10th Parliament · 1st Session
Mr. Speaker (Hon. Sir Littleton Groom) took the chair at 2.30 p.m., and read prayers.
Agreement with States.
– Yesterday the
Minister for Works and Railways made a statement to the effect that five of the
States have Accepted the agreement with the Commonwealth in connexion with the proposed, grant for main roads. Will the honorable gentleman say whether the representatives of the States have affixed their signatures to the agreement 1
– Five of the States have officially notified their intention to accept the agreement.
– But they have not yet signed I
– The representative of one of the States has signed the agreement. It has been sent to the other four States for signature. It may have been signed in each of those States by this time, but it has not yet been returned to me.
Progress of Work
– Is the Minister for Defence in a position to inform the House how far the construction of the cruisers, seaplane carrier, and other naval construction provided for, nas progressed ?
– I believe there will be Borne little delay in the de livery of the cruisers. The other portions of the fleet under order are up to contract time. .It will be remembered that I’ promised the House that on the Estimates I would make a full statement of the position in connexion with defence.
Accommodation fob High, Court.
– I ask the AttorneyGeneral what steps, if any, he has taken to make provision for meetings of the High Court at Canberra upon the transfer of the Seat of Government f
– The answer is “ None.” The House recently passed amending legislation which provided that the -principal seat of the High Court should be as determined by the GovernorGeneral. In view of the building programme at Canberra, it was considered impossible to raise in any practical form the problem of obtaining necessary accommodation for the High Court at Canberra at the present time. The matter will have to be considered when the present pressure of building operations has been to some extent relaxed.
– Under a sessional order private members’ business ie to take precedence to-morrow, and I should like to know if it is the intention of the Prime Minister, before it is called on, to spring some motion suddenly upon the House to set it aside?
– I have not signified any intention to interfere with private members’ business to-morrow. I have no such intention.
– I ask the Minister for Defence is it a fact that the service provided for the training of naval cadets at Jervis Bay is barely half availed of. If so, is this due .to a lack of applications for the training or to the examination prescribed over-taxing tha abilities of applicants f
– We have a sufficient number of cadets applying for admission to Jervis Bay Naval College. At present the number required for the services is being trained there.
Ineffective Insurance - New Zeal and Importations
asked the Minister for Markets and Migration, upon notice -
– The answers to the honorable member’s questions are as follow: -
asked the Minister for Markets and Migration, upon notice -
– I have asked the Australian Stabilization Committee to furnish me with the information desired by the honorable member.
Price of Spirit - Petrol Produced and Consumed in Australia.
asked the Minister for Trade and Customs, upon notice -
– The answers to the honorable member’s questions are as follow: -
asked the Minister for Trade and Customs, upon notice -
– The answers to the honorable member’s questions are as follow : -
Dr. SMALPAGE SERUM. TREATMENT.
asked the Minister for Health, upon notice -
– The answers to the honorable member’s questions are as follow”: -
asked the Minister forWorks and Railways, upon notice -
– The answers to the honorable member’s questions are as follow : -
Lord Howe Island and New Hebrides
asked the Minister representing the Minister for Home and Territories, upon notice -
– The answers to the honorable member’s questions are as follow: - 1 and 3. A memorandum setting out certain objections by the residents of Lord Howe Island to the present steamer service between Sydney and that place was presented by the honorable member for East Sydney to the Minister for Home and Territories, and, as the honorable member is aware, inquiries are being made regarding the matters referred to therein.
Rail Conveyance of Staff Officers and Men
– On the 8th July, the honorable member for East Sydney (Mr. West) asked the following question: -
Will the Minister for- Defence furnish the cost of conveyance by the railways of staff officers and men from Melbourne to Sydney and Sydney to Melbourne for the year 1924-25 and to June, 1926?
I understand that the question of the honorable member has reference to naval personnel. The respective totals are: - 1924- 25, £10,304; 1925-26, £11,052. I might explain that the increase for 1925- 26 is due to the larger number of direct entries at Flinders Naval Depot, and, consequently, bigger batches sent from that depot to the fleet] also to the increased number of ratings required to undergo courses of training (gunnery, torpedo, &c.), at Flinders to meet additional requirements of trained men for the new cruisers.
– I lay on the table the final report of the Federal Capital Advisory Committee, and move -
That the paper be printed.
When the Government decided in 1920 to resume construction of the Federal Capital, it found that, with the exception of the plan of the city and certain specially designed engineering works, there was no general scheme covering the various aspects of the transfer of Parliament and the administrative departments to the Seat of Government. Work had been practically suspended for about five years owing to the war, and it was necessary to review the whole situation in the light of economic and other changes that had occurred in the meantime. The Government of the day decided to appoint an advisory committee for this purpose, consisting of the following gentlemen. - Chairman, Sir John Sulman, Knight, F.R.I.B.A., M.T.P.I., &c, consulting architect and town-planner; E. M. de Burgh, Esq., M.Inst.C.E., Chief Engineer for Water Supply and Sewerage, New South Wales; H. E. Ross, Esq., F.R.A., architect; Colonel P. T. Owen, O.B.E., Commonwealth Director-General of Works; J. T.. H. Goodwin, Esq., Commonwealth Surveyor-General. This committee was instructed to consider the whole position then existing, and draw up a scheme for the transfer of the Seat of Government to Canberra as early as possible, consistent with due economy in the provision of the necessary buildings and services. It did so, and submitted a comprehensive scheme for dealing with the various problems involved in the undertaking. This scheme was adopted, and although, because of shortage of funds and other difficulties, it was not carried out in the time proposed, it has formed the basis of subsequent developments. For a period of four years the Government was guided by the advice of this committee, not only in regard to matters connected with construction, but also in relation to land policy and other aspects of administration. The committee also acted in touch with the professional officers of the departments in the design and construction of the various works and buildings. As honorable members are aware, the control and finances of the Federal Capital Territory have now been placed on a more definite basis by the appointment of a commission, but the Government regards it as necessary to record its appreciation of the fine work done by the advisory committee in laying down a sound basis for the constructional programme, and rendering it possible to proceed actively with a well-grounded scheme. It desires specially to acknowledge the services rendered by the committee, and thinks that it will be of advantage to those on whom responsibility for guiding the destinies of the Federal Capital now rests, to have available an account of the committee’s activities and views as given in the report now laid on the table.
Question resolved in the affirmative.
Message recommending appropriation reported.
In committee (Consideration of Governor-General’s message) :
Motion (by Mr. Pratten) agreed to -
That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to amend the Shale Oil Bounty Act 1917-1923.
Motion (by Mr. Pratten) proposed -
That so much of the Standing and Sessional Orders be suspended as would prevent the bill being passed through all its stages without delay.
– I object to the suspension of the Standing Orders to enable the bill to be carried through all its stages; but I am willing for the measure to be taken to the secondreading stage to-day. It is wrong to rush matters of this description through the House without giving honorable members an opportunity to consider them. There is no necessity to rush this bill.
– I shall be satisfied to take the bill to the second-reading stage.
Question resolved in the affirmative.
That Mr. Pratten and Dr. Earle Page do prepare and bring in a bill to carry out the foregoing resolution.
Bill presented by Mr. Pratten, and read a first time.
– I move -
That the bill be now read a second time.
The object of this bill is to enable the provisions of the Shale Oil Bounty Act now in operation to be continued for another three years. If it is not passed, the bounty will cease to be payable after the end of next month: The principle of assisting the shale oil industry was first accepted by this Parliament in 1917, when it passed a bill that provided for the payment of 2¼d. a gallon on each 1,000,000 gallons of crude oil produced from shale in Australia up to 3,500,000 gallons per annum, and lower rates, varying from 2d. to1½d. on larger quantities than that. The act was amended in 1921 to enable the pay merit of the bounty to be continued until 30th August, 1922. In 1922, the Tariff Board made a thorough investigation into the industry, and upon its report the act of 1922 was amended, and the bounty continued for twelve months. At the same time, an increase to 3½d. per gallon was agreed to in the maximum rate of bounty payable. In 1923, the period in which the bounty was payable was ex tended to the 30th August next. The amount originally appropriated for the bounty was £270,000, of which £125,491 has been expended as follows: -
The amount of the original appropriation still available is something over £144,000.
– Has not the whole of the money been paid to one company?
– I believe so. I feel confident that this House desires to develop the oil resources of Australia. A potential development, and a potential continuance of operations, are practically assured if this bill is agreed to. Some activity is being displayed in the northwest of Tasmania, and I understand that an additional £100,000 has been spent in New South Wales for the purpose of resuscitating the shale-oil industry in that State. The Public Accounts Committee, in its valuable report upon the subject some time ago, stressed the importance of encouraging the production of oil in Australia if only for defence purposes. The by-products of shale oil are kerosene, lubricating oil, petrol,, wax. and fuel oil. Since- an adequate supply of oil is of supreme importance for the navy, army, air, and munitions, there can. be no doubt about’ the urgent need for stimulating, its production in Australia. The British Government is alive to the importance of maintaining this source of supply, and has taken the necesary steps to ensure the continued operation of the Scottish shaleoil deposits. The purpose of the bill is to continue the bounty hitherto paid. A sufficient sum of money has been appropriated already to continue the bounty for another three years. I submit the bill with every confidence.
.- Personally I have no objection to the continuance of the shale oil bounty, bub I think the Government should have been a little more active in encouraging the shale-oil industry in Australia. The Minister was kind enough just now to refer to the good work which the Public Accounts Committee had done in connexion with its inquiry into our shale-oil deposits. I think the Minister will remember that the committee made a number of valuable suggestions with regard to the deposit of oil shale at Newnes. in New South Wales.Whilst the Minister was speaking, I heard that the leases, which have been held by John Fell and Company, have been forfeited. I do not know whether the statement is true.
– I have had no intimation to that effect.
– If it is true, it means that anything that may be done at Newnes will have to be commenced de novo. The Public Accounts Committee made its investigation into our shale-oil resources about eighteen months ago, and realizing the value of the industry to Australia in time of great emergency, strongly recommended the Government to take immediate steps to protect the works at Newnes. I do not suggest that anything like an adequate supply of petrol can be obtained from our known shaleoil deposits, but in a time of war the industry would be of vital importance to Australia. Up to the present its development has been due almost entirely to the payment of the bounty. A railway was constructed by the original English company from Newnes Junction to Newnes, a distance of about 41 miles, at a cost of £250,000. The trip over that short section of line is one of the most picturesque railway journeys in Australia. It is a wonderful piece of engineering work, but unfortunately it appears to have been carried out on the wrong side of the mountain. Money was spent lavishly on the work. Statements have been made that the manager received a commission on the expenditure. Possiblythis was one reason why the works there have cost so much.. When we visited Newnes, some time ago we found an inclined shaft unlike anything I have ever seen in Victoria. ‘ The heavy timbers were so badly broken that I entered the shaft with a good deal of trepidation. The committee recommended that steps be taken immediately to ensure the revival of operations, but unfortunately the Government of the day failed to do anything. If the mine has been neglected since we saw it, I should say that it would cost more to re-open it for the production of shale oil than to put down new shafts. Evidence given before the committee showed that from 1909 to 1923 the mine had produced 13,915,000 gallons of gas oil, 3,136,000 gallons of kerosene, 2,316,000 gallons of lubricating oil, 1,689,000 gallons of motor spirit, 743,000 gallons of power kerosene, or a total, of 21,000,000 gallons of refined oils. The by-products were 230 tons of paraffin wax, 307 tons of oil coke, 528 tons of oil pitch, 718 tons of sulphate of ammonia. I presume that the Minister has in mind the granting of some portion of the bounty to the works at Newnes, but I think he should have obtained information as to its operations. I know the State Government has been on the point of forfeiting the leases owing to non-compliance with the labour conditions. Valuable deposits of oil shale exist in other parts of New South Wales, and I have no doubt that many millions of tons of shale can be extracted from the mountains. If the Newnes works have been at a standstill for the last eighteen months
– They have not drawn any bounty for three years.
– I know that Mr. John Fell paid a special’ visit to Great Britain for the purpose of obtaining additional capital, but unfortunately he was unsuccessful. I believe that since then he has been experimenting in a comparatively small way with improved retorts that give higher returns from oil shale and produce a better oil than the old type of retort.
– I understand that a new retort is under consideration.
– Yes, but a considerable number of a suitable type would be required before the shale oil could be produced in commercial quantities.
– Is not the history of this proposition one of continual failure!
– There has been a considerable amount of financial, labour, and managerial troubles almost since the beginning of operations, but the greatest deterrent has been the lack of capital. The Newnes deposit, which is the largest in Australia, produces one of the best shale oils in the world.
– I think it is the best.
– The quantity extracted from the -Newnes shale is greater than that obtained from the Scottish or Tasmanian shales.
– Dr. Wade expressed a very decided opinion . concerning the Newnes shale deposits.
– Yes; motor spirit of a very high grade, as well as oils of lower grades, and a number of by-products, some of which I have mentioned, are obtained from the Newnes shale. If the deposit was properly controlled, and the best of retorts used, valuable returns would be available to those operating the deposit, and the Commonwealth would also benefit in an emergency. The general opinion of all the members of the Public Accounts Committee, which considered the matter eighteen months ago, was that the Government should take a more active interest’ in the deposit, as it was a valuable asset wasting away. The position may be even worse to-day, in consequence of the timber supports in the shaft having collapsed under the pressure from above. Bather than allow the asset to become valueless, the Government should have terminated the lease, because considerable expense will now have to be incurred before the face can be properly worked. In all probability a new shaft will have to be constructed before work can be resumed.
– What is the depth of the shaft?
– It is really a drive which runs right into the centre of the mountain. If, the payment of a bounty on the production of shale oil will assist those who may be still holding the lease, it will be a long time before any advantage can be obtained under this measure. There is also valuable oil shale deposits in the Latrobe Valley, in Tasmania, where I understand operations have been continuously conducted for a long time. The shale in that locality differs from that obtained elsewhere, and, I understand, produces first, class petrol and kerosene, as well as a residual product which can be used as a fruit spray, and possibly for other purposes.. When the House is asked to agree to the payment of a bounty on shale oil, the Minister should supply honorable members with reports concerning the- progress being made at the various deposits, but no information has been given concerning the work done at Newnes or at Latrobe, where I believe the operations are being conducted with every prospect of success with the use of the Bronder retort. I cannot at the moment recall the name of the retort which Mr. Fell is operating in a small refinery at Sydney, but even though, it may produce satisfactory results on a small scale it is impossible to say that when operated on a commercial basis the results will be the same. The shale produced in Australia differs considerably from the American or Scottish shales, and retorts which can be successfully operated in those countries are ineffective in Australia. We shall, therefore, have to depend upon the inventive genius of some person to produce a retort suitable for the treatment of Australian shale before we can expect to receive full benefit “from our deposits. The honorable member for Newcastle (Mr. Watkins) has just handed me a specimen of compressed shale which competent authorities say is excellent for road-making purposes. In Tasmania the reserves and probable reserves of shale or 42,000,000 tons, or 1,700,000,000 gallons of oil - the Mersey Valley representing 10,000,000 tons of actual reserves and 27,000,000 tons of probable reserves, or 1,000,000,000 gallons of oil. The presence of shale oil in Tasmania has been known for about 50 years, and developmental work has been proceeding in a desultory manner for the last 20 years. I hone that something will be done to resuscitate the industry in New South Wales and to drive it ahead in Tasmania. If private enterprise is unable to develop the deposits in the Newnes district on a commercial basis, the Government should take them over, because they would be a valuable asset for defence purposes.
.- There appears to be something wrong with the Minister for Trade and Customs (Mr. Pratten). Usually when he brings before the House a bill of any consequence he gives to honorable members a mass of interesting information on which to base their judgment of his recommendation ; but, either he has been induced to believe that honorable members would unanimously agree to the granting of further assistance to this particular industry, or else his department has rushed the matter. I agree with the honorable member for Maribyrnong (Mr. Fenton) that, in view of the antecedent facts, the House should have further information about this proposal. I was associated with the Government that introduced the original shale-oil bounty proposal nine years ago. That Government asked Parliament to vote £270,000 for the payment of bounty to stimulate the production of shale oil. Nearly half of that sum has been paid away, and yet the industry has died. That is a thumb: nail history of the matter. I have never heard that the industry would have lived had we increased the rate of bounty gallon of crude shale oil, though it might have done so. The substance of the case is this: that the shale-oil product has to compete against flowing mineral oil obtained in other countries, and Australian shale oil cannot withstand that competition. Either the science of retorting has not been sufficiently availed of, or it has not advanced enough to enable oil to be extracted from the Australian shale to the gallonage that it is estimated to contain or something like it. The Government is acting wisely in endeavouring to stimulate oil discoveries throughout Australia, and as one who has beer associated with commercial endeavours of that kind in Australasia,. I take a keen interest in the search for oil, whether in the strata from which it is obtainable either by pumping or gas pressure, or in the shale or coal with which this country in certain parts abounds. In the course of my reading on the subject some years ago, I ascertained that the oil shales of Australia, notably those in the Newnes district and in the Latrobe Valley, have been acknowledged by geologists and scientists to ‘ be the richest in the world, and I think that if, instead of continuing the present bounty, the Government would exert some effort to discover a suitable retorting nrocess for the extraction of the oil from our shales, it would be better than paying: large sums of money to companies that eventually abandon their properties, and pass out of existence. This evidently is a retorting question. Oil is known to be contained in our shale in even greater quantities than in the Scottish and American shale. Ours is admitted to be the richest potential oil shale in the world. If we pay the balance of £144,000 to another company that will renew the efforts at shale-oil extraction in the
Newnes district or in the Latrobe Valley, we may be no better off in the end. Surely the Council of Scientific and Industrial Research might well be called on to co-operate with those engaged in trying to resuscitate the industry bv attempting the invention of a retort by which commercial extraction will be possible. If we paid £100,000, and brought about the invention of such a plant, we should have mastered a phase of the problem, and it might then be possible to produce oil from the untold millions of tons of shale deposited in various parts of Australia, which would increase the defensive power of the Commonwealth as” well as add to its commercial productivity. I suggest that matter to the Minister for his consideration. I know that he wishes to do his job as well as a man can do it, and he has already shown that he is keenly anxious to increase the industrial power of this country; but I believe that the money will be thrown away under present conditions. Still I am prepared to vote for the measure, because the bounty may be regarded as an insurance. If the payment of £144,000 resulted in the production of a commodity which would enable our naval forces to continue to function after oil supplies from overseas had. been cut off, this would be a cheap investment; but I do not regard the bounty in its present form as a commercial proposition. Nothing that the Minister has said to-day convinces me that the extension of the bounty for another three years would open the oil shale mines, and lead to the production of shale oil in large quantities, and under commercial conditions. I hope that the Minister will see fit at a later stage of the debate, or in committee, to give honorable members more information as to the operations contemplated in Tasmania and New South Wales, and whether the necessary capital is being found. If Australian capital is being invested in the enterprise, we should be all the more anxious to encourage it, but, in any case, I should like to know what prospect there is of the difficulties being overcome that- have confronted the producers of shale oil in all parts of the world in their efforts to retort in commercial quantities.
.- I agree with the right honorable member for Balaclava (Mr. Watt) that the efforts made in the past to extract oil from Australian shales in commercial quantities have not been particularly successful; but I think that it would be unwise to cease encouraging those who are prepared to put capital into the work of discovering means of properly treating the shale. During the last twelve months, a new method has been adopted in the Newnes district of New South Wales; By a decarbonizing process the cost of extracting the oil has been reduced, and the resultant product is, I understand, of a higher quality than that generally used in petrol-driven motors. In these circumstances, I see no reason why we should hesitate to spend the last few thousands of pounds of this bounty in further encouraging those interested in the shale oil industry. I have not been requested to speak on behalf of those concerned in the efforts now being put forward at Newnes; but I am familiar with the work being done there. When talking to a gentleman outside the chamber a few moments ago, I was informed that those persons were producing not only oil from the shale, but also bitumen. He asked me to obtain information for him concerning imported bitumen, which is extracted from oil residue, because they have already branched out in that line of the business. He gave me two samples, one imported, and the other local, which any honorable member can compare. It is apparent that the bitumen which they are producing is greatly superior to the imported. If the payment of a bounty will lead to the establishment of even a dozen factories for the production of that residue for road-making purposes at a cheaper cost than now obtains, it should be continued, because it will lead to the development of the shale seams. The gentleman who interviewed me comes from Newcastle, and the workings are in the western district of New South Wales. If it is possible to develop those workings, similar development must follow in Tasmania, Queensland, and other places in which shale is found.
.- Judging by the amount which has been drawn from the bounty fund during the last three years, the’ extension of the bounty for another ten years would’ not matter very much. The Public: Accounts Committee recently investigated every phase of this matter.. It inspected the works at Newnes,, and obtained from experts the latest available information. In its report it stated that eleven experts were appointed by the Government of the United States, of America, to ascertain the length of time that the oil supplies of that country would meet its requirements, and investigate other sources of supply. Amongst other things, those gentlemen drew attention to- the immense, deposits: of shale that existed in the United. States, of America,, but pointed out that, whilst flow oil1 was available’, it was not advisable1, on account of labour and other costs,, to attempt to’ work those deposits. They recommended that they should be regarded as a great national asset. Similarly, Dr.. Wade, after having inspected the Newnes deposit, stated that it could serve no useful commercial purpose in the immediate future, awd recommended that we should regard it as: a great national asset. The Committee,. therefore, urged that the Government, through the Department of Defence1, should acquire that and similar assets, and! work them- om a unitary basis, so that, if a national emergency should arise, fame would not be lost in- putting the- works in operation. I ami confident that that is the best course- to’ adopt. We should not be anxious to have the works developed1 om a large scale, at the present time’, because such action might lead to- the exhaustion of a national asset, and”, in the meantime, add to- the cost of petrol fueL The world’s oil flows’ are liable to become worked1 out, and if we refrain from developing these assets at the present time we shall be able to utilize them in the future to- supply our requirements in the event of a shortage abroad’, or other emergency. I hope that the House will take that sane view of the matter. The Government could provide the unit of an up-to-date plant, and make available railway facilities that would render operation easy whenever it was required. I strongly urge the adoption of the recommendation *£ the Accounts Committee.
.- I hope that the bill, will be passed speedily.
I am unable to agree with the contention which has just been advanced by the honorable member for Forrest (Mr. Prowse) that we should allow these deposits to lie idle until a national emergency arose. If that course were adopted, the process, for working, the deposits might not be available when it was required. Bounties, are necessary to encourage private enterprise, to exploit these ventures. The trouble with the Tasmanian deposits was that the right means of processing had not been discovered.
– Has it been discovered now?
– That remains to be seen. I believe it is claimed that the problem has been solved. The Tasmanian deposits are to be found on both sides of the river Mersey. In the employ of the Southern Cross Company, some of the directors of which, I believe, are members of this Parliament, is a man who has discovered a process which it is claimed will enable the company to run small retorts. The idea’, I understand’, is to erect a number of small retorts instead of having one large retort. On the opposite side of the river the Blunder process”. is1 being worked. It is an American process1, and the company which has? been responsible for its introduction to- Australia has spent something like £100,000, the greater part of which1 has been expended! at the site of the works. Some time ago- the retort was given a trial ran, and! although I have nol received’ any official information1 in relation to’ the result, I lame been informed that it was successful. The difficulty with the shale hitherto has been to find a way. of retorting’ it TwO’ or three attempts’, have been made, and a lot oi money has: been spent, in the endeavour to solve the difficulty. The retort would rum well for two or three days, and extract, in an excellent manner the quantity of oil per ton necessary for success. Then it would clog, and refuse to work. The. money would become exhausted,, and operations would cease. The deposits iri Tasmania are extensive. Further up the river other deposits, of similar shale have been discovered. The Tasmanian Government geologist estimates, that the quantity available in the Mersey Valley is something like 30,000,000 tons..
– To what stage has the Bronder process progressed I
– A big retort has been erected, and a trial run has been given. It is intended to have an official opening in a few day’s time. No doubt some honorable members will be invited to the opening ceremony. Contrary to the statement of the honorable member for Forrest, that the shale oil deposits should be worked only in case of emergency, Dr. Wade strongly recommended working the Mersey Valley shale deposits.
– The honorable member for Forrest, I believe, was referring to the shale oil deposits at Newnes.
– I was referring to the investigations of the Public Accounts Committee.
– If we wait for emergencies before working the deposits we shall never get the benefit of half the shale oil in Australia, because when we need it we shall not know how to work the deposits. Many years ago when the Tasmania’s shale was sent for analysis, either to Scotland or England, the authorities there call it “ Tasmanite “ to distinguish it from other shale. Dr. Wade very strongly reported in favour of working, the deposits, both to the company that held the lease’ and to the Tasmanian Government when it was proposed that the Government take control of the works. When Dr. Wade was before the Public: Accounts Committee I, as a member, took the opportunity to question him about these deposits. He had stated that the shale seam would average 40 gallons to the ton. Although a seam may be 5 feet deep there is usually some sandy matter in the middle of it, and I asked Dr. Wade if, in making his estimate, he referred to the whole depth of the seam or to merely one layer of it, and. he replied that he referred to the whole depth of the seam. I also asked him if he had obtained the shale with which he had experimented from a certain tunnel driven into a hill by one of the companies on the river. He said that he had obtained the shale close to the funnel, but nearer to the river. The shale was of the same quality throughout, and Dr. Wade was very definite in his opinion that the deposits should be worked. The companies there according to their reports, have obtained 40 gallons to the ton from the retorts ; in fact, one company reported an output of 50 gallons to the ton. I invite the shareholders in the companies oranybody else to visit the works in Tasmania. Another type of retort was erected at the works, but like the previous one it clogged and would not operate. I understand that the Southern Cross Company has overcome that difficulty, one of its experts having discovered a means to prevent carbonization, and other troubles that arose in connexion with working the retorts. It is also claimed that the Bronder retort also overcomes that difficulty. It is very necessary that the. bounty should be available to these companies, because one of the experts that came before the Public Accounts Committee - I believe that it was Dr. Wade - recommended that these shale de-. posits should be developed not only for commercial purposes, but also especially for defence ‘ purposes. If we discontinue the bounty, people will not be encouraged to invest in these mining ventures. Unless crude oil is produced no bounty will be given.. The bounty has been availablefor many years, but it has been availed of only by the company at Newnes. The richest shale in the world is at Newnes. It is much richer than the Tasmanian shale, but the deposits are not so conveniently situated.. I understand that one difficulty at Newnes is due to the fact that the works are on the wrong side of the hill one expert contending that the present site greatly militated against the success of the venture. I understand that another difficulty is the lack of capital to develop the deposits. I see no danger in continuing the bounty, because it will not be availed of unless oil is produced.’
– When the original measure was’ introduced in this Chamber, ‘ the debate centered round the shale oil deposits at ‘ Newness and it was contended that with the assistance of a bounty a very flourishing industry would soon be established. The- company there has been drawing a bounty for a number of years. I understand that Mr. John Fell, the managing director of the company, after several years’ operations, found that the industry could not be successfully carried on because of the heavy expense of mining the shale. He applied time after time for the extension of his. lease, and finally suspended operations. The Government warden then declined to extend the lease, and. the works are now lying idle. I should like to know from the Minister - whether any new company is beginning operations at Newnes, and, if so, what are its capital and prospects of success ?
– I think that T can fully satisfy the. honorable member on that point.
– I shall not pass judgment on the bill .until I have heard the Minister’s reply. Unless there is some prospect of the industry being successful the Government has no right to expend public money on it. We have already expended £125,000 in bounties to assist in the production of shale oil. As a layman I fail to see how oil that has to be mined can compete with oil that naturally flows to the surface. I hope that the Minister will be able to satisfy the House that the money to be expended under this measure to assist in the production of shale oil will not be wasted as similar grants have been in the past.
– While I heartily support this measure, I feel that a much boldor course must r-e adopted by the Government if the shale oil industry of this country is to be placed upon a satisfactory basis. As the days go by, we shall require oil in immense quantities in this country. It is becoming, every day more essential, and is, to-day, the chief fuel used at sea. The supply of oil is, therefore, intimately associated with the defence of this country. The firm of John Fell and Company has been battling along for years, in the effort to develop the shale deposit at Newnes. It has been said that the Newnes shale is the richest in the world. I have taken out some figures on the subject, and have found that it yields an average of from 80 to 120 gallons per ton. I find also, that at our present rate of consumption, there is sufficient shale at Newnes to supply our requirements for at least 300 years. The shale deposit there covers an enormous area, and extends from Katoomba up to Mudgee.
– Who is responsible for the calculation that there is sufficient shale at Newnes to supply our requirements for 300 years?
– That is the calculation of an expert, whose name I forget at the moment, who has written to the
Sydney Daily Telegraph on the subject. It has been contended that richer shale is found in Scotland, but, as a matter of fact, the Scottish’ shales give a yield of only 30 gallons to the ton. In spite of this low yield they are profitably worked. The average of the shale deposits of Colorado, in the United States of America, is only 16 gallons to the ton. It is strange that these deposits are commercially worked, whilst those of New South Wales, with an average yield of from 80 to 120 gallons per ton, are not.
– Various reasons have been given to account for the fact that the Newnes shales have not so far been commercially developed. The Tasmanian shales give a yield of from 25 to 95 gallons per ton.
– The Barren Bluff shale gives a yield of 120 gallons to the ton.
– The figures I have quoted have been given in evidence and can. be relied on. They have been criticized and accepted by the Sydney newspapers. These figures all point to the fact that we have, in Australia, a valuable asset which is not being developed. If the Newnes deposits were situated somewhere in America, there can be little doubt that some successful methods of treating it would be adopted. The honorable member for Wilmot (Mr. Atkinson) has mentioned that the real difficulty is found in the methods adopted for treating the shale. This difficulty has been experienced in Tasmania as well as .in New South Wales. After the retorts have been used for a little while they clog and cake, and operations have to cease until they have been cleaned. At the Wembley Exhibition some shale retorts were shown, and one called the Wallace retort is said to have proved very satisfactory indeed. New South Wales and Tasmanian shales were successfully treated at Wembley in this retort. It seems to me that with the increasing demand for oil in this country, and the consequent increase in price, it should be possible to organize the working of Australian shale deposits. Whether this can be done by private firms remains to be seen. I am personally of opinion that the development of the de- posit at Newnes will have to be taken over as a Government undertaking. I am informed that John Fell and Company have spent about £2,000,000 in trying to develop the Newnes deposit, and, in view of the failure of operations there, it is unlikely that private companies will be able to command sufficient capital to develop it. There can be no doubt that the demand for oil will continue to increase, and I agree, to some extent, with the honorable member for Forrest (Mr. Prowse), that countries which conserve their oil deposits, and in the meantime use cheap oils obtained from other countries, are probably acting wisely; but it must bo borne in mind that when it becomes necessary to develop our shale-oil deposits we must be in possession of machinery that will enable us to carry out the work of development on a commercial basis. I support the bill with great pleasure; but I look forward to the time when the Government must take other steps to develop the deposits of oil shales which am known to exist in New South Wales and in other parts of Australia. The country that lacks oil must in future lack development. To-day we are all right, because we are living at peace with other nations, and can draw the supplies of oil we require from overseas, but we do not know how long that condition of things will continue. For a country like Australia, isolated as it is, it is absolutely necessary in the interests of defence that the Government should see to the development of its oil-shale deposits.
.- I intend to support the bill. The measure is absolutely necessary to assist the shale-oil industry. It has been admitted that within the last two or three years practically no bounty has been paid on the production of shale oil. Until oil is produced no bounty is paid. According to information supplied me by the Minister, the firm of John Fell and Company has erected a plant in the neighbourhood of Sydnev. which is about to extract oil from shale.
– Where will the firm get its shale from?
– I understand that the shale is to be obtained in New South Wales. The firm of John Fell and Company proposes to treat shale by the Dibbs’ cracking system. This is a new experiment, and it is believed that it will prove to be a great success. When we consider that Australia imports every year 82,000,000 gallons of motor spirit at a cost of about £7,000,000, honorable members will realize the importance .to Australia of being able to supply its owns requirements for motor spirit and lubricating oils. The Minister has pointed out that kerosene, benzine, and lubricating oil can be manufactured from shale, and there is a great demand for these commodities in Australia.
– Motors are being ran to-day on spirit distilled from shales.
– I recognize that, and also on power alcohol manufactured from molasses; but, unfortunately, enterprises for the treatment of shale oil in Australia have in the past been failures. The Government has paid approximately £125,000 in bounties on shale oil, but the companies producing it have ceased operations, and the industry has languished. A new enterprise is now being started in Sydney, and those concerned in it are absolutely confident that they will be able to turn out shale oil in large quantities if they get the proposed bounty in the initial stages. The Public Accounts Committee went into this matter very carefully, and obtained some very interesting evidence from Dr. Wade, a recognized authority on mineral oils and the shale deposits of Australia and their treatment. Referring to the deposits of shale in New South Wales the Public Accounts Committee in its report said that it is estimated that there are over 40,000,000 tons of shale, representing 3,500,000,000 gallons of oil, of which 20,000,000 tons or 2,000,000,000 gallons are in the Newnes district. The Newnes deposit extends from Capertee to Wolgan Valley. It is the most extensive deposit yet developed, and has been proved over an area of 5.000 acres. The thickness of the seam varies from 14 to 15 inches, and it is estimated that the deposit is one of the richest in the world, yielding from 60 to 150 gallons of oil to the ton. The average actual distillation is about .101 gallons to the ton. Shale has been- exported from Newnes in the past for the use of gas manufacturers. The quantity of shale mined in New South Wales from 1865 to 1924 was 1,919,000 tons. .According to the Public Accounts Committee, there are great possibilities in the Newnes area, but it is only by financial assistance in the initial stages that people can be induced to put their capital into the shale oil industry, as the extraction of oil from shale has in the past been found to be a very precarious business. I visited Tasmania about eighteen months ago, and in company with the honorable member for Wilmot (Mr. Atkinson) inspected the shale oil deposits in his district. One of these deposits was, at the time, being developed by a Melbourne company, of which Mr. Bronder, an American, was the engineer. They proposed to use the Bronder retort, and were absolutely confident that they would be able to produce oil from shale, and sell it at a profit in competition with oil imported from other countries. There was also another company operating in the same district. The Public Accounts Committee,, in its report on the shale oil deposits in Tasmania, said -
The reserves and probable reserves of shale in Tasmania are set down at 42,000,000 tons, or 1,700,000,000 gallons of oil; the Mersey Valley representing 10,000,000 tons actual reserves, and 27,000,000 tons probable reserves, or 1,000,000,000 gallons of oil. Occurrences of shale in Tasmania have been, known for about 50 years, and development work has been proceeding, but in a desultory manner, for the past twenty years.
The committee points out that one company in Tasmania produced about 100,000 gallons of oil, which is stated to have given favorable results as motor fuel, whilst another company retorted 11,000 gallons. Any one who reads the report of the Public Accounts Committee and the evidence given by Dr. Wade and others, must be convinced that there are great possibilities in this industry in Australia. In the Gladstone district, in Central Queensland, there is a very rich deposit of oil shale. Some of the people interested in it believe that one day a great enterprise will be established there. When that deposit is developed, I hope it will receive the same assistance from the Federal Government as the Minister pro-poses to give to- Tasmania and New South Wales companies.
– -This measure will apply all over Australia.
– It is- on that ground I am supporting it. When the Power Alcohol Bill was before this Parliament, I strongly urged that the bounty on power alcohol should be extended to alcohol manufactured, not only from cassava and other starch-bearing plants, but also from sugar-cane, inferior sugars, syrups and molasses, so that the industry might be established on a large scale.
– Power alcohol is also being obtained from prickly pear.
– I understand that, in evidence given before the Public Accounts Committee it has been shown that power alcohol can be manufactured on a commercial basis from prickly pear. Although this may appear to be a very innocent looking measure, there may grow out of it a great oil industry in Australia. When the proposal for the payment of a bounty on the production of power alcohol from cassava was before the House, I pointed out that if last year’s surplus sugar production in Queensland had been converted into power alcohol, approximately 24,000,000 gallons of power alcohol would have been produced - sufficient to supply three times the whole of the State’s requirements of liquid fuels. In these days, when we are, to a large extent, in the grip of the big oil corporations in America, the more shale oil and power alcohol we can produce the greater will be our chance of preventing the exploitations of the people by those corporations. Australia is already paying too much for its oil in comparison with other countries. There is no doubt that the discovery of well oil in commercial quantities in any portion of Australia would be followed by a tremendous drop in the price of oil in Australia, and still the oil importers would carry on their operations at a profit to themselves. Competition would have a very salutary effect on those corporations, mostly American, which have in the past taken, approximately, £7,000,000 a year out of Australia for the benefit of their shareholders. If this bill has the effect of assisting through its struggling stages the shale oil industry of Australia it will do most useful work. I understand that works are now in course of erection at Sydney, and that the Tasmanian company has spent, approximately, £100,000 on the Commonwealth Government’s assurance that this bounty will be paid as soon as the oil is produced. As the bounty is only payable on the oil produced, honorable members need have no doubt about passing the bill. I hope that the day is not far distant when we shall have a great shale oil industry in Central Queensland.
.- In introducing this bill the Government is probably actuated by a desire to make the oil or liquid fuel industry of Australia so progressively and continuously prosperous that there will be a possibility of our throwing off the strangling yoke of the foreign oil producers, whose importations we are compelled to buy. Although, like another honorable member who has preceded me, I am quite opposed to State enterprises, I think that the Government would be well advised to utilize the services of the Commonwealth Oil Refineries Limited in maintaining a controlling interest in some of our great shale oilfields. Earlier in the session, when the Minister for Trade and Customs (Mr. Pratten) introduced a bill for the payment of a bounty on the production of power alcohol, the measure met with practically unanimous support. The only regret expressed was that the amount of £25,000, which was to be spread over five years, was too small. I mention this matter in order to refute a canard which has recently been spread - probably by those not Ur associated with people who are importing oil - that the payment of a bounty on the .production of motor spirit from cassava will be one of the expedients made use of by the Commonwealth for taxing motorists. Already the payment of that bounty has had an effect such as I hope will follow the payment of a bounty upon the production of shale oil. By the end of next year three factories which are now in course of erection should be in a position to supply 3,000,000 gallons of power alcohol per annum.
– From cassava?
– No, from molasses. The bounty is payable only on power alcohol derived from cassava. In the course of this debate the honorable member for Maribyrnong (Mr. Fenton) has said, very wisely, that Parliament should receive periodical reports from all industries iri receipt of bounties. I hope that the Minister will not lose sight of that suggestion. I am in perfect agreement with previous speakers who have supported the payment of a bounty on the production of shale oil. The honorable member for Forrest (Mr. Prowse), guided apparently by some evidence given before the Public Accounts Committee, suggests that at present it is unwise to develop our huge- shale oil deposits, and that they should be reserved for’ a future emergency. But our deposits are so immense, and any attempt to develop them in a case of national emergency would, because of the shortness of time available, prove so ineffective, that I cannot see how we can accept the honorable member’s advice.
– No country is now producing shale oil commercially.
– I agree with the honorable member to a certain extent, but according to the Petroleum Times, quite recently a conference of American experts, whose activities are practically confined to the production of shale oil, thoroughly debated the whole subject of the scientific treatment of shale oil deposits. The great drawback to the development of the industry in Australia is not that it is not possible to retort the oil with ease, but that it is difficult to derive from it those commodities we should like to have and put on the market. For instance, it is estimated that the shale oil deposits in Tasmania cover more than 300 square miles, and the Petroleum Times estimates that they are capable of producing 400,000,000 barrels of crude oil. The Newnes deposits in New South “Wales are capable of producing 300,000,000 barrels. Hitherto, the great bugbear has been the difficulty of extracting gasolene from the oil, but under a new system of “cracking” by a catalytic method, it is possible to produce from crude oils 50 per cent, of high grade anti-knocking gasolene. This result is attained in America, and the spirit obtained can be sold profitably with the cost of production at. 8 cents a gallon. There is, therefore, no reason why in the immediate future we should not be able to do the same in Australia. The right honorable member for Balaclava (Mr. Watt) suggests that the shale oil industry should work hand in glove with the Council of Scientific and Industrial Research. I understand that the first matter .the council will take in hand is an investigation of the liquid fuel resources of Australia, and I am hopeful that, in the course of its researches, it will turn serious attention to the cracking of oil. I welcome this bill just as I did the Power Alcohol Bounty Bill. I trust that in the immediate future the purpose for which it has been introduced will be achieved, and that our shale oil deposits will be turning out not only crude oil, but also a substantial proportion of high grade gasolene, which will in some measure help to render Australia economically independent of supplies of oil from foreign countries.
– I feel impelled to make a contribution to this debate because of the very favorable opportunity I had, as a member of the Public Accounts Committee, to investigate the whole position of our shale oil industry. I am quite certain that the Minister for Trade and Customs (Mr. Pratten) is prompted by a sincere and worthy desire to foster an Australian industry, and if the bill would carry out that very laudable intention in a practicable way, no one would give it more cordial support than I would be prepared to give it. I have learned to appreciate and admire the enterprise and confidence of Mr. John Fell in the shale oil enterprise. But having inspected the deposits of shale at Newnes, probably the richest in Australia, having seen the inner working of the mine there and the treatment plant, and having gained a thorough knowledge of the possibilities of the shale oil industry, I do not draw the conclusions formed by the honorable member for Herbert (Dr. Nott), nor have I the favorable anticipations of the honorable member for Capricornia (Mr. Forde) regarding the proposal before the House. The Public Accounts Committee having made a thorough investigation into this industry, was convinced that shale oil could not at present compete with flow oil, and that in a country which so far has not proved the existence of well oil, it was desirable to conserve all its deposits of shale oil for a future emergency. This was considered desirable not only from the point of view of having propellant oils available, but mainly to provide the country with essential lubricant oils.If in a time of emergency we were without lubricants, we should be in a hopeless and helpless position. The committee was also of the opinion that our shale oil deposits should be worked on a nucleus basis so that if at any time it should be necessary to exploit them in the national interests, it could be done without delay. The honorable member for Herbert (Dr. Nott) stated that the system of retorting now in operation was so efficient that it enabled shale oil to compete with flow oil ; but in spite of the large expenditure at Newnes, and the installation of the cracking system at Parramatta, it is very doubtful whether shale oil can be produced in quantities or at a price that would make such competition possible, notwithstanding that the Newnes shale is said to be the richest in the world in oil content. It must be remembered that we have only limited supplies of shale. On this point the Public Accounts Committee reported -
Extensive and rich as are Australia’s shale deposits they are by no means inexhaustible, and on a conservative estimate, the amount of oil in the known deposits will suffice only to supply the Commonwealth’s requirements, at the present rate of consumption, for approximately twenty-five years.
Twenty-five years, as honorable members will realize, is an inconsiderable period in the life of a nation. I am in hearty accord with the recommendation of the committee, that our shale deposits should be husbanded to serve the nation in any emergency that might arise. Our munitions factory is operating on the nucleus basis at present, but if there should arise any occasion for extending its operations, that could be done immediately. I submit that our shale oil deposits should be developed along similar lines. We have no desire to see the industry closed down, but we submit that it should be carried on with a minimum expenditure, on a basis which will enable it to be developed at short notice. The following paragraph from the report of the committee is interesting -
The committee was informed in evidence that notwithstanding the large production of flow oil in the United States of America, the Navy department of thatcountry holds in reserve large areas of oil shale. In my opinion, we should follow the example of America, which is using flow oil while it is available, and reserving shale oil for emergencies. We should menace the future well being of our country if we exhausted our shale deposits at our present stage of development. I sincerely trust that we shall hold them in reserve.If the Government desires to do the best thing in the interests of Australia, it will take over these deposits and compensate those at present interested, and then work them as I have suggested.
Mr. PRATTEN (Martin- Minister for
Trade and Customs) [4.29]. - 1 have listened with considerable interest to the debate, and have gathered that honorable members generally are favorable to the bill, and believe that the Government should do everything that it can reasonably do to develop our internal oil resources. The bill provides one means by which this may be done. Messrs. John Fell and Company have recently established at Clyde a Dibbs cracking plant, which is regarded as absolutely the latest and most successful process yet invented for the distillation and conversion of crude oil into the marketable product. In the issue of the Sydney Sun newspaper on Wednesday, 14th June, a number of pictures was published illustrating the plant; and it was stated that it was proposed to haul shale from Newnes to these works. I am quite prepared to admit that, so far, the various processes that have been used to obtain oil from shale have largely failed; but I have very great hopes that this new cracking process will be most successful.
– Do I understand that it is proposed to haul shale from Newnes to Sydney for treatment?
– That is what I gathered from the newspaper statement, although the very favorable report which the Tariff Board made on the proposal to continue the payment of this bounty for another three years hardly suggests that. One paragraph of it reads as follows : -
The assistance would have the additional advantage of preventing the oil refinery plant at Newnes from becoming ruined by disuse, or dieman tied, and sold and scattered, should it be found practicable to again work the shale deposit in the Wolgan Valley.
Messrs. John Fell and Company, having sustained heavy losses in endeavouring to establish the shale oil industry, have now spent the remainder of their capital, and all the money which Mr. John Fell was able to raise on his business and privately, amounting, I understand, to about £100,000, in installing this new process. I have heard marvellously optimistic views expressed in the last few days as to the possibility of this process developing our petrol supplies. I am told that if this plant is as successful as similar plants in America, the oil re fining processes of Australia will be revolutionized, .and our petrol supplies practically doubled. I am sure that every honorable member will be delighted if these hopes are realized. At any rate, I do not think that we are prepared to take the responsibility of killing the shale oil industry, and therefore I hope this bill will be passed.
Question resolved in the affirmative.
Bill read a second time, and reported from committee without amendment or debate; report adopted.
Bill read a third time.
Motion (by Mr. Pratten) (by leave) agreed to -
That he have leave to bring in a bill for an Act to amend section 15 of the Commerce (Trade Descriptions) Act 1905.
Bill presented by Mr. Pratten, and read a first time.
(By leave.) - I move -
That the bill be now read a second time.
The Commerce (Trade Descriptions) Act 1905, gives power to the Minister to prohibit the importation into, and the exportation from, the Commonwealth of all goods bearing false or misleading marks as to nature, number, quantity, quality, purity, class, &c. ; and further it authorizes the Minister to make regulations for the compulsory marking or labelling of goods, whether imported or exported, that are used for food or drink by man, or used in the manufacture or preparation of articles used for food or drink by man; of medicines, and medicinal preparations for internal or external use; of manures; of apparel; of jewellery; of seeds and plants. The bill proposes to add brushware to the list. This measure does not profess to be an ambitious attempt to deal entirely with all amendments to the Commerce Act, that, upon strict examination, may be found necessary. Recently the British Government introduced and passed legislation for the compulsory marking of foreign products. Communications have been passing with the object of securing some uniformity in this matter within the Empire. I am hopeful that, in the not. distant future, we shall he able to mark all our goods as “ Made in Australia,” and also that foreign goods shall be marked with the country of origin. The bill merely gives power to the Minister, after reasonable notice, to compel further marking, so that people buying such articles will know the country of origin.
– I have no objection to the measure, if its only purpose is to add brushware to the list of articles which the Minister may require to be marked with the country of origin. I endorse the remarks of the Minister as to the necessity to have Australian made goods definitely marked - “ Made in Australia.” The time has arrived - indeed it is more than ripe - for our manufacturers to mark all their goods. This is necessary in the interests of Australian industrial conditions. However, one may desire to purchase Australian-made articles, there is no guarantee, at present, that Australian goods are being supplied. One has to take the word of . the shop assistant, and we know that the business man’s chief concern is. to sell his goods. At. present many people fondly imagine they are buying Australian-made goods when, as a matter of fact, they are buying foreign goods.. I am glad to hear from the Minister that something will be done before long to compel the marking of all goods made in Australia.
.- I join with the Leader of the Opposition. (Mr. Charlton) in: regretting that the bill does not go far enough. Australian goods should be marked. Recently a Victorianmade cloth, selling at14s. a yard, and costing not more than £2 6s. for the suit length, was sold as a British suiting in a Collins-street shop for £14 14s. This is a very great injustice to the Australian industry. We should compel all manufacturers to brand their goods, and certainly all articles made in Australia should be branded “ Australian made.” During the war Australian privates were frequently saluted by British Tommies, simply because the cloth from which their uniforms were made was so much superior to the uniforms of British privates that the Tommies believed that the wearersmust be officers. Similarly, Australian- made boots, and indeed all articles supplied to our forces, were very much better than the boots and other commodities supplied to the allied armies from other sources.
Question resolved in the affirmative.
Bill read a second time and reported from committee without amendment or debate; report adopted.
Bill (by leave) read a third time.
Motion (by Mr. Pratten) agreed to -
That be have leave to bring in a bill for an act to ratify an agreement between the Commonwealth of Australia and the Dominion of New Zealand in relation to preferential duties of Customs.
Bill presented by Mr. Pratten and read a first time.
– (By leave.) - I move -
That the bill be now read a second time.
This is a formal measure to prevent any possible loss of revenue owing to the wording of the reciprocal agreement now in operation between the Commonwealth and the Dominion of New Zealand. Clause 2 of that agreement reads -
The Commonwealth shall not impose any Customs duty or increase the rate of any Customs duty on any article entering the Commonwealth from the Dominion …. until aftersix calendar months’ notice to the other party to this agreement.
Under a strict interpretation of the wording of. that clause, Australian importers could receive British or foreign goods entering the Commonwealth via New Zealand, and pay the tariff duties previously in force until the six months’ notice provided for had expired. It is now proposed to amend the clause by adding, “ the produce or manufacture of the Dominion.” The object of the amendment is to exclude the importation of foreign goods coming to Australia via New Zealand, and to make it clear that the six months’ notice applies only to goods the produce or manufacture of the Dominion of New Zealand. A slight concession has also been granted by New Zealand by including after the words “Meats, potted or preserved,” the words “ (not including mutton birds).” These proposal’s have been agreed to by the Minister for Trade and Customs, representing the Commonwealth Government, and Mr. Downie Stewart, the representative of the Dominion of New Zealand.
.- It seems strange that the first point mentioned by the Minister was overlooked when the Customs Tariff New Zealand Preference Bill was under consideration. Under the existing act, foreign goods may be imported through NewZealand, and, after being retained there six months, may come’ in under a preferential rate which is foreign to the spirit of the reciprocal arrangement entered into between the Commonwealth and New Zealand. Can the Minister say how much revenue has been lost up to the present in this way?
– Very little. The last tariff has made this amendment necessary.
– I offer no objection to the bill.
.- As clause 2 of the agreement, as amended, makes it. retrospective to September of last year, I should like to know if the department has an opportunity of collecting the duties which should have been paid, or whether it is the intention to allow the importers to escape payment. If goods have been imported in good faith and have been passed on. to retailers in the ordinary course of business, it will be exceedingly difficult to dot justice to those concerned.
– I do not; think there will be any necessity to collect duties under the retrospective clause. This is a joint action by both Governments to prevent amy attempt at fraud in the future. No cases of underpayment of duty have been brought under my notice.
– As a slight alteration has been made in the list of items on which preference is given,, I wish to again mention the necessity of imposing a higher duty on imported butter. Prior to April and May of this year only 17,895 lb. of butter were imported in three months, but during the two months I have mentioned nearly 3,000, 000lb. of New Zealand butter came to Australia.
– Was there a shortage in Australia during that time?
– No; we were exporting butter at that time.
– There was a shortage of the best brands.
– That may be so, but there was not a general shortage. New Zealand butter was being sold at a price lower than that charged for Australian1 butter, and as those producing butter, particularly in the butter factories, have to comply with awards of the Arbitration Court, the imposition of a higher duty on imported butter is necessary. As other secondary industries are protected against outside competition, greater protection should bo afforded to those engaged in the dairying industry.
– The honorable member is now discussing a matter not mentioned in the bill.
– Butter is one of the items mentioned in the reciprocal agreement in operation between the Commonwealth and New Zealand, and I am merely drawing the attention of the Minister to the fact that a higher duty should be imposed on butter so that our primary industries may receive a greater protection. Dairying is carried on under sweated conditions, and in common with others who represent dairying constituencies, I appeal to the Minister, and to metropolitan members’, to assist in providing reasonable protection to those engaged in the butter manufacturing industry, who should enjoy the same conditions as are enjoyed by those employed in other secondary industries. I trust that the Government will reopen the subject with the authorities in New Zealand, and suggest the imposition of a duty of not less than 6d. a1b.
Question resolved in the affirmative.
Bill read a second time, and reported from committee without amendment; report adopted.
Bill, by leave, read a third time.
Debate resumed from 27th July, (vide page 4599), on motion by Mr. Hill -
That the bill be now read a. second time.
.- This measure authorizes the execution by the Commonwealth of agreements with the respective States for road construction. All honorable members realize the necessity for good roads, and most of us have offered no objection to Commonwealth assistance being granted . to the States for that purpose. When on a former occasion, it was proposed to pay £500,000 to the States to assist in that direction I approved of the Government’s attitude. The- Labour party stated in its policy speech at the last election that it would be prepared if returned to power, to co-operate with the States in the matter of road construction; but it did not commit itself to any proposal such as that now before the House. My party intended to help the States as far as possible out of any surplus revenue that might be available from time to time; not to impose additional taxation for the raising of money for roads. I agree with the Minister (Mr. Hill) that additional and better roads are required. The Commonwealth Parliament, while taking all such steps as may be necessary to see that the money granted is wisely expended, should leave the matter almost entirely to the States concerned. The State Governments are responsible to the electors for the construction and maintenance of roads just as they are for the provision of railway and tramway services. It is questionable whether this Parliament is justified in providing large sums of money for roads that will result in competition with railways that already supply means of transit in rural districts. Since motor transport has been largely adopted, most of the States have experienced deficits on their railway systems, and, when improved roads are provided, that form of transport will be a stronger competitor than ever with railway services. A considerable proportion of the national debt represents expenditure on State railways, and the interests of the taxpayers should, so far as possible, be protected. That is one of the reasons that I advance why the States should be permitted to manage road construction for themselves.
– Many of the roads to be built with the aid of the Commonwealth grant would become feeders to the railways.
– I shall deal with that point. The Minister stated last evening that good roads would result in a reduction in the cost of transport; but it does not necessarily follow that cheap transport will be brought about by motor services under-cutting railway freights and passenger fares. The probability is that the resultant loss, of railway revenue will cause increased fares and freights, and the competitors of the railways will immediately take the opportunity of increasing their charges, the community, in the end, having to pay higher rates than are now charged. I agree with the Minister that a large outlay on road construction is needed to provide feeders for railways, and I think that most of the grant should be ear-marked for that purpose. On the other hand, it is unwise for the Government to impose further taxation to assist States in providing a service for which they are at present responsible.
– Particularly when that taxation is levied on motorists who use through roads and not feeder roads.
– Quite so. I claim that a mistake has been made, and’ I doubt whether the Government is justified in bringing the bill down before the agreement has been ratified by the States. I have complained on former occasions about the Government’s method of putting the cart before the horse. This House is solemnly asked to authorize the granting to the ‘States of £20,000,000 before the necessary agreements have been made. A portion of that amount is to be raised by mean? of a special tax on petrol, chassis, and tires, which is now being collected. What position would this Parliament be in if the State Governments refused to ratify the agreement?- I asked the Minister to-day how many State Governments had already to sign it; and he said, up to the present time, only one had done so.
– Only about a week has elapsed since the agreement was sent to the States.
– That makes the position all the worse.
– I am referring to the agreement in its legal form. The States have not yet had time to ratify it; but the proposal has already been accepted.
– Evidently the Government is rushing it through the House. If the agreement is not ratified, will the petrol tax that has been collected ‘ be returned, or will it be allowed to swell the . general revenue? Is there any guarantee that this Parliament will agree to the special tax? We have been told that this is not a tariff proposal, but merely a means of assisting in the raising of money for road construction. I believe that when the Government i-ent to the country it promised a roads policy, and spoke of deriving money through the Customs for that purpose; but it is not justified in proceeding with this bill before the States have ratified the agreement. The Minister stated that a conference, extending over three clays, took place on this subject between representatives of the Commonwealth and the States. Surely honorable members should not be denied a report of the proceedings at that important gathering. “We are simply informed that the State Governments have agreed to the proposal, but have not yet appended their signatures to the agreement. It has not been placed before any of the State Parliaments for ratification.
– The Minister also stated that five of the States had signified their approval of the proposal, but he did not say which State had not done so.
– I think that New South Wales bas not approved of it. I intend to quote what has been said on this matter by Ministers in the States which are alleged to be in favour of the proposal. Mr. Gunn, the Premier of South Australia, speaking in reply to a question in the House of Assembly in that State, remarked -
The great weakness in the proposals in comparison with out own is that we must spend the money on new construction or reconstruction. We will have £120,000 less for maintenance of our main roads. The ‘State has to subsidize each Commonwealth £1 to the extent of 15s. Although we pay 15s., we have not tl* power they have. We submit a scheme for the construction of a road to them, and they say “Yes” or “No.” It may be that they want to. construct an interstate road’ or roads that we would not spend the money on, because we want to spend it on roads which will develop our own State. The move of the Commonwealth Government is unwarranted. There was no need for it. I hope that Mr. Bruce will see the wisdom of withdrawing the tax, and leaving the States alone. It is most undesirable that we should fight each other. Who has asked the Commonwealth to come into housing and roads? The policy speech of the Prime Minister might be the speech of a State Premier or leader. If the Commonwealth wants to do this thing, let them do it by the approval of the people, and not by this backdoor method
– When was that state-ment made?
– It appeared in the Melbourne Age of the 21st of this month.
– That is since the agreement is alleged to have been made?
– Yes. It indicates that Mr. Gunn is dissatisfied with what has occurred since the conference was held. Evidently no mention was made at that conference of the intention of the Commonwealth to impose additional taxation. Unfortunately, we are unable to say what took place- at the conference, because, although only to-day I endeavoured to obtain through official channels a copy of the report of the proceedings, none is available.
– The Commonwealth Government would not be justified in discussing with State Ministers a proposal to impose a petrol tax before it had been introduced to this House.
– If the right honorable member for Balaclava is right in that contention, the position is worse; for the simple reason that State Ministers, without any knowledge of the manner in which the money was to be raised, were given to understand that they were to be assisted financially by the Commonwealth. I do not know what was in the mind of the Premier of South Australia when he made the statement that is attributed to him. He may feel bound to append his signature to the agreement. But can it be imagined that the Parliament of South Australia will endorse it, in the light of what he said? His announcement was cheered from all sides of the House.
– But he is not correct.
– I do not know whether he is or is not. Let us take the case of Western Australia. Mr. McCallum, the Minister for Works in the Government of Western Australia, made the following statement: -
At the conference between the Commonwealth and States, the States’ representatives apposed any further taxation on the grounds that the Customs revenue on the importation of motor cars and accessories provided practically the whole .of the Federal expenditure under the road construction plan.
– Yet both of those Ministers made provision for the removal of their petrol taxes so soon as the Commonwealth petrol tax was imposed.
– They must have been told that the Commonwealth intended to impose a petrol tax.
– They anticipated that such a tax would be imposed. When the announcement was made, the Treasurer of Victoria said that he was not surprised at the Commonwealth having taken that action.
– No reasonable man would expect any Parliament to ratify an agreement if it were dissatisfied with what had taken place since the matter was discussed. These are very important facts, that bear materially on the present position. We ought to know what is in the minds of the representative men who are expected to attach their signatures to this agreement, and then have it ratified by their parliaments. Let us come nearer home. In the Melbourne Herald of the 26th July, Mr. Allan is reported as having said -
He had hesitated to sign the road agreement because he feared the Federal impost, but could not obtain anything definite on the subject up to the time he signed.
His is the only signature that has been attached to the agreement; yet he says that he is sorry he did so before he obtained information that would satisfy him that he was acting rightly. This proposal has since been sprung upon’ him. Do honorable members expect that the States will ratify the agreement when, in three instances, disapproval is expressed of what has taken place since the conference was held in Melbourne. Does there appear any chance of the agreement being passed by their respective parliaments ?
– The matter ought to be deferred.
– I agree with the honorable member. It should not have been brought forward until we knew exactly the attitude that the States intended to adopt.
– What benefit will the Commonwealth derive from the scheme? It appears to me that the States will get the whole of the benefit.
– The theory of the proposal is that, “ It is more blessed to give than to receive.”
– It is true that two of the States already have a petrol tax. Because of that fact they may be influenced in favour of the agreement. I believe that any taxation which is necessary for road construction ought to be imposed by the State concerned. Commonwealth assistance should be made available out of whatever surplus is in hand. If the Constitution does not allow of the Commonwealth embarking upon the construction of roads, why should this Government endeavour to regulate the whole of the expenditure that will be incurred on that work?
– Supposing that two States decline to ratify the agreement, what will be done with their share of the grant?
– I suppose that it will be divided up among the other four States. The right honorable member has raised a point that is well worthy of consideration. If three States decline .to ratify the agreement, will the whole sum be raised and handed over to the. remaining three? Before taking any action the Commonwealth should have been given the assurance that the .States intended to go on with the scheme.
– We have that assurance.
– The Government will have nothing definite until the agreement has been completed and ratified by the Parliaments of the States.
– So far as I know, the agreement relating to soldier land settlement has never been signed by any of the States.
– Too many agreements have been entered into without having been properly executed. But there is no guarantee that the Government can establish this scheme on a similar basis. Meanwhile the taxation has been imposed, and the revenue is being collected. We shall look rather foolish if in six months’ time we find that we do not require the money for this purpose, and have to return it to those who have paid it. The Treasurer smiles. I am quite sure that he has no intention of returning it. It will prove acceptable to him, because it will help to swell his surplus. It cannot be argued that the upkeep of the roads should be the sole obligation of the users of petrol. Do not other vehicles travel over the roads with equally harmful results. The States should be allowed to decide what taxation ought to be levied on the owners of motor vehicles and other users of the roads. They would take care that the primary producers who used motor fuel in con- nexion with the cultivation of their lands were free from taxation. That is not possible under this scheme. Take the State of New South “Wales as an example. It has issued thousands of motor licences. What is to prevent it from raising the fees that motor-owners are charged, and thus obtaining sufficient revenue to enable its roads to be maintained. Any State, if it felt so disposed, could impose a wheel tax on vehicles over a certain weight.
– Such a proposal has been spoken of for about 40 years.
– That is done in Queensland.
– The States have the right to impose taxation for the purpose of raising money to construct and maintain their own roads.
– Does the honorable member contend that the Commonwealth Government is under no obligation in regard to the maintenance of roads ?
– Constitutionally it is not; but I am in favour of assisting the States out of our surplus revenue. There is a difference between co-operating with the States and imposing taxation solely for the purpose of road construction and maintenance. The honorable member must draw that distinction. If he fails to do so the electors will do it for him. I am as strong a protectionist as any honorable member, but protection does not enter into this matter. That is admitted. It cannot be expected that men who believe that this particular method of raising money is not equitable, and that in any case it is a matter that does not concern the Commonwealth, will approve and support the action of the Government. There are grave doubts as to what will be the result. Clause 1 of the agreement reads -
This agreement shall have no force or effect, and shall not be binding on either party, unless and until it is approved, adopted, authorized, or ratified by the Parliaments of the Commonwealth and of the State.
Yet the Commonwealth is actually engaged in the collection of the money to give effect to it ! Does not that seem ridiculous?
– The scheme is upside down.
– Of course it is.
– Like a good deal of the Government’s policy.
– I do not support that policy, but the honorable member does. Clause 3, paragraph 3, of the agreement provides -
Of the amount to be provided by the State under this clause the sum of [(d)] shall be provided from revenue. The balance of the amount to be provided by the State may, at the option of the State, be provided out of current roads expenditure or from revenue or loan monies.
If honorable members will look at the amounts that are to be provided by the different States they will see that New South Wales will have to find £4,140,000, of which only £517,500 need be taken from revenue. In other words, although it is not intended that the Commonwealth shall borrow to defray its contribution, the State may borrow all except oneeighth of its share. With such an attractive bait, the reason for the States jumping at the proposal is easily understood.
– Will they not have a splendid asset?
– Does the Minister for Markets and Migration (Mr. Paterson) believe that, whilst we decline to borrow money for this work, we should encourage the States to adopt that policy? Would it not be far better for them to defray their expenditure out of revenue? Should not the work of reconditioning roads be paid for out of revenue and not out of borrowed money?
– A special sinking fund of 3 per cent. is provided under the bill.
– I am not referring to the provision of a sinking fund. I am asking whether we are justified in inducing States to borrow money to meet the bulk of their expenditure on roads constructed under the agreement. I have no doubt that the State Governments will eagerly accept the opportunity to expend money out of loan rather than out of revenue, as that will help them to balance their accounts.
– The States are already borrowing money for this purpose.
– That affects their own domestic policy, and does not justify this Government, which itself does not intend to borrow money for expenditure on roads, in levying a tax upon petrol users, and then inducing the States to borrow money to meet their obligations under the agreement. Whether this is a wise policy remains to be seen, but I myself cannot countenance it. It means that, in most cases, we shall borrow abroad, and receive the equivalent in goods, which will not help the development of this country at all. It is quite true that a sinking fund of 3 per cent. is to be provided, and that at the expiration of ten years, whatever may be the debt incurred by the States, they will still contribute to the sinking fund, but that does not alter the fact that continual borrowing abroad is unwise.
– Provision is being made for maintaining as well as constructing roads. The asset will be maintained, and at the same time the debt will be repaid..
– Petrol users will continue to pay a tax to the Commonwealth, and to some of the States, and much of the money collected will be expended in meeting the interest on the debt. We have to deal with the principle of borrowing, and decide whether we should borrow money for the building of roads, or for the repairing of them.
– Surely that is a matter of State policy.
– We should expect the Treasurer, above all others, in view of his past utterances, to discountenance borrowing abroad, but he is now trying to place on the shoulders of the States the Commonwealth’s responsibility for borrowing money in connexion with its roads policy.
– Provision is being made for a sinking fund of 3 per cent.
– Although we provide sinking funds, the national debt is still increasing. I wish to correct a statement made by the Minister for Works and Railways yesterday when introducing the bill. I am quite certain that, at the time, he did not understand the interjection that was made. When he was dealing with the financial position of the Commonwealth and the States under the bill, the right honorable member for Balaclava (Mr. Watt) asked by interjection whether this matter would remain in the hands of the States, and the Minister replied that it would. I believe that that statement was incorrect.
– That is so. The sinking fund provisions are contained in subclause 3 of clause 4, which I had just quoted.
– The Commonwealth is insisting that, at the expiration of ten years, the States shall continue to contribute to the sinking fund. I have refrained from dealing at length with the proposed petrol tax, because that subject will come up for discussion shortly; but it must be apparent that we, as a deliberative Parliament, are acting wrongly in levying a tax upon the users of petrol in this country, especially when we have no guarantee from the States that they will ratify the agreement.
– Surely we can accept the word of the State Treasurers?
– When the State Treasurers decided to accept the agreement, they did not know that a petrol tax was to be levied by the Commonwealth to meet its commitments under the agreement. I have quoted extracts to show that that was so in connexion with three of the States.
– The honorable member did not quote the whole of Mr. Gunn’s statement. Since the levying of the tax, that gentleman has stated that he is prepared to accept the agreement.
– I did not quote the first part of Mr. Gunn’s statement, because it referred to the petrol tax, which is a subject I do not wish to debate. Mr. Gunn’s intimation that he will keep his promise, even though the petrol tax has been levied, shows that he is an honorable man. He has stated that he will accept the agreement, but it does not follow that the South Australian Parliament will approve of it. If that Parliament rejects it, what will happen? Have we any guarantee that the Commonwealth Parliament will ratify the agreement? It may be that a majority of honorable members are opposed to the levying of the petrol tax.
– According to the honorable gentleman’s argument, no Parliament should act in this matter before another.
– Before submitting the agreement to this House, and before imposing additional taxation to meet our obligations under it,the Government should have made sure that the States were prepared to ratify it.. Otherwise, the Commonwealth Government may be placed in the humiliating position of having collected a tax from the people for no purpose whatever.
– The States have always honoured the agreements that they have made with the Commonwealth.
– Before’ imposing taxation we should know definitely whether it will be required. No one knows whether the States will ratify the agreement.
– They will certainly ratify it.
– Yes, because this Government is inducing them to borrow money to meet their obligations under the agreement. The States will probably accept the agreement, caring little for the obligation that it places upon succeeding governments and posterity.
– That statement is unfair to the State ministers who, by accepting the agreement, looked to the future for ten years hence.
– I am not saying anything unfair to them, but speaking from my knowledge of human nature. The States are now considering whether they will be justified in accepting the agreement in view of the tax levied by the Commonwealth on petrol users.
– The question of ratifying the agreement was included in the Governor’s Speech at the opening of the Queensland Parliament to-day.
– We should know whether this agreement will be ratified by all the States. If only two or three States accept it, will the Commonwealth Government hand to them the whole amount collected through the tax, or pay them their share as provided in the agreement, and swell the Federal surplus with the remainder ?
– Did the honorable member, during the election campaign, indicate that he was opposed to this Government assisting the States in connexion with their road policies?
– Unfortunately the Prime Minister was not present when I made my position clear. I said that the Labour party was agreeable to cooperate with the States to assist their road policies, but we objected to the imposition of special taxation for that purpose. When the Commonwealth Govern ment has a surplus, we have no objection to spending portion of it on the construction . of developmental roads in this country.
– The honorable member contends that the general public, and not the road-users, should pay for the construction of roads?
– I have told the Treasurer more than once that a petrol tax is solely a matter for the States. We have no constitutional power to build roads in any State, except for defence purposes. There is a vast difference between the Government’s road policy and that of the Labour party; and, because of that, I am unable to support the bill.
Mr. RODGERS (Wannon) [5.4SJ.- I. am as strong an advocate as any man in this country of good roads, for I have lived all my life in the country, in a district where it is almost impossible, because of the nature of the soil, to have good roads all the year round. At the same time I regard the provision of roads and their maintenance as State functions. The Commonwealth may have some liability or obligation in respect of roads used for Commonwealth purposes, and to that extent it may have to meet some commitments; but, broadly speaking, the provision of railways and roads has always been definitely regarded as a State matter, and a State duty, as well as a State function.
– The States have not fulfilled their duties.
– The State of Victoria has done magnificent work under the Country Roads Board. If all the States of the Commonwealth were as advanced as is the State of Victoria, their roads would be in a much better condition. In the matter of transport, the function of the Commonwealth concerns export, and should begin after the States have done what is necessary to convey the produce of the country to the seaboard. The Commonwealth has an interest in the shipment of produce from Australia, and it should aid the States by helping to furnish the various outer ports of Australia with modern equipment for the transport overseas of our products. A greatly needed work, long awaited, remains to be done at. - these ports. We might, by their development, prevent the congestion in large centres in Australia that are now given too much attention. There is no country in the world that is calling so loudly as Australia for a de-centralized system of export.
– There is no better way to secure it than ‘by providing good roads.
– As I have said, I am, in common with every other member of the House, an advocate of good roads.
– What about new States ?
– If the outer ports of Australia are developed as they should be, new States must be brought into existence. It is the outstanding way in which to solve the problem of the creation of new States, and I hope the Treasurer will ponder over it. I was surprised that the Minister for Works and Railways (Mr. Hill), in introducing this bill, did not direct more attention to the attitude of the public towards this proposal. He failed to deal with the great agitation in the country at the present time.
– I do not admitthat there is any agitation other than thatwhich is stirred up by certain interested people.
– Then the people of the honorable gentleman’s electorate must be in a very different frame of mind from those in my electorate. Already we have three distinct authorities dealingwith road construction under a well thought out system. The States are primarily responsible; then there is a main roads board in practically all the States, in some cases modelled on the Victorian Country Roads Board. This board is doing admirable work in Victoria, and the State has already strained its finances to provide money for its road policy. Then we have the local municipal authorities, also dealing with road construction. Now the Commonwealth Government proposes that it should be a fourth authority.
– All are in favour of this scheme.
– That is not so. This measure cannot be considered apart from the sister measure which the Minister for Trade and Customs (Mr. Pratten) will shortly introduce, based upon the Customs (duties he has recently imposed. The two measures must be regarded as, together, constituting the roads policy of the Government. I am aware that road construction is urgent, but I believe that there is a measured stridebeyondwhich it is unsafe and unsound to proceed, in dealing with the finances of this country. The bait which the Treasurer holds out is so very alluring thatif we had twenty State govern-, ments they would all jump at it. But it wasa shock to the State governments to hear suddenly the announcement that there was to be new taxation proposed forthe purpose of financing the Commonwealth’s aid for road construction. I leave for the moment the question of the incidence of that taxation. The Commonwealth Government has nibbled at road development on two or three occasions, and the bait it held out was accepted. But this time it comes forward with a proposal for a grant of some £20,000,000 which will tie it and successive Governments to this road policy for ten years. In my judgment, the proposal will create a permanent Commonwealth authority in connexion with roads in Australia.
– Hear, hear!
– The Treasurer says “ Hear, hear “ ; but when he sat in the Country party corner there was. no more fierce critic of the Government or advocate of the necessity for restoring responsible government in the Commonwealth. Here we have a proposal involving the expenditure of £20,000,000 which was never brought into this House.
– It is brought in now.
– That is so. The Prime Minister (Mr. Bruce) will know that I took fundamental exception to certain items of policy, and I am not to be debarred by anybody from speaking my mind freely. It is unpleasant sometimes to speak against certain items of Government policy, but this is an occasion, in the public interest, upon which I propose to exercise my right in this respect. The Treasurer expects in this financial year to receive a revenue of, roughly, £76,000,000. That is an enormous sum of money. Thereis to be also a borrowing programme involving at least £47,000,000- £12,000,000 for . the Commonwealth and £35,000,000 for the States. This is an enormous programme for 6,000,000 people, and I remind honorable members that we cannot look for a continuance of good years and high prices indefinitely. Prodigality of expenditure has been indulged in as a result ‘of our huge customs revenue, which, in my judgment, cannot be contemplated for the years ahead. This policy of financial magnificence - £20,000,000 here and £20,000,000 there- must stop. There must be a public conscience created in Australia to ensure that we shall live within our means. It is contemplated that we shall spend a revenue of £76,000,000 this year. That may be all right, but it is also contemplated that we shall borrow and spend £47,000,000 that we have not yet earned, and all this in spite of our public debt being what it is. I say that the figures are staggering. It is time the people woke up to the grave financial position of Autralia. The symptoms, or some of them, on examination may seem healthy, but the Commonwealth cannot afford to make grants of £20,000,000 here and there. The Treasurer used to contend from -the Country party corner that we should live within our means, but we are not doing so. In view of the present inflation of costs of construction, the honorable gentleman cannot- lay down a mile of road that will be a permanent and enduring asset worth its cost. We have had submitted a programme calling for nearly £80,000,000 for certain items; there is to be £20,000,000 for housing, £20,000,000 for roads, £3,000,000 for wire-netting, and £34,000,000 for migration. The financial position of the Commonwealth has to be faced, and the Treasurer should not complain of any criticism levelled at him, because, when a private member, he was a whole-hogger for economy. What I have to say to the honorable gentleman is not said in passion, but in a friendly spirit, because I believe it to be necessary to bring him back to the sane position which he took up as a private member. He then considered that the Prime Minister, who was then Treasurer, was going at a hand-gallop towards a financial precipice, but he is to-day himself the great champion of national expenditure. For every £1,000,000 spent on roads, it must be remembered there will be a per manent annually recurring expenditure for their maintenance. This will represent a very serious tax upon the people.
– Yes, with road rollers made dutiable at 25 per cent.
– The cost of maintenance will be higher than the previous amount spent in construction.
– The cost of maintaining roads in this country is very heavy.
– Does the honorable gentleman suggest that no savings will follow as a result of the construction of good roads?
– The saving to the people, generally, in a country so large as Australia, from the construction of good roads will not be reflected in their balance-sheet for many a day to come. I again say that I believe in good roads, but the upkeep of the roads it is proposed to construct under this bill, will more than counterbalance the savings resulting from their construction.
– America has not found it so.
– I hope that the Ministers will say no more on the subject of roads in America. The right honorable member for North Sydney (Mr. Hughes), returning ou one occasion from a visit to America, was impressed, as the Treasurer has ‘been, by what he saw there. He said that America was a nation on wheels, and that its road policy was magnificent. I am quite prepared’ to believe all that the right honorable gentleman said on that occasion, all that the Minister for Works and Railways said in introducing this bill, and all that the Treasurer said in the speech he delivered in Sydney about the American roads. But America is the richest country in the world. It has 48 States, and a population of 116,000,000. The American nation is rolling in wealth.
– What made America wealthy ? Development of the country, surely !
– Yes, and the war made the American people wealthier still. It is wrong to assume that because an honorable member has a well-founded opposition to the Commonwealth entering upon road construction, he is therefore against the provision of good roads. There are already two levies made for roads. There is the raising of revenue by the State Government, and the raising of revenue by municipal authorities. The people of the country districts are called upon to pay very heavy rates for their roads. The Minister for Markets and Migration (Mr. Paterson) is to-day championing the taxes upon petrol, tires and chassis, but a few months ago he got up in his place in this Chamber as a private member and made a gesture of strong opposition to the Government, of which he is now a member, because of the duties levied on agricultural machinery. To the embarrassment of his Government, he moved the adjournment of the House in order to draw attention to the fact that, owing to the imposition of customs duties, the cost of agricultural machinery was too high. Yet now he is supporting a tax on the petrol which is necessary to propel some of that machinery, the effect of which will be to increase considerably the cost of production and the cost of living. I come now to the incidence, of the tax.
– I hope that the honorable member intends to refer only incidentally to the tax?
– -I trust that it is permissible for me to show that in my judgment the incidence of the proposed taxation for roads is inequitable. Why should the man who drives a tractor be levied upon to help to make roads upon which he is not permitted to travel it?
– How many tractors use benzine ?
– Most of them. As the honorable member is an agriculturist, he ought to know that benzine is used in most tractors.
– It is merely used to start them.
– Most tractors do not use benzine.
– It is well-known that Mr. Ford is converting all his tractors so that they may be driven by benzine.
– As a matter of fact, tractor users are almost unanimous in the belief that better results can. be obtained from petrol than from kerosene Farmers in my constituency have made the strongest representations to me against this proposed source of revenue. The tractor-driver is compelled to pay tax, in order to raise revenue out of which to construct roads on which he is not permitted to travel. Petrol is used also as the propellant of milking machines.
-Order! I have already pointed out that this measure is -
To authorize the execution by the Commonwealth of agreements between the Commonwealth and the States in relation to the construction and reconstruction of Federal-aid roads, and to make provision for the carrying out thereof.
I ask the honorable member now to confine himself to the subject-matter of the bill.
– If you, Mr. Deputy Speaker, restrict debate in such a way that honorable members are not permitted to discuss the financial provision for roadmaking, you will tie the hands of this Parliament. The honorable member for Wannon, like the Leader of the Opposition (Mr. Charlton), questions not only the propriety of the Federal Parliament’s assumption of the States’ function of road-making, but also the means which will permit it. If the collection of special duties, the means by which the Government proposes to carry out its policy, cannot be discussed, and the debate is to be limited merely to the subject of roadmaking, we might as well come to a decision at once without any further discussion.
– I ask you, Mr. Deputy Speaker, to reconsider your ruling that honorable members must not discuss the financial arrangement behind this bill. If you peruse the agreement which forms the schedule to this bill, you will see frequent reference in it, not only to how the States are to find means to carry out this road-making scheme, but also to the Commonwealth’s policy in that respect. The agreement makes provision for the expenditure of Commonwealth money, and it will be impossible for us to agree to proposals for expenditure unless we oan at the same time discuss the financial arrangements made by the Government to meet that expenditure.
– The Leader of the Opposition (Mr. Charlton), in speaking to the bill, referred to the fact that it was proposed to raise money for road construction by a certain, method, but he said that he would not discuss it at this stage, as he preferred to wait until the specific measure came before the House. No objection was taken by the Chair to the reference made by the Leader of the Opposition, but when the honorable member for Wannon (Mr.Rodgers) was speaking on that aspect of the question, he was requested not to deal with it in detail at this stage. Later on, when the honorable member proceeded to a detailed discussion of the users of petrol in various classes of machinery, he was told that he was not in order in doing so on this bill.
– When you intervened, Mr. Deputy Speaker, to give a ruling that very much limits the value of a discussion on a bill to ratify an agreement for the construction of federal aid roads, I was endeavouring to show that some of those who will be the chief contributors to the revenue from which the roads are to be built, are already very heavy contributors to Customs revenue. They pay, roughly, £3,500,000 a year, and now they will be expected to contribute another £1,500,000, making in all £5,000,000 a year. They will also pay their share of the £500,000 which has to be provided from general taxation. On the whole, it will be a heavy burden on them. The incidence of this taxation is, in my estimation, inequitable. At a later stage I hope to go into this matter in more detail;but for the moment I shall endeavour to confine myself within the limit of the ruling, because Mr. Deputy Speaker, I have the greatest belief in the fairness of your decisions. On a prior occasion a very eminent legal authority in this chamber, the Attorney-General (Mr. Latham), told us that the Commonwealth’s financial contribution to road construction in the States as such was unconstitutional. In the first place I think it is an error of judgment on the part of the Commonwealth Government to usurp a State function, and in the second place no worse time could have been chosen by the Commonwealth, for an incursion into the arena of the States’ activities than thepresent, when it is about to ask the people to amend the Constitution, by taking certain powers from the States. Apart altogether from the constitutional aspect of the matter it is questionable whether the Commonwealth Ministry should spend £20,000,000 upon an asset which will not belong to the Commonwealth. State roads are State property and are under the control of municipalities. It is the greatest departure the Commonwealth has yet taken to earmark £20,000,000 for expenditure on State property under the control of local governing bodies over which the Commonwealth cannot exercise proper control or supervision. Unless we propose to build up a huge staff, we shall not have the machinery which will enable us to exercise . effective supervision over the expenditure of this money. In order to supervise the existing limited road construction programme every municipality in the Commonwealth finds it necessary to employ engineers and in some cases clerks of works, many of whom, to cover their territory, are travelling most of their time in motor cars. If this programme is to be multiplied all over Australia, what supervision can the Commonwealth exercise? The Treasurer ought to know that the dominant factors in any successful undertaking are proper supervision and control. Can he tell the taxpayers that this expenditure will be wisely undertaken and carefully scrutinized by Commonwealth representatives? He cannot do so.
– Does the honorable member say that the States are incompetent to supervise this work?
– He is saying that the Commonwealth is unable to do so.
– The Minister knows exactly what I am saying, but interjects in such a way as to make it appear that I am reflecting on the States.
– That is what the honorable member was doing although it may not. have been his intention to do so.
– I was not doing so. On the contrary, I was saying that the Treasurer would not be in a position to give a certificate that the taxpayers’ money was spent under a Federal supervision with which he was perfectly satisfied. We have got into a first-class mess through the overlapping of Commonwealth and State functions. In the expenditure of £40,000,000 between the Commonwealth and the States on soldier land settlement, overlapping has resulted in a huge loss to the Commonwealth. We are now entering upon the same sort of competition with the States in an attempt to do something which is purely a State function, and for which the States alone possess the necessary machinery. Nothing can come from it but the building up of a huge unwieldly department with branches all over Australia. I cannot stand for that. If the Treasurer wants to uphold the reputation he won on the Corner bench, he ought to be reducing taxation, instead of levying new duties. The time has come when some one should call a halt, but it will not be the Treasurer at the pace at which he is travelling now. The expenditure to which he has committed us is colossal. I cannot account for the change that has come over him. The magnitude of his financial policy can be seen in every direction. Had the Government of which I was a member brought down a programme of this description when the honorable member was sitting in the Corner, things would have moved. The whole of his party would have been behind him to a man, raking the Ministry fore and. aft. To-day, they are ominously silent, as they swallow the gilded pill; I can see no reason for modifying a single word that I have said with regard to the commitments of this nation. Many of our industries are unable to bear the present cost of production, yet the Government proposes, by means of this tax, to add to it. I should like to know whether we are going to get the States to ratify this agreement.
– We are.
– I do not know that the Treasurer is in a position to say that. But even if the State Governments accept, I doubt very much whether the rank and file behind them will do so.
– I do not think they will endorse the Government’s method of raising the money.
– The Government did not announce, when the agreement was under consideration, how it proposed to raise the money; but now that it has done so it has found that thousands upon thousands of the rank and file which supports it are diametrically opposed to the method proposed.
– Were the States aware when they signed the agreement, how the money was to be raised?
– They could not have been.
– The fact is that neither the Prime Minister nor the Treasurer indicated, prior to the election, that there was any intention on the part of the Government to impose fresh taxation on the people through the Customs Department.
– Had we done so the revenue would have been defrauded.
– If we should pass this bill and later find that the States will not ratify the agreement, we shall suffer a well deserved rebuff, for we are undoubtedly trespassing on the State domain.
– But the tax will help to swell the surpluses!
– The disappearing surpluses! That is so. In many country districts the heavy work of carting produce to market is done in the summer time when the roads are good.
– Not in my State.
– The honorable member should not tempt me to refer unkindly to his State. I am speaking of the wheat belts of Australia.
– Oh, wheat!
– Probably if wheat were grown in the honorable member’s State it would not be in such serious financial difficulty.
– And wheat is rather an important crop!
– It is possible to exaggerate the need for good roads at any cost. After all, the financial position of the country must be the governing factor in its roadmaking policy. If we were to construct good roads throughout Australia we should need an enormous population to maintain them; but, in the wheat belts the principal road traffic occurs in the summer, when the farmers are carting their wheat to the railway, and taking manure as back loading. Every uptodate farmer has a programme of improvements which he plans to carry out in the off season. He carts all his fencing wire, wire-netting, building material and so on, while the roads are good; and it should be remembered that very often he chooses the earth side track in preference to the main metal road. A good earth track, as everybody knows, is always preferred to a metal road. Many of the farmers do not shoe their horses where good earth tracks are available, and that is a distinct saving, seeing that it costs 10s. or lis. to shoe a draught horse.
– They use the side tracks even in Tasmania in the summer months, for I have been over some of them.
– Even the motorists use the side track if it is good, for it means less damage to tires and less wear and tear generally. I am an advocate of good roads, but if we intend to make all our roads good roads, we must face a far greater expenditure than has yet been proposed.
Sitting suspended from 6.27 to ? p.m.
– I regret that, prior to the dinner adjournment, Mr. Deputy Speaker thought it necessary to direct me to confine my remarks within certain limits. I have since had an opportunity to consult May, but as Mr. Deputy Speaker is not now in the chair I shall refrain from dealing further with the matter except to say that I feel that his ruling has robbed the debate of much of its value.
– Perhaps Mr. Speaker will take a different view.
– It would hardly be fair to Mr. Deputy Speaker to take the matter up with Mr. Speaker now. if I were asked to sum up my opinion of this bill and the petrol tax, and pronounce upon the policy involved in the two, I could not do better than quote the remarks made by the present AttorneyGeneral (Mr. Latham) on the 9th September last. The Minister may now take a different view of its constitutionality, but I should say certainly not from changed conviction. On the 9th September last, speaking on the Main Roads Development Bill, the Attorney-General said -
I am sorry that I am unable to join in the general chorus in praise of this bill. Of course, everybody agrees as to the necessity and desirability of making good roads in Australia. We want more roads and better roads. The question is, Who should make them? Should it be the Commonwealth Government or the State Governments? In proposing, year by year, legislation of this character the Commonwealth Parliament is placing itself in a difficult position. It is merely granting financial subventions instead of devoting its revenue to the work which should properly concern it. Although the Commonwealth Parliament has no power to legislate for main roads as such, we are discussing a bill the object of which, as we all know perfectly well, is to make possible the construction of main roads, without considering at all whether this admittedly desirable object is one of the objects with which the Commonwealth legislature ought to concern itself. I venture to assert, although I know it will be unpopular to do so, that in passing legislation of this description we are not acting constitutionally. This Parliament has no power to legislate for main roads. It has power, of course, to grant financial assistance to States which need it. I suppose this bill would be defended on that ground if it were attacked.
I am sure that the Attorney-General remembers nearly every word of that speech. It was a very clear pronouncement. I say without hesitation that if the Commonwealth Government can by a process of grants on the one hand or of strangulation on the other, so affect the policy of the States as to make them dependent upon it to carry out State functions, Federation will become a dead letter, and the Federal spirit will start to vanish. The Attorney-General has since joined the Government, and is now a member of the chorus to which he referred, so I can hardly expect that my remarks this evening will contribute any melody to the chorus of the party. The position is perfectly clear. The State Governments have always been regarded as the authority charged with responsibility for the construction and maintenance of roads, and I cannot stand for this policy of subventions to the States, which may levy taxation upon the same people if they desire to do so.
– It would then be direct taxation.
– And this Government is resorting to that kind of taxation. I regard the present situation between the Commonwealth and the States as a trial or a tryout of the Federal spirit. The people have become bewildered by the creation of all these authorities. The Attorney-General on other occasions has waxed eloquent over the unwisdom of constituting overlapping authorities and of duplication in industrial affairs. He warned the Government, before he was a member of it, of the unconstitutionality and the unwisdom of the Commonwealth entering the State arena or intruding on State affairs, but now he deliberately participates in the work which hitherto has been left to the States. I said in my opening remarks that there may be some roads in respect of which the Commonwealth could be said to have some interest; such roads, for example, as could be used for defence purposes.
– Most roads may be used for defence purposes,
– Not at all. This proposal is also a negation of the policy enunciated by the Treasurer and the Government that it is sound finance for a Government to raise the money which it spends for its own purposes. The Attorney-General will not deny that under this bill money will be expended upon State undertakings. Nor will he deny that the responsibility for road-making is vested in the States, and that this work is carried out under the control of main roads boards and local municipalities. The Commonwealth Government has no machinery by which it can supervise and check expenditure on roads. The Treasurer is naturally looked upon as the watch-dog of the taxpayer. I doubt if, under this scheme, he will be able to justly lay claim to that title, because he proposes to hand over to the States £20,000,000 without making adequate provision for an effective check upon, its expenditure. Consequently, he will be unable to certify to the taxpayers of the Commonwealth that the whole of the money has been economically and wisely spent. He will be obliged to rely upon State authorities. Moreover, when it can be avoided, it is bad policy for one government to spend money that is raised by another. The first duty of the Government should be to reduce the cost of production. I have yet to learn that the cost of production may be reduced by the imposition of additional taxation. The announcement of this tax. came as a shock to the State Governments and the people generally. The people had become imbued with the idea that there was a huge surplus every year, and that the Commonwealth was in a position to make money available for such purposes as are contemplated under this measure. They never dreamed that new taxation would be levied upon them. I take the view that unless the cost of production comes down this country will be unable to carry on successfully.
– The country will come down.
– Quite so. Another objection I have to the measure is that, notwithstanding the view that succeeding governments may take with regard to this assumption of State functions, they will be committed by this measure for a period of ten years. It is part of this Government’s policy, and we may safely anticipate that it will be a permanent feature of the Federal Government’s programme. If it is to be part of the Government’s permanent policy, are we going to have competition at general elections for the amount of the roads grant?
– Of course.
– Personally, I cannot stand for this action of the Government in taking over what I regard as purely eState functions. I propose to vote against the bill and its complement, the petrol tax, as a definite protest against the tendency of the Government to take from the States functions that were deliberately left with them at the time of federation. It will be impossible, unless we now insist upon clearer lines of demarcation between the Commonwealth and the States, to stop the drift. We are overlapping now in so many matters that the people have become bewildered as to what is a Federal and what is a State function. Even at this’ juncture the Government would be well advised to change its road policy; if it still desires to keep the spirit of the agreement made with the States, it should float a loan at a low rate of interest on their behalf, instead of ear-marking Federal revenue for the purpose. I say in all sincerity that it is most unfortunate that the Government should have earned such unpopularity by being the first to impose new taxation when the people are expecting relief. I am certain that the Government is actuated with the best of intentions, and I give it credit for desiring to help the man on the land, particularly those in the back country, but it has adopted the wrong method.
– The Government can assist the man on the land by providing them with better roads.
– No one knows bettor than the honorable member for Indi (Mr. Cook) that a vigorous roads construction policy has been in operation in “Victoria for some time, and that magnificent work has been done by the Country Roads Board.
– And that body is strongly in favour of the scheme.
– No State has provided more money for road construction purposes in such a short time as has Victoria, and the honorable member’s interjection is, therefore, of little value. Other States, particularly Tasmania, have spent enormous sums of money on roads construction, and the States which are most jealous of their progress are those which are spending what they can afford in that direction. I know honorable members will continue to refer to the value of good roads to any country. Every one admits that, but it is only a question of the amount that can be raised. Under the proposal te impose special taxation, money will be obtained from taxpayers who are providing the funds which the States are now using for road construction.’ I have made my protest, and I intend to f ollow it up with my vote.
.- This is a Roads Bill, and the road it is traversing is a rocky one. I listened with interest and pleasure to the speech of the Leader n* the Opposition (Mr. Charlton), and also to that of the honorable member for “Wannon (Mr. Rodgers), which contained a good deal of common sense. The supporters of the Government are continually chiding the Opposition for being unificationists. It is true that we favour one sovereign government for Australia, but we are, at least, honest enough to say that, whilst we have a Federal system, it should be respected, and that we should not try to undermine it. It is the duty of the Government and those who stand for federation, and not a unified system, not to undermine it, and those, who believe in changing it in a constitutional way should also respect the union until they can openly bring about a unified system such as they believe in.
– Similar assistance has been rendered to the States in America for years.
– We have heard a good deal of what has been done in America.
– They also have prohibition in America.
– They have in that country lots of things that we do not want here. I have not the slightest objection to this Parliament making a grant or a gift to assist the State Governments in any direction it considers necessary; but there is a marked distinction between a gift to the States of £250,000 or £500,000, from an overflowing Treasury, to assist them in developmental work, whether it be for road-making or railway construction, and introducing a permanent and continuous policy over a period of ten years. Honorable members can draw a distinction between the gift of a sum of money for constructing a few main roads or building a railway, which is a State function, and introducing a policy under which new taxation is to be imposed in order to enter the field of road construction in State Territories. We are exceeding our constitutional rights when we invade in this way territory under the control of State authorities, and that, in my judgment, is the fundamental objection to the bill. It is useless the Prime Minister chiding the Leader of the Opposition as he did, concerning the policy he enunciated. The Commonwealth should co-operate with the States as it has done in the past when there has been a surplus to distribute, but it should not interfere with the functions that rightly belong to the States, by competing with them in a way of which, they do not approve. It is easy for the Treasurer to say, as he did during a previous debate in this House, that this policy was enunciated by the Prime Minister in his policy speech. That statement I dispute. If it was the intention of the Government to adopt this course, when the policy of the Government was enunciated, the Prime Minister should have been quite frank in the matter. It is. true that he said in his policy speech that £20,000,000 was to be used for road construction, and that the money would be obtained from Customs revenue.
– From road users.
-He did not say that the money was to be obtained by the imposition of new taxation.
– I made that very clear.
– I did not understand the honorable gentleman to say so.
– If any one should have known what was in the mind of the
Prime Minister, surely it was the honorable member for Wakefield (Mr. Foster) ; but he admits that he did not. The promise of £20,000,000 was a very nice bait to the electors, but, as one honorable member stated, the hook was very carefully concealed. Let us examine the position. It is useless to avoid the fundamental and special objections to the proposal, by saying that we need good roads. That has become the formula of honorable members sitting behind the Government.
– And that a similar policy is in force in America.
– Yes, and when that is said, we are to assume that the last word has been spoken. The good roads, which we admit are needed, should be made by those who are in a position to provide them in a proper and equitable way. One of the greatest problems with which the State Governments have to contend, is that of road competition with the railways under their control. Road construction policies must co-ordinate with railway construction schemes, and that is the responsibility of the States. All of the States are spending hundreds of thousands of pounds to provide suitable roads for motor transport, but as expenditure is increased on road construction, railway revenue is being lost. It is not the duty of the Federal Government to ask the States to raise 15s. for every £1 which the Commonwealth contributes, or to recommend routes and road construction works, irrespective of the more important problem which the States have to face in making their railways successfully compete with modern transport systems. I am not suggesting that we should be tied to our railway systems as against motor transport; I do not think we should. I believe that we must adopt the most modern methods, whatever they may be, according to the decision of the experts who go into the matter, and construct roads as feeders to railways rather than to compete with them.
– That is what is suggested.
– That has not been done. At any rate, this Parliament should not be the judge.
– That is the point.
– Yes; that is the problem to be solved by those controlling the railways, and not by those responsible for this policy. In effect, the Prime
Minister said in his policy speech that as the Treasury was overflowing as the result of the heavy Customs revenue, and that as approximately £5,000,000 was being obtained annually from motor users, that source should be tapped for road-making purposes. Every one believed that revenue was to be obtained from that source instead of by imposing a special revenue duty, which is unsound in principle. Revenue duties are always unsound, but particularly so when they are ear-marked for a special purpose. The introduction of such a policy when the Government is proposing to discontinue the per capita payments is most inopportune, and particularly so in view of the fundamental principle enunciated by the Treasurer, that the authority raising the money should be the authority to spend it. On top of that a new proposition is now submitted. At the very time that the Government is saying “ Separate the Federal and State finances,” it is entering into an arrangement under which the finances of the Commonwealth will be linked up with those of the States for at least ten years.
– It is like a teetotaller becoming intoxicated !
– It is worse. There is a general desire to dispense with a duplication of taxation. Yet here we have duplication. Two of the States are already imposing a petrol tax on road users for road construction which, so far as we can ascertain, is being most equitably applied - more equitably than this Parliament can constitutionally apply it. By interjection the Treasurer emphasized the point that we must impose a tax upon road users as if the Government was laying down a great fundamental principle. It is one that is as old as the toll gates - a principle which we departed from years ago. We might, however, depart from a principle which we considered fundamentally sound because of the special conditions obtaining to-day, and I’ admit that some special impost should be levied on those who are playing such havoc with our roads.
– And the States are levying it.
– Yes. The States are the only authorities that can equitably impose such a tax, and it is within their power to go further in that direction.
I propose to consider one or two points that have nob been elucidated. Under an agreement of ten years’ duration it is proposed to pay a certain sum each year into a trust account for road construction. The money is to be raised by special imposts on petrol, chassis, and tires. No provision is made that the whole of the revenue shall be paid into that trust account; only a specified sum is to be paid into it. I understand that in Western Australia and South Australia every penny raised by means of a petrol tax is put into a road fund; but under the Commonwealth proposal only one-tenth of the £20,000,000- that is, £2,000,000 - is to be paid annually into the fund, and of that sum £1,500,000 is to be raised by means of the new Customs duties. Experience has shown that the consumption of petrol has increased in the last five or six years by about 30 per cent, per annum, so that in a little over three years the revenue derived ‘ from the petrol tax will have doubled. Into what fund will that extra revenue be paid? It will help to swell the Treasurer’s surplus. There, again, the tax collected from road users will not be devoted to road construction, which is supposed to be the principal object of the bill. The State authorities alone have the constitutional power to equitably impose a tax on road users. I refuse to believe that a tax on petrol alone, or a Customs duty on chassis or tires, is an equitable means of raising the money required. If it is proposed to tax those who use petrol-driven vehicles on the roads, we must take into consideration more than petrol consumption. The weight of the vehicles and the engine power employed, plus the petrol consumption, should be considered in arriving at the formula on which to base the tax. Light motor cars cause very little wear’ on tarred roads, and they should not be taxed according to the quantity of petrol they consume. Heavy motor lorries do far more damage to the roads than light vehicles in using a given quantity of petrol. The surface of St. Kilda-road was not seriously affected by ordinary motor cars, but soon after the heavy buses were allowed to use it the road resembled an ocean wave.
– The States have endeavoured to arrive at an equitable basis of taxation.
– Yes ; but this Parliament cannot do that, a. fact which shows that we have no right to interfere in the matter. Accepting the statement that a tax should be levied on road users, I ask whether the Government’s proposal squares with that principle. Three taxes are being levied - on petrol, chassis, and tires. But are they equitable imposts for road construction ? The. petrol tax falls upon owners of tractors that are stationary, and do not cut up the roads at -all. It is imposed also on those who use petrol in motor boats or in aeroplane engines, and as a solvent in manufacturing processes. To bring the farce right home to us, I point out that the extra duty -of 2d. a gallon actually falls on mineral turpentine used in the manufacture of paints! Yet it is. supposed to be a tax on road users. Then, again, one notices that there are road users other than motorists who are not touched by this tax. I- refer to the great steam lorries employed in carting metal through the city and suburban streets, and which do immense damage to the roads. Electrically-driven motors and horse-drawn vehicles, too, will, not be affected by this proposal. Whilst on the one hand there are some road users who are not taxed, some non-road users are.
– And there are others who can evade the tax.
– Yes, by using petrolthat is not imported. Therefore, the basis of the taxation is inequitable. The disparity in regard to the tax on chassis is even greater than in respect of that ‘on petrol. It is said to be a tax on road users.. Obviously, it applies only to chassis now being imported, and does not impose any taxation on the owners of the. 350,000 motors in use on the roads throughout Australia to-day. The-.e are all exempt.
– Until their tires -wear out.
– Yes, and until their chassis wear out. I remind the Minister that between 300,000 and 400,000 imported chassis now in use are exempt, and only those who come late into the field will have to pay the tax. Even when their tires wear out, they can evade the tax- on tires by purchasing Australianmade tires. The Minister’s illustration,, therefore is not a happy one.
-Green’. - Is the honorable member not in favour of encouraging Australian industries?
– Yes.; I am a strong believer in protective duties for the purpose of encouraging the use of Australian goods, but I do not intend to be sidetracked by this proposed revenue duty. Although the Minister for Customs (Mr. Pratten) said that it was protective, the Prime Minister (Mr. Bruce) declared that it was not. lt is avowedly a revenue duty. If any extra protective impost is required, I shall support it. This tax is inequitable- in other ways. If the Government can afford to be generous with surplus revenue, let it assist in the building of roads in* the back-country, where they are most required; but when it proposes to carry out a considered policy over a number of years, and levy special taxation for a special purpose, it should, distribute the money equitably as well as raise it equitably. It has no right to make distinctions between city and country. The Minister told us to consider what was done in the United States of America. There it is provided that the highway funds shall be used for country and city roads.
– That is not so.
– I understand that from 25 to 50 per cent, of the revenue raised by the States of America is allocated to city and town streets.
– The honorable member is surely speaking of State taxation in America. The Federal aid there is applied only to roads outside, and not in towns having a population of over 2,500.
– The honorable member has given wrong information to the House, as usual.
– I call upon the honorable member for Richmond to withdraw that remark.
– I withdraw it.
– I did not hear the honorable member’s comment ; it does not trouble me what he may have said. After perusing details of the distribution of road funds, in New York, Colorado, and other American States, the impression I gained was that, of the whole of the highway revenue, from 25 to 50 per cent, was used for street construction in cities and towns.
– I think that the honorable member will find that that applies to State taxation, not to the Federal aid.
– If so, it shows that the ‘States in America are raising and distributing the tax on an .equitable basis. If we are to give surplus Federal revenue as a special bonus to -country districts, I have no quarrel with the Government. I am prepared at all times to be generous to the undeveloped portions of Australia,, and I would even go as far as to say that, even in distributing revenue, the bulk of which is raised in the cities, it should be generously employed in the out-back districts. The greater part of the revenue to be raised under this impost will be collected in the cities’ and towns, and it would not be equitable to exempt them entirely from their share of assistance in the construction of arterial roads, because the expenditure would result in increased traffic in outlying districts being concentrated upon city roads, thus adding to the serious problems already confronting urban and suburban authorities. It is useless to raise the argument that the people in the back-country are in poor circumstances. I remind honorable members that the rates levied for the maintenance of the highly-expensive city roads, which have to cope with particularly heavy traffic, are raised in the near suburbs, and the great majority of people taxed to pay for them are living on the basic wage. There are about 100 miles of arterial roads in the metropolitan area of Melbourne, and the cost of their construction has ranged from £20,000 to £40,000 a mile. It is estimated that 70 per cent, of the tax to be raised in Victoria under the Government proposals will be paid by people in the metropolitan area. Good roads are to be built to the boundary of a town, and the main road that carries the traffic right through will have to be maintained by the municipality. We are not in a position to handle this matter in an equitable way, because it is not one (if our functions. The honorable member for Wannon (Mr. Rodgers) stressed an important point. He said that, although it is proposed to expend £20,000,000, we have not the machinery that will enable us to exercise an oversight of the expenditure. The Minister replied that that was a reflection upon the States. Surely we do. not reflect upon the States when we say that we have some responsibility to the people of this country to supervise the expenditure of £20,000,000 that we raise from them! It is our responsibility to see that that money is well and wisely expended. A number of other bills that the Government proposes to bring down overlap this measure. In passing, I point out that if there is one form of taxation that it is equitable to impose for road construction, it is the taxation of land values. The construction of roads and railways is responsible to a greater extent than anything else for the creation of land values. Yet, simultaneously with the proposal of the Government to expend £2,000,000 a year on road construction, the bulk of which is to be taken from a revenue duty, it is intended to wipe out the land tax that now results in the collection of £2,000,000 a year.
– Does the honorable member prefer a land tax?
– A land tax falls upon people who are enjoying the unearned increment which has been created by road construction. That is a much sounder policy for the raising of revenue for road construction than is any special imposition like this.
– I am afraid that the honorable member and I will have to part company on that.
– I could understand the action of the Government if it proposed to supplement its land tax by a special tax ; but I cannot support the withdrawal of a tax on land values which are created by road and railway construction. I point out that none of the struggling men on the land are paying a great deal of land taxation to the Federal Government. I could take honorable members right through the electorates of the honorable member for Wannon and the PostmasterGeneral (Mr. Gibson), and show them the garden portion of the State of Victoria. They would there find main roads, used for motor transport,, that have enhanced the values of cultivable land that is not being put to the use it should be put, and is not contributing to the railway revenue to the extent that lands used in smaller allotments by. the- toiling farmers is doing. Hundreds of miles of railways and roads run through those lands, yet they are not contributing to any extent to the cost of construction or upkeep. It ill becomes the Government, at the very time when it proposes to withdraw the Federal land tax, which has been in operation since 1910, to come down with a special revenue duty for the purpose of raising money for the construction and maintenance of roads. I am unable to support a bill that trespasses upon the domain of the States by allowing the Commonwealth to embark upon a continuous policy of road construction, the taxation in respect of which is inequitable in its incidence.
– It is again, my lot to follow the honorable member for Yarra (Mr. Scullin), and I again compliment him on his excellent speech. I do not, however, propose to express agreement with the majority of the arguments that he advanced; because, in spite of what he and other honorable members opposite have said, the fact remains that when the Government went to the country at the last election, it placed in the forefront of its programme the proposal that money would be advanced for. the construction and maintenance of roads. It was returned with a majority, and if the Prime Minister (Mr. Bruce) did not endeavour to carry into effect the. policy that he enunciated when he went before the electors, he would betray the trust that they reposed in him. Whether we believe in, or- disagree with, the proposition that the Commonwealth Government should subsidize road construction, it cannot be denied that the Government was given a mandate to do so, and that, at the earliest opportunity, it is endeavouring to give effect to its promise. I am surprised that this proposal should be opposed by honorable members of the Opposition. I should have thought that they would be glad to stand behind the scheme. The working class in the country districts of New South Wales are looking forward to the passage of this -bill, so that a greater amount of money may be spent upon roads, and unemployment be thus greatly alleviated. Many workers throughout Australia will find it difficult to believe that opposition to this .proposal is being shown by .members of the Labour party.
But the opposition is not confined to those honorable members. Even honorable members on this side, members who represent country electorates, principally Victorian members, are opposing the measure.
– The Victorian Government has approved of the measure, and the Premier has signed the agreement.
– He regrets having done so. If he had not, he would later have had keener regrets. Mr. Lang, the Premier of Now South Wales, according to to-night’s Melbourne Herald, has stated that he has not signed the agreement, and does not intend to do so. I have had the pleasure of sitting in Parliament with Mr. Lang, and I can assur: honorable members that he is immovable; if he says that he will not do a thing, one can be sure that he will not. During the period that I have occupied a seat in this House, I have found that the Prime Minister (Mr. Bruce) is irresistible in his determination to carry out any proposal on which he embarks. One can imagine what is likely to happen when the irresistible Bruce meets the immovable Lang. I do not know what the effect will be upon New South Wales. That State, during the ten years, will be called upon to contribute £7,600,000 towards the cost of this scheme. There are thus 7,600,000 reasons why Mr. Lang should forsake his attitude of immovability and sign the agreement. We .must realize that the roads throughout Australia are to-day not what they should be. Objection has been taken by honorable members on both sides of thi3 chamber to comparisons being drawn with the United States of America. An honorable member to-night said that America was a populous country, and that comparisons could not be drawn between the capacity of a population of 116,000,000 and that of a handful of 6,000,000 people. When road construction is being considered, area, and not population, must be taken into account. The area of the United State9 of America and Australia is practically identical.
– It is a question of resources.
– Good roads are an absolute necessity. Whether people are closely or sparsely settled, means of com munication between them must be provided. When both the United States of America and Australia were young, transit was carried on by means of bullock wagons or horse-drawn vehicles, and the state of the roads was not of very great moment. We must advance with the times. Motor traffic is now the principal means of transport, and it is essential that good roads be provided for it. Every owner of a motor vehicle must come to a realization of the fact that, although he may be called upon to pay a little extra in taxation, the good road that he will have provided for him will be ample compensation. The advance of £2,000,000 by the Commonwealth Government this year will not immediately benefit every owner of a motor car, because he may have the bad luck to live in a district in which expenditure is not incurred during the year, but his time will come, and gradually better roads will be constructed throughout the country. It must be admitted that good roads are an absolute necessity. Generally speaking, the roads of New South Wales are today in a worse state than they were twenty years ago.
– Question !
– There is no question about it. In certain localities they have recently been improved; but, taking them generally throughout the State, they are not as good as they were twenty years ago. In that respect the State has failed. I do not blame it. We know that it possesses the resources that would enable it to raise the extra revenue required in order to bring the roads up to a proper standard; but any government which endeavoured to do that would become very unpopular. It is the duty of the central government to recognize the difference between the position now and 25 years ago, when the Constitution was framed. There were then no motor cars, and we had only a handful, of people. To-day our population has practically trebled. The motor vehicles in New South Wales number over 100,000, and there must be at least 100,000 in Victoria, and probably 80,000 or 90.000 in South Australia. Consequently the provision of good roads is a burning question to-day, and the fast that the Government included this proposal in its electioneering programme was one of the reasons for its being returned with such a big majority. It is only twelve months or two years since New South Wales altered the form of its taxation on motor cars. Many persons in the State Parliament were in favour of a petrol tax, but could not see in what way it could be imposed unless the Federal Government took the matter in hand. This Government has now recognized the justice of a petrol tax, and proposes to impose it on the users of the roads. I should like to see the bill go further than it does. The Government ought to approach the States with the suggestion that they should reduce their present taxation so that the Commonwealth could increase theirs. The petrol tax is the fairest form of taxation that can be imposed upon car-users. Some persons complain that the owners of horse-drawn vehicles are not to be asked, to bear any road tax. There are not many horse-drawn vehicles in Australia to-day; they are practically a thing of the past, and the revenue which would be derived from the imposition of a wheel tax would not pay for its collection. It has been argued that this tax will hit the farmer. Inquiries in America have proved that, by the adoption of certain methods, ‘ the farmer can be exempted. I have no doubt that the Minister who will have the administation of the act, will take steps to that end. I believe that in America blue and red petrol are sold, and any person who requires petrol for use in connexion with farming machinery is exempted from taxation.
– They are exempt under the South Australian act.
– If the tax proves to be a hardship upon farmers this measure can be amended, or regulations can be promulgated to supply a remedy.
– How about the fishermen ?
– In the United States of America the petrol is coloured according to the uses to which it is to be applied. The honorable member for Wannon said that Australia appeared to be running amok in its borrowing, and he instanced the fact that it is proposed to borrow £20,000,000 for the Commonwealth’s housing scheme. When money is borrowed for housing it is not really added to the national debt, as eventually the advances made under such a scheme are returned to the Commonwealth. The honorable member also grudged the amount that is to be spent on migration.
– I did not say that. I mentioned that sum as a contemplated expenditure.
– It will not be an ordinary expenditure. We have made a particularly good bargain in connexion with the loan of £34,000,000 for immigration, and the rate of interest to be paid on it is small indeed. Under this scheme no money will be borrowed at all.
– The States will borrow money.
– Money collected through taxation is not borrowed.
– The States will be able to b….. ow £13,000,000.
– I am referring really to the Commonwealth obligations. I know that we propose to raise funds for this purpose by means of a petrol tax. I am not in sympathy with borrowing money for the construction of roads. I should much prefer even to increase the tax on petrol.
– Under this scheme the Commonwealth will not borrow money, but the States will be able to borrow a certain sum. provision being made for a sinking fund of 3 per cent.
– The States should decide their own domestic policies.
– Borrowing by the States is bad for the Commonwealth.
– The States may do quite a lot of things .that are bad for the Commonwealth. It is not the duty of the Commonwealth to inquire why the States wish to raise a loan. So long as a sinking fund is provided, the Commonwealth need not worry about loans raised by the States to meet their obligations under the agreement. Mention has been made of railways and roads. Railways are different from roads. In most of the States, motor vehicles, running on good roads; are able to compete successfully with railways. A railway goods rate or passenger fare is really taxation levied by the railway department not only for transport, but for the upkeep of the permanent way. In most cases, main roads have been provided by previous Governments, and one has only to provide motor vehicles to drive along those roads in order to compete successfully with the railways. I take it that the users of roads will not object to paying a small tax on the petrol that they purchase, considering that the amount collected is to be expended on the construction and maintenance of roads. Main roads that do not run parallel with railways will, no’ doubt, receive most attention, because they act as feeders to railway lines. Since the Commonwealth’s policy of assisting road construction has been in force, such roads have been greatly improved. In my electorate some twelve or eighteen months ago, an application was made for a grant to assist in repairing a road between Bega and the port of Tathra. The Commonwealth consented to grant £14,000 towards that work, and the State Government agreed to put it in hand. Later the proposal was vetoed by the State Government. Trouble then ensued, and, eventually, the funds necessary for the repair of the road were obtained, and the work is now in hand. That is an evidence of the benefit arising from the Commonwealth road policy. That road is used by the dairy farmers between Tathra and Bega, and the Tableland beyond. The traffic is suspended for as much as .four or five days in a year. At times vehicles laden with produce become bogged, and are stranded on the road for three or four days. Thanks to the Commonwealth that road is now to be put in good condition. I could mention other similar . cases. Very little can be done in the way of repairing roads when only the State grant and the taxes collected from the farmers concerned, are available. Roads have been getting worse instead of better. I welcome the bill. I represent a large country electorate, and I have not received, from my constituents, one telegram or letter objecting to the petrol tax, but I have received letters expressing opposition to the tax from persons directly concerned with the sale of petrol, or, as in one or . two cases, representing .unions professing to represent pastoralists and farmers. Neither, at this stage nor during the election campaign, was any ob- jection made to me respecting the Commonwealth Government’s road policy, aud, consequently, I have much pleasure in supporting the bill.
.- Many honorable -members say they favour good roads, “ but “ - and would support the construction of good roads in the country, “ but.” The constant reiteration of the word ‘” but “ forces me to conclude that I am among a herd of goats. The main argument against the bill is certainly peculiar. The honorable member for Yarra (Mr. Scullin) let the cat out of the bag when he rode his pet hobby horse - the land tax. He said that’ the imposition of a tax on petrol for the construction of roads in the country, as proposed under the bill, was wrong in principle, and he then suggested that the moneys should be provided from land taxation. There recently met at Scott’s Hotel a body calling itself the Town and Country Union. That union has been particularly active in its opposition to the petrol tax. It is a freetrade association, which expend? a lot of money, the source of which is unknown to me. The suggestion was made at its meeting that, the money for roads should be provided, not by a petrol tax, but by an increase in the land tax. It is peculiar that the honorable member for Yarra, who is a high protectionist, in fact, a prohibitionist, should express an opinion that is held by the Town and Country Union.
– The Town and Country Union made no such suggestion. One person at the meeting suggested it, but he was howled down.
– The honorable member for Wannon (Mr. Rodgers) represents a country electorate, and his constituents will not be very pleased when they hear that he is in opposition to a measure providing for the construction of roads which are so essential to country districts. The honorable member for Eden-Monaro (Mr. Perkins), by a lapsus linguae, referred to him as the “honorary” member for Wannon, but I suggest that he is the “ temporary “ member for Wannon. He has been playing a lone hand recently. No doubt he thinks that because the Government has such a large majority it can do without him. He wants a little limelight in his constituency, but he will regret his present method of obtaining it when he tries ‘to justify his action at the next elections.
– If the honorable member’s capabilities were equal to his impertinence he would be a valuable member of this Parliament.
Mr.R. GREEN. - The honorable member for Yarra is an ardent protectionist, yet one of his objections to the measure is that under it we shall raise money through the tariff. Had these taxes, or even higher taxes, been included in the amendments to the tariff, he would not have hesitated to support them. Yet to find some stick with which to beat the Government he has denounced his own principles. He has allied himself with the opinion expressed by. the freetrade Town and Country Union, The honorable member for Wannon and the honorable member for Yarra said that under the bill this Government had no check over the expenditure of money. I draw their attention to paragraph11 of the agreement in the schedule to the bill, which reads -
The Commonwealth Minister for Works and Railways will, therefore, be responsible for the satisfactory completion of any work undertaken under the agreement. Of course, he will accept the opinion of his. departmental experts. I suggest that those honorable members have not read paragraph 11 of the schedule.
– If I read it one hundred times more it would not alter the fact that we have no officers to supervise such works. There is no road expert in the Commonwealth service.
– About three years ago a conference of certain shire engineers and clerks was held in my electorate. It was representative of the northern portion of New South Wales, and the suggestion was made that a tax on petrol should be imposed by the Commonwealth Government, and the money raised therefrom allocated to road construction. I was in favour of such a step at that time, and now that this measure has been introduced I see no reason to change my mind. Various objections have been raised to the measure, which are absolutely misleading, and the constant reiteration of them seems to indicate that the misrepresentation has been wilful. We are told that many people on the land use petrol for stationary engines, tractors, and other machinery that make no use of the roads. I am a man on the land, and have a couple of stationary engines on my property. The only petrol used in them is used for priming. The fuel used is power kerosene, which is free of duty. Every one of my neighbours who has a stationary engine or tractor also uses power kerosene. It is therefore clear that the contention that owners of stationary engines and tractors, although they make no use of the roads, will be taxed Under the Government proposal has no foundation in fact. The number of stationary engines on farms in which petrol is used for fuel is so small that it need not be taken into account. Recently I had to purchase a stationary engine of about 8 horse-power, and inspecting a number of makes at different agencies I did not see one that was other than a keroseneburning engine. There are, however, people who use large quantities of petrol in machines which make no use of the roads. I refer to the aeroplane companies. The Commonwealth is paying subsidies to encourage civil aviation, and I suggest to the Minister the advisability of making provision to permit aviation companies to obtain the petrol they require from bond upon a statutory declaration that it is to be used only for their aeroplanes. That would remove some of the objections to the Government proposal that it penalizes those who make no use of the roads.
– I remind the honorable member that the aviation companiesare getting only the same subsidy now, when petrol costs from1s. 9d. to1s.11d. per gallon, as they received when the cost of petrol was 3s. 4d. per gallon.
– I admit that they have gained something in that way. I am one of those who believe that there is a big future for civil aviation in Australia, and I suggest that the Minister would do well to make the concession I have mentioned to civil aviation companies. The Government proposal covers three clasess of roads, first, main roads, which open up and develop new country; second, trunk roads between important towns ; and, third, arterial roads, to carry the concentrated traffic from developmental, main, trunk, and other roads. I think that a better classification would be - -First. arterial roads; second, trunk roads; and, third, shire- or municipal roads. In my view, arterial roads are essentially federal in character. I do not believe that the mainland of Australia will continue to be arbitrally divided into five States. I believe that, as population and production increase, further subdivision will take place, and then the construction, not only of railways, but also of arterial roads, will become more and more a Commonwealth function. A foreknowledge of this is indicated in this bill, under which the Commonwealth will assist in the construction or reconditioning of arterial roads. That is a step in the right direction. The electorate of the honorable member for Moreton (Mr. J. Francis), in Queensland, adjoins my electorate in the north of New South Wales, and there is now in course of construction a main road connecting the two electorates, which will ultimately become the main north road. That road would never have been constructed if the Commonwealth Government had not decided to take part in road construction. In the same way, the unification of the railway gauge between Kyogle and South Brisbane would never have been undertaken at this time if the Commonwealth Government had not decided to go on with the work. Arterial roads, the construction of which is aided by the Commonwealth, will serve the same purpose as will bo served by the unification of railway gauges. The construction of main arterial roads is at the present time distinctly a work in which the Commonwealth should engage, and as time goes -on and the number of States is increased it will become even more certainly a ^Commonwealth function. Trunk roads are roads between important towns or running out from a railway station, roads which can be fed by shire or municipal roads iu order that produce may be brought to the railways. The Commonwealth Government has entered into this work because it realizes that all the States are suffering from financial stringency.
– Through the fault of the State Governments.
– I am not discussing whether the fault is that of the State
Governments or not. I merely state the fact that all the State Governments are financially embarrassed.
– Both Labour and National Governments.
– That is so. The Commonwealth Government has a source of revenue still untapped.
– Prom the same people.
– Exactly, but the Commonwealth has in this matter the necessary powers and the State Governments have not those powers. As we are all agreed that good roads are necessary I again suggest that road construction is a function in connexion with which the Commonwealth might well exercise its power, even though in doing so it apparently infringes State rights. So far as I am personally concerned the argument founded upon State rights leaves me absolutely cold. I believe in the further subdivision of Australia into new States, and I believe that a natural corollary of a further subdivision will be the destruction of the fetish of State rights. Every person in Australia has a dual personality as a citizen of the Commonwealth and of a State, but all prefer to be regarded as citizens of the Commonwealth. Perhaps 25 years ago when the Commonwealth was established the position was not the same as it is to-day. The war has intervened, and as a result many Australians have been influenced to view Australia from a different angle. A house looked at from the front appears different if looked at from the back, although it is the same house. As the result of the voyaging overseas of tens of thousands of young Australians, male and female, Australia is viewed to-day very differently by many people from the way in which it was viewed 25 years ago. This has done more than anything else to break down the State jealousies, which have in the past hampered the progress of this country. To use an expression recently employed by the honorable member for New England (Mr. Thompson) there are still in this House some troglodytes who continue to live in the past. They have not kept in step with the march of events. Their minds are incapable of expanding, and they are unable to judge Australia as it should be judged to-day. If they arc to continue to act as a brake upon the wheel of Australian progress it is a pity that their constituents saw fit to return them. If the full measure of their iniquity were known this would be their last session in this Parliament. I represent a very new area of tho Commonwealth. Recently an historic event took place in my electorate. I refer to the first movement made to unify the railway gauges of Australia, and the turning of the first sod of the railway on the standard gauge from Kyogle to South Brisbane, by the Attorney-General (Mr. Latham). Twentyfive years ago Kyogle was a cattle station and in the whole of the district apart from those working on the stations round about there were only two settlers. Now Kyogle is a fine town lit by electricity, with macadamized roads, pavements and kerbed gutters, and fine public buildings of brick and concrete.
– The land in the district was cut up into dairy farming. That is what made Kyogle.
– That is so. At the last triennial elections for the return of members of the Kyogle shire the platform of the councillors returned, for all three ridings, included support for an increase of rates. ^ The people of the district showed by their votes in December last that they are prepared to tax themselves more highly in order to secure decent roads. In my district good roads are essential, and cost more to construct than do roads in drier areas. Kyogle has an annual rainfall of 60 inches, and the rainfall for the whole of the coastal part of my electorate runs from 60 to 120 inches per annum. Roads arc difficult of construction in the district and require constant supervision. Mine is one of the most closely settled rural areas in New South Wales if not in Australia, and the people of the district are distinctly in favour of the proposed taxation for road construction. Other honorable members have talked of the telegrams they have received from constituents. I have received no telegrams against this proposal; but, as I have mentioned previously, a conference of shire engineers and clerks which met three years ago carried a resolution advocating the very proposal which the Government has made.
– It was not quite the same.. They did not advocate a tax on chassis and tires.
– They advocated a tax on petrol. The fact that the Government’s proposal also includes taxes on tires and chassis does not affect the principle they advocated. If we are to adopt the principle of taxing road users rather than those who live alongside roads, I cannot see how an honorable member can discriminate between a tax on petrol and taxes on tires and chassis. Before the advent of motor traffic, people who lived alongside roads were expected to pay for their upkeep ; but now that a road may be used by a person whose residence is. hundreds of miles away, it is unfair that only those who live alongside it should be taxed for its maintenance. The users of the road should also pay something towards its upkeep. This bill provides that road users are to contribute towards the upkeep of roads. Although those who live alongside roads will still continue to pay rates, an additional amount of money contributed by road users will also be available for expenditure on the roads. By passing this bill we shall at last have some semblance of a real roads development scheme in Australia. I was pleased to hear the Minister say that it was not the intention of the Government to carry out a scheme for repairing pot-holes, but that the intention was to embark upon a comprehensive ten-years’ programme for the construction of good roads radiating from the larger centres with subsidiary connecting roads. Every one must benefit by such a scheme, not only those who live in country districts, but also people in the cities; and we shall have in Australia a uniform roads policy which so far we have not been in a fortunate enough position to develop. With that peculiarity which enables him to state things not exactly as they are, the honorable member for Yarra (Mr. Scullin), when he was speaking of the possibility of a reduction in railway revenue through the construction of good roads, claimed that the States who own the railways ought to be in a better position than the Commonwealth to say where those roads should go. The honorable member had no foundation whatever for inferring that the Commonwealth would force its opinion on the States. If he had read the bill carefully he would have seen that the States themselves were responsible for choosing the roads upon which money is to be spent before they are submitted for the approval or veto of the Commonwealth Minister for Works and Railways. If the States in the selection of roads for construction forget the needs of their own railways, it is their own concern. Honorable members who are in favour nf having good roads in Australia must support this bill. There must be no beating about the bush or saying “We are in favour of it but- >” for when they go into their electorate the people will ask them the straight-out question, “Did you vote for the Federal Aid Roads Bill ? “ and on their replies they will be judged.
.- It is my intention to vote against this bill, if another measure which accompanies it does not undergo serious amendment. I do not know whether the representatives of the States when they reached an agreement with the Commonwealth for the construcoitn of roads were fully aware of the circumstances under which the Federal Government proposed to raise money for expenditure by them. I know that when I entered upon the last .election campaign, I was rather pleased that the Federal Government had decided to embark upon an extensive roads construction programme, because it would give to the work of roads construction in the country districts of Australia a sort of permanency that would enable road contractors and road boards to secure up-to-date roadmaking machinery, which would not only make good roads, but also give good value for the money expended. For that reason, I lauded the proposal of the Government, because I understood .that the money would be provided out of the everincreasing revenue derived from Customs duties. Australia being a hyper-protective country, has so much protection on its industries that for years past its revenue through the Customs has exceeded the most sanguine expectations of the Treasurer or the country. There fore, I explained to my constituents that, while I opposed an unnecessarily high tariff which brought in this amount of revenue, I thought that the Government was doing the next best thing by handing back its surplus revenue to’ the people for the purpose of building roads. Subsequently, I learned that, in his ‘.policy speech, the Prime Minister had said that the users of the roads would be further taxed to provide the money required for the construction of these roads. I could stretch my previous conception to the point of accepting a proposal on those lines, if the taxation of the users of the roads were equitable, but I now find that the Government’s proposals provide for a most inequitable incidence of that taxation. The principle is grossly unfair, because the users of locally-made tires or Commonwealth Oil Refineries petrol will use the roads just as much as purchasers of imported tires or petrol, and will pay nothing. There is no protective incidence in the proposed duties on petrol, chassis, or tires. Some months ago this House decided what amount of protection should be afforded to these, and the right honorable member for Balaclava (Mr. Watt) has told us that already the local manufacturers of tires are amply protected. They ought to be amply protected, because, the duty ou an ordinary tire is 115 per cent., and with the addition now proposed it will be as high as 139 per cent. The Commonwealth Oil Re-, fineries Limited produces about 5 or 6 per cent, of Australia’s consumption of petrol, but those who are fortunate enough to be in a position to secure Commonwealth Oil Refineries motor spirit will be able to run free on the roads. To my mind, that is a discrimination which is unfair, if not unconstitutional.
– Let the other petrol companies refine their oil in Australia.
– The honorable member is now talking of protecting petrol. That matter has already been settled. When the right honorable member for North Sydney (Mr. Hughes) was Prime Minister, he assured Parliament that the adoption of the agreement with the Anglo-Persian Oil Company, for the refining of oil in Australia, would involve no protective duty on petrol. He said that it would be a distinct advantage to the company to refine its crude oil. in Australia, and that it would lead to the production of cheaper petrol. But advantage seems to have been taken now to impose, in an insidious way, a greater protective duty than was ever intended by Parliament. I should vote with the Government on this bill if it were prepared to be fair in the incidence of the taxation necessary to raise the money required for the construction of roads; but, in any case, I cannot see that the proposed duties will have the effect anticipated. A duty of 115 per cent, on imported tires is already a tremendous handicap against American tire manufacturers, who have to pay higher wages than are paid in Australia, and have to buy their raw material overseas. Has the Government taken into consideration the possibility that an additional 6d. per lb. duty may have the effect of reducing the revenue already derived from the duty on tires?
– The honorable member is now dealing with another bill.
– I am dealing with the incidence of the taxation that will have to be raised. It is perfectly true that the actual taxation is imposed by a separate bill, but both proposals were associated when the Treasurer delivered his budget speech.
– Would it not be an advantage to Australia if tires were manufactured here?
– If that aspect of the question has any relevancy to the Government’s proposal, it is an insidious attempt to give the proposed duties a most discriminating protective incidence. We are all agreed that good roads are necessary, and already the States are taxing the users of roads. For instance, Western Australia, rightly or wrongly, has a tax on petrol, but those who do not use the roads are exempted. That is the more honorable and equitable method to adopt. I do not think that the petrol used for marine and stationary engines should be taxed. The Western Australian Government, having a higher sense of honour in this matter than this Government, provided that if a declaration were made that petrol purchased was to be used in that way, the tax should be refunded. It also provided that as very little public money was spent in making roads in the northwest of Western Australia, the petrol used in cars there should be exempt from the tax. At least, an effort was made to levy the tax on a fair basis ; but this Government has not even attempted to be fair. No man in the community desires good roads more than I do, but it is possible to pay too much for them in the sacrifice of principle. We have already had some experience of Federal grants to the States for road purposes. The previous grants were made from surplus revenue. While the Federal Government is favorable .to the contract system for road-making, th Government of Western Australia spends a great deal of money, in road-making by the day-labour system. The change of policy in that State came about through the Government making the conditions of tender so difficult that almost all the former road contractors, including the roads boards were, unable to tender. For instance, it was provided that none of the work should be sub-let. Some of the roads boards had a certain amount of plant which they used regularly, but they did not purchase ploughs or teams of horses as a rule, preferring rather to sub-let the work to the farmers round about who had both ploughs and horses.
– And were expert men !
– That is so. This was the most economical way to do the work. The roads boards are comprised of unpaid men who are closely identified with the districts in which they live, and regard the roads almost as a mother regards her children. But the conditions of tender insisted upon by the Western Australian Labour Government have practically prohibited them from tendering. Consequently, the Western Australian Minister for Works has been able to come to the Federal Minister and say, “It is impossible for us to get contractors to tender for this work; so we are obliged to do it by day labour.” It is for that reason. I suppose, that we have in the agreement, paragraph 4 of clause 9, which reads -
The method of execution shall be by contract except that where the Minister for the State considers that tenders received for the execution of the work are unsatisfactory dr that execution by day labour would be more economical and/ or expeditious and so informs the Minister the Minister may if he is satisfied that action has been taken by the State to ensure that the work will be carried out according to approved methods of construction in which modern plant is utilized to the fullest extent approve of the execution of the work in whole or in part by day labour.
I trust that the Government will agree to an amendment to provide that wherever day labour is permissible it shall be obligatory on the parties concerned to submit a tender in the ordinary way, so that we may be assured .that the public money is being spent to the best advantage. We ought also to have some undertaking that when a section of road work is commenced it will be completed. Thb road-making practice in some districts in Western Australia is to lay a foundation of large boulders, cover it with a certain thickness of finer metal, and then top off with gravel. But in consequence of the day-labour policy, many road-making jobs in Western Australia have been left in an incomplete state, on account of the money having run out. In some places where this has occurred one travels along a completed portion of road for a distance, but then comes on to a stretch of bare metal, and later to a section of heavy boulders, which, in some cases, are so rough that even a bullock wagon would be damaged if it were driven over them. The Government should not allow that kind of thing to occur. It should have some undertaking that whether a particular work is carried out under the day-labour system or otherwise, it will be completed. If I am not mistaken, there is a provision in the Federal Aid Roads Act of the United States of America to the effect that value shall be given for all money expended. I desire to see that fundamental principle recognized in any road making policy that we may undertake. When the insidious little Customs Bill, designed to impose the petrol tax, comes before the House, I shall have something to say on it.
Mr. COOK (Indi) [9.531.- I am at a loss to account for the opposition that some honorable members have offered to this measure, for I believe that it is one of the best, from the point of view of country development, that has come before the House for a considerable time. In my opinion good roads are essential to defence and land settlement. Although a good many honorable members have said that they believe in good roads there has been a “ but “ in the matter. It surely must be apparent that we cannot have good roads unless we spend money to get them. The amount of £1,750,000 that this Government has already allocated to the States for road construction has been spent in a way that has benefited the whole community, and there has been a general agitation for more money to be provided for the same purpose. It was for that reason that the Government formulated its £20,000,000 road policy, which has been approved by the people. Nobody surely thinks that the money will fall from the clouds, or that it can come from huge surpluses. We cannot expect to have surpluses of £20,000,000 while we have a war debt of nearly £400,000,000. The people unquestionably expect to be taxed to provide the money to carry out the proposed continuous road construction policy. I have had considerable experience in local government work, and I know that the money which the Commonwealth Government has provided from time to time for the shire councils to carry out road work has been of great assistance to them. Prior to the adoption of this policy many shires were obliged to spend practically the whole of their rates on main road work, and could not give any attention to necessary developmental projects in their district: but now that the Commonwealth is helping to maintain the main roads, the shires are turning their attention to these other roads. In my opinion, the adoption of a practical policy of road construction will be beneficial to ths land-owners, the road users, and the general community. lt will benefit the land-owners “most, for it will increase the value of land by reducing trie difficulty of marketing produce. It will benefit the road users by reducing their running costs. I suppose that at present motors account for about 80 per cent, of our road traffic. Motor transport, much of which is “foreign” traffic, has created road problems which many shires have found it quite impossible to solve. As a matter of fact, many shires were becoming insolvent prior to the provision of Commonwealth money for main road purposes. In these circumstances, I consider the proposed tax of 2d. a gallon on petrol and the tax on chassis and,tires, which are estimated to yield £1,500,000 annually, perfectly fair imposts. The honorable member for Richmond (Mr. R. Green) said that not a single complaint had been made to him in his constituency about the proposal to impose these taxes. I wish to say that the only two complaints I have had from my division have come from business men who use petrol in their manufacturing processes. I shall deal with that point presently. I have received quite a lot of encouraging comments from members of shire councils in regard to the tax, and some have said that the Government should substantially increase it.
– I have received antagonistic resolutions from the Farmers’ Union.
– The honorable member for Wannon (Mr. Rodgers) probably had something to do with drafting the resolutions. It is very easy to suggest to people who think they are already sufficiently penalized that this is a cruel tax.
– Is the honorable member speaking from experience?
– I do not think any honorable member has had more experience than the honorable member for Wimmera (Mr. Stewart) in that sort of work. I agree with the views expressed this evening by the honorable member for Eden-Monaro (Mr. Perkins). He is of the opinion that the tax could have been increased to allow the States to do away with the registration fees. The Victorian system is antiquated and most unfair, because it penalizes the owner who runs his car only a few miles a week, to the same extent as the man whose car is on the road continuously, and who makes his living out of the business. I should like to see part of the revenue from the petrol duty handed over to the States on the understanding that they abandon the motor registration fees. I cannot understand how country members justify their opposition to the scheme, because they must know how bad roads handicap country residents. The honorable member for Wannon said that the big wheat-grower had his large waggons and carted his manures, seed and machinery during the dry weather. He failed to take into account the position of the thousands of struggling farmers who do not own large waggons, and, therefore, have to get along as best they can. They want good roads. This scheme will be a god-send to them, because the shires in which they live, being relieved of a considerable expenditure on arterial roads, will be able to devote the money raised from rates to the construction of developmental roads for the benefit of outback settlers. I fail to understand, also, the attitude of honorable members opposite. To a man they are protectionists, and yet they are opposed to a measure that will compel the oil trusts and the motor car importers to contribute something towards a scheme that will give employment for a large number of workers in the manufacture of motor cars and tires, and provide good roads for country people. It was reported recently that a Sydney firm was about to start manufacturing an all-Australian car. I can promise it my support as a member of this House. I understand, also, that a wealthy firm is about to start the production of petrol. If successful, this new industry will lessen the grip of the overseas oil trusts on Australia, and perhaps in the near future we shall be able to obtain the whole of our requirements from Australian sources. Honorable members opposite are continually complaining, and I think with justice, about unemployment. I give them credit for doing what they can to relieve the situation, but I cannot understand why they are opposed to a progressive scheme like this, which will provide employment for hundreds of men throughout the Commonwealth. Next to the primary producer, the workers stand to gain most from this proposal. Suburban municipalities have objected that no portion of this money will be spent on arterial roads that run through their territory. I believe there is some ground for their complaint, and I have no doubt that, if the State Governments mak» overtures to the Federal authorities, a reasonable adjustment will be made. I believe, also, that manufacturers who use petrol for process purposes, and aeroplane companies which use petrol for aeroplane engines should receive some concession, perhaps in the way of rebate of duty. I disagree entirely with the honorable member for Wannon, that it is not the function of the Federal Government to undertake road construction, and I am sure that the Attorney-General, when he replies, will have an effective answer to his criticisms. I submit that the Commonwealth is definitely responsible for the maintenance of our defence highways, particularly in view of the fact that Commonwealth mail contractors are large users of roads throughout the Commonwealth. Some reference was made by a previous speaker to the desirableness of an excise duty on petrol. I cannot endorse that view. Nor do I agree with the proposal to impose a heavier duty on imported motor tires and an excise duty on tires of local manufacture. It would be very much better to reduce the duties than to impose excise. The honorable member for Wannon stated that, if we have good roads, we shall want a large population. I entirely agree with him, but I fail to see how we can secure a large population unless we provide reasonable facilities for all those who may come to Australia under our migration proposals and settle on the land. We are definitely committed to a big migration scheme, for better or worse. We trust it will be for the better. Therefore we should see to it that settlers arc given good roads, so that they may market their products at a reason- able cost. If, as has been argued in this debate, it is not the function of the Commonwealth to sponsor a proposal for road -construction, we might as well give up our land-settlement schemes, as the States are unable to do so. For that reason the Commonwealth has been very lax in rendering assistance to the States in the matter of road construction, and now that general satisfaction has been expressed with the action of the present Administration, I trust that future Governments will adopt a similar policy. The honorable member for Yarra (Mr. Scullin) said he would have no objection to grants or gifts being handed to the States for road construction when there was an overflowing Treasury, but that he was strongly opposed to the imposition of a special tax. The honorable member who is an authority on financial subjects should realize that with a debt of over £400,000,000 and with defence expenditure seriously curtailed the amount of money available for this purpose from surpluses will not be very large. The honorable member for Wannon, and the honorable member for Yarra, represent Victorian constituencies, and should realize that as the State Government of Victoriahas signed the agreement their views are contrary to those expressed by State Ministers and the great mass of the people settled throughout the length and breadth of the Commonwealth.
– This bill, as honorable members are aware, provides for financial assistance by the Commonwealth to the States to enable them to construct certain roads described in the agreement set out in the schedule. During the debate there have been references to speeches previously delivered by honorable members upon this subject, and particular reference has been made to the remarks I made when the subject of main roads development was under discussion in the last Parliament. It has been alleged that my attitude in supporting this bill is inconsistent with that which I adopted in my speech in this House in 1925. In addition, therefore, to dealing with the general subject of this measure, I take the liberty of referring more particularly to the objections which I raised to the legislation then proposed, in order that I may indicate to the House the essential difference between it and the legislation now before us. We all accept it as a general principle that the Commonwealth exists for the attainment of national objects, and that the States are to carry out functions which ought to be dealt with upon a State basis. National objects, as understood by the people when Federation was accepted, are set forth in the Constitution. In the speech which I delivered in 1925, to which reference has been made, I pointed out the specific fact that road-making was not mentioned as among the subjects for Commonwealth legislative activity. Roadmaking generally apart from roads for defence or some such special Commonwealth purpose, is not within the direct power of the Commonwealth, and one may say as I said previously, and as I still maintain, that,’ speaking generally, road-making is not a Common- wealth f unction. That indeed, is obvious because the Commonwealth has, speaking generally, not the power to put a pick into a road in any State. Accordingly, any Commonwealth work in the direction of road construction must necessarily be done with the consent of the States. In other words it must be a co-operative enterprise. The bill which was before the House in 1925 did not contain any reference to co-operation with the States. In that respect this measure is essentially different. But. before I deal with these details let me submit to the House that so far as main roads are concerned - and this is quite apart from any constitutional or legal viewpoint - transport is national in character. Speed and rapidity of transport are of the greatest concern to all classes of the community, and particularly to those living in the sparsely settled parts of the continent. The confusion into which we have fallen in connexion with railways should not be repeated in relation to roads. It may be said that in road construction, there is nothing comparable to the problems which have arisen in connexion with railways and railway gauges. I suggest, however, that there is a considerable resemblance between road-construction and railway problems. They are all essentially transport problems and cannot be effectively handled upon a purely State basis. As our railways must connect up on the State frontiers so also should our main roads, and in order to have an effective system of main roads throughout Australia, there must be measures for securing coordination between the road policies of the different States. As a matter of fact and experience we know that in the absence of origination of proposals by the Commonwealth, it is very difficult to secure unity of action between the States, and from this viewpoint it appears to me that the Commonwealth is performing a national service by seeking to assist the States to develop a system of roads that will form the basis of a scheme of national road transport. There is a national aspect of road construction. I do not suggest for a moment that every road is national in character; but it is important that the main network of roads should be laid down from a national viewpoint. How can that be brought about? Surely the most effective means is that which in fact has been adopted- by consultation between the Commonwealth and all the States. A conference between the Commonwealth and the States has been held at which the whole matter was threshed out. The proposals now submitted to Parliament have been worked out upon the anvil of discussion as between the Commonwealth and the States.
– All the States that took part in the conference have not agreed to this scheme.
– All the States were represented at the conference, and this scheme, as will be seen, is dependent upon the consent of the State Parliaments.
Because special reference has been made to the position that I took up on this matter in 1925, and because it has been suggested that since I have become a Minister I have swallowed my previously expressed opinions on this matter, I think that I am entitled to say something about the attitude I adopted on that occasion.
– The Attorney-General is not the only Minister who has done that.
– I have not done it at all yet. Of all those honorable members who were in the House in 1923 and 1924, and I think also last year, I was the only one. who opposed the previous measure. Every other honorable member, including the honorable member for Yarra (Mr. Scullin), supported it. The honorable member did not then see any trouble about finding Commonwealth money for the making of roads in the States. He then had no enthusiasm for protecting the interests of the States. The Leader of the Opposition. (Mr. Charlton) also was a keen supporter of the proposal. One can understand why he has some difficulty in dealing with this matter.
– I was never an enthusiastic supporter of a policy such as that now proposed.
– Speaking on the Main Roads Development Bill 1925 the honorable member said -
This hill will secure the support of most honorable members. We all recognize the necessity for good roads, especially in this age when we have so much motor traffic. . . . Any financial assistance which the Commonwealth can give to the States for the construction of good roads will be money well spent.
– That was not a proposal to provide funds for the purpose by the imposition of a special tax.
– This bill does not impose a tax. I want to be perfectly fair to the honorable gentleman. I admit that I had not an opportunity of hearing his remarks this afternoon.
– If the honorable gentleman had heard my speech he would not be making these statements about me. I am at least consistent.
– If I am wrong in my remarks the honorable member will put me right; but I understand, from what I have been told, that the honorable member’s objection to this measure was that it involved an incursion into the sphere of the States: If that was not his argument, or that of the honorable member for Yarra, I have nothing further to say’ regarding their attitude.
– I said that there should be no additional taxation for the purpose of raising money for road construction, which was the function of the States.
– The honorable the Attorney-General had better proceed with what he was going to say.
– The honorable member would rather I dealt with my own speech on a former occasion than with that then made by him. The legislation before the House in 1925 was purely roads legislation. It simply provided money for the making of roads. At that time I objected to the proposal on various grounds. I intend to recapitulate the objections that I then raised, and to indicate how this bill differs from the proposal then before the House. In the first place I said that the Commonwealth Parliament had no power to legislate for main roads as such, and I went on to say that if the principle were defended, as might be suggested, on the ground of granting financial assistance to the States, the bill did not say so, and the States had not asked for any financial help. In this case, however, if honorable members look at the preamble to the bill now before us, they will see that it is based on section 96 of the Constitution, which provides for the granting of financial assistance to the States. The preamble reads -
Whereas it is expedient toprovide for financial assistance to the several States for the purpose of the construction and reconstruction of roads:
Be it therefore enacted ….
In that it is a bill for the granting of financial assistance to the States under the power contained in section 96 of the Constitution, this measure differs from the previous legislation.
– Then the previous bill would have been in order if it had been couched in similar terms.
– I shall come to that point. In my earlier speech, the next point I made was that the States had not come forward with any request for assistance of the character proposed,and had not been consulted. In effect, I said, as I would say now, that that proposal was not a co-operative enterprise. In the first paragraph of the agreement in the schedule to this bill, however, it is expressly provided that -
This agreement shall have no force or effect and shall not be binding on either party unless and until it is approved adopted authorized or ratified by the Parliaments of the Commonwealth and of the State.
That is to say, the proposal is made, in express terms, a joint enterprise or not an enterprise at all; and this bill arises out of the conference at which the States agreed to find so much money if the Commonwealth provided so much more money. In other words, the second point made in my objection to the previous legislation is met, because this is a cooperative enterprise between the Commonwealth and States.
– But not all the States.
– The position of New South Wales, apparently, is not clear at the present time. It is not known whether or not New South Wales will go on with the agreement; but that State was represented at the conference, and the Government was justified in assuming that the attitude it then adopted would be continued. Until there is an official intimation to the contrary, I propose to deal with the matter on that assumption.
– Is it assumed that according to the Constitution all the States must agree to the proposal?
– No; the bill makes it possible for the Commonwealth to enter into separate agreements with the several States. But the legislation has been introduced as a result of the States in conference expressing a desire for it. The State Governments were prepared to see the proposal through, conjointly with the Commonwealth.
– Most of them declared that they agreed to it reluctantly - almost at the point of the bayonet.
– What is the use of saying that to reasonable men? No State that does not wish to agree to a proposal of this nature is bound to accept it.
– South Australia accepted it almost under duress.
– I cannot understand the honorable member for Hindmarsh (Mr. Makin) objecting to the bill, since he was one of the most enthusiastic supporters of the previous measure.
– When the proposal was accepted by the States, was the petrol tax mentioned ?
– I shall deal with that aspect in a few moments, and indicate particularly the precise position taken up by Western Australia, showing what was understood by the proposals. Another objection that I took to the pre- vious legislation - and none of my objections was concurred in by any other honorable member - was expressed in the following words: -
I contend that, if money is voted tor main roads construction, provision should also be made for the maintenance of the roads that are constructed. No proposal of that nature hoa been suggested.
This bill makes provision for the maintenance of roads. There was no such provision on the prior occasion ; therefore that objection has been met. I went on to say that there was no certainty that these subventions would continue. This is a ten-year scheme; therefore that objection also has been met. If honorable members will read my speech, they will see that every objection which I raised on that occasion has been met in this legislation.
– Was it not one of the honorable gentleman’s main objections that this was not a function of the Federal Parliament?
– I said it was not a function of the Federal Parliament to legislate independently of the States, and on its own account, in respect to main roads. The honorable member for Yarra (Mr. Scullin) supported the legislation on that occasion. If he considers the position, he will see that this bill depends upon, and is the result of, agreements between the Commonwealth and the States, and is therefore radically different from the prior legislation.
– Methinks the honorable member doth protest too much
– If I were to refrain from dealing specifically with all the points that have been raised, the honorable member for Kalgoorlie (Mr. A. Green) would say that I was evading the issue. When I face every point, he says “ Methinks the honorable member doth protest too much.”
– But the Attorney-General- **
– Has the honorable member for Hume (Mr. Parker Moloney) any points to make ? He is an enthusiast for this policy of road construction.
– Not this policy.
– The only objection that was raised by the honorable member for Hume on the last occasion was that the amount proposed to be spent was altogether too small. He said, “It could all be absorbed in my electorate, and still leave work undone.”
– That is quite right.
– We are’ not now dealing with the means by which the money shall be raised for carrying out this policy.
– But if we vote for the bill, we shall be committed to the expenditure. That is a trick of the Government.
– The object of the bill is to authorize the Government to execute certain agreements. I hope that we shall not have further objections raised by honorable members opposite, based upon a new-found tender solicitude for the rights of the States. No objection of that nature was raised on the last occasion. The objections that I alone raised on that account have, on this occasion, been fully met. It is important to realize that, under this proposal, not a single road can be constructed the proposal for which is not actually initiated by the States. If the States do not want a particular road, it cannot be built; but if they do, they must submit a proposal in respect to it.
– And even when a State does want a road, the Commonwealth Government . can prevent it from being constructed.
– The Commonwealth Government ought to have that power.
– The honorable gentleman ought to state the position fairly.
– If the Leader of the Opposition (Mr. Charlton) were responsible for a policy involving Commonwealth expenditure, I do not think that he would seriously propose to spend £20,000,000, and not have any voice as to the method by which the money should be expended.
– I did not say that. The honorable gentleman stated only half the position.
– What I said was that the States had the sole power of initiation. No work can be done the proposal for which has not been initiated by. the States. That is absolutely accurate. It is proper that, in a joint enterprise of this character, the Commonwealth should have the right to agree with the States as to whether a particular work shall or shall not be carried out. It is essentially a co-operative enterprise between the Commonwealth and the States. Some honorable members have suggested that it is quite wrong for the Commonwealth to provide any money for this purpose ; that it should be left to the States to raise, from their own revenue, the funds necessary for road construction. I do not, for a moment, suggest that there is not room for a difference of opinion on that matter, but I point out the possibly obvious fact that the Commonwealth alone has the power of indirect taxation through Customs and excise. To leave the whole of the expenditure on roads, which is very heavy to-day, to be found by the States, would necessarily mean that it would have to be found . out of direct taxation or from loan moneys. Honorable members who urge that the . money should be raised entirely by the States - whether by way of a land tax, as the honorable member for Yarra suggested, or by other means - should recognize that they are asking for the imposition of direct taxation. The practical application of that principle would cause very serious difficulties of political and other kinds.
– What I said was that the Commonwealth should not remove the land taxation and impose revenue duties.
– There are many newfound friends of the States in regard to this matter.
– There are also some oldtime, unfailing friends of the States.
– We have heard it argued that roads will interfere with railways, and, therefore, will be opposed to the interests of the States. Surely, that is a matter to which the Parliaments and Governments of the States can be trusted to look! The agreement depends upon the Governments and Parliaments of the States concurring with the Government and Parliament of the Commonwealth. It has been said that the imposition of new taxation to find money for the provision of roads came as a surprise, and that it was not understood when the Prime Minister made his policy speech that there would be any new taxation. I have here a statute of the Western Australian Parliament, which (received the Royal assent on the 31st December, 1925. That measure, the Taxation (Motor Spirit Vendors) Act relating to the taxation of petrol was passed after the Federal elections, and after the Prime Minister’s policy speech was made. Section 15 of that act provides -
If, under any law of the Commonwealth, a tax is imposed on motor spirit, and appropriated to the purpose of main roads, the tax as prescribed by the act shall be reduced by so much thereof as is the tax imposed under any law of the Commonwealth as aforesaid.
That act is to come into operation by proclamation, and I am not aware that a proclamation has been made. But the fact that it contains a provision that if a Commonwealth law is passed, providing for the taxation of motor spirit, for the purpose of main roads, then the Western Australian tax shall be correspondingly reduced, shows that it was well understood at the time that money would probably be raised by the Commonwealth by new taxation on motor spirit for the purpose of main roads.
– Will the . AttorneyGeneral quote that portion of the Prime Minister’s policy speech which suggested a tax on petrol ?
– The Prime Minister’s actual words were -
The Government proposes to make available to the States a sum of £20,000,000, spread over a period of ten years, such amount to be provided out of the revenue derived by the Commonwealth from taxation to be collected from motor users through the Customs Department. The provision of this amount is, of course, subject to a policy of national road development being evolved at a conference between the Commonwealth and the States, which is acceptable to the Commonwealth.
It is quite plain that the Legislature of Western Australia understood from that statement what was intended- it anticipated the imposition of a petrol tax by the Commonwealth for the purpose of main roads.
– That is one State out of six. My interpretation of the Prime Minister’s statement was not that the money was to be found by new taxation on petrol and chassis and tires; but was to come out of the general Customs revenue.
– I do not for one moment challenge the honorable member’s understanding of the Prime Minister’s statement, but I would point out that the Parliament ofWestern Australia understood that motor users used petrol in their motors, and that a tax on motor users might reasonably be construed to include a tax on petrol. I would suggest that a great many other people took the same view. There is no doubt that, as the honorable member for Indi said, £20,000,000 cannot be brought down from the clouds, and itmust be obtained from somewhere. Honorable members- are sufficiently acquainted with the actual position of Commonwealth finances to know that we could not reasonably expect this sum of money to be obtained from the normal revenue of the Commonwealth. I have road a great deal in the press, and wellwritten paragraphs, too, objecting to the petrol tax, and I have noticed that an intensive campaign is being directed against members of Parliament. I represent a. suburban constituency, which has main roads running through it, and the councils there have difficulty in keeping them in repair on account of the through traffic. I have received from the whole of my constituency only three objections to this legislation including the petrol tax. By reading the press one would imagine that the whole community is in revolt against the bill. I do not believe that that is the case. This is a wellconducted agitation. I have no doubt that some motorists, particularly city motorists, object to the tax, and I can quite understand any man objecting to being taxed. I suggest, however, that we must not be misled into thinking that the prominence given to this matter by the press is a true indication of the opinion of the people. City motorists know that good roads are needed in the country. Any census taken on a country road which is largely used by motor traffic will show that the major proportion of motors using it come from the city. The city motorists realize fully the benefit to them of good country roads, in the saving effected not only in petrol but also in tires and repairs. I suggest thatmotorists as a class are prepared to pay thiB light taxation, because the amount spent on petrol in running a car is cer’tainly nothing like the largest item of expenditure. The difference in the running costs of - a car travelling 20 miles to the gallon and one travelling 18 miles to the gallon is slight. The expense of repairs, tires, and depreciation is enormously greater than is the cost of petrol in the running of a motor car. Three or four years ago, wo were paying from 3s. 6d. to 3s. 9d. per gallon for petrol, but now we are paying 2s. 2d., and in some cases 2s. per gallon, and this extra charge spread over the mileage of an average cnr is not, as ordinary motorists appreciate, going to impose a charge upon them to any extent commensurate with the benefit which motorists as a class will derive from the construction of good roads. We are told that other users of roads should also be taxed, but these roads are to be of the best class arid quality, suited to the traffic that will go over them. They will be specially constructed in view of the fact that modern traffic is largely motor traffic. Honorable members arc aware that, as roads become good, motor traffic over them increases. Where roads are bad, the use of - horse-drawn vehicles is necessary, but when good roads are substituted for r.hem, horse-drawn vehicles are replaced by motor vehicles. The petrol tax will make all motorists pay on as fair a basis as is obtainable. It is not possible to secure absolute fairness under any tax.
– Those who use a certain brand of petrol will not have to pay the tax at all.
– To the extent of 6 per cent., or thereabouts, that will be the case. That is what I had in mind when. I said that from a practical point of view it is impossible to obtain perfect fairness in any tax. If we take, for example, the income tax, we allow deductions of a certain character, and two taxpayers receiving the same income pay the same tax, whilst if we considered their circumstances, domestic and business, we should find that the tax paid by one, as compared with that paid by tho other, is utterly unfair and unjust. Taxation must be based upon general principles, and upon a general view of the benefit to the community. I submit that this roads policy is a sound policy, dependent as it is upon cooperation with the States. It provides for maintenance and sinking fund - all elements absent from prior legislation I venture again to remind honorable members - and it is to be financed upon a sound basis. I admit that objections can bo raised to this, as to any other scheme of taxation that might be proposed, but I would again ask honorable members to look at the matter from the point of view of the weight of the objections, having regard to all the circumstances of the case. No scheme of taxation results in perfect equity and ideal justice. These proposals are substantially just and equitable. They are intended to benefit the whole community. They are founded upon sound principles, so far as the roads proposal is concerned, in that they depend on the co-operation of the States; and all tho objections I raised in the past, and to each of which I have referred one by one, have been specifically met in this legislation. I hope that the House will support it enthusiastically.
Debate (on motion by Mr. Foster) adjourned.
House adjourned at 10.55 p.m.
Cite as: Australia, House of Representatives, Debates, 28 July 1926, viewed 22 October 2017, <http://historichansard.net/hofreps/1926/19260728_reps_10_114/>.