, which I have said previously is a matter to be dealt with by negotiations between the Federal Government and the State Government, let me remind the House that there are many members of the State Government who are not in favour of handing over this territory to the Federal Government. They are influenced in their attitude by the awful mess the Federal Government has made of the Northern Territory. Itis not my task at this moment to indicate methods that might prove successful in administering these distant territories. I want to show how much better off the State was prior to federation in respect of Customs duties upon commodities essential for the development of primary industries. Under the State regime zinc shavings, steel wire, winding ropes, and agricultural machinery were free, and mining machinery paid a peppercorn duty of 5 per cent. Under the Commonwealth Tariff now in operation mining machinery pays a duty of 40 per cent. British, and from 50 to 55 per cent, general; zinc shavings pay 10 per cent, general, steel-wire winding ropes pay 30 per cent. British and 45 per cent, general, and agricultural machinery pays 45 per cent. If the State were given control of its own tariff it could, for 25 years, place a small duty on goods it was capable of manufacturing. Of the £7,000,000 worth of goods imported from the eastern States nearly £1,000,000 consists of apparel, and the balance of £’6,000,000 mostly consists of boots, hats, tobacco, butter, and sugar. With the exception of sugar, Western Australia could produce all of . these commodities. I think there would be an agreement to exempt Queensland sugar, and apply to sugar imported from overseas that duty that now obtains in the Commonwealth to keep sugar-growing in Australia a white-labour industry. Although I -realize that a separate tariff for
Western Australia is not within the immediate bounds of practical politics, I am of opinion that the State will not industrially develop without une. I believe that the people of the eastern States, if the matter were submitted to a referendum, would see their way to grant this concession, and the probability is, that after 25 years the development of the State would be such that it would be in a position to walk side by side with the eastern States, thus enabling’ one tariff to operate for the whole of the Commonwealth. Meanwhile a grant should be made from year to year, as recommended by the commission. One of the main causes of Western Australia’s present disabilities is the decline of the. goldmining industry! A few years ago it employed 16,000 wage earners, their wages amounting to approximately £3,000,000 per annum. To-day the number of men similarly employed is about 5,000, their wages totalling about £1,000,000 per annum. It has been said - and I believe truly - that every miner carries six other men on his back. The statement certainly is true of the eastern gold-fields, where the population is in the region of 30,000. In those fields there is property valued at £9,000,000; but if the gold-mining industry is allowed to become extinct - and it must do so unless measures are adopted by the Government to assist it - that property will not be worth ninepence. Western Australia’s disabilities were increased greatly during the period between July, 1916 and February, 1919, when Australia’s gold production was taken over by the Commonwealth Government at the pre-war price of £4 4s. 11½d. per fine ounce. Every other industry benefited by the high prices caused by the war. Of the gold valued at £15,000,000 which the gold producers of Australia were obliged to hand over to the Commonwealth Government about two- thirds .came from Western Australia. Previous to that commandeering of our gold, the sum of £13,500,000 in sovereigns was sent from Australia to- liquidate the liabilities of the Imperial Government in other countries, and to assist the Empire to prosecute the war successfully. Of the gold which was shipped from the Commonwealth at the request of the British Government, £10.500,000 was sent to the Pacific coast of the United States of America, £1,500,000 to India, and £1,500,000 to South Africa. Australia proved herself remarkably patriotic during the war. This country did not take even ordinary business precautions; other nations, particularly the United States of America and France, did not at any time forsake recognized business practice. Because of Australia’s patriotism, those engaged in the mining industry were called upon to make prodigious sacrifices. It has been computed that the Australian gold producers lost from £1,500,000 to £2,000,000 because of the action of the Commonwealth Government. That contention is supported by the fact that since February, 1919, when the Gold Producers’ Association -was permitted to ship gold abroad without restriction, it has distributed £3j00,000 by way of bonus. While gold remained at pre-war prices, the price of silver, copper, tin, and spelter increased by 100 per cent, over 1914 prices, and the price of lead by nearly 100 per cent; while prices for wheat, wool, coal, and coke increased to an even greater extent. As a result of the war, fifteen commodities used in the mining industry increased on the average by “217 per cent. Yet tho products from the mines had to- be sold at pre-war rates. Is it any wonder that the gold mining industry has declined? If the wheat farmers of this country had been treated in a. similar manner, there would have been a very vigorous outcry. Because of the higher cost of working the mines, selective mining became necessary. Where previously a 15-feet lode could be taken out, it became necessary to confine operations to the richest portion of the lode, and to take out from 3 to 4 feet only. Consequently large quantities of the poorer ore have been buried and lost for ever, and the life of the mines shortened. The cost of treating the ore, which in 1915 was 19s. 9d. per ton, increased to 38s. 7d. per ton in 1921. During the period 1913 to 1924 the value of the gold produced in Australia decreased from £9,376,573 to £3,131,583; in Western Australia the decrease in that period was from £5,581,701 to £2,258,440. All that the gold producers now ask for is a subsidy of £1 per fine ounce. That the Prime Minister him self recognized that the recommendations of the commission regarding the goldmining industry were not altogether satisfactory is shown by his remarks, because, when speaking at Ararat on the 28th October last, he said that the whole of the ‘ evidence put before the commission was being -examined to ascertain whether the appointment of a special loyal commission to deal with the industry was warranted. The Prime Minister recognized that this matter should be dealt with by experts. The British Government has subsidized the coal industry to the extent of £10,000,000 up to the 1st May, 1926; indeed, one British Cabinet Minister said that the subsidy might reach a total of £15,000,000. Some honorable members in the course of the debate have stated that gold is unnecessary. That remark might apply to the region which we hope to reach in the hereafter - although we are told that there the streets are paved with gold, which, therefore, must be regarded as valuable if only for . civic purposes - but in this work-a-day world it has been shown that those countries which have adopted gold as the basis of their currency are the only nations which have been able to stabilize their finances, and whose credit it is considered has stood good with other nations. The. Australian Notes Act recognizes this fact, in that it provides that the Treasurer shall hold in gold coin reserves equal to not less than one-fourth of the note issue. If the Government substituted any other metal, or scrip certificates. for the basis of its currency, Australia would soon be in the position occupied by some of the Central and South American states to-day. When I was in South America, where there was no gold standard for currency, I sometimes received 6s. or 7s. a day for my labour, . whereas on the following day, because of a fluctuation in the price of silver, my wages were possibly only 4s. 6d. Gold is essential to our national credit. It has been said in defence of its action that the Government made nothing out of the gold taken from the gold producers; in fact, the Government’s action in sending sovereigns abroad has been acclaimed as an act of patriotism. The government of the day was so anxious to win the war that it was prepared to rob the gold producers of Australia to do so. The then Treasurer found it necessary to increase the note issue, which in June, 1916, was £9,590,000. to £55,000,000 bythe 30th June, 1919 - an increase of nearly 600 per cent. That was done because Australia had to make greatly increased purchases, and because it was necessary to stabilize our finances. Our finances were stabilized at the expense of the gold producers; because of their sacrifice, Australia to-day occupies a financial position which is the envy of other countries which also were engaged in the conflict. Mr. Higgs, the chairman of the commission to which I have referred, recommended a gold bonus. It is true that he recommended a bonus of 10s. an ounce only, which he considered should operate for a certain period of years, when the question should be reviewed. The other members of the commission, Messrs. Entwistle and Mills, rejected the idea of a bonus. The reason for their rejection requires some explanation. The Western’ Australian Government, in order to assist the goldmining industry, appointed Mr. C. . Kingsley Thomas, from South Africa, to make an investigation in an attemept to restore it to prosperity. Mr. Kingsley Thomas reported that at that time the mines in Western. Australia were working with old plants, and adopting out-of-date methods. For twenty years those plants were among the foremost in the world, and for many years the mines paid enormous dividends. But, unfortunately, the London boards of control had regard only for immediate dividends, and in order to make them as big as possible they adopted a short-sighted policy, and consequently, however much we may regret to admit it, the gold-mining companies of Western Australia have now no reserves with which to install new machinery. Gold-mining as ‘an investment is not at present attractive. If the proposals contained in the report of Mr. Kingsley Thomas are to be adopted, a gold bonus is necessary. In his report he suggested that in the South African mines one man did as much work as was performed by six men in the Western Australian mines. That suggestion is entirely disproved by the facts. Goldmining in South Africa and in Australia are entirely different propositions. In South Africa, they have what is known as “ banket “ formations. Geologists can tell at what depth the banket formation may be reached over any distance. Along the Rand there are 60 miles of that formation. As a result, companies are prepared, in many instances, to spend enormous sums of money on a big shaft, knowing the formation they will strike, and how much it will be worth per acre. Another essential difference between the two countries is that in gold-mining on the Rand, in South Africa, there’ are 17,000 whites, and 181,000 coloured people employed. The gold mining industry of Australia is a white labour industry; that of South Africa is a coloured labour industry. In spite of the contention that the South Africans have the more up-to-date machinery, the miners of Western Australia do more per man than the minersof South Africa. In 1923, according to the latest available South African figures, supplied by the Chamber of Mines, of Johannesburg, the output was 135 tons per man per annum. In Western Australia, it was 163 tons in 1923, and was increased to 171 tons in 1924. This included the work of a large number of prospectors in various parts of the State. If we. compare the big industrial centres of the industry, whilst the South African output was 135 tons per man per annum, we turned out 297 tons per man on the Golden Mile, in Western Australia, or about two and a half times the South African output per man.
– Then black labour is not so cheap !
– The figures show that, as we have always contended, white labour is the more efficient. The only reason given by Messrs. Entwistle and Mills for turning down the gold bonus is the lack of efficiency in the working of the mines, as asserted in Mr. Kingsley Thomas’s report. I think that I have put up a good case for this form of assistance to the gold-mining industry; but I go further. The Government is committed to two well-established national policies of Australia to-day. One is the protection of secondary industry, and the other the assistance of primary industries. If I had. time I might read from a list which has been prepared to show that since 1916 the Commonwealth has spent £1,300,000 on bounties and similar forms of assistance for the production of sulphur, of iron and steel, and the export of meat, canned fruits, cattle, and wine. In the circumstances, I claim that the gold-mining industry is entitled to a bounty. I make the claim also on the ground of the observance of the White Australia policy. I can claim assistance for the gold-mining industry on the ground of what is being done for the sugar industry. I represent a State which has to bear its share of the large assistance paid to that industry. With thousands of people in Western Australia, I gladly assent to this, in order that sugar may be grown in this country with white labour, under Australian conditions, and at wages fixed by Australian Arbitration Courts. In Australia, in the various capitals, we pay 4£d. per lb. for sugar in order to support this policy. The import duty on white-grown sugar is £3 9s. 6d. per ton, whilst the importation of sugar grown by coloured labour is absolutely barred. We produce some 300,000 tons of sugar per annum in Australia, and yet the people of Auckland obtain Australian sugar from the Colonial Sugar Refining Company at 3d. per lb., whilst in Austrafia the price is 4$d. per lb. This country pays over £4,200,000 ‘ per annum practically by way of bonus to the sugar industry in order that it may be kept a white man’s industry. Just as we must have sugar, we must also have gold in order to stabilize our finances. We must get’ the gold we require from somewhere. We must get it either from Western Australia, which has the largest area of auriferous country in the world, or from South Africa. If in dealing with the sugar industry we are prepared to pay a large bonus in order .that it may be maintained as a white man’s industry under Australian, conditions and paying Australian rates of wages, so we may contend that the gold that is necessary to stabilize’ the finances of the Commonwealth should be produced in Australia under White Australian conditions, and the ‘Government should be prepared, to pay the bonus necessary to assist the gold -mining industry under those conditions.
.- In speaking upon this question I should like to say that what Western Australia is asking for is not charity hut justice, and I feel satisfied that it will be given some degree of justice by this House. I cannot commend the speech which was made by the Treasurer (Dr. Earle Page). . He said that during last year the reveune received from Western Australia was £720,000 less than the expenditure of the Commonwealth in that State. The honorable gentleman, of course, adopted figures supplied by his department, but those figures were, I think, somewhat biased. The Treasurer of Western Australia in dealing with the same question showed, and I think with justification, that the amount received, by the Commonwealth from Western Australia was greater by £440,000 than the’ amount expended in that, State by the Commonwealth. The honorable member for Kalgoorlie (Mr. A. Green), suggested that some odium might attach to him for advocating something like State rights. I am a federalist. I helped to bring about federation, and to induce Western Australia to join it. Federation means the union of separate States in the Commonwealth ; but federalists are not unificationists, and, personally, I do not believe in unification. Under the Commonwealth Constitution certain powers are reserved to the States, and I am always prepared to fight for State rights, and to see that they are preserved. Those who are trying to bring about unification are doing- their best to destroy the federation and to encourage secession movements, not only in Western Australia, but in some of. the other States as well. Western Australia joined the federation, and what it wants is that this Parliament shall honour the terms of the Constitution. Australia is a huge continent, as large as the United States of America, and Western Australia comprises one third of its area. I have in my possession a lithograph of a map of Australia, published in a Japanese magazine in the early stages of the war. It shows around the fringe of the Australian coast the full area of every country in Europe, with the exception of Russia. That story without words was sent to all the peoples of the world and to the League of Nations, that it might be seen that we, in Australia, with less than 6,000,000 of people are holding this enormous country, and are refusing the right of entry to other races.
No State has to a greater degree than Western Australia realized its obligation to settle people on the land successfully. Western Australia was in a practically moribund condition up to about 1892. I appreciate very highly the difficulties confronted by the early settlers who had little or no market for their production. Upon the discovery of gold at Coolgardie a change came over the scene. I was one who with others was attracted to Western Australia at that time. I do not suppose that Victoria was ever in a worse position than then. When I was leaving here, taking a few horses and a dray to Western Australia to do prospecting, I had four bags of chaff and a bag of oats delivered at the wharf in Melbourne for 19s. lOd. Terrible distress prevailed in this place at that time. Old residents told me that they could get no one to occupy their houses. Actual destitution was common in Melbourne at the time. With the attraction of people and capital to. Western Australia and the subsequent development that took place there, traders and manufacturers in Victoria were able to do marvellously well. The market afforded in Western Australia for the productions of Victoria, and to some extent also of South Australia, did much to build up the prosperity of those States. One cannot speak too highly of the great work performed in the early days by Sir John Forrest, who later became Lord Forrest, and was- one of Australia’s foremost statesmen. He was responsible for the construction of railways, roads, and telegraph lines, and for the supply of water to arid parts of the State. The Goldfields Water Scheme was a wonderful proposal. Western Australia was building itself up and becoming known to the world, and his position was so sound financially, that the Western Australian Government was able to borrow money for the Goldfields Water Scheme at par for 3 per cent. I do not believe that any other State in Australia has ever borrowed money upon such favorable terms. Such terms were obtained because it was realized that the development of the State gave indications of great success. To show how desirous the people of that State were to build up Australia, I may inform honorable members that in the period from 1890 to 1901, when the federation was established, the people of Western Australia built 1,167 miles of railways, and spent £12,700,000 from loan moneys, and £2,000,000 from revenue on public works. They were spending loan moneys in the development of the country to the amount of £114 per head, whilst the average loan expenditure in all the other States of Australia was only £20 2s. 3d. per head. It cannot be contended that up to that period the people of Western Australia had not made every possible effort to build up the country. In 1896 and 1897 the people of the State began to seriously consider the proposal for the federation of the Australian States. The people of the eastern States were very keen about it. The people of Western Australia recognized, as did the people of the eastern States, that if they joined the federation they must be prepared to make great sacrifices. They did, indeed, make great sacrifices. Western Australia agreed to join the federation, and a special provision was inserted in the Constitution to enable the State to impose additional customs duties for a period of five years. The Treasurer suggested that in. that way Western Australia imposed an extra penalty upon the Australian people, but he omitted to point out that the protection of that day does not compare with what is called protection to-day. The old protectionists would turn in their graves if they could hear of the extraordinary fiscal demands that are made in some quarters now. In comparison with present-day duties the Western Australian tariff was free trade. To-day the yellow flag of prohibition flies at every port of the Commonwealth. The Braddon section of the Constitution provided that three-fourths of the customs revenue should be returned to the States during the first. ten. years of federation, but it was generally understood that upon the expiration of that period similar consideration would be extended to the States.. Before the Braddon clause expired, a conference was held between the Commonwealth and the States at which a per capita payment of 25s. per annum to the States was agreed upon. The disabilities suffered by Western Australia were again recognized, and a special grant of £250,000, diminishing at the rate of £10,000 per annum, was arranged. I do not know whether the Treasurer mentioned that only half of that special grant is paid by the Commonwealth, the other half being contributed by the States. Probably that is one of the reasons why the Commonwealth Government desires to confer with the State Premiers before any relief to the West is proposed beyond the grant for one year, to which this bill relates. The great financial loss entailed by the repeal of the Braddon section was followed by the Surplus Revenue Act. Although that statute was held to tie constitutional, I am satisfied that it was contrary to the spirit of the federation. So also was the establishment of the Commonwealth Savings Bank. The Constitution gave to the Commonwealth control of banking other than State banking, and there is not the slightest doubt in my mind that that limitation was intended to protect the State savings banks. Certainly the Western Australian Savings Bank suffered considerably as the result of the competition of the Commonwealth Bank. The fact is not generally realized that when the Commonwealth took over all the post offices it obtained also a certain amount of goodwill, in respect of the savings bank business. Thus, a good deal of the workers’ savings which otherwise would have been deposited with the State bank, and been available to the State Government for the carrying on of public works, was paid into the Commonwealth institution. I consider that both the SurplusRevenue Act and the intrusion of the Commonwealth into the field of savings banking were infringements of the Constitution and contrary to the true federal spirit. Up to 1914 Western Australia made very good progress, and was able to pay its way, although in 1913-14 there was a small deficit. The Great War did more harm to that State than to any other. In no other State did the manhood of Australia respond so magnificently to the call of the Empire. The response fromthe goldfields was wonderful, and ‘the exodus of young men to the theatres of war was a serious blow to the mining industry.
– Twenty-five per cent, of the miners enlisted.
– Yes, and they were of the best type - young and able-bodied men. This meant, of course, a diminution of labour efficiency. The State was further penalized by the embargo on the export of gold, and the federal restrictions upon the base metal industry. Many mining companies were absolutely ruined by the Commonwealth Government’s insistence that all base metals should be sent to the eastern States for treatment and realization. Tin had to be sent to Sydney, although a profit of £40 could have been made by sending the ore to California. Copper ore, upon which a profit of £10 per ton could have been made by shipping it to Singapore, had to be sent to Port Kembla, and when freight, treatment, and realization charges were paid, not one penny was returned to the mine-owners. The lead names also suffered. In this way a very grave injury was done to the mining industry of Western Australia. That State was also at a disadvantage in that very little of the huge war expenditure occurred within its boundaries. The total military and naval expenditure within Australia in connexion with the war was £156,615,000; the greater portion of that money was spent in Victoria and New South Wales, the people of which made huge profits. The war also greatly increased mining costs, and from 1920 onwards that burden has been further enlarged by the raising of the tariff duties- Prior to the war the average working cost in the mines was 20s. 6d. per ton, but in 1921 it had increased to 38s. 7d. per ton. The honorable member forKalgoorlie (Mr. A. Green) quoted figures showing the increased working cost and the enormous losses that have resulted in the mining industry. From 1914 to 1923 the earnings of the railways of Western Australia, which had been constructed at great capital cost, showed a decrease of nearly £2,000,000, whilst the revenue of the gold-fields water scheme was reduced by £481,000. Of course, the number of miners employed also decreased. During the war period the State Government fully realized the danger of economic disaster, and it may be truly said that no State ever made a more determined effort to settle its lands. The expenditure on public works for the purpose of assisting rural development between 1901 and 1923 was £40,000,000, representing an average of £5 Ss. 2d. per head of the population, as compared with an average for the whole of the Commonwealth of only £3 3s. 6d. per head. Thus, ever since it joined the federation Western Australia has been expending about £2 5s. per head above the average for the Commonwealth. The State Government has lent to settlers £19,500,000, of which £7,000,000 has been repaid. In 1901 the area under crop was only 201,000 acres; in 1911 that had increased to 855,000 acres; whilst in 1924 it was 2,323,000, an increase from 1901 of 1,100 per cent. A recent report shows that there are some 2,500,000 acres of light lands undeveloped within 12$ miles of existing railways, and we hope to make all this productive. What we need are people, capital, and lower producing costs. If honorable members will refer to the Commonwealth Tear-Booh, and study the statistics regarding land settlement, production, and expenditure on public works, they will realize the tremendous effort made by the Western Australian people to keep their State solvent.
– Only a wealthy State could do so much.
– It was done by borrowing. I suppose money has been wasted there as well as elsewhere, but some losses of that kind are unavoidable. Certainly no other State of the Commonwealth has such a record of land development. I am not asking for charity for Western Australia, but I desire it to be built up as a portion of the Commonwealth. It is suffering very grave disabilities, and T realize that unless the policy of the Commonwealth is altered the man on the land will be placed in serious difficulties. Cheap production is essential to the future of that State. It is mainly a land of primary production, and is dependent upon the markets of the world where its products have to compete with those of all other countries. Moreover, Australia of all the primary producing countries, is most distant from the European markets. The cessation of primary production by this country would destroy our secondary industries and cause ruin and desolation. The average wheat production of Western Australia for the last five years has been 8.99 bushels to the acre, and of the rest of Australia for the same period 11.49 bushels; just 2£ bushels difference. The land in that State is cheap and can easily be cleared and cultivated. If the price of wheat were 5s. a bushel, the producers in Western Australia, compared with those in other States, would obtain, on an average, 12s. 6d. less for every acre of wheat sown by them. We must settle the people on the land and give them a chance of making a profitable living. If low prices for wheat were ruling, or if there were two or three bad harvests, the demand from Western Australia for secession would be so great that nothing in the wide world could stop it. I believe in federation, but we must settle people upon the soil under favorable conditions and with reasonable prospects of. success. The pastoral industry of Western Australia has made wonderful progress, and the fruit industry and the export of apples have grown by leaps and bounds. I am hoping that, in the near future, we shall establish in that ‘ State canning works, like those in Victoria. A special effort is being made, and huge sums of money are being expended in the establishment of group settlements in Western Australia, from which I believe a big dairying industry will develop. It is costing an enormous amount of money to clear those, forest lands, entailing high capital costs on each block, and it is essential that we should make the means of production as cheap as possible. Since federation,- the secondary industries of Western Australia have languished, because many large firms which had established factories there, found that it would be cheaper and more economical to establish them in Adelaide or Melbourne and to send goods to Western Australia by boat.
– Is not a large firm establishing a branch, in Western Australia ?
– I have heard that Lysaght’s intend to establish works there. The pastoral industry of Western Australia has developed wonderfully. Huge areas of mining lands in the vicinity . of- Kalgoorlie are now being bought at high prices by South Australian pastoralists, and enormous sums of money will be expended in wire netting that country. Rabbits are net so bad in the mining areas as they are in the agricultural areas, but wire netting is essential to keep out the dogs. I hope that honorable members will remember that when this Parliament is dealing with the dumping duties on wire netting. Those States that reap enormous profits through the Government’s policy of high protection should be compelled to contribute something in the way of a bounty to enable Western Australia to overcome its disabilities. In New South Wales the factories employ 159,000 men: in Victoria they employ 156,000 men: and in Western Australia only 19,200, inclusive of railway workshops. The wages paid in New South Wales amount to £24,750,000; in Victoria, £27,500,000; and in Western Australia, £3,500,000. The value per head of population in New South Wales is £66; in Victoria, £70; and in Western Australia, £34. Owing to the tariff, the trade between Western Australia and the eastern States has greatly expanded of recent years. Prior to 1920 the trade between Western Australia and the eastern States amounted to £3,500,000, and during the last five yearsto £7,500,000 annually. Western Australia is a magnificent market for the eastern States. The Disabilities Commission in its report, Table Y, shows the value of the trade between the various States, but it is worked out on a wrong basis. It is based on duties of 17.15, whereas a later return in the Y ear-Booh shows a considerably higher percentage. New South Wales benefited by Western Australian trade to the extent of £1,144,000 per annum, and Victoria to the extent of £3,029,000 per annum; but Western Australia suffered a loss of . £1,409,000. Those figures were computed on a per capita basis. Western Australian’ imports and exports are much greater than those of some of the other States. In 1922-23 her imports were valued at £40 12s. a head, and ex? ports £31 18s. a head; while the average for Australia during that year was: imports, £23 7s. 8d.; and exports, £20 18s. 4d. Western Australia is entitled to some measure of assistance. No Commonwealth grant to any State would have the same value as a reduction in the cost of production. Western Australia will not make much progress, or fulfil its part in the federation, until the people of Australia realize that the only way that that State can be genuinely helped is by giving it control of its Customs for a period of 25 years.
– The honorable member knows that that is impossible.
– I do not know that it is. At one time it was thought almost impossible for Western Australia to join the federation. If the people of that State had an opportunity to reverse their previous decision on federation, they would promptly do so. Western Australia should be given an opportunity to build up its land settlement and industries. What would Victoria be to-day had it not been for the discovery of gold there, and what’ would South Australia be without the Broken Hill and Western Australian trade 1 Any public man when dealing with the future of his own State must state his convictions, if he did otherwise he would be a hypocrite to- himself and not doing his duty to his country. I am quite satisfied that under the old tariff, so far as gold-mining and agriculture are concerned, Western Australia would progress’ by leaps and bounds, and in a short time its population would exceed that of most of the other States. It has good country, with excellent prospects, but it is in the early stages of development. New South Wales, Victoria, and South Australia were able to develop their lands when labour was cheap.
– The honorable member surely is not an advocate of cheap labour.
– I am not asking for cheap labour. Why did not the honorable member make himself heard when we were dealing with the tariff and the- duty on explosives 1 If Western Australia received satisfactory Customs duties on her imports on the average of Australia’s Customs duties, as shown on page 256 of the Year-Book, namely, 31.86 per cent., her income from Customs would amount to £4,450,000 per annum, and not £2,199,000 as calculated by the Treasurer. Western Australia is entitled to have its own tariff to assist in overcoming its disabilities.
– The honorable member is a freetrader, and surely he does not advocate a tariff for Western Australia!
– I have never preached the freetrade doctrine in this House. When Sir William Lyne, who was looked upon as the great protectionist of Australia, advocated the imposition of the ‘tariff, when Parliament after Parliament discussed the tariff, and when Mr. Tudor brought in the tariff of 1914, I did not object. There was little objection in Australia to the tariff until Parliament went protection mad in 1920 and decided that we should have no competition with other countries. I have never advocated freetrade for Australia. We impose a tariff in order to produce revenue, and I have never objected to that. Australia must raise revenue by a tariff, and a small measure of protection to build up the resources of this country would not be resented.
Sitting suspended from1 to 2.15 p.m.
– I do not wish to go any farther into the question of the tariff, except to add that, owing to high customs duties, Western Australia is suffering under very grave disabilities, which are added to by the provisions of the Navigation Act. I think honorable members will support me in the contention that if high duties are placed on goods required for the development of the country, development must be retarded. The Minister for Trade and Customs (Mr. Pratten) has told the people that he will not permit goods to enter Western Australia at a price less than the Australian wholesale price. I have letters from him saying that no dumping duty is imposed on British iron and steel, and wire and wire netting, unless the landed cost is less than the Australian wholesale cost. That means that all competition is destroyed. Western Australia is involved in heavy transport charges owing to the Navigation Act. Developmental work in that State now has to be carried on at a time when prices are extraordinarily high, but Victoria, South Australia, and New South Wales, were able to do the greater part of their developmental work when their needs could be supplied much more cheaply. When the Treasurer of the Commonwealth and the Treasurer of the State make financial calculations, they adopt different bases, so that we must accept their statements only for what they are worth. The Treasurer of the Commonwealth has quoted figures relating to the losses in the Western Australian post office, but Mr. Brown, the Secretary of the Postal Department, gave entirely different figures. The one calculation was made according to the Treasury method of finance, while the other was on a commercial basis. The Treasurer’s statement purports to show that Western Australia receives from the Federation £740,000 a year more than she contributes, but the Under-Secretary to the State Treasury says that Western Australia contributes £440,000 more than she receives. There is an item of £2,300,000 included in defence expenditure. That is charged to the trust account, but, on the other hand, no credit is given for the item of old age pensions. In a sense there is almost a double charge.
– Does the honorable member suggest thatold-age pensions are not paid out of the current revenue?
– Not all of them.
– Last year they were all paid out of current revenue.
Mir. GREGORY.- About £4,000,000 was taken from the trust fund.
– That is only a bookkeeping entry.
– The Postal Department’s losses in Western Australia are set down by Mr. Brown at £87,000, but the Treasury figure is £133,000. Western Australia is credited with £27,000 out of £31,000 expended on lighthouses, although the Director of Lighthouses has stated that the cost of the service in the Northern Territory is more than that for the whole of Western Australia. At the outbreak of war the Government borrowed £10,000,000 in gold from the banks, and also commandeered the gold of Australia. It was thus able to issue notes, which it lent to the States at a high rate of interest, which, according to the Treasurer of Western Australia, was, in some instances, over 7 per cent.
– It was not 7 per cent, on that money, which was all lent at a uniform rate of 4 per cent.
– It was lent for the purpose of providing for the settlement of returned soldiers, and we now claim that the amount credited to Western Australia should not be calculated on a population basis. Instead of only one sixteenth, about one fourth of it should be credited to Western Australia. The Treasurer knows quite well that the balance of the gold reserve was made up with gold commandeered in Australia. A large proportion of that gold was Western Australian gold. For that we are entitled to receive a credit of more than would be allowed on a population basis. The commission took evidence from an officer of the Treasury, and from officials of the Treasury in Western Australia, and the questions asked, and the conclusions reached, show beyond doubt that members of the commission appreciated the case put forward on behalf of the Treasury of Western Australia. It should be recognized that the figures I gave in regard to secondary industries in Victoria and New South Wales show that since Federation, ‘ the secondary industries in those States have benefited greatly from the policy pursued by the Commonwealth Government, and no one can say that Queensland has not also benefited enormously, although secondary industries have not been established on a large scale there. The embargo placed on the importation of sugar, and the heavy duties on bananas have been exceedingly beneficial to that State. But the policy that has been so beneficial to those States has been disastrous to the development of the industries of Western Australia. I believe that the only way to relieve Western Australia is to give her control of her customs tariff. If that were done, that State would, in twenty-five years, become one of the most prosperous in the Commonwealth. Honorable members must realize how essential it is for the defence of Australia to be able to show that we are mating an effort to develop and people this country. I should like to quote the statement of Mr. Keenan, who’ is a federalist, and represented the Government of Western Australia, which is entirely opposed to a request being made to the Commonwealth to give Western Australia control of her tariff. In stating the case for his Government, Mr. Keenan said -
J hold the very strong view that the fact that the British Empire exists to-day is in one sense due to federation, because the war decided our fighting strength to the last breaking strain, and any sensible man must admit that the effort Australia made must have been of greatest value, as the very last ounce of strength was exhausted before we became victorious. Discounting the more extravagant claims made by some Australians, no reasonable person can question the fact that, if the effort which Australia made had been wanting, it would have dangerously imperilled the Empire. Remembering that, and remembering that effort could not have been made, as you put it, Mr. Chairman, if the States had been all separate States, it is not possible to lightly conceive the possibility of federation being destroyed. That is the view I take. But, notwithstanding the pride and value of federation, it might be purchased at too high a price, and it may be the view of many in this State that, although they favour federation, and still do so, the price they are called upon to pay for it is far too high.
The price we are being called upon to pay for federation is much too high. . The method of providing redress must depend upon the good sense of members of this Parliament. I do not agree with the suggestion that the Commonwealth should take over the north-west of Western Australia, unless it were for the purpose of creating a new State, although the population there might be too small at present to make a State. I do not think any one of sound sense would say that the Commonwealth should increase its territories until it had proved itself capable of building up the Northern Territory. But, although it is idle to suggest that the north-western portion of Western Australia should be added to the Northern Territory, it is the duty of the Commonwealth to do something substantial, even to the extent of making sacrifices, in an endeavour to people this great area in the north of the continent. According to the report of a Government officer, which has just come to hand, there is a magnificent area in the Kimberley district, close to Wyndham, which is available for closer settlement. Some years ago, Mr. Hobler reported that many new industries could be commenced in the north if only people were encouraged to go there by the provision of facilities for disposing of their produce. Railways are needed to open up this immense area, but Western Australia cannot afford to take the full responsibility of-such an extensive work. No one can justly say that Western Australia has not done its share towards its own development. It has spent more loan money in providing assistance to settlers than has any other State of the Commonwealth; but its progress has been retarded by the operation of the Navigation Act and by the imposition of a high customs tariff. I was pleased to hear the honorable member for Kalgoorlie (Mr. A. Green) point out that, owing to the large income tax that has to be paid in Western Australia, people with money to invest are sending it away to Victoria, where taxation is lower. While I regret this, it is only further evidence that the people of the eastern States have benefited by the policy of the federation, while Western Australia has suffered. I realize that the Government is’ justified in awaiting a conference of the Governments of the various States, whose people might be called upon to share in any special payment to Western Australia ; but- the royal commission lias already recommended that the -first payment to the State should date from 1st July, 1924. I am quite content that the first payment should apply to the financial year 1925-26; but I hope that, at the earliest possible moment, the future policy in this regard will be settled. The people of Western Australia will then be in a position to know what they can do to continue their strong and definite policy of laud settlement, which, if pursued in the future as in the past, will enable them to play the part which it is so essential they should play for the welfare of the Commonwealth.
.- First of all, I compliment the Composite Government on having appointed a royal commission to inquire into the disabilities under which Western Australia was said to be suffering through federating. It is the first government that has made any earnest attempt to ascertain if those disabilities existed, as they were said to exist by honorable members representing the State. The royal commission discovered that they did exist, and, after setting out what the causes were, assessed the damage done to Western Australia at £450,000 a year for a certain number of years. It recommended that this amount should be paid annually to Western Australia until the State had freedom to impose whatever protective duties it cared to impose. I do not anticipate that honorable members will refuse to agree to the bill submitted by the Treasurer. I know that honorable members of the Opposition will not oppose it, because, during the recent election campaign, it was part of their platform that if they came into power they would unhesitatingly make these payments for the whole of the period recommended by the royal commission. They even twitted the Government with offering this first payment as an electioneering sop without any intention of making further payments. I staked my political reputation on the hustings when I replied that the Government would carry out its pledge. I had heard the Prime Minister (Mr. Bruce), speaking in Western Australia, say that his Government was most sympathetic with the State, that it had appointed a royal commission to inquire into its position, and that it would act conscientiously upon the findings of the commission.
Those findings are now before us. I. have no objection to the Government confining this bill to the first payment, but I should like a statement from the Ministry as to what it intends to do in the future. I was hot too pleased . with the Treasurer when, in moving the second reading, he pointed out that if Western Australia gathered revenue by Customs duties under a local tariff, it would penalize the people of the State by adding to the cost of their living. I do not think it would do that any more than does the revenue collected from the Customs duties now imposed on the whole of the Commonwealth. Later I shall refer to the juggling of figures as to the relations between the Commonwealth and Western Australia. The State has wonderful possibilities and potentialities.
– The trouble is that it has been badly governed.
– For years the honorable member for East Sydney has been jeering at the State. The findings of the . royal commission should satisfy him that the complaints that honorable members representing Western Australian constituencies have voiced here concerning the effect of federation on their State were justified. The royal commission has now said exactly what we said. The Tariff Board has said the same. Yet the honorable member still jeers. The figures presented by the Treasurer do not correctly represent the position of Western Australia. If you start a man in a race and hobble him, it is not fair to say, “He should have done better; he had only a couple of hobble-straps to carry”; the fact is that he is hobbled. It is a hobble-strap to have to buy what you want in the highest market and sell what you produce in the lowest market. Reporting in June, 1924, the Tariff Board, whose Chairman (Major Oakley) may be regarded as an out-and-out protectionist, said -
Whatever additional cost the policy of protection may add to the price of goods and material imported -by the Australian consumer, the citizens of the eastern States gain as a compensating advantage the presence of a large production and manufacture. Such is not the case with Western Australia, which is so placed that at present it has to bear whatever burden may arise under the protectionist tariff without reaping any of the accompanying advantages.
Elsewhere it said -
It lias been claimed by the critics, and it will be conceded by the Tariff Board, that the position into which the secondary industries of Western Australia have drifted is most unfortunate. The Tariff Board is further satisfied that the situation has been growing steadily worse since the Colonial Treasurer (the Honorable H. P. Colebatch) made his statement in 1018. . . . The Tariff Board is satisfied that it is wrong to blame the tariff for this position alone. Western Australia’s remoteness from the other States and the continually increasing cost of transport, coupled with the’ impracticability of manufacturing on a large scale from lack of capacity to compete on competitive terras in eastern State markets, is in a great part responsible for this backward state of secondary industries.
In addition to the opinion pf the Tariff Board, Ave have the views pf gentlemen of high standing in the commercial world of Western Australia. In past years it has been estimated that in actual cash the disadvantage suffered by Western Australia was £500,000. ‘ Sir William Lathlain, in his evidence before the commission, stated -
One must realize the great areas of auriferous country yet unexplored. To give you a faint idea of the big stretches of auriferous areas in this State, you can start at Ravensthorpe, go north-east right up to Marvel Lock, Southern Cross, Bullfinch, still on to Mount Magnet, Day Dawn, Cue, Nannine, Meekatharra, right on to Marble Bar - 2,500 miles - lin one stretch. Then there is the Norseman line of reef, the Kalgoorlie fields, Leonora, right up to Wiluna, where hundreds of thousands of pounds have been spent in endeavouring to find the most successful treatment for the enormously large bodies of refractory ores . which exist .there. At present, with the prevailing high costs, the working of many fields is unprofitable. In my opinion, sufficient gold still remains in Western Australia, not in promissory notes, but in sovereigns. The working costs, however, must be much .lower to secure its recovery. Whilst the various States have all concentrated their efforts in placing men on the land, the Federal Government, in my opinion, are doing their utmost to tax him off the land.
So far as Western Australia is concerned, that statement is absolutely correct. It is idle to endeavour to place men on the land, even under the group system, unless their products can compete in the world’s markets. We are living in a fool’s paradise if we think otherwise. In this connexion, I hope that the advice of Sir Frank Heath, when on his departure for England he ‘ said primary industries are of first importance to Australia, will be heeded. Sir William Lathlain went on to say -
When the primary producer gets up in the morning, the first thing he uses is soap, which bears a tax of 3S£ per cent. The next article he uses is a towel, on which the duty is 22 per cent.; and when he uses his hair brush, he is reminded that lie pays 33 per cent. When he puts on his clothes, it is 44. per cent. His hat is 38i per cent.
– I rise to a point of order, and ask what connexion there’ is between the remarks of the honorable member and the subject before the Chair.
– I understand that the honorable member is referring to the disabilities of Western Australia. I ask him to confine his remarks to the effects of the tariff on Western Australia, and not to discuss the fiscal issue.
– I am endeavouring to show that the grant which this bill proposes to make to Western Australia is not in the nature of a dole, but that it is her due. I cannot imagine that I could be more in order than in quoting evidence given before the Royal Commission on Western Australian Disabilities. Sir William Lathlain stated further -
After breakfast, when he starts work, if he uses his saw,, it is 15 per cent. When he puts the harness on his horse for a day’s work, it is another 38J per cent.; and then he starts work in the field. If he uses the stumpjumpplough, that is 24 per cent. If he use3 a reaper and binder, it is 33 per cent., or £0 10s. each. If he repairs his shed, and uses galvanized iron, he is paying a. duty of fi a ton. So after a hard day’s work he returns home to rest. He goes to bed, and when he gets under the blankets he finds that he has to bear the weight of another 274 per cent.; and it must be kept in mind that these are the rates of duty for goods from the British Isles.
– On a point of order, I ask whether the subject before the House deals with the tariff, or is a bill to grant assistance to Western Australia.
-I have already asked the honorable member to confine his remarks to the effect of the tariff on Western Australia. I now ask him not to read in detail the evidence submitted to the royal commission regarding the necessity or otherwise of a certain fiscal policy.
– If my remarks are not in order, I shall sit down; but this matter was in order before the royal commission, and I cannot imagine that it is out of order in this House.
– Is the honorable member quoting from the report of the commission regarding the effect of duties on agricultural implements, or regarding the effect of federation on Western Australia?
– I am quoting evidence which was given to show the burden which, the tariff imposes on a man in Western Australia from the time he rises in the morning until he goes to bed at night.
– I understand that the honorable member intends to show the effect of the tariff on Western Australia, as a ground for the grant of financial assistance to that State ? He may therefore proceed.
– The statement of Sir William Lathlain continues -
But if the goods come from America or any other part of the globe the duty is much higher still, and then the ordinary shipping charges, must be added. Eventually the ‘ man dies, probably of a broken heart; and yon would naturally think that the Federal Government would let him alone. But no! They still tax the furniture and nails in. his coffin at 27$ per cent., and eventually, after he has lain in his grave for some time, and those who are surviving him desire to erect a tombstone to his memory, lay a duty of 38i per cent, on him. They have taxed him ali the time he was alive, and they tax him or his heirs after he is dead. They have taxed him from his feeding-bottle to his tombstone, -and I am afraid that with the weight they have laid upon him he will be unable to rise in response to the Angel Gabriel’s last call.
In dealing with this matter, the value of Western Australia to the Commonwealth must be. taken into consideration. I agree with the honorable member for Swan (Mr. Gregory) that the people of Western Australia desire to remain in the federation, but I point out that no State can continue to be penalized by a tariff in the way that Western Australia is penalized without the question of secession arising. People cannot live entirely on sentiment. The commission’s report shows that in 1923 Western Australia purchased from the other States goods to the value of £6,465,557, whereas her importations from overseas were valued at only £811,756. Is Western Australia to be compelled to buy from the eastern Stales in order to enrich those States and penalize herself, and is she to be handicapped in her competition in the open markets of the world?
Western Australia is penalized by a Navigation Act which places that State farther from Melbourne and Sydney than from New York or London. These are the strangle-holds placed on Western’ Australia by federation. I marvel that she has been able to exist at all under such a strain. The purchases of the eastern States from Western Australia amount to only £161,583 per annum. The eastern States, therefore, are useless to Western Australia as a market for her products. The honorable member for Hindmarsh (Mr. Makin) said that the home market was the best market. I point out that Western Australia has no home market in the eastern States; the Australian market is no better for her than the London market. The effect of these disabilities on Western Australia must be evident to every thinking man. It may be claimed by the representatives of the eastern States in this House that the high prices prevailing in Australia are of benefit to its people ; that a protective policy is the right policy; that the Australian standard of living is not too high; but these contentions do not apply to . Western Australia. The commission says so. As pointed out by the honorable member for Swan, the State of Western Australia comprises practically one-third of the continent, whose area is 700 square miles greater than that of the United States of America. Prior to federation, there was no heavy burden of taxation in Western Australia, and the State was making steady progress. But as the tariff duties increased, her difficulties increased. When the Prime Minister urges that loyalty and sentiment should make talk of secession impossible, I reply that all Australian citizens, of whatever State, should be treated alike in matters of taxation. That is only fair. A £1 note should be as valuable in Western Australia as in any of the other States. But it is not. The evidence placed before the royal commission shows’ clearly that it is not. When I gave evidence before the commission I invited it to call Mr. Black, the Deputy Commissioner for Taxation in Western Australia, to appear before it. On page 83 of the commission’s report we read -
It will be observed that Mr. Black is correct when he states that, on incomes in excess of £6,500. the rate of tax in Western Australia is higher than that in any other State of the Commonwealth. The difference between the tax paid on an income of £ 0,500 from personal exertion in Western Australia and the same amount of income in Victoria is remarkable - £1,352 lis. 3d. in Western Australia, and £221 7s. Id. in Victoria.
Yet we have Victorians laughing at Western Australian representatives, and suggesting that they should remain silent and say nothing about secession because of the federal sentiment. I am afraid that in this mundane world sentiment does not count, and governments charged with the carrying on of the affairs of the country recognize the importance of £ s. d. They are reluctant to impose upon their people heavier taxation than is absolutely necessary. I have shown the disabilities under which the people of Western Australia labour .as residents of a State that is part of the federation. They have to carry burdens that are not imposed upon the people of the other States. The Government should at least make the payment to Western Australia provided for in this bill, and, as suggested by the leaders of Labour during the election campaign, should continue the assistance, although I consider that if fiscal freedom were given to Western Australia., it would be very much better.
– Western Australia would then have to adopt a system which the honorable member condemns.
– I do not say that Western Australia, if given fiscal freedom, would adopt freetrade. I am, and always have been, a revenue tariffist. Western Australia had her own tariff before federation. Western Australians, if given fiscal freedom, would determine what was good for them, and would not have to bear the crushing burdens which, according to the royal commission, have been imposed upon them as the result of federation. With a revenue tariff on such things as tobacco- and spirits, leaving implements used in production free, Western Australia could adopt means to develop its wealth. There are many ways of carrying on the government of a country without actually bleeding its people. The Treasurer has properly suggested that the treatment meted out to Australian citizens by the heavy taxation imposed upon them is like an infusion of blood into the body of an anaemic person from the left hand into the right hand - with something lost in the process. Mr. Black went further than to point out the difference between the taxation of money in Western Australia and in Victoria, and showed that it brought about naturally another very serious effect, and that is that people in Western Australia, with money to invest do not invest’ it in that State because the resultant profit would be so heavily taxed. One of the leading assessors of the Taxation Department said, to me on one occasion, “ Mr. Prowse, I am surprised that you should have your money invested in Western Australia.” When I asked why. he said, “Because “of the sound investments possible ‘in the other States where the taxation, is not nearly so heavy as it is in Western Australia.” I put that before the royal .commission. At page 83 of the commission’s report, it will b« found that Mr. Keenan said -
One thing is certain. It is not possible for this State to raise further revenue from her own citizens by taxation. Already the danger point has been reached hi the burden of taxation placed upon the shoulders of the citizens of Western Australia. Capital is being frightened out of the State by this burden. To those who are conversant with the stringency of finance in this State, it seems ludicrous to talk of the capacity of Western Australia to bear an increased burden of taxation. It is a matter of notoriety that those who have capital to invest - in many cases capital resulting from savings made during a life time in Western Australia - unfortunately prefer to invest that money in Victoria, despite all local sentiment, for the simple reason that they will obtain there a larger return with a less burden of taxation.
This again causes another condition which I wish to bring under the notice of honorable members to show that they are not being asked to give a sop to Western Australia, but only partial compensation. The proof that this condition is brought about is in the evidence given by the Western Australian Deputy Commissioner of Taxation. The head offices of many big manufacturing warehouses are situated in Melbourne, Adelaide, or Sydney. They have agents or branch houses in Perth. They have been known to sell to their agents or branches in Perth at prices which make a profit in the east, but no profit in Western Australia. If honorable members expect
Western Australians to remain loyal federalists, this Parliament will have to put them on the same basis as the people of the other States. The royal commission asked Mr. Gillies, who was then Premier of Queensland, if he had anything to say. His answer was “No, except that there are no disabilities suffered by Western Australia that are not suffered by Queensland.” I would not like to permit him to get away with a statement like that. Faithful to the federal sentiment, the honorable member for Kalgoorlie (Mr. A. Green) declared to-day that the sugar industry must be developed at any cost. Under that policy, Queensland benefits tremendously, and Western Australia suffers a great deal. In almost all the instances in which, as the result of the adoption of these policies, advantages, are given to the other States, Western Australia has to pay for them. If, like Queensland, we had in Western Australia a big industry that was being supported by the whole of the Commonwealth, we might have some cause for gratification.
– Let Western Australia develop such an industry, and we will support it.
– I do not say that the honorable member would not support it, but I am speaking of conditions as they exist, and dealing with the statement made by Mr. Gillies. A constituent of mine wrote to me some time back from Bunbury. An important commodity of that district is jarrah timber. The people in Mauritius wanted two ship loads of jarrah or hardwood sleepers and called for tenders for their supply. The Bunbury people tendered and received a reply, “ As the ships would have to go out in ballast we are so’rry we cannot accept your bender, but if you will take two ship loads of sugar at 2£d. per lb.”- we were paying 6d. a lb. for the sake of Queensland - “ we will take your timber.” We might have had a deal in sugar in Western Australia at 2$d. a lb. whilst making a deal with our local commodity, of jarrah timber. For Queensland’s sake and to keep Up the federal spirit, our people had to forgo a deal in sugar and lose a contract for the supply of sleepers. One might quote instances ad infinitum to illustrate the position of Western Australia. If honorable members would read .the report of the Western Australian Disabilities Royal Commission it would be unnecessary for the honorable member for Swan (Mr. Gregory), myself, or any other Western Australian representative, to speak on this matter at length ; but if I were a betting man I should lay a good deal of odds that not 2 per cent, of the members of this House have read the report faithfully.
– I have read it.
– I am very glad to hear the honorable member say so. If honorable members generally had read it much that I have said would be unnecessary. The principal industries of Western. Australia are wool, wheat, and fruit, and those industries are being rapidly developed. They are, however, greatly handicapped. Western Australia is trying to settle British migrants, but unless it can be done at a lower cost than is an- ticipated I am afraid the results will not be satisfactory. The wheat industry has progressed in Western Australia, not because of any legislative action by the Federal Parliament, but because of world conditions, and the increased price of wheat, largely due to the war and its aftermath’. If the price of wheat goes down in the world’s market and costs of production in Australia are maintained - and they now amount to at least 4s,. a bushel - we shall not be able” to produce wheat for sale overseas. It must be- admitted that this question is of fundamental importance to the whole of Australia. Sir Frank Heath, on leaving this country, said that he did not make his report to Australia ; but it should be interesting reading for Australians when he has made it to the Imperial authorities. He did, however, say to the people of Australia, “ Your main industry, your king-pin industry, is primary production. Without its development your secondary industries cannot be started. In England we get our money from manufactures; you get none of yours from that source. Your interest and sinking funds are paid with your primary products. Develop them.” That is the pronouncement of a man who was sent out here to inquire scientifically into our conditions. The production of gold in Western Australia is handicapped by conditions due to federation. Evidence can be produced to show that low-grade mines that were working before the rise in our standards are no longer being worked. I read to-day with very great pleasure that what promises to be a great mine has been discovered near Southern Cross. Let us hope that it will be found rich enough to be worked. The sample goes 30 dwt. to the ton. which is now about the margin for payable working. It used to be very much lower. I compliment the Government on the introduction of this bill. Previous governments have taken no notice of the position of Western Australia as a unit of the Federation. I give the Government due credit for the investigation by the royal commission. It has relieved Western Australian representatives of great responsibility, and should put an end to the jeering at the western State. The commission has declared, as a result of its investigation, that Western Australia does suffer from disabilities, and the question is: What is this Parliament going to do about it? I do not regard this measure as providing for more than a part of the compensation due to Western Australia. The Government, in pursuance of its promise to the people of that State, should hurry up with its definite and comprehensive policy to remedy the disabilities under which they labour because of Western Australia’s partnership in the Federation.
.- I do not like this bill or the principle upon which it is founded. The State of Western Australia has to its credit a magnificent performance in the development of its natural resources. One of the youngest partners in the Commonwealth, it has faced and solved its problems with the true spirit of the best pioneers. But I am bound to say that I could not discern in the speeches delivered by the honorable members for Swan and Forrest anything of the optimism and breadth of vision of the late Lord Forrest. He was a great Australian statesman, and an ardent supporter of fiscal protection in the interests of the whole nation. There was nothing little in his political composition. He took a comprehensive view of the nation and its needs, and no man in the history of Australia has done more for the development of any State and said so little about his deeds. I do not wish the House or the country bo think that I am opposed to granting as sistance to Western Australia ; I am quite prepared to vote for a scheme which will aid that great State to solve its problems, but I do not think that the royal commission has laid down a sound basis upon which such help should be founded. It has merely suggested the payment of an arbitrary amount. However, in order to honour the promise made on the hustings by my leader, I shall vote for the bill. I regard this Parliament as the constitutional trustee or bailee for all the States of any surplus of revenue that is available for distribution among the States after Federal requirements have been met, and this Parliament has no moral right to distribute that surplus in great sums to individual States without prior consultation of all the partners in the Commonwealth. That is the only proper and just procedure. No party should give an undertaking to pay a lump sum of £450,000 to one State because of certain disabilities under which it is said to labour. Many of Western Australia’s disabilities are natural. On the other hand, the honorable member for Swan and the honorable member for Forrest have declared that they are the result of federation and the unsound economic conditions prevailing to-day. This Parliament is now asked to subsidize those unsound conditions instead of remedying them.
– Quite true.
– Parliament is asked not to remove the fundamental causes of Western Australia’s troubles, but to offer a palliative in the form of a subsidy. No State in the Union has experimented so much with socialism as has Western Australia. It incurred its first deficit under a socialistic regime.
– Its people have seen the error of their ways.
– Yes, but their financial troubles originated from an incursion into the realms of State socialism. For instance, there were State mills-
– They pay handsomely.
– State meat works.
– They pay well.
– That is not so. There are ‘State implement works.
– They pay well.
– And State fish shops. Western Australia’s financial difficulties commenced with these socialistic experiments. I read recently with great pleasure a long and excellent statement by the Western Australian Minister for Works (Mr. McCallum). According to him, everything in the western garden is lovely, industries are sound and progressive, and the people are prosperous and contented. Apparently, only in this chamber is a dismal note heard.
– Does the honorable member ignore the reports of the Tariff Board and the royal commission?
– I have read both. They are founded upon brief visits to Western Australia, but Mr. McCallum lives there.
– Has the honorable member been to Western Australia?
– No, but that does not disqualify me from criticizing this proposal. I am not pretending that my remarks are based upon personal knowledge of the State, but I have quoted a State Minister for Works, an optimist who has given a glowing description of the West.
– He is one of the Socialists whom the honorable member condemns.
– The honorable member for Swan (Mr. Gregory) told the House of the rapid and sound development of - agriculture in his State. Unquestionably Western Australia has one great advantage over all other States, in that it has vast areas of cheap agricultural land, and is making good progress in the settlement and cultivation of it. No doubt, as in all young countries, particularly those engaged in wheat-growing, cultural methods are still fairly crude. If a few Wimmera farmers could be induced to go to Western Australia and introduce their methods, the State would not be suffering from such a low yield per acre.
– There are many farmers in Western Australia who are quite as capable.
– I do not think their methods are as good.
– Many of them went to the West from neighbouring States.
– That is so. My criticism applies also to the northern States.
– The South Australian cockies could teach the Wimmera farmers a lesson.
-Possibly they could, although the Wimmera and Mallee country to which I refer has some of the best wheat-growers in the world, some of whom came originally from South Australia. The only satisfactory feature of the bill is that the subsidy is for one year only. That means that Parliament will have an opportunity for further consideration of the basis upon which the Commonwealth shall render assistance to Western Australia, and, if necessary, to Tasmania also. I realize that it is unpopular to denounce bounties and doles. They are very much in favour, but, unfortunately, Victoria does not participate in them.
– What about the dried fruit advances?
– By some incomprehensible logic the two chief opponents in this House of the prevailing fiscal system, advocate that Western Australia should impose its own Customs tariff. If that were allowed, the State Parliament would have to impose upon its own people a form of taxation which, when imposed by the Commonwealth, is resented.
– Who said Western Australia would do that? The State Parliament could arrange the incidence of taxation to suit the needs of the State’s industries.
– The Western Australian people ask to be allowed to impose an independent Customs duty, in order to raise more revenue than the State receives to-day. That would involve the imposition by the Western Australian Parliament of heavy protective duties.
– The honorable member’s fear is that Victoria would lose a profitable market.
– I have no such fear. The other States are proud to have Western Australia as a member of the great Australian family. It must be admitted that the State has derived some benefit from federation - the transcontinental railway, for instance.
– Its construction was one of the conditions upon which the State entered federation.
– Yes, and that condition has been honoured. The benefits of the federal contract have not been altogether one-sided. Western Australia is a great State;, it has attracted some of the best people from other parts of Australia, and certainly has a very fine record of development. But a dismal note regarding it is sounded in this chamber, and we are asked to believe that the bottom is falling out of the State because of its membership of the federation. That is Wrong. Western Australia was admitted t.o the union upon terms laid down by its own people, and those terms have been faithfully honoured. In regard to Australian primary production generally, certain unsound economic conditions are retarding the progress of the country, but they cannot be cured by subsidies. We must go further. On one occasion only have I been a party to the granting of a subsidy. At that time the meat industry of Australia was in a very bad way. Australian meat had been off the London market for eight years, and all Australian meat works, excepting those in the metropolitan areas, were closed. In Queensland, eleven out of thirteen were closed. The Queensland meat producers asked for assistance and the matter was referred to me as the responsible Minister. I said that. I could not recommend to the Government- the granting of a subsidy, because if . I did so, it would mean sudsidizing the impossible conditions that surrounded an industry at a time when the bottom had fallen out of the meat market and had previously a wonderful war contract. The Government suggested that if the shippers would reduce their freights, and the meat works their treatment charges, and if the. workers would accept a slightly lower wage, then the Commonwealth would subscribe £d. a lb. and thus build up the industry on a co-operative basis. After a good deal of negotiation the scheme was agreed to. It was the basis of the bounty to the meat industry.
– Who suggested the price-fixing ?
– I did not; I certainly do not know ‘ to whom the honorable member is referring. Today we are suffering from economic conditions, brought about by the high values that . existed during the war and afterwards. Many industries have failed, and still the cost of production remains high. The problem arises: How are we to meet the position? This Parliament, even since I have been here, has passed half a dozen bills granting bounties and gratuities, but that is not the way to meet the true economic position of this country. We must go beyond that. While Australia is borrowing money heavily, and making money available, prices will not decrease; but when money becomes scarce the barriers Lo industry must immediately fall. Today it is easy to get money “and, consequently, prices are high. I am not opposed to assisting Western Australia, but we are doing it on a wrong basis. After federal activities have been paid from the Commonwealth revenue, we are morally the trustees of the States for any surplus revenue, and our partners in federation should be bargaining with us, and be in accord with whatever advance is made to a State out of the surplus revenue of the country.
.- It is hardly fair to expect us to pass the bill this afternoon, especially as many honorable members expect a reply from the Treasurer on certain points.
– There is no opposition to the bill.
– There may be no opposition to it, but there are matters that need explaining. I have no desire to prevent the bill from passing by 4 o’clock, if possible. After listening to the remarks of the last speaker, and to some of the interjections of honorable members, I am reminded of the well-known lines.
The toad beneath the harrow knows Exactly where each toothprick goes. The butterfly upon the road Preaches contentment to the toad.
The honorable member for Wannon (Mr. Rodgers) said that there were no complaints or whining about. Western Australia except in this House. Let the honorable member pay a visit to that State and he will find that honorable members in this House are only repeating the opinions that he will hear from its citizens. I agree with him that this grant is subsidizing an unsound position. That has been the burden of remarks of honorable members representing Western Australia ever since they have been in this Parliament. We have always tried to show that the proper method of dealing with Western Australia is to make her position sound; but if the Government refuses to do that and still continues along the road that it has always taken it will come to an intricate and uneconomical position from which it will be difficult to extricate itself. It is a road that maylead to disaster, and if it does, then we who represent Western Australia must be acquitted from any ulterior or wrong motive, because we have frequently pointed out that the subsidy system is unsound.. We have been obliged from force of circumstances to take advantage of the Government’s offer, even although it may be objectionable to us. If we” continue to grant subsidies and to increase duties on imported articles, the day must come when the whole false economic structure will topple about our ears. It has been generally recognized that Western Australia is suffering” some ‘disability, and I believe that the House has no objection to the bill. I myself do not object to it, except that the acceptance of the grant is very much against the grain. In the circumstances weare forced to accept it. I have somewhat of a quarrel with the Treasurer regarding his method of presenting the measure. One could not help believing that he was not enamoured of it, and perhaps was unwilling to father a piece of the Cabinet’s policy.
– That is incorrect.
-I shall give the Treasurer an easy method of proving that I have been unjust to him. The commission’s report recommended a grant of £450,000, to begin from July, 1924. In the first place, the Government said that it intended to adopt the commission’s recommendation. At the recent election it was definitely stated in Perth by the Leader of the Government that the grant was to extend in its effect beyond this year. Under the bill the grant is for twelve months only. I tried by interjection when the Treasurer was speaking to get him to make some statement in accordance with the declaration of policy by the head of the Government, but he declined to do so.
– The policy statements of the Prime Minister and myself were very clear and definite, and are being given effect in the bill.
– An official statement was made By Senator Pearce, as the representative of the Government, at the opening of the campaign in Perth. He said in effect that the Government could not undertake in indefinite terms to grant £450,000 for more than one year, out it did pledge itself that at the subsequent conference between the States and the Commonwealth it would undertake to accept this grant as a definite basis for additional payments to Western Australia. There has been no mention of that in the debate on this measure.
– That does not necessarily mean that the Government will not carry out its pledge.
– The honorable member is far too experienced not to know that unless mention is now made of the. matter it will very likely go into the limbo of forgetfulness. The result of the elections in Western Australia might have been very different if it had not been for Senator Pearce’s statement. It was made part of the definite Ministerial programme.
– Was it a bribe?
– What any other State gets is a “ bribe,” but what the honorable member’s State or his constituency gets is just and fair. Such terms as “bribe” are unnecessary and uncalled for. I wish it to be clearly understood that Western Australian members accept this grant as the fulfilment of only a portion of the promise made by the Federal Government to the State of Western Australia, and they expect that when the time comes, in the interstate conference, the Government will fulfil the other part of the promise, and advocate the extra allowance. If the Government does not do that, it will not be fulfilling the promise it made, and if that promise is not fulfilled I confess that I, for one, will hold that the people of Western Australia have been misled. I wish to refer to one other point in the speech of the Treasurer. He said, in effect, that he could not understand on what basis the recommendation of the commission for a grant of £450,000 was made. It is very curious that in the dispute which has occurred as to the relative loss or gain as between the State and the Commonwealth, two sets of figures have been produced, one by the Treasurer, to the effect that Western Aus- . tralia has gained by over £700,000, and the other by the State Treasurer, to the effect that the loss has amounted to £448,000. I quite agree with the statement made by the honorable member for Wimmera (Mr. Stewart), that the commission ought to be called “the disagreement commission,” because its members did not agree on very many points. Let me say in passing that the members of the commission were appointed from outside Western Australia, in the hope that no question would be raised as to their disinterestedness. It is an extraordinary fact that, although those figures were submitted, the members of the commission, one of whom was an ex-Treasurer of the Commonwealth, in a. rather naive way said they were sorry they could not come to a conclusion as to which was right; and it is a strange coincidence that the figure adopted by the commission as the amount of compensation due to the State was approximately the amount stated by the State officer.
– The commission said that the amount was £289,000, not £448,000.
– I should have expected the Treasurer to read the evidence as well as the report. I say that the officer showed conclusively that the amount was £448,000.
– He did not show it; he simply stated it. I have read the evidence as closely as the honorable member has read it.
– At least it is remarkable that the State officer put forward that figure, and that the same figure was adopted by the Commission as the amount of compensation due. The total grant provided in the bill is £450,000.
– Less £96,000.
– The State officer said that £448,000 was the amount of the loss, and in any case that is the nearest figure obtainable. His was the only complete and consecutive statement that came anywhere near the amount provided in the bill. The more we examine the figures as they have been examined here to-day, the more we see that the greater reliance must be placed upon the State officer’s estimate.
– That estimate is easily disproved.
– Then the commission should have disproved it.
– I will disprove it in this House.
– That is not a fair way to do it. The commission has been sitting, and all the evidence should have been placed before it.For the Treasurer to make a statement which he knows honorable members will not have a sufficient opportunity to combat is not fair. I wish to make it. quite clear that there is a reasonable and reasoned basis for the amount of compensation proposed to be granted, and to lay particular stress upon the fact that this is only part of the fulfilment of the undertaking given by the Government to the State of Western Australia. While the Treasurer could not in his opening speech commit himself to the remainder of the undertaking, I urge upon him and the Government that it is equally important that the remainder of the undertaking should be carried out. We do not impugn the good faith of the Government in this matter. I agree entirely with the honorable member for Wannon (Mr. Rodgers) that . we should re-organize the basis of interstate and Commonwealth finance. That can only be done at a conference of representatives of the Commonwealth and the States. The present tendency of all our legislation is distinctly towards unification, and so long as the majority of the State Governments are Labour Governments, whose policy is in favour of unification, this Government, which professes not to support that policy, needs to be specially careful lest it unwittingly, and in pursuance of a desire for the centralization of power, places itself in the hands of those who in the States are not working in the best interests of the States. It may be that the Commonwealth Government at the present time would receive much encouragement if it propounded unification at such a conference. Through. the medium of finance the Commonwealth Government is tightening its hold upon the State Governments. Does that mean that the Government is deliberately, though not explicitly, working towards unification? If that is so, the Minister should say so.
– I thought the Government was going the other way
– Not at all. The honorable member knows that the trend of bills brought before us lately has been in the direction of unification. It would be a great pity if the Commonwealth Government should go into a conference concerning the financial relations of the Commonwealth and the States - a conference in which this particular question, though small in itself, is an index to what may come out of the conference - with an intention to centralize power in the Commonwealth, well knowing that by so doing it would be meeting the wishes of governments that represent a party whose overt aim is the unification of Australia. It seems that a very difficult and dangerous position may arise.
– The Slate Governments would demand it now.
– If so, let them express that wish. Let the question be decided by the people. We are rapidly reaching a point at which most important decisions are arrived at by means of conferences that are not part of our constitutional machinery. And then we are told that the voice of the people has. been expressed, although they have never been consulted. I agree with the honorable member for Wannon (Mr. Rodgers) that grants of this sort will lead the Commonwealth into a dangerous position. I regret that the subsidizing of States in this manner has become necessary. We are collecting money with one hand, by means of taxation, and paying it back with the other. As one honorable member truly said, it would be more effective to lower the cost of production and remove the burden now resting on the people. I do not desire to delay the passage of the measure. I hope that the Treasurer will note particularly the two points I have raised, and will endeavour to see that the undertaking given to
Western Australia, as distinctly understood by the people of that State, is carried out in its entirety.
.- I intended to ask for the adjournment of the debate, but I have been given to understand that if the bill is not passed this afternoon, it may be some weeks before its consideration is resumed. A great deal has been said already about the disabilities under which Western Australia labours, and possibly I could not add anything new now.I do not know of any disability that has not been referred to during this debate, and therefore, I propose to allow the remarks 1 would have made on the motion for the second reading to stand over until another occasion. I shall content myself now with merely endorsing the opinions of those who have spoken, or some of them ; because I cannot agree with all that they have said. I hope, however, that the Government will do what the honorable members for Perth (Mr. Mann) and Swan (Mr. Gregory) have asked - that is, make the grant available for 25 years instead of for one year. Western Australia needs the money urgently, and this Parliament, if it wishes to help that State, should give her assistance as quickly as possible.
.- Mr. Speaker!
– I think that it would be fair to adjourn the debate.
– I suggest to the Treasurer that the debate should be adjourned. If he is prepared to accept a motion to that effect, I shall move for the adjournment.
– Does the honorable member for Balaclava desire to speak on this measure ?
Debate (on motion by Mr. Watt) adjourned.
Bill returned from the Senate without amendment.
Bill returned from the Senate without amendment.
– I think that I should have the right to continue on Wednesday next my remarks on the Western Australia Grant Bill.
– The measure is not now before the House. The honorable member will have the right to discuss its provisions during the committee stage.
– I should like to make a personal explanation about the matter. I intended to ask for the adjournment of the debate on the motion for the second reading of the bill; but the Treasurer sent me a note to the effect that if the bill did not go through this afternoon it would be several weeks before the debate sould be resumed. Therefore I purposely curtailed my remarks; but now that the adjournment of the debate has been agreed to, I think that I should be permitted to make a speech when the debate is resumed.
– The honorable member will have an opportunity to mention the matter on the resumption of the debate.
The following paper was presented: -
Taxation - Ninth Report of the Commissioner, years 1923-24 and 1924-25
– In moving -
That the House do now adjourn.
I desire to inform the honorable member for Fremantle (Mr. Watson) that I understood it. to be the general desire of the House to dispose of the Western Australia Grant Bill this afternoon ; but as honorable members have now expressed a wish to speak on it, it is only fair that they should be given an opportunity to do so. The honorable member will be able to speak again at the committee stage, or, by leave of the House, he can address himself to the measure on the resumption of the second-reading debate.
Question resolved in the affirmative.
House adjourned at 4.2 p.m.
Cite as: Australia, House of Representatives, Debates, 5 February 1926, viewed 22 October 2017, <http://historichansard.net/hofreps/1926/19260205_reps_10_112/>.