10th Parliament · 1st Session
Mr. Speaker (Hon. Sir Littleton Groom) took the chair at 2.30 p.m., and read prayers.
Mr. MACKAY, as chairman, presented thereport of the Parliamentary Standing Committee on Public Works, together with minutes of evidence, re lating to the proposed establishment of an automatic telephone exchange at Box Hill, Victoria.
Ordered to be printed.
– From a French vessel, 116 alien migrants, principally Italians and Greeks, disembarked at Port Adelaide last week. Has the PrimeMinister communicated with the Governments of Italy and Greece regarding the serious unemployment in this country, and advised them to restrict the migration of their nationals to Australia?
– I have had several conversations with the Italian ConsulGeneral, who has represented to his Government that Italians should not be granted passports to go to industrial areas in Australia. I understand that the Italian Government has acted on that representation. No communication has been sent to the Government of Greece.
– Having regard to the large number of men unemployed in the various States, will the Prime Minister represent to the State Governments the advisability of unifying the railway gauges?
– The policy of the Commonwealth Government in regard to the . unification of railways has been clearly defined. I do not know of any further steps that could be taken with advantage at the present time.
– The longer the unification of gauges is deferred, the greater will be thecost. Will the Prime Minister state what States have agreed to unifying their railway gauges, and what effort is being made to convert those States which are opposed to the scheme ?
– At the last conference of Premiers at which this subject was discussed, the only States that would definitely agree to co-operate with the Commonwealth in the unification of railways wereNew South Wales and Queensland, and their attitude related mainly to the Brisbane to Kyogle railway. No efforts are being made at the present time to bring the other States into line, as the financial obligations in- volved in the works that arebeing carried out are as great as the Commonwealth Government feels justified in undertaking.
Mr.RODGERS. - Has the AttorneyGeneral read in recent press reports of the notorious Abrahams taxation case that an officer of the Home and Territories Department has been accused of complicity and bribery? Will the honorable gentleman take the earliest possible steps to have that charge investigated so that a slur may be removed from a great body of Commonwealth servants ?
– This matter is now sub judice. When the judicial proceedings are concluded, a full inquiry of the kind suggested by the honorable member will be made.
Re-classification of Treasury Officials.
– About two weeks ago the Treasurer said, in answer to a question by the honorable member for Perth (Mr. Mann), that certain public officers in the Treasury Department, who had been re-classified, would not be able to receive the arrears of salary due to them until the accounts had been completed. As the accounts have been completed, I ask the Treasurer if he will make arrangements for such arrears to be paid before Christmas to the officers affected.
– I understand that action of the nature suggested was taken yesterday.
– A recent paragraph published in the Sun Pictorial, stated that plans are being made to revive the Australian market for Fiji bananas, that small shipments were coming to Sydney, and that a Melbourne firm had approached the Government with a view to re-establishing the trade on a large scale. I ask the Minister for Trade and Customs whether any representations have been made to him on that subject?
If so, what is the nature of the scheme, and what reply was given by him?
-The answer to question No. 1 is in the negative. In regard to questions 2 and 3, see answer to question. No. 1.
– Several weeks ago the Minister for Trade and Customs promised that he would make certain inquiries regarding the officers engaged in searching and watching vessels at Port Adelaide. Is he yet in a position to supply me with the information I sought?
– 1 hove called for a report from the Collector of Customs in South Australia, and I hope to be able to answer the honorable member’s question to-morrow.
– Has the Minister for Home and Territories yet received the information for which I asked sometime ago regarding certain costs in connexion with the Darwin wharf?
– The information is not yet to hand.
– Will the Prime Minister tell us the present state of the negotiations for the holding of an Australian exhibition at Sydney?
– Whether the exhibition will be proceeded with will depend very largely upon the attitude of the Government of New South Wales. I have not yet been able to negotiate with the present Government in regard to the scheme.
City Railway - Transport Service
asked the Minister for Home and Territories, upon notice -
– In reply to a question by the honorable member for Lilley yesterday, I promised to make a statement in regard to the recent variation of the plan of the lay-out of the City of Canberra.
The questions asked by the honorable member for Herbert will be dealt with in that statement, which I shall make later to-day.
asked the Minister for Home and Territories, uponnotice -
– The answers are as follow: -
asked the Minister for Trade and Customs, upon notice -
What number of vessels trading to Australia have, as their first port of call, any port (a) in Queensland, or (b) in the other States of Australia?
-The information is being obtained.
asked the Minister for Works and Railways, upon notice -
What hospital accommodation is provided for the women domiciled along the TransAustralian railway line?
– A medical scheme subsidized by the Commonwealth Railways Commissioner provides medical attention and medicine free of charge to the men, women and children along the TransAustralian railway, and free hospital accommodation, as necessary, at Port Augusta and Kalgoorlie, including accommodation for the women during confinement at these hospitals or any approved maternity home.
The medical arrangements are under the supervision of departmental doctors at Kalgoorlie and Port Augusta, and a qualified dispensing chemist is continually travelling over the railway in a special car fitted up as a dispensary. Practically all the women along the railway are members of railway families and obtain free railway passes in case of sickness. The train service is frequent and comfortable, and the women would prefer the journey either to Port Augusta or Kalgoorlie. A hospital established along the railway would be seldom, if ever, used.
asked the Prime Min ister, upon notice -
– The answers are as follow : -
Position of Clerk
asked the Minister representing the Minister for Defence, upon notice-
Office, Queensland, which prompted the Government to obtain from the Governor-General in Council a certificate to the effect that no officer of the Commonwealth Public Service was available for the position, and so paved the way for the appointment, without examination, of a person from outside the service?
– The answers are as follow: -
asked the Minister for Trade and Customs, upon notice -
– The information will be obtained.
asked the PostmasterGeneral, upon notice -
– The answers are as follow : -
asked the Treasurer, upon notice -
– The information is being obtained.
asked the Minister for Trade and Customs, upon notice -
Has his attentionbeen drawn to the following published statement: -
If there is any truth in these statements, will he cause the Tariff Board to inquire into the matter with a view to the removal of the protective tariff on imported bananas, and in order that our reciprocal trade relations with Fiji may be restored?
-The information will be obtained.
asked the Minister for Markets and Migration, upon notice -
Will he supply the members of the House, for the purpose of comparison with the freight rates on primary produce between -
Australia and the United Kingdom, and
New Zealand and the United Kingdom?
-The answer is as follows : -
Pontoons for Training
asked the Minister representing the Minister for Defence, upon notice -
– Inquiries will be made and the honorable member will be informed as soon as possible.
asked the Minister for Trade and Customs, upon notice -
Is it a fact that seamen employed on vessels engaged in the lighthouse service are to be transferred to the Commonwealth Public Service; and, if so, was this decided at the instance of the Government, or merely at the behest of the department?
– Yes. The matter was decided by the Government. The lighthouse service is one that exists for the safety of life at sea, and the Government considers that these vessels should be kept quite outside the sphere of disputes that may arise with regard to ordinary commercial vessels. This action will give the men permanent employment under the Public Service Act at reasonable and satisfactory wages, and with superannuation rights and other privileges (including the right of appeal to the Public Service Arbitrator).
asked the Minister for Health,upon notice -
What are the terms and quantity of radium to be delivered by the Radium Beige Company to the Commonwealth Government?
– The terms of the agreement with the company provide for delivery of the whole of the radium within three months. Four (4) grammes are now in process of mounting, which is a laborious process, and will be ready for despatch in separate consignments within three months from 26th October last. The actual date of despatch of the first consignment is to be cabled by the High Commissioner in a few days. Two (2) grammes of radium bromide will follow shortly afterwards, The date of the despatch of the remaining four (4) grammes is dependent upon the decision of the expert advisory committee as to the most suitable form of mounting.
asked the Prime Minister, upon notice -
– The answer to the honorable member’s questions are as follow : -
asked the Minister for Works and Railways, upon notice -
– The answer to the honorable member’s questions are as follow: -
Note. -In regard to the cost in Victoria, it is explained that the amount includes the provision of furniture, &c, in the rooms recently established in Melbourne. It is also pointed out that the accommodation in these rooms is availed of by members from Western Australia, South Australia and Tasmania, as well as Victoria.
– On the 3rd November the honorable member for Maribyrnong asked the following questions : -
I am now in a position to furnish the following information : -
– Yesterday the honorable member for Lilley (Mr. Mackay), and to-day the honorable member for Herbert (Dr. Nott) asked me this question : -
Whether he will explain the reason for the departure from the Griffin design, as suggested by notice of variation of the plan of lay-out of the city of Canberra and its environs,appearing in the issue of the Commonwealth Gazette, date 29th October last?
To that question I now desire to make the following reply: -
Most of the alterations made are of a minor character, and it is not considered that any of them involves a departure from the basic principles of the Griffin design. They provide for the elimination of a number of the former roads, and the addition of certain new roads. In some cases, the roads previously gazetted would have been insufficient for residential subdivisional purposes, unless the undesirable method of leaving vacant land at the rear of allotments were to be followed. The new design provides open spaces in front of allotments. In a few cases, the development of previously gazetted roads could not have been effected without objectionable results, such as the destruction of the original Canberra rectory buildings, the partial destruction of an outstanding clump of native trees, and building in a water-course. In other cases, considerations of symmetry and convenience have been the determining factors. Misapprehension has arisen from the fact that on the revised plan a proposed alternative railway route is indicated.
I wish to make it quite clear that no alteration of the plan in respect of railway routes is involved. In submitting its recommendations for alterations of the plan, the Federal Capital Commission advised, inter alia, that: -
The proposed alteration to the railway route shown by heavy dotted lines has been inserted for information only. This matter will be the subject of a separate report explaining what is contemplated, but is not put forward at the present time as an alteration to the plan.
The position in regard to railway routes may be summarised as follows: -
The following papers were presented : -
Papua Act - Ordinances of 1927 -
No. 3- Sale of goods.
No. 6 - Petroleum.
– (By leave). - In regard to the Commonwealth Savings Bank Bill and the Commonwealth Housing Bill, the Government this morning have had an interview with the Chairman, the Governor, and two other directors of the Commonwealth Bank. They have represented to the Government that although, as I stated in the House during the debate on the second reading, I had freely consulted with them on the principles of those measures, they did not appreciate the exact intentions of the legislation as to the carrying out of the housing functions, and that on further consideration they are now of opinion that under the provisions of the measures the boardcould carry out their administration. To enable the board to do this an amendment is to be presented in another place to provide that until the commission is appointed the board will carry on the functions under the two bills. Should it become necessary at a later stage, for any good reasons, to establish the proposed separation by the appointment of the commission, that course could be adopted. This action is being taken with the cordial approval of the board. The amendment is being made in the Senate, but will be brought back to the House, when full discussion can take place.
– What a climb-down!
– It justifies everything that we have said.
In Committee of Supply - Consideration resumed from 15th November (vide page 1421), on motion by Dr. Earle Page -
That the first item of the Estimates under Division I. - the Parliament - namely, “ The President, £ 1,300;” be agreed to. upon which Mr.Charlton had moved by way of amendment(vide page 1414) -
That the item be reduced by £1.
This afternoon I desire speciallyto supportthe amendment moved by the
Leader of the Opposition. The amendment is in these terms -
That the item be reduced by fi, in order to draw attention to our adverse trade balance, the inadequate protection afforded to Australian industries, and the increase of unemployment, and to direct the Government to remodel its financial policy to bring it into accord with thu economic necessities of the Commonwealth.
It seems to me that it is high time that Parliament gave such a direction to the Government. The budget does not reveal that the Government appreciates the real economic situation of the Commonwealth. The budget statement itself is remarkable more for what is suppresses than for what it reveals. It is only a series of statements relating to financial transactions, and of statistics relating to departmental finance. This information was already available from other sources, and might be gleaned from the budget tables and estimates. The Treasurer has failed to avail himself of the opportunity to give guidance to this committee on the matter of the Government’s financial policy. He is in a peculiarly favorable position to place before the committee information which could guide it in its deliberations. The economic situation should have been fully examined by the honorable gentleman. The honorable gentleman should have stated the fiscal policy of the Government in terms that were unambiguous. At present no one knows what that policy is. The honorable gentleman should throw light on the trend of the money market, on trade stability; he should examine the incidence and effect of taxation, and place his conclusions before the committee. That is all the more necessary in a session like this, when we shall be called upon to deal with taxation measures. One examines the budget speech, in vain, for any light upon those topics: It does not disclose the financial policy of the Government. It does not analyze the incidence or effects of taxation, and it certainly does not disclose any achievements in economy. I understand that the Treasurer owes his position in this Government to his championship of economy. Everybody is aware that up to the end of 1922, the honorable ‘gentleman preached economy as the essential factor in bringing about stability of trade and security to the community. No one could have been more caustic than was the honorable gentleman when he criticized the former Treasurer and his administration. I have no doubt that his strictures of that year have often been quoted, and I feel sure the honorable gentleman will pardon me for quoting again a portion pf one of his speeches, in order that I may have a text on which to offer him advice. In Hansard of 1922, volume CI, when speaking in criticism of the Hughes administration, the honorable member said -
We believe in a substantial reduction of Federal Government expenditure, and a cessation of extravagant administration, which would be more helpful than any other single factor in reducing the cost of living.
Later, the honorable gentleman continued -
The lesson of effective economy is still to be driven home and put into practice.
That last phase is more apposite to-day than it was in 1922. The honorable gentleman has been Treasurer for nearly five years, and has had ample opportunity to put into practice the theories that he enunciated before assuming office. No one has had a better opportunity to- carry out the policy that he then thought was essential for the salvation of the country. What has the honorable gentleman done to achieve those economies ?
– Coming from a critic of the Government, was not his a perfectly natural speech?
– Yes; but the honorable member surely does not condone hyprocrisy of the kind that has been exhibited in the speeches of the Treasurer. The honorable gentleman urged economy and then, when he had the opportunity to put his preaching into practice, failed utterly to exercise it. Surely the honorable member for Macquarie (Mr. Manning) does not stand for political dishonesty. The Treasurer either believed or did not believe in what he stated. As he preached economy he should have practised economy when he had the opportunity.
– I wonder if the honorable member has ever seen this little booklet, Results of Socialism, Debt, Deficits, Taxation. Queensland Labour Parly Impeached. It deals with nine years of government under the leadership of the honorable member.
– I recognize that booklet, which was produced by “ Searchlight,” the editor of the Brisbane Daily Telegraph, one of the most unconscionable perverters of the truth that one could come across in a political career. The Treasurer preached economy and has failed absolutely to practice it. Take, for instance, the expenditure since the honorable member has been in. office. That is one of the best tests of economy. One cannot achieve a reputation for effective economy if the expenditure continually increases under his administration. For the years 1921-22, the last complete year before the honorable gentleman assumed office, the expenditure on departments and services - I am excluding expenditure for business undertakings and payments to states and territories of the Commonwealth - was £51,453,000. The budget for this year specifies £50,855,000 for the same purpose. The reduction amounts to £598,000, equal to a 1.1 per cent, reduction in the five-year period. When it is considered that the honorable gentleman described the expenditure for 1921-22 to be extravagant and wasteful, displaying a ruinous disregard of the financial stability of the country, one wonders at the temerity of the Treasurer in claiming to have effected economy.
– Now tell us about the rise in interest.
– All in due course. If the honorable member will allow me to continue in my own manuer, I shall endeavour to deal with each of the points in which he is interested, in logical sequence - in which endeavour I hope I shall be more successful than he was last night. The £51,453,00 expenditure in. 1921-22 included war service. The estimated expenditure for this year also includes war service, interest on war loans, pensions, and so forth, and the cost of such services is less to-day than it was in 1921-22. In failing to carry out his bold policy of economy, upon the preach ing of which he attained office, the honorable gentleman has failed to justify himself as a Treasurer. As an economizer he is a hopeless failure.
There are other features of this budget which demand very careful consideration at the hands of the committee. The budget exhibits a tendency to favour the rich at the expense of the poor. If any budget could be called a rich man’s budget, this is it. Take the comparison between direct and indirect taxation. The honorable gentleman does not deal with that feature of the financial drift in his budget speech. He takes credit for bringing about tax reduction, but, actually, he had done nothing of tlie sort. The honorable gentleman has reduced the taxes payable by certain classes, but, generally, the taxes levied by this Government have increased enormously.
– And the amendment of the Leader of the Opposition would increase them further.
– I -hope that the honorable member will be patient? There are certain maxims governing the principles of taxation that should be a guide to all democratic governments, maxims which have become classical canons of taxation. For the edification of the Treasurer I shall reiterate them and ask him if he is applying them. They are as follow: - The subjects of a State ought to contribute towards the support of its government as nearly as possible in proportion to their respective abilities. In the observation or neglect of this maxim consists what is called the equality or inequality of taxation. The tax which each individual is bound to pay ought to be certain, and not arbitrary. The time and manner of payment, and the amount to be paid, ought to be clear and plain to the contributor and to every other person. Every tax ought to be levied at a time and in a manner in which it is most likely to be convenient for the taxpayer to pay it. Every tax ought to be so contrived as both to take out and keep out of the pockets of the people as little as possible over and above what is required to meet the current needs of the Government.
– Who is the author of those principles? ‘
– Adam Smith enunciated them about 150 years ago. It appears to me that they are being altogether disregarded in the Commonwealth, notwithstanding that they have been the basic principles of taxation in practically every democratic country since the days of Adam Smith.
– Some vindictive taxation has been imposed in this country by the party to which the honorable member belongs.
– I do not know whether the honorable member suggests that I was the author of these alleged vindictive taxes-
– I do not say that.
– It is true that I have applied taxation, and I have been accused of adopting drastic methods, but I have endeavoured always to be true to the tenets which I have just quoted. One is able to tell fairly accuratelywhether direct taxation is falling equitably upon the community; but it is not possible to ascertain with certainty the incidence of indirect taxation.
– When the honorable member was Premier of Queensland he applied certain taxation to a very small section of the community.
– Direct taxation, to be equitable, must fall more heavily on small sections of the community than on the large bulk of the people, for under our present dispensation the small section is far better able to pay it.
Mr.Rodgers. - To a great extent, that is a fallacy, for taxation is frequently passed on.
– It is true that some taxes may be passed on without great difficulty, but income and land taxation cannot easily be avoided. Indisputably the present Treasurer has heaped indirect taxes upon our people to such an extent that they have become a crushing burden.
– If the amendment is adopted the taxation will be increased.
– It is possible to read in the financial columns of practically every newspaper, statements by financial critics that the people are groaning under the weight of the income and land taxation which they are obliged to pay, but these persons ap pear to forget that our Customs levies, and other indirect taxation, are an infinitely greater burden upon the people.
– The Treasurer is pledged to reduce these.
– But he has hopelessly failed to do so.
– In 1925 we removed the duties from no less than 50 articles.
– But the aggregate receipts from Customs are continually increasing.
– Is the honorable member of the opinion that our Customs duties should be reduced?
– I say that our Customs revenue should be reduced. There is no justification for the heavy Customs imposts that this Government is making. In 1921-22, which was before the present Treasurer assumed office, our Customs receipts, excluding excise duties, amounted to £17,200,000; but this year the Treasurer is budgeting for £33,150,000. It will be seen, therefore, that the increase of Customs taxation since he has been in office has been more than’ 91 per cent. Not a word appears in the budget speech to justify this. It is, in fact, unjustifiable and ruinous, for it has brought a great many evils in its train. In the last complete financial year of the Hughes administration, land and income taxation and probate and succession duties - I am leaving out of my calculation the amount received in war-time profits and entertainment taxes, for it was quite evident that the war-time profits tax would have to cease, and I do not regard the entertainments tax as a legitimate source of revenue for the Commonwealth - yielded a total of £20,000,000. The Treasurer is this year budgeting for an income of £13,300,000 from these sources. The reduction in direct taxation since he has been in charge of the Treasury may be taken, therefore, to be 33 per cent., while the increase in indirect taxation exceeds 91 per cent. It is possible to ascertain, with a reasonable degree of accuracy, who pays, and, therefore, who is relieved of direct taxation; but that is not practicable in respect of indirect taxation. According to the Treasurer’s estimate the Customs duties for the current financial year will average £5 16s. per head of our population. That is equivalent to £25 per family of a man, his wife and three children.
– It is near enough to an average of 10s. a week.
– The wage-earner for very many of the families who will be obliged indirectly to contribute this £25 impost receives no more than £250 a year. It cannot be denied that every person in the community must contribute to this indirect taxation through the Customs Department. Since the Treasurer has been in office the imposition under this heading has been increased by £12 per family per annum. Now let us look at the reductions that are proposed. It is intended this year to allow a reduction of income tax of 10 per cent, to 11,000 persons in the community who are in receipt of an average income of £5,000 per annum. These people will be relieved of direct taxation to the extent of £54 each during this year, while numerous families which are supported upon an income of less than £250 per year will be obliged to pay £25 in indirect taxation. The Treasurer may say, in reply to this argument, that honorable members on this side of the chamber assisted the Government to impose the Customs duties that are now operating. That would not be a legitimate answer, for the Treasurer and his confreres in the Government are responsible for the fiscal policy that is now operating as well as for the taxation that is being imposed.
– A good deal of the Customs taxation has been received because of the money that has been borrowed overseas.
– The honorable member for Wannon is barking up the wrong tree. He argues that our overseas borrowing has caused our adverse trade balance, but the honorable member is confusing cause and effect. The tariff police we need is not one that will produce Customs revenue, but one .that will exclude overseas goods, enable Australian - goods to be manufactured, and Australian markets conserved for the benefit of our own people.
– -How can that be done under a system of short hours and the “ go-slow “ policy ?
– Did the honorable member ask himself that question when the Prime Minister, in his policy speech, advocated uniform and shorter working hours and a child endowment scheme? If not, I take it that the honorable member is not sincere in his interrogation. Under an effective protective policy we may have to pay more for our goods; but we shall have more industries and more production. Under our revenue tariff we pay more for our goods, and we are not encouraging local industries, because overseas goods are still coming here in great quantities. Let us examine this lamentable failure of the Government effectively to protect Australian industries.
– Honorable members opposite assist to raise the tariff iu every Parliament.
– Although the present Government has not effectively protected Australian industries, it is quite within the competence of this Parliament to do so. In some cases it might be necessary even to impose an import embargo. If an industry is capable of supplying Australian needs at a reasonable cost-
– What is a reasonable cost?
– In arriving at that, we must take into account the standard of living that has been established in Australia. The recalcitrant honorable members opposite are disguised free traders. I thought that this was a protectionist Government, and that protection was the policy of Australia; but, judging by the interjections of honorable members opposite, they are opposed, not only to that policy, but also to a reasonable standard of living. If Australia is to remain a white man’s country, and a fair measure of social advancement is desired, we must naturally pay for it. That is why we should have effective protection against countries whose standards of living are lower than ours. In the year 1920-21, before the assumption of office by the present Treasurer, the famous economizer who was going to bring fiscal salvation to Australia, the total imports amounted to £103,000,000. Last year they* increased to £164,000,000, or, roughly, by £60,000,000. Let us consider how the trade balance has stood since the Treasurer took office. In 1922-23 there was an adverse balance of £13,800,000, and in the following year it amounted to £21,000,000. In the succeeding year there was a favorable trade balance of £4,800,000; but in the next year the balance was adverse again to the extent of £3,000,000. Last year we had an adverse balance of nearly £20,000,000, and the net adverse balance for the whole period was £53,000,000. Can the country continue in financial security or economic safety under such conditions? There must be a drastic change. The honorable member for Wannon (Mr. Rodgers) was perfectly sound in his argument so far as he touched on this subject in his speech last night. The continuance of the adverse trade balance is a menace to our prosperity, our development, and the maintenance of the social and industrial conditions that we have established.
– The adverse balance amounts to between £13,000,000 and £14,000,000 for the first quarter of the present year. Therefore, the position is becoming worse.
– That is, unfortunately, true. I have endeavoured to show that the Government has taken no effective steps to rectify the position. Heavy indirect taxes have to be borne by the people as a result of a faulty financial, policy. This year the Treasurer proposes reductions in income and land taxes. Has he shown in the budget speech that the income taxes now imposed are burdensome, or so inequitable that they operate unfairly in any quarter, or that those paying them are demanding and should have relief to the extent of 10 per cent. ? What class is to benefit by the reductions he proposes? From a cursory consideration of the situation, one concludes that the persons who will benefit are largely importers. The Australian manufacturers have been suffering from a lack of protection, while the importers have been making large profits, yet the latter will benefit more than any other class. Is hardship being undergone by those who are contributing income tax to-day? So long as the incidence of the tax is fair there should be no complaint, because taxpayers contribute in accordance with the amount they earn. I have shown that the majority of the people pay indirect taxes - all heads of households pay them - and these have been increased year by year during the Treasurer’s term of office. According to the last available report of the Commissioner of Taxes there were 220,000 income taxpayers in the Commonwealth. Their taxable income for the year which ended with June, 1925 - I could not obtain later figures - amounted to £119,000,000. Of those 220,000 taxpayers, 11,000 had taxable income aggregating £57,000,000. That is not working capital, or money required to carry on business or industry; it is their taxable income for one year. The average income of each of them, is more than £5,000 per annum.
– A few of them may be manufacturers.
– Perhaps so. Unfortunately, too few manufacturers figure conspicuously in the income tax returns. There are plenty of traders, importers, and merchants, and a certain number of land-owners who do so. It is they who will benefit by the reduction proposed by the Treasurer.
– It will be passed on.
– There are 11,000 taxpayers with taxable incomes of £5,000 a year, and each will get, on the average, a gift of £54 from the Treasurer this year through the reduction of taxation. Men with taxable incomes of £10,000 will get a benefit of £191 ; those with taxable incomes of £20,000 will get £491; and those with taxable incomes of £50,000, of whom there are quite a large number in the Commonwealth, will be given £1,391 in the very year in which the Treasurer is imposing a heavier burden upon the family man living on the basic wage. These figures indicate the iniquity of the system of taxation applied by the present Government.
– All the States are increasing their income taxation.
– Some of the States are; they have been driven to do so by dire necessity. The Nationalist Government in South Australia is increasing taxation in a most reckless fashion. Having regard to what is happening in that State honorable members opposite should never again criticize Labour Treasurers for the heavy taxation they impose. Never before has there been such a drastic increase regardless of consequences, as that which is being imposed by an anti-Labour Government in South Australia.
– The same thing is happening in Victoria.
– Because of the lightness of its taxation, Victoria was long held up for admiration as the model State, but the Nationalist-Country party government that recently was put out of office left to their successors a very unhealthy exchequer. I am trying to ascertain what justification can be found for the Treasurer’s proposal to relieve the wealthy classes of taxation before he has made any effort to relieve the general public of the burdens they are carrying. In 1925-26 the general taxpayers were prosperous. The aggregate taxable income was higher than in the preceding years, and measured by the banking deposits, the financial, commercial, and pastoral sections of the community were doing very well, notwithstanding the droughts in some States. In 1925 bank deposits and peace and war savings certificates in the Commonwealth amounted to £466,077,000; in 1926 the total was £491,587,000, having increased by £25,500,000 in one year. From 1916 until last year the aggregate deposits to the credit of various institutions throughout Australia increased by £202,000,000. I know that that sum cannot be accepted as an exact measure of the increase in wealth and production; it is apt to be misleading if so regarded. Allowance must be made for various factors which led to an inflation of bank deposits, but the figures are a broad indication that the general trading community, and the large body of Commonwealth taxpayers are not in such distress that they should get relief in preference to the family man and others who are paying indirect taxation through the Customs. Nor has the Treasurer any justification for proposing to reduce the land tax.
– Millions of pounds worth of land, particularly in the State of Queensland, is yielding nothing and less than nothing.
– Does the honorable member say that the owners of such land are paying taxation?
– Yes, notwithstanding the hardship board.
– The large estates in Queensland are leasehold, and are exempted from Commonwealth taxation.
– I should like to possess the freeholds of Queensland.
– The honorable member suggests that there are large numbers of freehold properties which are not earning anything and yet are subject to Commonwealth land tax.
– Many of the owners are actually paying out money in order to keep their land.
– The honorable member is speaking without his book. If such estates are yielding no income, it must be because of losses caused by flood, fire or drought, and there is a special provision for the remission of taxation in respect of losses of that kind. The Commonwealth land tax is well justified. It was intended to prevent the growth in Australia of that land monopoly which in other countries has become a curse. Land monopoly is. one of the most difficult agrarian problems with which older countries have been faced, and the Labour party has wisely endeavoured to prevent it from becoming acute in Australia. The aim of the party was to break up large estates and return to the community a proportion of the unearned increment of land values created by the community. For the latter reason the tax was made applicable to city as well as country property. Although the present Treasurer and his party were returned ostensibly to assist the small landowner and working farmer, nearly all his efforts have been in the direction of relieving the wealthy pastoralists and land monopolists. Is the Commonwealth land tax paid by the farmers ?
– I took all the small farmers out of the land tax in 1924.
– Is any large proportion of the Commonwealth land tax paid by the bona fide farmers?
– No portion is paid by the bona fide working farmer; it may be paid by the cheque-book farmer who employs managers and does not work the land himself. There are 20,000 payers of Commonwealth land tax, and the total assessable unimproved value of the laud owned by them is £256,000,000. The average unimproved value of these 20,000 properties is £12,S00. What working farmers own farms of which the unimproved value is £12,800? That is the class of estate that pays the Commonwealth land tax. It is not paid by the working farmer who has property of an unimproved value of £1,000, £2,000, or £3,000. Those are prosperous farmers indeed, if they can be called farmers, who own property of an unimproved value of more than £5,000. The average unimproved value of the land owned by the bona fide working, farmer throughout the Commonwealth is less than £1,250 and such “an estate pays no Commonwealth land taxation. The majority of the 20,000 land taxpayers are owners of city property, and the value of their land is enhanced by the work of the whole community. In the course of a decade the unearned increment to their land amounts to millions of pounds, and they are asked to return to the Commonwealth merely a small modicum, of that communitycreated wealth. Yet the Treasurer proposes to whittle away this taxation, which is no longer as effective as it was in the early days of its application.
– It is not quite so punitive ?
– It was never punitive. It first came into operation in 1911. If it was intended to punish land-owners it is a strange fact that although nonLabour governments have been in office in the Commonwealth since 1916, this allegedly punitive legislation is still on the statute-book. No one who knows the history of the Commonwealth land tax can doubt the bona fides and purity of motive which prompted the Labour party to introduce it. The pity is that it was not continued in its original, effective form. Had that been done it would have led to* a greater subdivision of large estates, and the closer occupation and better utilization of land, and would have given to farmers’ sons more opportunities to get holdings for themselves. Many towns in New South Wales are land locked because large estates adjacent to them are being used for grazing, although suitable for wheat-growing and other forms of agriculture. Within a 12-mile radius of existing railways in New South Wales is 25,000,000 acres of alienated land of which 9,000,000 acres is suitable for cultivation but is not cultivated.
– Is wheat-growing still a profitable industry in Australia?
-From the point of view of the general community ii is one of the most valuable industries in Australia. Those people who suggest that wheat-growing should be discontinued or not extended are preaching a policy of despair. J udging by the remarks of honorable members opposite, it is impossible to carry on profitably, dairy farming, fruit-growing, wheat-growing or agriculture. If that were true, we might as well surrender this country and make room for somebody else who could make more effective use of it. Such despairing counsel is a slander on Australia, and is a distortion of the facts.
– What about the Bathurst Conference ?
– That was a gathering of producers and consumers working in harmony to solve problems which previously th”.y had not been able to solve, and it showed that both those sections can co-operae and evolve a realizable policy for each. They can arrive at the cost of production and so control prices in the home market that that cost will be met. The bene. market is the one we should encourage; it will be the salvation of Australia. It can be improved by an effective fiscal policy, which will create a manufacturing population, and make it unnecessary to continue to send our money overseas for the support of the populations of other countries.
– Does not the honorable member recognize that much of the land which is not used for wheat-gowing is put to a more profitable use?
– No. The land is used for sheep raising, which is a very beneficial and prosperous industry, but the experts of the Agricultural Department of New South Wales have strongly urged the Government to resume, those areas, because of th: enhanced economic value that can be got from land under cultivation through closer settlement and a greater production of wealth. Surely the honorable member will not contend that more wealth per acre is produced from grazing land than from cultivated land.
– Very often more profit is produced from grazing lands.
– They may produce more profit, but not more advantage or benefit to the nation generally, and that is what we have to take into account. All authorities agree that it would be wise to apply much of the land that is at present used for grazing to agricultural uses, thus bringing about closer settlement, increased production and a substantial addition to the wealth of Australia.
– Australia would be in a bad way this year without its £55,000,000 worth of wool.
– We should be In a bad way without agricultural production as well. Wool is the chief product of Australia, but it is not the only one. The taxation reductions proposed by the Treasurer will, to the extent of 90 per cent., benefit the rich people, but will afford no relief at all to those who are not so rich. The Treasurer’s budget is calculated to satisfy those who are already well-to-do, and has ignored altogether the hardships occasioned to the Australian family man who is contributing indirectly to the revenues of the Commonwealth. The financial policy of the Commonwealth has failed. The Treasurer has shown no ability in coping with the problems, though he assumed office as the champion of economy. He has achieved no economy. Though he preached the necessity for an effective tariff, he has not been able to propose one. As a consequence of financial ineptitude on the part of the Government, the taxation now ruling in the Commonwealth is the highest on record. The expenditure this year, from both loan and revenue sources, leaving out war services, is also a record under a Treasurer who promised to practice economy. Imports into Australia for the financial year just ended have reached record dimensions, and the adverse trade balance during the last five years is also a disastrous record. These four main essentials to sound finance - economy, equitable taxation, a satisfactory trade balance, and a reduction of foreign imports - have not been achieved, and the present Government has a more disastrous record than any of its predecessors. The Treasurer must know the position, although he has not dealt with it in his budget. He has failed to give any guidance or explanation to honorable members, and to offer any policy that will lead to a correction of the evils that undoubtedly exist. Surely honorable members cannot be . blind to the situation. The Treasurer has preached economy to the State Treasurers. He has condemned extravagant expenditure. There is not in Australia, nor has there been for many years, a more unsuccessful Treasurer than the honorable gentleman himself. I wish now to refer to the speech of the honorable member for Wannon.
– I am wondering why the things that I enunciated are wrong, but, according to the honorable member, are right when enunciated by him.
– The honorable member rose to offer what he said would be positive remedies. I did not rise for that purpose.
– The honorable member said that he would supply a remedy.
– It is time enough for the physician to prescribe when he is summoned. The honorable member for Wannon last night said that various things were wrong, and that he would offer certain remedies, but the only remedy that he offered was the cessation of borrowing. I do not believe that we can have a complete cessation of borrowing in Australia without great distress and stagnation. We can, of course, curtail borrowing. I have never set myself up as a financial authority, although I have had much experience. For ten years I managed the Queensland Treasury.
– I have with me a booklet containing a little story about the honorable member.
– If the honorable member is particularly interested in
Queensland, I can give him a more accurate authority than that publication, which, I can assure him, is full of misrepresentations. The honorable member rose to offer remedies, but has not done so. Our fiscal policy is wrong, and is not protecting Australian industries, as is evidenced by the fact that more goods are coming into Australia than before, and, in addition, Australian industry is being subjected to a keener and fiercer competition from overseas. An increase in Customs revenue is not evidence of the effectiveness of a protective policy. If the policy is effective, revenues must diminish.
– Does not the honorable member want a higher tariff?
– Yes, if it will exclude foreign goods from Australia ; if it will diminish the Customs revenue; if it will enable the Australian producer to compete successfully with the foreigner; and if it will preserve Australian markets to Australian producers. By all means let us have a higher tariff under those circumstances; but not if it is merely going to pour into the public treasury millions of money to be extravagantly expended by the Treasurer. My attitude is perfectly clear and logical. I go so far as to say that we should place a complete embargo upon the importation of certain food products which can be and are being produced in Australia. We are expending over £6,000,000 a year in the importationof jams, preserves, pickles, and similar articles. A complete embargo on such goods, every one of which can be produced in Australia, would mean additional wealth to this country and would keep money circulating among the people. The same remarks apply to other manufactured articles. If a certain industry can supply Australian requirements, I would preserve the Australian market exclusively for it. I know that that is an uncompromisingly protectionist policy, but it can be given effect. It is sound, and, if given effect, would lead to the rapid development of Australia and to the ultimate benefit of all sections of the community.
– There must be industrial efficiency behind such a policy.
– It is not a sufficient ;argument against the protection of
Australian industries to say that we have not the highest degree of efficiency necessary in Australian industry. Such an argument is a reflection upon the controllers of industry and upon the Government.
– That is not so.
– The responsibility for efficiency in industry mustbe chargeable against some one, and an investigation will show that whereas the factor of labour is chargeable with a certain degree of that responsibility, mismanagement, lack of standards, lack of transportation, and lack of proper organization are the principal factors making for inefficiency in Australia and in every other country to-day. I have sufficient faith in the Australian man, whether worker or supervisor, to say that he can do as well as his competitors elsewhere in the matter of conducting business and producing the commodities that we require in this country. I hope that before long we shall institute a real protective policy. Our present policy is ineffective, is producing a load of taxation, and is net saving Australian industry. Those are the chief problems facing Australia. The motion of the Leader of the Opposition is justified, and every real Australian in this chamber must endorse it.
.- Honorable members have listened to a long lecture by the honorable member for Dalley (Mr. Theodore), dealing principally with the shortcomings of the Treasurer (Dr. Earle Page). The honorable member has had a long experience of financial matters ; but it will not be denied that, when he was Treasurer and Premier of Queensland for some ten years, the public debt of that State increased from £56,869,000 to £97,000,000.
– The honorable member knows that, during my régime, the increase in the public debt was less in Queensland than in any other State of ‘ the Commonwealth.
– As honorable members were treated to a lecture by the honorable member for Dalley, they will probably appreciate criticism of his administration while he was Treasurer of Queensland. I shall read it in a kindly spirit, not wishing to do the honorable mem her any injustice; but it is only right that honorable members should know something of the honorable member’s administration of the finances of Queensland.
– I ask the honorable member to be accurate, and not to slander his own State.
– I do not wish to slander my own State; but in party politics it is only right that the people should know exactly what their advisers have done, and, therefore, we should let them have the facts.
– What authority does the honorable member intend to quote ?
– I shall quote from a leading article which appeared in the Brisbane Courier^ a public journal with a wide circulation and complete knowledge of all the circumstances. I feel quite certain that, as I read the article, honorable members will realize the importance and justice of the criticism. The article was written while the honorable member was contesting the Dalley seat in New South Wales. It reads -
Mr. Theodore left Queensland. He held office in Queensland for ten years, and during that period he was Treasurer for more than seven years, and for nearly six years he was Premier as well as Treasurer. He was Treasurer during the war years, and, though he came into office denouncing the principle of borrowing, he managed during those years to spend more loan money, on a population basis, than any other State Treasurer in Australia.
– That is incorrect. Mr. MACKAY.- The article continues : -
When Mr. Theodore took over the Treasury on 1st June, 1915, he found himself inheriting the results of eight successive surpluses. Mr. Theodore immediately began to build up deficits, against which he had stormed at the election of 1915. As a Treasurer he played the role of Mr. Magnificent, playing ducks and drakes with public money, dazzling the eyes of his supporters with extravagance, saddling his successors with an empty Treasury, a heritage of debt and commitments, and bewildering the public with taxation. On one occasion he said he intended “ To search the pockets “ of the taxpayers. He did. In fact, taxation was the one thing of which he had a thorough grasp.
– He possibly taxed the right people.
– In reply to the honorable member for Newcastle (Mr. Watkins), it is only necessary to point out that” Mr. Theodore once maintained that it was the workers who paid the taxes.
– No; the honorable member is inaccurate. Surely he can stick to the truth. I never made such a speech as that. What I said was that it was the workers who suffered.
– The honorable member for Dalley (Mr. Theodore) said that all taxation, in the last resort, fell on the workers.
– May I give the quotation ? What I said was, “ The producer is the person who pays; the worker is the person who suffers.” I made that statement in 1915.
– The article goes on to say: -
In ten years of office, Mr. Theodore increased the public debt by £40,000,000; he initiated a land tax, increased income tax by more than 100 per cent., and the stamp duty by nearly the same amount. As a master of taxation, Mr. Theodore has had few equals in Australian history. It is forgotten that Mr. Theodore found the railways paying working expenses and interest, and showing a little profit. But’ from the day that he took oflice they besran to fail, and the failure has meant a deficit of about £14,000.000 in .11 years. Mr. Theodore either had the hick, or the foresight, to leave Queensland politics before the crash caine. In his long career in Queensland as Premier and as Treasurer, Mr. Theodore “ busted “ practically everything that he administered, and in his autocratic way he “ searched the pockets “ of the people to pay for his mistakes. To give him credit, where credit is due, he had wisdom to flee before the crash, leaving someone else to face the storm.
– The statement made in that article is based on inaccuracies, especially the reference to the increase of the debt. I have the statistics here.
– I think I am justified in quoting these facts when the honorable member for Dalley lectures the Government on the alleged mismanagement of its finances. The Leader of the Opposition quoted a mass of figures in an effort to prove that the Government has bungled the finances of the Commonwealth. I do not think that the Leader of the Opposition succeeded in proving his case. Probably the layman will find some difficulty in following all the figures mentioned in the Treasurer’s statement, but it is a good deal more difficult to follow the figures given by the Leader of the Opposition. To me they are completely bewildering. I have some figures here which I think put the case in a nutshell, so far as debt redemption is concerned. Between 1922, when the Bruce-Page Government assumed office, and the present time, the Commonwealth debt has been reduced by £36,188,464. It is a fact that loans to the amount of £3S,000,000 have been raised in the meantime for Commonwealth purposes, but I ask honorable members to consider what the money was borrowed for. It was borrowed for reproductive post office developmental and other Commonwealth works. How often do we hear honorable members on both sides arguing with the Postmaster-General about the necessity of providing better facilities for country districts. For postal and developmental purposes, sums totalling £35,936,357 were raised, and, in addition, the sum of £2,024,022 was raised for the Federal Capital Commission. Will any honorable member say that this expenditure was not necessary, or that the borrowing was not soundly conducted so far as the sinking fund scheme is concerned? As honorable members know, there is a 10s. per cent, sinking fund for Commonwealth loans on a 50-yea.rs period, and provision has been made to wipe out these debts within a certain time. The Leader of the Opposition (Mr. Charlton) attempted to make capital out of the fact that the public debt, at the present time, is higher, in spite of debt reductions, to the extent of £2,000,000, than when the present Government assumed office. It is perfectly clear to any one who studies the papers that this is so, but if there had been a Labour Government in office, it might have squandered that £36,188,464 and instead of the public debt being only £2,000,000 more than in 1922, it might have been £38,000,000 more. That has been the experience of every State of the Commonwealth governed by Labour. At the present time we have four States under Labour administration. Does any honorable member suggest for a moment that taxation is being reduced, or borrowing curtailed, in those States? The Leader of the Opposition had much to say on the fact that the trade balance is against the Commonwealth at the present time. There is nothing new in that. We are all, unfortunately, aware of the fact ; but the honorable member for Dalley goes a step further, and says it is the consesequence of heavy Commonwealth taxation. The explanation, of course, is that we buy . more from overseas than we export from Australia. As a nation we are not producing enough. It is true that the tariff is designed to help local industry, and from time to time this House is asked to increase the duty on various items. Every time, an increase has been made, however, a demand has followed for better conditions of labour, higher wages, or a shorter working week. The result is that the cost of production, instead of being reduced, i3 increasing all the time, and for that reason the people have to pay more for their goods. It is impossible for our secondary industries to manufacture for export for the reason that the cost of production is too high. That is undoubtedly the reason for the adverse trade balance of which the honorable member for Dalley spoke. It is unreasonable to suppose that we can go on in this way. We are now producing less, under better conditions, that we. were producing some years’ ago, and the remedy, it appears to me, is to decrease working costs. Various suggestions have been made to this end. The Government recently asked representative men from the trade unions and from the employers to visit America, and to learn what might be of benefit to industry in Australia. Those gentlemen have now returned, and it -is regrettable that their report is not unanimous. Any suggestion that is made in Australia for the introduction of piece-work, profit-sharing, copartnership, or payment by results, immediately brings protests from the Trades Hall. The other night, when I was speaking on another matter, I referred to the fact that there was a great deal of unemployment throughout Australia, necessitating large sums of money being paid in the form of doles, without any return to industry. Recently in Queensland, when the railway unions went before the Board of Trade for an increase in wages, it was refused, and the board’s reply is reported as follows: -___
In refusing the claim of the Queensland railway workers for an increased basic wage, the Arbitration Court intimated that the
Queensland tradesmen’s claim for an additional wage that represented the value of his work over and above that of the labourer, might be conceded under the system of payment by results, based on the individual or group output, and with adequate protection against progressive rate-cutting and excessive labour, and for the right and opportunity of collective bargaining. With this correction, there should be no valid objection to a trial of piecework on a large scale. The system of piecework had been in operation for a - number of years in the moulders’ section at the Ipswich railway workshop, and the court urged the Commissioner and the unions to come together with a view to its extension to other sections of the workshop, on conditions that would safeguard the proper interests of the employers, and thus secure them the full result of their industry. The court declined to grant preference to any particular union, but agreed to allow the Commissioner to make his own terms with each organization.
That gets right down to bed-rock, and it appears that, although this board was appointed by a Labour government,’ and its personnel bave pronounced Labour sympathies, it realizes - as Mr. Mccormack has done - that the country cannot go on under present conditions. The suggestion it makes is very timely, and I would be glad to see honorable members on the other side take more interest , in the matter, and try to work in with capital, so that we might get better results all round. Under a system of piecework full protection can be guaranteed for those men who are genuinely unable to compete on equal terms with their fellows; but it is a fatal mistake to handicap the good man, and keep him down to the level of the less efficient man. The Leader of the Opposition has not made out a good case for his amendment. I cannot agree with the honorable member for Dalley that the tariff should be raised, if necessary, to 100 per cent. It is not wise to increase the duties too high. The object of duties is defeated when, as at present, the trade unions immediately demand increased wages and shorter hours. I am just as jealous of the rights and privileges of the working man as is any other honorable member, but I deprecate the use of methods which encourage class hatred, and the endeavours of extremists to induce unionists to agitate for higher wages and shorter hours when it* is impracticable to grant them. Those methods are not in the best interests of the workers of Australia. The high taxation prevalent in our States is largely responsible for the existing unemployment. The Commonwealth Government has made strenuous endeavours to reduce taxation, and cannot be held to be in any way responsible for our unemployment. It has increased the exemption from £100 to ‘£300, and the deduction for the maintenance of children from £26 to £50. In 1923 it reduced the incidence of taxation by 10 per ,-ent.; in 1924-25, . by 10 per cent.; in 1926- 27, by 13 per cent.; and in 1927- 2S, by 10 per. cent. Despite the remarks of the honorable member for Dalley, those reductions must, of necessity, be beneficial to the worker. It is impossible for industries to expand in most of our States because of the high taxation. Quite a number of people who have from £2,000 to £3,000 available for investment prefer to place their money in gilt-edged securities, such as Commonwealth loans, instead of in industry, mainly because of the prevalence of industrial trouble. It is all nonsense to say that our unemployment is due to the excessive arrival of migrants in Australia. The number of unemployed in Queensland alone- is greater than all the migrants that arrived in Australia last year. I long to see the establishment of a better understanding between capital and labour, so that all concerned may reap adequate reward for their labour and investments. Honorable members opposite, regardless of the result, are keen to see the realization of that plank of their platform which requires the nationalization of the means of production, distribution, and exchange. The honorable member for Darling (Mr. Blakeley) said, the other night -
We have lost on our steamers, as we have on other state instrumentalities: and when Labour is in power it will continue, if necessary, to lose on them.
Such a policy would accentuate existing difficulties. It is ridiculous to contend that Ave can spend 25s. if ‘we have only £1. The Treasurer is to be complimented on the presentation of his first budget speech in the permanent home of the Commonwealth Parliament. The press reports indicate that the budget has been very welcome, and that good results are expected to accrue from it. The Bruce-Page Government may justifiably be proud of having provided a solution of the financial relationship between the Commonwealth and the States. Undoubtedly the repeal of the Surplus Revenue Act, in April last, in defiance of the opinions of many prominent members of this chamber, ‘has proved to be very welcome, and is largely responsible for bringing about a permanent solution of the problem.
– There has . been a drastic alteration since April.
– The Commonwealth Government has been generous to the States to a degree that was not originally intended. Some credit for the solution of the matter may be claimed by Mr. Abraham Hertzberg, of Brisbane, who has studied the matter very carefully, and made representations to this Government from time to time. The scheme has been satisfactory to the States, as is indicated by the Premier of Queensland is his financial statement for last year, as follows : -
The proposed agreement for the adjustment of the financial relations between the Commonwealth and the States will mark a very important point in Australian history. I am satisfied that the arrangements which it is proposed to embody in the agreement are sound in principle, and will prove of distinct advantage to the States. From the point of view of prospective benefit, a continuance of the payments at the rate of 25s. per capita would be more acceptable, in view of our rapidly increasing population; but the Commonwealth Government has definitely decided to terminate this method of financial assistance to the States, and to substitute the payments provided for in the proposed agreement.
Mr. McCormack continues at some length, but I shall not weary honorable members by reading the full text of his remarks. I am pleased that the Government has set aside £200,000 as the nucleus of a fund to establish a scheme of national insurance, and I sincerely hope that the measure will be introduced this session. As an indication that some sort of a scheme of national insurance is imperative, I refer to the extensive work performed by our charitable institutions. Last year 150,000 adults and children received outdoor relief throughout Australia, to the extent of £2,539,000. A further £4,000,000 was expended on the upkeep of general and mental hospitals. If we add to that amount the cost of old-age and invalid pensions, £9,000,000, we find that a total of £15,000,000 was expended on charitable relief work throughout Australia last year.
– Are old-age pensions to be included in this scheme?
– I am not sure what the proposals of the Government will be. Undoubtedly the various institutions provide a certain amount of relief, but it is desirable that the Commonwealth should evolve a more adequate scheme to assist those suffering from sickness and unemployment.. The Government has given complete evidence that it is desirous of doing the fair thing by every section of the community. It will be remembered that, at the last general election, the Prime Minister (Mr. Bruce) said that so long as he was leader of the National party he would not represent any particular section of the community, but would legislate for the people as a whole. There are two sections with which the Government is anxious to deal. One is the conservative who desires to exploit the labourer by paying low wages and enforcing long hours, and the other is the communist, who endeavours to stir up industrial strife and class hatred and foment strikes and direct action. I rose principally to refer to the remarks of the Leader of the Opposition (Mr. Charlton). Had the honorable member for Dalley (Mr. Theodore) not spoken, I probably should not have digressed by reading newspaper extracts, a practice which I deprecate. The concern of this House and of the people of Australia is that the finances of the country should be administered sanely and f.or the benefit of every section of the community. If that is done, Australia is sure to progress. I trust that, as this debate proceeds, honorable members will endeavour to get away from the desire to make political capital and, instead, will formulate constructive schemes that will help Australia along the path of progress.
.- The honorable member for Lilley (Mr. Mackay) stated that he read extracts from newspapers with regard to Queensland. I am pleased to hear that, because I would not like to accuse the honorable member of being guilty of that worse kind of untruth, the half-lie. Our daily press frequently quotes misleading extracts in order to . misrepresent the Labour party, in the endeavour to place that party at. a disadvantage. If they told the truth, it would be of advantage to this party, and not a disadvantage. The honorable member tried to make a considerable amount of political capital out of the statement that the Queensland national debt was so much greater under n Labour than under a National Government, taken over a number of years. He accused the honorable member for Dalley (Mr. Theodore), who was for a long time Premier and Treasurer of Queensland, of having indulged in a reckless financial policy. ‘ The debt of Queensland for the period 1915-1925, under Labour administration, shows an increase proportionately less than the increase in the debt of any other State, and certainly less than that of the Commonwealth. The following are the percentage increases of the public debt of the different States for the period
For the greater portion of that period New South Wales was under a National Government. Labour being in power only for four years of the term. Those figures entirely discount the statements of the honorable member. A consideration of the rate of interest payable on the public debt of the various States reflects the greatest, credit upon Labour’s administration in Queensland. When the Labour party assumed office in that State in 19.15 the rate of interest on the public debt there was the highest in the Commonwealth; but ten years later it was the lowest. When we remember that, and at the same time bear- in mind that the public debt of that State increased less proportionately during the same term than the public debt of any other State, we have a complete vindication of Labour’s rule. The oversea reputation of Queensland is higher than that of any other State. The honorable member for Lilley read a number of extracts from articles which have appeared at various times in what I must assume to be biased newspapers, and he reiterated certain parrot cries in which the words “ shorter hours “ and “ higher pay “ occurred with monotonous regularity. The honorable member does not appear to know that captains of industry in other countries have deliberately shortened the working hours of their employees and paid higher wages because experience has shown them that the results are increased output, a better organization, and more efficient workmen. This action has been taken in spite of the fact that other employees in the same neighbourhood have carried on under the old conditions. Nor does the honorable member seem to be aware that when the Fuller Government came into power in New South Wales in 1922 and repealed the 44-hour week legislation passed by the preceding Labour Government, a.nd re-instituted the 48-hour week, many manufacturers refused to take advantage of the measure. I have never heard any of them say that they suffered loss through it. . It appears as though some honorable members opposite would be quite willing to introduce the Japanese barrack system to Australian industrial life. In Japan children are brought into the cities and herded in barracks adjacent to the factories in which they are to work, and they spend twelve hours in the barracks and twelve hours in the factory, year in and year out. The barrack beds are never cold. Is it suggested that we should adopt those methods in Australia in order to compete with Japan? The honorable member also referred to class hatred. If ever there was a political organization which battened upon class hatred it is that with which honorable members opposite are connected. The Government which they support is in office to-day mainly because it aroused class hatred during the last election campaign. The prostitution of the instrumentalities of government of which this Government has been guilty is more calculated to cause revolution in this country than the warmest advocacy of any of the reforms in which honorable members on this side of the chamber are interested.
– Does the honorable member regard Communism as a reform?
– I do not; but the conduct of the supporters of this Government is bringing our present methods of constitutional government into serious disrepute with the people, and when people begin to scorn the form of government under which they live revolution is likely to occur. The history of the world shows that whenever class-conscious effete aristocracies have become corroded by over-indulgence and greed the mass of the people rise up and overwhelm them. This Government, even in the last week or two, has acted in such a way that it may expect the people at the first opportunity to overwhelm it. The debate upon which we are engaged can only, like most similar debates, have the effect of further condemning the methods of finance which this Government seems determined to follow. “We have already heard a good deal from honorable members about the adverse balance of trade and the financial stringency from which the country is suffering: but we have heard only about effects. The Treasurer set the example in his speech of entirely overlooking the causes sf our present difficulties. Until we clearly recognize these causes we cannot expect to remedy them. Honorable members opposite seem determined to hug the present financial system until it absolutely collapses. They are afraid to do anything unless they have some precedent for it. In my opinion we must find a new method of financing the affairs of our country, or our civilization, like many that have preceded it, will crumble and disappear. We hear a good deal in these days about our national debt. National debts have been caused by the operations of private banking companies, and the longer we allow them to accumulate the more complete must be our ultimate collapse. We laid the foundations for building up huge public debts when we handed’ over the currency of our country to private financial institutions and permitted them to usurp the prerogatives of government. Our financial burdens will continue to grow until we resume control of the currency. There must come a day of reckoning, and the sooner we anticipate it and prepare for it, the better it will be for us. We heard a good deal last ‘night about the cost of production, and the cost of living, but the criticism of honorable members opposite, who had so much to say on the subject, was far from constructive. Our methods of production and distribution are wasteful in the extreme. Every morn ing one may see in, say, the suburb of Canterbury, in Sydney, hundreds of men rushing from, their homes at 6 o’clock in the morning to catch trains, trams or buses, to get to Balmain to start work at the appointed hour; while at Balmain probably just as many men begin at the same hour to rush to Canterbury, so that they may reach it in time to begin their duties. Every morning seven or eight milk carts may be seen delivering milk in the little street in Dulwich Hill where I live. Other perishable commodities are distributed in the same wasteful manner. While we are talking about finding markets abroad for our products, many of our own people are obliged to do without them because our methods of distribution make them far too costly. The dairyman, for instance, gets only about 25 per cent, of the value of his milk, while the consumer has to pay twice as much as it is worth.
– The honorable member should bear in mind that for five of the last ten years the affairs of New South Wales have been administered by Labour governments.
– The conditions to which I am referring are practically world-wide. But in reply to the honorable member’s interjection, let me say that Labour governments have not been able in five short years to overcome the effects of 50 years of mal-administration by anti-Labour governments. As a matter of fact, the Lang Government was about to wrestle with the problem of milk when it was superseded. What honorable member would think of allowing five or six postmen from rival post offices to deliver letters in the same street? If that were permitted our postage rate for ordinary letters would be ls. instead 0i ltd. each. Private enterprise has altogether failed to justify itself. The economic waste due to private enterprise will never be eliminated under the present anarchic system of capitalism. Distribution, at least, must be socially controlled in order to reduce overhead charges, provide better returns to the primary producers and reduce costs to the consumers. Milk and fresh fruits, which are essential to the well-being of children, but are now largely denied to them, could then be plentifully supplied to them. We have reached a stage when the piled up costs of government thai obtain under the capitalistic system must not be permitted to continue. By organization, consumption should be placed on the same footing as production. It is useless to produce goods unless they are consumed, and I prefer to see our own people fully supplied with the good things that are produced in this country before looking for fresh markets abroad.
I shall now consider the budget from another point of view. The Treasurer reminded us that it is his fifth, and he repeated the fallacy that a sinking fund makes provision for the redemption of the national debt. He took to himself the credit of having invented the system; but it is as old as national debts themselves. Pitt tried it many years _ago, when it was used for the sugar coating of the national debt pill to induce the people to swallow similar pills of ever increasing size. The Treasurer’s own figures show that the debt of the Commonwealth will never be extinguished under his scheme. Pitt reduced the national debt of Great Britain by £15,000,000 in a few years, and at the same time he added a further £70,000.000 to its indebtedness. That has been the practice of most of the Treasurers of the Commonwealth. Sir Joseph Cook conceived the brilliant idea of using the proceeds of the note issue, which he once characterized as “Fisher’s flimsies.” He had previously prophesied that the introduction of the note issue would bring dire calamity on the people and had asked what the “ bowyang “ party, the “pick and shovel” party, could possibly know about the intricate problems of high finance. Sir Joseph Cook refused to take advantage of the proceeds of the note issue to give relief to drought stricken squatters and the unemployed, but decided to use the accumulated profit in reducing the national debt. How did he do it? War bonds amounting to £6,000,000, bearing interest at 4$ per cent., were retired, and in less than eight months he floated a’ £10,000,000 loan at 5 per cent. The present Treasurer is following in the footsteps of that so-called financier. Let me read the following paragraph from one of the Sydney evening newspapers: -
Conversion and Redemption of 4i per cent. and 5 per cent. Commonwealth Loam maturing on lath December, 1927.
The Commonwealth Treasury is now inviting applications for the conversion of holdings in the above loan.
Cash subscriptions are also asked for, to repay those persons who do not desire to convert.
The interest rate offered for both conversion and cash subscriptions is 5J per cent., and the issue price is £98 10s.
Subscribers are offered the choice of three periods for their investment, viz.: five years, ten years, or fifteen years.
As the “ Issue price “ is £98 10s., the average . annual interest return to the investor for the five-year period is £5 lis. lOd. ‘per cent., for ten years £5 Ss. lid. per cent., and for fifteen years £5 Ss. per cent.
Those persons who convert into the new loan will receive from the Commonwealth on loth December, 1927, a cash bonus at the rate of £1 10s. for each £100 converted. This cash bonus makes the yield on converted holdings the same as that on cash subscriptions.
The loans to be redeemed carry 4$ per cent, and 5 per cent, interest; but the new loan will bear interest at 5J per cent. That is the Treasurer’s conception of proper loan redemption. The bond-holders not only receive an extra i per cent., but, for their charity to the Commonwealth, they also receive a cash bonus of £1. 10s., and the loan is free of State income tax. The present Government is gradually receding from the field of income taxation and constantly raising the exemption. To a certain point I support exemption ; but is it moral for the Government to convert loans year after year and make them free of State income tax, while its policy is to evacuate the field of income taxation, thereby giving the wealthy class higher rates of interest on gilt-edged securities free of income tax.’ Now that the war is over, the sufferings of our men at the front are apparently forgotten. The Government proposes to grant increased, exemptions to those with large incomes, and yet it has the audacity to complain that State” Labour governments are going in more freely for direct taxation. What other means have State governments of obtaining the revenue they require? Profits accumulate so rapidly under the capitalistic system of profiteering and robbery that were it not for the facilities afforded for gilt-edged investments, the system would have broken down years ago. The funding of the national debt has opened an avenue for the investment of capital without the risks attendant ‘on industrial enterprise. If we analyse the Treasurer’s figures, they show how stupid is the claim tha., the national debt will be extinguished ‘ under the Government’s proposal. The financial year covered by the budget shows an increase in the national indebtedness of £2,624.891. Om- national debt is now £1,016,623,752. According to the Treasurer, this amount will be redeemed in 58 years. On those figures, allowing nothing for inevitable increase in the rate of borrowing, the new debt created in that period will be £1,168,838,430. Should the present policy continue for the next 5S years, Australia will have paid in interest £3,049,871,256 on the existing debt. It will also have redeemed that debt, and created a new debt of upwards of £1,168,000,000, upon which will have been paid in interest an extra £100,000,000. Where does the Treasurer think he is leading the country ? Just what do he and his associates think they are doing. In the words of Tennyson, this heaven-sent financier has “ dipt into the future as far as human eye could see “ ; he has visualized Australia’s financial policy for the, next 58 years, and this is what his vision means to Australia -
I firmly believe that we can safely double that amount, and that the burden on the community through this capitalistic system of finance will be at least £10,000,000,000. A study of the national debt of Great Britain suggests that that estimate is not extravagant, even if there should be no further war. Beyond doubt this system of finance, which we call capitalism, is hopelessly bankrupt, and the Treasurer and his supporters, in seeking to stave off the day of reckoning, are attempting the impossible. The only instrument by which the Commonwealth Government could have built up the national finances on a sound basis was forged for them by a Labour government ; but it has been rendered almost useless. I refer to the Commonwealth Bank. The Treasurer, in his budget speech, referred to the visit of Sir Ernest Harvey, Comptroller of the Bank of England. This wonderful person is a private banker, who came to Australia at the invitation of the Commonwealth Bank Board, no doubt supported by the Government, but in the interests of private finance. His expenses were paid by a private bank, and he was well looked after by private financial interests in Australia. Speaking at a dinner tendered to him by the Millions Club, of Sydney, he said -
As the result of the knowledge I have obtained here, when the Commonwealth Bank wants help in London, it can rely on me.
He went on to say that the Commonwealth Bank had been established for a very definite purpose, as to the wisdom of which he was very doubtful; but he was convinced that the men who are controlling the destinies of that institution were now taking a very similar view of their work to that taken by the directors of the Bank of England. Because of that, he made the promise that I have just mentioned. In other words, because he was convinced that the directors of the Commonwealth Bank, who had been appointed by the present Commonwealth Government to sabotage the institution and make it a mere lackey of the private banks instead of the servant of the people, Sir Ernest Harvey was willing to place the resources of the Bank of England at its disposal. The definite purpose for which it was created by a Labour government was to re-organize completely the financial structure of this country. All Australia knew what was the Labour party’s intention, which it will yet achieve. But, because the original purpose of the bank has been abandoned, and it has become merely a bankers’ bank, it is assured of tho full support of the private bankers of England. Sir Ernest Harvey said that the banking of Australia was carried on differently from that of Great Britain. Instead of the overdraft operating in Australia, the bill market operated in England. It is common knowledge that the bill market is operated on a gold reserve with a free gold market, and the bank rate of interest fluctuates according to the reduction or increase of the gold reserve. I shall mention one illustration of how this wonderful system operates when the money jugglers of the world apply it to their own uses. Some years ago, over a period of weeks, a group of American financiers drew from the Bank of England amounts ;n gold aggregating £11,000,000, and shipped the money to New York. Prior to that these gamblers sold British securities heavily, and bought’ American bonds and shares. The transfer of £11,000,000 worth .;f gold to America caused a- heavy fall in 325 British representative securities, equivalent to £115,000,000, while the absorption of gold in America caused a corresponding rise iu the securities of that country. It was computed that at the time of this operation the actual wealth of Great Britain was £20,000,000,000. Yet a few men, who. lily-wise, “ toil not, neither do they spin,” by taking £11,000,000 worth of gold from a country whose wealth amounted to £20,000,000,000, caused a tremendous trade depression, a depreciation pf the stocks of one country, and an appreciation of thos-1, of another country, and raked off millions of pounds in the process. Subsequent1,)-, having bought up the depreciated British stocks, they returned the gold to England and. raked in an additional profit through the consequent appreciation f.f values. If that £11,000,000 .had bena sent to America in the form of goods, there would have been more work for the employees in the factory, more money spent on wages, and a general buoyancy in British trade. Instead, depression and dislocation were caused by the machinations of a few men who were financially immoral, and a greater menace to the world than were the buccaneers and pirates of old. A pirate or bushranger at least takes his life in his hand ; but a financial manipulator, hiding behind legal intricacies, is able to rob the people. His operations are more detrimental and far-reaching than the depredations of pirates and bushrangers. One would have thought that Great Britain would take steps to stop this practice, since it has been detrimental to her export trade; but she has lain dormant. The banker is the medicine man of finance, and he is left untouched; simply because he instils in the people a superstition .for this thing called gold greater and more potent than the superstition of the most abandoned savage for his sticks and stones and false gods. The banker gets his “ rake-off “ from every country in the world. The result frequently has been trade wars and the dislocation of the world’s affairs. Some people are under the impression that gold as international currency is old established, but it was unknown before 1870 as a basis of value for international trade. I want this country to develop as Britain developed during her industrial period, but not under similar conditions. At that time the policy of laisser faire opel.ated, and, as Adam Smith said in his book, Political Economy, no political party dared to interfere with private enterprise. In ‘ all countries at that time sweated labour conditions were rife. From 1844 to 1S70 Great Britain had a phenomenal growth of industries, and at the end of that period her export tra. le’ had increased nearly SOO ner cent. She had a national currency which had no reflection elsewhere, and could not be depreciated or interfered with by any other country. With the exception of France, Great Britain was the only country in the world at that time that had gold currency. France had adopted the system of bimetallism; but as she manufactured only luxuries there was little or no international effect. Then the picture changed, and a rush for European markets and a struggle for trade and commerce ensued. In 1872 Bismarck demanded. an indemnity from France of £400,000,000 in gold. Germany established a gold basis of currency, and other countries followed suit. Gold thus became an international factor. The one man in England who had the mentality to foresee the effect upon Great Britain was Cecil Balfour Phipson. In his book, The Redemption of Labour and The Science of Civilization, he showed that unless Great Britain changed its policy its industries would languish. Prior to 1872 Germany, America, and other countries sent their primary products to Great Britain and received manufactured articles in “xchange. Those countries had a silver currency, and were therefore not wealthy enough to compete with Great Britain in manufacturing. At that time Germany was backward in industries, simply because Great Britain had outdistanced her. Gold in Germany was more valuable than in Great Britain. It is an economical truism that money is more valuable i-i a poor country than in a rich country, its purchasing power is greater. Instead of Germany receiving manufactured articles in return for her beet sugar arid other products sent to Great Britain, she claimed gold from the Bank of England and utilized it as desired. Then carnie the operation of the bill market, and, as the gold was withdrawn, the bank rate increased. The other countries refused to take the manufactures^ of Great Britain, in return for their products, and that, in addition, the operation of the bill market, stifled to a large extent the industrial activities of Great Britain. Germany, as a consequence, had a period of phenomenal growth, while Great Britain’s progress was relatively less. The American and Canadian farmers sent their products to Great Britain, and claimed on the Bank of England for gold. In most countries of Europe, where sweated labour conditions prevail, currency has depreciated. Our currency is more valuable, and, therefore, those countries send their goods here, and instead of making a profit of from 10 per cent, to 30 per cent., they make from 100 per cent, to 300 per cent. In Germany our currency is worth five times its Australian value. Assuming that in Japan our currency is worth five times its Australian value, a Japanese merchant who sells goods here at £100 would receive in return currency valued at £500 in Japan. That position operated up to the time of the war. Count Ashati, a Japanese economist, said that, as far back as 1908, one sovereign in Japan was worth five sovereigns in England.
– When Japanese goods arrive their value is increased five-fold.
– That is so, and when our currency is sent to Japan, its value is increased to the same extent. It is impossible to frame a protectionist tariff to meet that position. In 1908 a sovereign was worth £6 10s. in Japan, and as a result of the war its value has increased. We are handicapped to that extent when we attempt to compete with that and other countries. The Minister for Trade and Customs (Mr. Pratten) recognized this when he was a private member. He said that it was absolutely impossible for this country to have a proper protective tariff, and that borrowing abroad must cease. The Treasurer replied that borrowing abroad would not cease. Twenty-four hours later, the honorable member became Minister for Trade and Customs, and swallowed the whole of his criticism of the Government’s borrowing policy A few months ago a merchant and manufacturer told me that he had to ship 1,000 bales of Australian raw material over to Liverpool and bring it back again before he could obtain finance, because the private banks in this country refused to extend him further accommodation. While the assets of this country are twice what they were a few years ago, the extent of the accommodation granted to traders remains the same. It is all planned for the purpose of allowing that “ medicine man “ of finance - the banker - to put the “ dope “ over the public in just the same way, only more effectively, that the medicine man of the tribe puts it over the ignorant savage. The whole thing is well thought out and arranged for the purpose of keeping the people clinging.- with the superstitition of savages, to this thing called gold. Surely the profits, perquisites, and privileges given to private banking institutions by this Government, and ‘ the privileges which they have enjoyed in this and every other country in the past, have been great enough without giving them more. The private banks have been allowed to usurp the prerogative of government, and between the years 3 901- and 1925 they took full advantage of the liberty allowed to them. In 3901 the legal currency in possession of the banks amounted altogether to £18,5S1,600. The banks expanded credit to the amount of £93,701,100 by issuing counterfeit cheque pounds to the extent of over £75,000,000. This process of counterfeit coining increased every year until in 1925, the last year for which I have the figures, the banks, with legal currency amounting to £45,779,623, expanded credit to the extent of £197,450.902, and the issue of counterfeit cheque pounds amounted to £151,671,270. Cheque pounds to-day comprise 90 per cent, of the paper currency of the nation, and 95 per cent, of this currency is spurious and base. It is as spurious as any counterfeit £5 note ever issued by a criminal, but the criminal is put into gaol, while the banker is called a patriot, and is given the highest titles in the land. The system is neither more nor less than a legalized form of counterfeiting. For every £1 the banks hold, even on current account, they lend out 17s. at 6 or 7 per cent, interest, some of the money being on short-dated loans, and some on longer loans. This money is used principally by the farmers and primary producers, and is obtained by them in the form of overdrafts to carry them, pending the marketing of their produce. When the private banks fall short of till money, all they have to do is to apply to the Commonwealth Bank, from which they can obtain as many notes as they require at 5 per cent, interest, and they only pay interest for the period they actually hold the notes.’ That is what this paternal Government has done for the private banks. While I hold no brief for any of these institutions, and regard them all as either glorified pawnshops or counterfeit coiners, I must point out that there is one bank- - the Bank of New South Wales - which is allowed to have a private arrangement with the Commonwealth Bank whereby it can obtain up to the £300,000 or £400,000 accommodation at 3 per cent., while all the other banks have to pay 5 per cent. I do not know why this is. I have asked the Treasurer about it, but all he will tell me is that he does not know, and that it is not his business. I ask him now does he think it right turn the resources of this nation should be used to allow bankers to over-trade, to lend out 17s. for every £1 they hold on current account at 6 or 7 per cent, interest, and then to obtain till money from the Commonwealth Bank at 5 per cent, interest. The financial position of this country will never improve until the nation pools its resources by the complete national control of finance and credit, and until it takes back from the private banks the power they have usurped ‘of issuing currency. The currency needs of’ the people are reflected very often in prices, and while it might be said by some that the gold basis still exists, it is a fact that as far as currency is concerned, gold has played no effective part for 50 years. In Australia there are claims against gold amounting to £700,000,000, and there are not 40,000,000 sovereigns to meet it. The Government refuses to issue sufficient currency for the needs of the people, so that trade is restricted, and a huge currency vacuum is created which is filled by .counterfeit coining and cheque pounds issued by the private banks. Whether it is a £1 note or a cheque or any other form of money, the thing that affects economic exchange in a country is currency, and it has been the prerogative of all governments, despotic and otherwise, to issue the nation’s currency. The banks to-day have usurped that power by the issue, of cheque pounds. Every £1 that is created by overdraft or otherwise is currency. The banks have no right to do this, and they are counterfeiters pure and simple. I will be satisfied with nothing less than the elimination of this criminal practice from tlie commercial and financial life of Australia. I will be satisfied only with complete national control of the whole finance and credit system of the country, and the carrying on of all banking arrangements by the Government. In other words, I want to see the bank the nation, and the nation the bank.
– Does the honorable member’s party advocate that?
– Yes, and I have stood on the public platform and advocated it.
– Every Labour member does.
– The honorable member is the only one who talks about it.
– If the honorable member thinks he knows so much about the subject, I invite him to meet me on the public platform to debate it. My electorate is open to him, or to any other member of his party, including the Treasurer and the Prime Minister, if they wish to debate this question. There is no “hush hush” policy about that; we have advocated it for years. The inauguration of the Commonwealth Bank was part of that policy, and had the war not come to furnish honorable members opposite with an opportunity to trade on the loyalty stunt, there would now be no private banks operating, or their operations would be so nearly negligible that they would exercise practically no influence on the finance and trade of the country. Honorable members opposite talk about the need for producing more, about reducing wages, about black labour, and longer hours. Their party has had all that in the past. In Europe to-day, and by Europe I mean Britain also, they are getting back to the system of doles, which was in operation 100 years ago. The condition of affairs there must arouse feelings, not only of dissatisfaction, but also of fear for the fate of the civilization on which we pride ourselves, and which it is our desire to maintain. The interests represented by honorable members opposite have tried the system of sweated labour, and of working men and women in the mines for long hours and low wages, and where did it get them? They have tried the barrack system, and child labour in the factories, with the brutal bosses going around with whips to keep the people at work. Where did that get them ? The only way in which the State can progress is by our using our intelligence, and realizing that the present chaotic system must go. Honorable members opposite talk about law and order and constitutional government, but they are standing behind a system which no man can analyze without seeing the elements of anarchy and chaos. The capitalistic system is anarchy, and the honorable gentleman and the Government are standing behind anarchy and chaos, trying to prop up the system with a budget that will show a burden of £5,000,000,000 in the period of 58 years which the Treasurer tries to visualize.
– We stood behind anarchy at the last general election !
– The honorable member and his party did, with the assistance of the Inchcape Shipping Combine, and now that Combine is being given its quid pro quo, in the form of a government utility. If political iniquity could fall below that action, I should like to have an illustration of it. A few days ago the Treasurer stated that Australia was under a considerable debt of gratitude to Great Britain for providing it with £34,000,000 to assist migration. That £34,000,000, like the restof our borrowing abroad, must come here in the form of British goods, to be consumed by Australians, to the detriment of our artisans, who will be put out of employment by the transaction. The Treasurer scrupulously follows the policy of his party, which had even its cruisers built abroad. It imports the migrant, and exports his job. I shall never vote to bring another migrant here while our own people are land-hungry and unable to secure employment. I have in my electorate many experienced farmers, who have successfully share-farmed for vears, but who cannot obtain suitable holdings for themselves. They have approached me repeatedly, and stated, “ Give us half the advantages that you give to the immigrant, and we will make a success of things.”
– Are not those people adequately catered for by the State Governments.
– Neither the Commonwealth nor the State Governments cater for them. To-day the Prime Minister said that migrants are to come to Australia only for our rural industries. And our own people cannot obtain suitable land ! Probably it is the intention of this Government to unload on the migrants land such as was passed on to our soldier settlers, land which would be refused by any practical farmer. After the war, estates which would not bring £2 or £3 per acre were purchased by the Commonwealth Repatriation Department for £6 and £7 an acre, and unloaded on our unfortuate returned soldiers, who, naturally, could not make good in such circumstances. There is more behind the scheme than a mere desire to place more men on the land.
We have heard a good deal about protecting our industries, but this Government has made no adequate attempt to deal with the fiscal question in Australia. The Treasurer stated that he had a surplus of £200,000. I have here a newspaper cutting which states that there war a surplus of £75,000 over the estimates customs revenue for the month of September. Perhaps when our busy Christmas season arrives, and our patriots import their, toys f rom -Germany and perfumes and soaps from France, the customs revenue will increase even more rapidly, and the surplus will be greater than anticipated. Our customs duties are increasing too rapidly. -I support, particularly, that part of the amendment moved by the Leader of the Opposition, to the effect that insufficient protection is granted to our Australian industries, and I agree, to some extent, with the honorable member for Dalley. We should prohibit the importation of many commodities. If I go into a tobacconist shop in Sydney and buy tobacco, in most cases I am given a box of matches with the tobacco. Eight out of ten of those shops hand me imported matches.
– Bryant and May could easily overcome that, but they will not supply -except to certain firms. I prosecuted that inquiry very thoroughly.
– I continually ask my grocer to supply me with Australian matches, but he invariably brings foreign matches, which I return. Those foreign matches sell at 8d. per dozen, while Australian matches sell at 5½d. to 6d. a dozen, yet the imported and higher, priced article is forced on the people. I have inspected the Melbourne factory of Messrs. Bryant and May, and consider theirs to be a wonderful industry. I would go further than the honorable member for Dalley. I would not merely put a stone wall protection around Australia so far as matches are concerned, but I would have destroyers patrolling our coasts, and would shoot anybody who attempted to bring in foreign matches. Anything less than complete prohibition is useless where we can supply the requirements of our people. I consider a revenue tariff to impose the most immoral kind of taxation in existence. It is the policy of a cowardly Government and Treasurer, who are afraid to disclose the origin of the Government’s revenue, and seek to bring it in through the back door. I do not apply that remark to any specific Treasurer. It has been my life-long conviction. I support the amendment. I hope that it will be carried, and that, as a result, this Government will go thoroughly into its financial and’ other sins of the past, and endeavour to formulate a sound financial policy, which will be permanent. I shall conclude my speech by reading the amendment, so that it may be well impressed on the minds of honorable members. It is an excellent one, which must commend itself to this Parliament, and it certainly will commend itself to the country. It reads -
That the item be reduced by fi, in order to draw attention to our adverse trade balance, tlie inadequacy of the protection afforded to Australian industries, and the increase of unemployment, and to direct the Government to remodel its financial policy to bring it into accord with the economic necessities of the Commonwealth.
.- I congratulate the Treasurer on the form of his budget. It is admirably brief, clear, and easy to understand. I am in complete agreement with many of the individual actions of the Treasurer in the past. He has a remarkable record in that respect. But beyond that I cannot go. To my great personal regret I find myself in almost complete disagreement with the honorable gentleman in regard to his management of the Commonwealth finances. Indeed, his appreciation and mine of the present political and economic position of Australia are as wide apart as the poles. There runs through the budget speech, as well as other speeches which he has delivered of late, great cheerfulness respecting our existing conditions and a complete optimism as to the future. I may be entirely wrong in my. financial diagnosis, but I take a somewhat gloomy, or at least serious view, of the position, and in that I do not differ from many thoughtful and responsible people who are engaged in the business affairs of this country. The grounds upon which I base my opinion of the situation are briefly these. We found ourselves, after the- war, so heavily burdened with debt and taxation that, even under easy and simple economic conditions, our future would have been at least a little obscure, and our progress restricted. But our economic conditions were neither simple nor easy. Indeed, they were very remarkable. Almost every month we found Australian industry as a whole becoming less self-supporting, and the position has gradually become worse, until to-day all our secondary industries need, end are receiving, artificial aid. That, perhaps is not, in itself, surprising; hut what is surprising and disquieting is the growth and necessity of the practice of giving support to our primary industries. Already the whole of our tropical and sub-tropical primary industries are artificially supported. The primary industries in our irrigation areas are also being assisted in the same way; and even primary industries in the normal rainfall areas are one after another becoming so sickly that they are asking this Parliament to help them. It is clear that the money required to sup-, port these industries can be obtained from only two or three sources. As I see the position, ‘‘the assistance is being drawn from the few remaining industries that are still self-supporting, and from borrowed money. Wool and wheat and loans are at present carrying the Australian industries remaining. This is a precarious situation indeed, and justifies one in regarding the outlook with gravity. It is highly dangerous, for this country as a. whole, and for so many of its industries in particular, to be dependent upon two main primary industries; for, after all, there is nothing certain in the production of either wool or wheat, or in the prices which we can obtain for those commodities. We cannot look with any confidence even two or three seasons ahead. Both industries are extremely susceptible to seasonal influences, an’d we know from sad experience that prices for both commodities vary greatly. I should like for a few minutes to speculate as to why it is that one after another of our great industries has weakened until it has needed artificial assistance. The explanation is simple. It is because of the abnormal prices which prevail in this country for the fundamental necessities of industry. Take capital. Australia is paying more for its money than any other country within the British Empire, and more than the great majority of countries throughout the world. Take labour. I say, without hesitation, that owing to our short working week and our resistance to the piece-work system, we are paying more for labour than any other country in the world. If we take such essentials to industry as coal, cement, steel, petrol, and the like, we find that, although industry is to a large extent dependent upon these basic commodities, prices for them are higher in Australia than anywhere else. It is because of these facts that I regard our present economic position as serious. Let us look now for a moment at the activities of the Commonwealth Government in respect to the situation. What is the Treasurer doing to meet it? What financial policy is he pursuing; and what is likely to be the effect of that policy in the immediate present, and in the few years just ahead of us? I say, quite definitely, that his policy is not helpful. Surely if there is one policy which the Government and the country requires today more than another it is a policy of taxation and administration which will leave in the hands of industries which are already hampered and restricted the maximum amount of capital and income. But, unfortunately, the Treasurer, during the whole of his four years of office, has year after year taken from industry far more than he should have taken, and spent the money on nonproductive undertakings. Let us compare the policy which he pursued after the termination of the war with that which one of the greatest men of all time pursued immediately after the close of the American Civil War. Abraham Lincoln was urged by bis treasurer to undertake an extensive developmental policy, and to increase taxation to enable it to be carried out; but he resolutely refused to do so. He pointed out that the country had just emerged from a terrible struggle, stricken, bleeding, and almost exhausted. “ Give it a breathing space,” he said, “to bind up its wounds .and recover its exhausted energies. This is not the moment to impose fresh burdens upon it.” I wish that our Treasurer had, from the moment he assumed office, followed the illustrious example of Abraham Lincoln. The policy which the honorable gentleman has pursued is the more disappointing to me because of the remarkable series of speeches i which he delivered in this Parliament a few years ago when he was a private member, and to which he owes his Cabinet rank to-day. He literally stormed his way into his present position. He relentlessly attacked the previous Government, and if it had not been for the way in which, in those days, he made his charges of extravagance and irresponsibility against the. Administration, he would not bc where he is to-day. I do not desire to revive old speeches, but I feel that I must put some statements on record by way of illustration of the kind of speech which the honorable gentleman so frequently made in those days. Speaking in the Address-in-Reply debate on the 6th July, 1922, the honorable member said -
One of tlie primary causes of the increased cost of living is the excessive taxation being imposed by both Federal and State Governments, which withdraws so much money from commercial and reproductive undertakings, and is absorbed in huge government expenditure. We believe that a substantial reduction in Federal Government expenditure and a cessation of extravagant administration would be more helpful than any other single factor in reducing the cost of living; but, especially in view of the disappointing and unsatisfactory statement of the national financial position made by the Treasurer (Mr. Bruce) yesterday, we are opposed to any further increase in the current national expenditure at the present time.
His speeches during that period are filled with such statements as “ Taxation has reached breaking point,’’” ” the cost of production must be decreased,” and so on. I do nol suggest that the honorable gentleman was speaking with his tongue in his cheek, but I do say that, in view of the attitude he then adopted, and of his performances up to date, he is the most inconsistent performer this Parliament has known.
Sitting suspended from 6.15 to 8 p.m.
– My concern in this matter is not a personal one, nor is it merely political ; it is concern for the welfare of the overwhelming majority of the people. I have said in the course of these remarks that, so far as I can see, all industries, primary and secondary, .are riding on the back of the two big primary industries, wool and wheat, or are being supported with borrowed money. I am old enough to remember the crisis of, the early nineties, when scores of thousands of men, down on the breadline and below it, were out of work.
Knowing the seasonal uncertainties, and the variations in prices that have occurred in my lifetime, and will, no doubt, be experienced again, in the wool and wheat industries, those two supports cannot be regarded as irremovable. They may fail us at any time. If’ they do, we shall assuredly see an era of b.aman suffering that we have never known before.
– Do not be so downhearted about it.
– We should face the issue. We cannot bury our heads in the sand.
– What docs the honorable member propose to do?
– I suggest the application of a little common sense. The honorable member for Gwydir, as a pastoralist, knows that what has often happened, may occur again. If wool and wheat should fail, there would be one alternative only - to borrow more money. What happened to the last Commonwealth loan that we attempted to raise in London? I think that 12i per cent, of it was taken off the hands of the underwriters, and we went across the Atlantic, to the great pawnbroker of the world. I admit that it is possible to borrow money abroad; but should we get it from a people who, apart from the fact that they speak approximately the English language, are as foreign to us as any other nation? I am not a pessimist. I regard Australia as the greatest of all the young countries, and I have seen and worked in most of them. A wise Treasurer and a wise Government would take all possible steps to prevent distress overtaking us. The Treasurer came into office, and owes his present position and his success at the 1922 election, when the Country party gained a few seats, to the attacks he then made on the Nationalist Government for what he termed its extravagance. He owes his position to the promises he made to Australia, which were properly accepted, to practice economy in the management of the public finances. Since then, what is the record of the honorable gentleman? Yet, beginning with the financial year 1923, his first year of office, he has increased annually the total taxation of this country by £9,000,000. I admit at once that the totality of taxation was almost inevitable, because of conversion loans at increasing rates of interest, the necessity for a policy of development in a young country, to which I entirely subscribe, and the growing cost of repatriation. But, by reason of the growth of population, the honorable gentleman had a considerable margin on which to work, and, therefore, I base my opinion as to his non-success as a Treasurer upon what he has done in the way of per capita taxation. He might have reduced, and had he lived up to his protestations, he must have reduced, our taxation per head of population. But here is his record. For the first clear financial year that ended June, 1924, he did reduce it. Evidently his conscience was at work then. The reduction amounted to 2d. a head I He was on the road towards redeeming his promise; but it was his expiring effort as an economist. In the year ended June,1925, he increased the per capita taxation by 3s. In 1926 he recovered a little, and increased it only by 1s. 7d. For the year ended June last it was increased by11s. 7d., and the net performance is a total increase of £9,000.000. or 16s. a head of the population. I cannot follow a Treasurer who increases per capita taxation on a country so overburdened and impoverished by debt and taxation as Australia is at the present time.
-Will the honorable member contest a by-election on that issue?
– I am here to support, not the Leader of the Country party, but the Leader of the Nationalist party; I repudiate the Treasurer as leader. I am not speaking in a personal way. For no honorable member have I deeper personal respect than I have for the Treasurer. My present task is the most distasteful that a member on this side the chamber could undertake.
– The honorable member ought to be ashamed of his remarks.
– The honorable member knows that everything I have said is stone-cold truth. He is well aware how unstable the seasons are for wool and wheat, and that the prices of these commodities are not absolutely fixed, as by divine law. A great deal has been said from time to time about the extravagance of the States. My desire is to emphasize the importance of the opportunity now presented to the Commonwealth as set an example to the States in sound finance. “We have a Loan Council. But what an influence is therein, exerted by the Commonwealth when it brings forward, year after year, a policy of extravagant expenditure and increased taxation ! What becomes of the whole case against the States when the Commonwealth itself is extravagant? I maintain that the action of the Treasurer is a direct incentive to extravagance on the part of not only the States, hut also every family and class in the country. “We charge the States with extravagance. Their taxation in the past four years has been increased by £8,000,000, but the Commonweal th taxation has increased by £900,000 a year. Why, then, hold the States up to scorn as the bad boys of the Australian family? We are the spendthrifts, and, so long as we pursue this policy, we can expect nothing different from the States. I have spoken plainly. J represent, by accident, by a few thousands, more Australians than any other honorable member ; mine is a Nationalist constituency, and for my strong criticism of the Treasurer, I am prepared to answer to my constituents. If I go out because of that criticism, I shall do so cheerfully.
I now come to the consideration of the agency employed by the Treasurer in raising taxes. It was referred to this afternoon by the honorable member for Dalley (Mr. Theodore) . With a good deal said by him, I am in agreement, but on vital points I am absolutely at variance with him. I agree with the honorable member that the Treasurer, by piling up indirect taxation and substantially reducing direct taxation - the only scientific and commonsense form of taxation - has pursued a policy that is inimical to the majority of the Australian people and the interest of our nation, and particularly to the primary producers whom he represents in this House.
-The honorable member need not bother about them.
– I am not concerned with the honorable member’s opinions; I am endeavouring to state the case for the nation, and am not merely pleading for a few squatters. The Treasurer’s claim that he has reduced taxation since he has been in office is one of the most fantastic ever made in any Parliament. It is true that he has reduced taxation of a particular kind - that he has collected less direct taxation from certain classes in the country - but at the same time, he has steadily increased the flow of money into the Treasury and has actually collected more both in the aggregate and from each individual taxpayer. He has merely shifted the load on income from the top to’ the bottom, and has not actually relieved those people whom he has sought to help by the remission of direct taxation. He has reduced the income collections by a few million pounds, but he has increased indirect taxation through Customs and Excise by almost £1,000,000 a month. I shall endeavour to explain how vicious is the effect upon industry of that change, and how progress is retarded when direct taxation is removed from the top, and a corresponding or greater amount of indirect taxation is collected at the bottom. The money collected at the top is clear profit; it is out iu the open. Much of our taxation to-day is a legacy from the war, the winning of which meant more to some people than to others. It meant infinitely more to the rich than to the poor. Had Germany won the war and been able to collect reparations from us and impose other exacting conditions which the Allies were not able to impose on her, the burden would not have been felt very much by the labourer, the artisan, the salaried man, or even the professional; but the millionaire and the men with £10,000 a year or £5,000 a year would have been very hard hit indeed. Therefore, it was for the rich more than for any other class that the war was fought.
– -For them and by them. I have never been able to say as good a thing as that.
– Prom the after effects of an unsuccessful war the rich man would have been the greatest sufferer.
– We would all have suffered. ‘ We would have been treated like dogs.
– We would not all have suffered to the same extent. The working man might have been treated like a dog by his conqueror, but the rich man, in addition to being so treated, would have been dispossessed of his money. Because he had so much more at stake, the rich man should continue to contribute heavily to the cost of the war. I have been endeavouring to show that by remitting direct taxation the man at the top of the scale is nor, being relieved as the Treasurer alleges, but is being penalized. When 10 per cent, of direct taxation is shifted from the top, and a corresonding amount of indirect taxation is applied at the bottom, necessaries, of life become dearer, the cost of living rises, wages advance in sympathy, the cost of production increases, output is reduced, and profits become correspondingly less. So, in the long run, the man who saves 10 per cent, by a remission of income taxation loses more in indirect taxation by reason of the extra cost of living and reduced turnover. Moreover, as the Commonwealth remits income taxation, the States promptly impose it. Any thing that the Commonwealth drops the States pick up. The Treasurer proposes this year to remit 10 per cent, of income taxation. The State Parliaments will say, “ Well, these fellows paid that 10 per cent, to the Commonwealth Treasurer last year; why should they not pay it to us this year?” As fast as the Commonwealth loosens the tether, the States take up the slack, and the man at the end of the rope is never a whit freer. The honorable member for.” Dalley (Mr. Theodore) said that the indirect taxation falls upon the basic wage worker. I deny that.
– It falls on all consumers.
– It falls on all the necessaries of life, but the basic wage worker is paid a wage which varies according to the cost of living as shown by Mr. Wickens’s index figures, and he passes on the extra burden.
– How often is the basic wage adjusted?
– I agree with the honorable member that that is the weak feature of the system. The Commonwealth is engaging in indirect taxation to a greater extent than any other country in the world. Of a total revenue of approximately £60,000,000 about £45,000,000 is raised by indirect taxation. This taxation is one of the main causes of industrial unrest and class dissension, for although the basic wage is adjusted to meet the cost of living, the adjustment is always so belated that the worker is discontented and wondering why, when the average adult wage has risen since 1911 from 51s. to 96s. a week, he is still no better off. In reality, he is only better off to the extent of 2 or 3 per cent., according to the official figures, despite wages boards, arbitration courts, hold-ups, stop-work meetings, &c. The pressure of this indirect Customs and excise taxation - imposed by all previous Treasurers, but by the present Treasurer to a greater degree than any other - is a principal cause of industrial unrest and unhappiness. I have been a working man, I was a trade unionist for years, and I yield to no honorable member opposite in my sympathy for the worker; I realize why, when he fails to get a wage that is of substantial benefit to him, he turns to the wretched, hopeless policy of reduced hours, reduced output, special rates for overtime, and other expedients to overcome the fact that, although since 1911 his nominal wage has greatly increased, his purchasing power is no greater than it was then. Hence the 44-hour week and the agitation for a work of 40 hours or less. The £45,000,000 a year collected in Customs and excise is only the first instalment of the burden, because it is a barrier raised ostensibly for the protection of secondary industries ; to it must be added a further huge sum due to the increased cost of goods manufactured in Australia. I view this matter as a sincere protectionist. A lot of this trouble can be overcome by removing the purely revenue duties, and by amending the excise duties; but this committee should not be in too great a hurry to pull down the only scientific taxation - a direct impost on incomes, land, deceased persons’ estates, &c. I have shown how the man on the basic wage pays the indirect taxation only until the stage when his wage is adjusted to meet the increased cost of living, after which he is able to pass on the burden. But I crave the sympathy of honorable members for those scores of thousands of unorganized workers who do not receive the basic wage. A graphic example of the evil of this wretched system of indirect taxation is its effect upon all soldiers and their dependants. Is there one soldier pensioner in this country who is receiving the basic wage? Not one - neither the totally incapacitated, nor the blind, nor the tubercular soldier is receiving what is the basic wage in any organized industry; but all are being oppressed by this wretched indirect Customs and excise taxation, which is being increased to enable relief to be given to the people enjoying high incomes. Consider the circumstances of the many thousands of soldiers’ widows and children. The suffering community is paying £45,000,000 out of that £60,000,000 raised under the present pernicious system of taxation. The revenue from Customs and Excise has increased by £31,000,000 annually during the last ten years, including £.11,000,000 during the administration of the present Treasurer. The basic wage escapes this taxation. Next the manufacturer, who passes on the tax, escapes. That is the purpose of the tariff. He passes it on in increased prices, and it thus becomes, if I may drop into the language that was used in the State schools during my youth, “Last man lousy.” The fiscal taxation is on an utterly unscientific basis, and the last man pays it. “Who is he? He is the man on a fixed salary. That would include all school teachers, all doctors, except highly-paid specialists, the lesser lawyers, journalists, the clergy, and the whole of the clerical profession of this country. Every man receiving a salary of less than £700 or £S00 is paying far more in taxation that should be paid in any democracy. Then we come to the real sufferers under this taxation scheme, whose parliamentary leader is the Treasurer. The chief sufferer is the primary producer who buys in one of the dearest markets of the world. He buys at prices greatly enhanced by the operations of the Tariff Board and the Arbitration Court, and he sells his products in the cheapest market of the world in competition with coloured labour. There is an old saying that the policy of Britain is to buy in the cheapest market and to sell in the dearest market of the world. I say that it is the lot of the Australian primary producer to buy in the dearest and to sell in the cheapest market of the world, because of a pernicious system, of taxation that has been endorsed and supported by the Treasurer. Let me endeavour to give to this House an illustration of what is happening to the primary producer. There has been an amazing drift from the country to the city. Ten years ago in Victoria and New South Wales - which are the most important primaryproducing States in Australia - there were 315,000 males engaged in cultivation. Last year the number was 87,000, a decrease of 2S,000.
– What, about South Australia?
– The same remark applies to South Australia relatively. In those two States the number of males engaged in cultivation decreased from 115,000 to 87,000 in ten years. In addition, during that time no fewer than 25,000 soldier settlers were placed on the land, at a total cost of £50,000,000, and they, or others equalling them in number, have gone. Furthermore, there were in those two States upwards of 25,000 migrants sent to the country to work on the land. They, too, or a like number of others, have gone. Then 1 asked the Statistician to give me an estimate of the average number of young men born in this country, the sons of the 115,000 males that I have referred to. who reached the working age of eighteen years during that period, mid he gave me the figure as 30,000. They. or their equivalent, have also gone. More people have deserted cultivation in Australia in the last ten years than have engaged in it. Some honorable members may say that that is a satisfactory position; but, believing as I do that primary production is the great sheet anchor of this country and its only hope if it is to become a great nation,
I consider that the present condition of primary production is an ample justification for the protest that I am making to-night against what I regard as the hopeless financial attitude of the Treasurer. I remind him that the decline of primary production is very pronounced in his own constituency. The rolls for Cowper show, apparently, a heavy shrinkage in the last five years. Evidently many of his original supporters did not like him or his policy very much, and consequently moved elsewhere. They are to-day in the cities, working as navvies on the so-called national works which the Commonwealth is carrying on with taxpayers’ money.
– What is the remedy?
– No easy remedy can be found; but surely there is something bigger than the acceptation of a spirit of hopelessness, than a policy of borrowing and spending, or of providing unproductive work at artificial wages for large numbers of men.
– What is the remedy?
– I recognize, as other honorable members do, that Australia is a young country, which must develop. I do not believe in public works’ that do not promise an early profit. Honorable members have asked me to give the remedy. I regret exceedingly, as I regret nothing else in my brief political career, that I have given a silent vote for such hopeless, uneconomical works as the north-south railway, and for such expedients as the wine bounty of last year.
– Does the honorable member refuse to vote for such expenditures in future ?
– I do not say that the wine bounty should cease at once; but, had I the opportunity again, I should not vote for it. I appeal to the Prime Minister to recognize, clear-eyed and boldly, the position in which we find ourselves. It is worse than it was five years ago, ,even one year ago. All industries in Australia are finding it difficult to continue, aud if private enterprise, engaged in our secondary industries and in a great many of our primary industries, finds it difficult to carry on without support, what chance have we of making government labour and government supervized works pay? I do not believe in retrenchment, and I should not bring about a great cessation of employment. I should not cease wise borrowing, but should use discrimination. For instance, I should eliminate from the budget, and I shall move in that direction later, the proposed expenditure of £200,000 for aeroplane services between the capital cities. Let us practice a little self-denial. I shall oppose the construction of the Red Hill to Port Augusta railway. It is of no use for honorable members to hold up their hands in horror at the idea of their pet hobbies being rejected. It is the indulgence in pet hobbies that has brought about Australia’s hopeless position. We must practice self-denial. If, within the next five- years, the standardization of railway gauges came up for consideration in this House, I should oppose it, although my own State would receive the greatest benefit from that scheme. I should oppose the standardization of gauges, because, if the project were carried through from Brisbane to Perth, it would not increase the production of wheat in Australia by a single bag, or of butter by a pound.
– Would it not be useful from a defence point of view?
– If the honorable member would consult the InspectorGeneral for Defence, as I have done, he would know that what is required for defence purposes is additional money to make existing defence services more efficient. The standardization of gauges would benefit a few thousand passengers, by saving them the trouble of hawking their baggage across the railway stations at Albury and other places. Honorable members speak of remedies, and I will suggest a remedy. I suggest that we make a resolution in this House to keep expenditure for a few years down to where it is now.
– I understood the honorable member to say that it was already too high.
– It is too high. Well, let us go back then to where the Treasurer found it when he assumed office. I will subscribe to that. I will give a few illustrations of how expenditure mounts up. Queensland will support the proposal for the north-south railway because she has a cotton bounty which she wishes to maintain. There is the wine bounty, in which South Australians are interested, and special financial grants for Western Australia and Tasmania.
– What is wrong with the wine bounty?
– The honorable member asks what is wrong with the wine bounty. The wine bounty is a monumental example of extravagance and folly, the greatest ever perpetrated by any Parliament. Last year we paid between £440,000 and £450,000 in wine bounty, at the rate of 4s. a gallon on a cheap wine, the export value of which was ls. lOd. a gallon.
– The honorable member is a poor Australian.
– The honorable member who champions the payment of the wine bounty is a great prohibitionist, one of the ring-leaders in the movement to keep this Territory dry. What he would call poison is good enough for the Britishers apparently. I do not know whether I have given any remedy, but I say with the right honorable gentleman who represents North Sydney (Mr. Hughes) that it is not the- function of anyone who criticizes the expenditure of a Treasurer to suggest remedies. It never has been, and i have gone beyond the traditional course in what I have already said. It is sufficient for anybody opposed to the Treasurer in the House to point out the disease, and to protest against it. I say, frankly, to the Treasurer, that if he cannot devise a better financial policy for this country, the sooner he gets out of the job the better.
– Hear, hear, and the Government too.
– I make that statement as a Nationalist member sitting behind the Treasurer, whom I do not recognize as my leader, but merely as the leader of the Country party. I have made it clear that I am opposed to the Treasurer’s policy, root and branch. I regard him as the most tragic Treasurer that Australia has ever known.
An Opposition’ Member. - And so is (lie Ministry.
– No, tlie Treasurer is not the Ministry.
– The honorable member is not supporting the Government now.
– Yes, I am supporting the Government, but I am not supporting the Treasurer on this occasion. It would not be possible for me to resent more strongly than I do this sinister and disastrous increase of expenditure which must be borne by an already overburdened people. There is one thing about the matter which I feel very keenly, though some honorable members may scott’ at it. Though a young people, innocent of nil war intent, and of the covetousness or selfishness that makes for war, we have yet found ourselves engaged in two wars within the space of one generation. The world is still very restless, and it is possible that while this load of debt is upon us we shall find ourselves engaged in another war. If such a tragedy as that were to descend upon us, the country would be ruined.
– What is the remedy then?
– I shall suggest a number of remedies in the future, and challenge the honorable member to support them. There are such remedies as the reduction of expenditure, and the curtailment of borrowing. While I have protested against the policy of the Treasurer, and the increase in expenditure, I say to him in all sincerity that if he will go back on his steps to the policy he advocated five years ago, and put. into practice the doctrines which were responsible for returning him to Parliament, I will follow him, and support him faithfully.
.- I am somewhat bewildered in addressing myself to this subject, as bewildered, in fact, as I imagine the Treasurer and the supporters of the Government must feel after the speech which has just been delivered by the honorable member for Henty (Mr. Gullett). Before proceeding further, I wish to compliment the Treasurer upon having presented the first budget in the Parliament’s new home. Further, I think he has established a record by presenting his fifth successive budget. Having said that, I do not intend to say anything more along those lines. Before 1 get on to the subject of the budget, let me make one or two observations on somewhat minor matters. During the recent Victorian State elections, which were held last autumn, we had an intrusion of Federal Ministers into the campaign. The Treasurer, the Minister for Markets and Migration, and the Postmaster-General mounted the rostrum in the interests of the Government. They came forward to engage in a contest between a spurious Country party and a real Country party.
– Which were they?
– It is hardly for me to say, but I think the honorable gentleman understands quite clearly what I am referring to.
– I ask for the sake of the readers of the Hansard.
– There was a revolt among the primary producers of Victoria against many of the things referred to by the speaker who, has just sat down - against the betrayal by the Country party of the primary producers on the tariff and other issues.
– How long was the honorable member in the Ministry^
– I was in the Ministry too long.
– The things to which he refers were going on while he was in the Ministry.
– In order to make my position clear let me state that 1 was in the Ministry as the result of appeals by the honorable gentleman seated at the table- the Treasurer. I agreed to a certain party arrangement for the sake of the party, but I was never in favour of it. Before I joined the Ministry I was candid enough to go to the Prime Minister and to tell him I was accepting the portfolio only in the spirit of one who was subscribing to an agreement in the interests of his party. While I was a member of the Ministry I would be loyal to the compact, but when the day came that I could be loyal to it no longer I would hand in my resignation and leave the Government.
– Nevertheless the honorable member must take the responsibility for what happened when he was in the Government.
– The things of which I complain did not happen while I was there. The Treasurer went into my constituency and deliberately stabbed me in the back. When I heard that the honorable gentleman intended to participate in the contest, I sent him the following telegram -
Country electors desirous hearing both sides of per capita and tariff issues. Understand you propose visiting Wimmera constituency. Are you prepared to meet me in public debate upon these issues? If so, please name time and place of meetings. Reply Renang Post Office. - Stewart, M.P.
I received the following reply, which said everything but “ yes “ to my invitation -
Reply your wire yesterday. The most appropriate place to debate the question of financial relationship of States and Commonwealth and tariff is on the floor of Parliament. I will, however, send you copies of my speeches on both questions, delivered both during the period you supported the proposal when in the Commonwealth Ministry, and later when you read in full to your audience, mid which you can then debate at your leisure.
The honorable gentleman displayed an unusual sense of humour when he suggested that I should read his speeches in full to anybody. The very thought of doing so is enough to make one shudder. The honorable gentleman eventually went to my electorate. He had a crowded meeting at Ouyen, and, in my absence, he made an attack upon me that he lacked the courage to make in my presence - which is characteristic of him. Among other things, the honorable gentleman endeavoured to attach to me a stigma of being the Minister of Works who ordered fourteen locomotives locally, when an overseas tender had been received quoting for the work at some £50,000 less. His exact words, as reported in the press, were -
This is the same Mr. Stewart who poses as a free trader, that signed the contract for the purchase locally of fourteen locomotives at a cost of £56,000 of the taxpayers’ money.
The honorable gentleman knows perfectly well that I am unable to reply to that charge.
– Why does not the honorable member do so, when a breach of faith has been, committed.
– If I exhibited as little scruple as the honorable gentleman I should reply. My reply to the charge is a challenge to the honorable member to read to this chamber the recommendations that I made to the Government on that occasion. The honorable gentleman went to my constituency with his typewritten platitudes that pass as speeches, and he had a night out. The newspaper reports state that it was 12.30 on. Sunday morning before he had finished, or before the audience had finished with him - I am not sure which. The honorable gentleman delivered a most ponderous speech, in which he referred to the “ initiation of national plans of efficiency in production and marketing that would ensure balanced development,” to a “comprehensive scheme of national power,”- to the “ construction of roads and water transport, according to a national plan,” and the “ necessity for a. proper co-ordination of all the governing bodies of Australia - Federal State, and municipal” - te deal with which is the outstanding problem; namely, “ the elimination of waste.” The honorable gentleman’s audience must have been like that which listened to Goldsmith’s schoolmaster -
And still they gazed, and still the wonder grew That one small head could carry all he knew.
But the. audience had. its revenge when they went to the polling-booth, and defeated his candidate by 6 to 1. All three nominees supported by the honorable gentleman in each of the three electorates, who were opposed by three Country Progressive party candidates, were ignominiously defeated.
Let me, as an ex-member of the Country party, review the circumstances in which that party was created. It was created and sent to this House by the producers of Australia as an independent political force. It, was formed in direct opposition to the Nationalist party.
– And the Labour party.
– And the Labour party. I shall quote some of the statement of the leaders of that party during the process of its formation, dealing first with the present Minister for Works and Railways (Mr. Hill). The honorable gentleman was the chief president of the Victorian Farmers’ Union when the Country party was being formed, and the following is taken from his annual report, dated 25th September, 1917 :-
We are faced at this very moment by a combination of political organizations, consisting of the People’s party, the People’s Liberal party, tlie Women’s National League, and the National Federation, which will be known as the National party; and the funds necessary for this combination to carry out its progamme will, in all probability, be found by the city and its capitalistic controlling organization, known as the National Union (late the Constitutional Union). Thus all sections of the political world, bar the Labour party and the Farmers’ Country party, are using that blessed word “National.” For what? For tlie ‘bolstering up of a Government that is discredited from one end of the State to the other; whose supporters cannot point to any one act of theirs, covering a period of throe years of war, that can be said to be national. This pirating of the word :° national “ and its use as a battle-cry on the eve of a general election, is degradation and a prostitution of the word. The party that can descend so low for the furtherance of their own selfish and party interests, and for tlie salvation of their own miserable political skins, should receive no consideration from us. What we do object to is being taxed, in season and out of season, to meet the increased expenditure brought about by the extravagance of the political spendthrifts, who arc even now scheming to bc returned to their snug billets under the garb of nationalism.
And then came the dramatic peroration -
Personally, I would bo prepared to go down and die lighting, rather than sacrifice any of those principles, tlie acknowledgment and adoption of which have caused us to band together.
So much for the honorable Minister for Works and Railways. Now let me deal with the honorable the PostmasterGeneral (Mr. Gibson), that model of ministerial propriety who surrounds himself with an air pf respectability and walks so securely within it. As the ladies would say, “ one would never suspect that a piece of Western District butter would melt in his mouth “. One would certainly never suspect that he once thundered at and denounced the profiteers of this country, that he, metaphorically speaking, had trained a 15-in. gun from the upper stories of the Parliament House in Melbourne upon the profiteers of Flinders-lane. I sometimes wonder what would have happened had that gun been loaded and gone off. It might have shot the Prime Minister, and so changed the whole course of political history in
Australia. The honorable gentleman delivered “good stuff,” which was popular. His denunciation of the profiteer tickled the ears of what he evidently regarded as the rustic cow cockies of Corangamite, and put the honorable gentleman where he now is, and in doing so it served its purpose. Now I come to the Minister for Markets and Migration (Mr. Paterson), also an exPresident of the Farmers’ Union, and one of its stalwarts. There has rarely been a more glaring case of political inconsistency than that displayed by the honorable gentleman. He attacked a nationalist in a nationalist constituency, the exmember for Gippsland, the Hon. G. H. Wise. I know the gospel that the Minister preached, because I helped him to preach it. In the same way I know the gospel preached by the Minister for Works and Railways, the PostmasterGeneral, and the Minister for Markets and Migration, for I helped them all to win their seats. On what grounds did the honorable . gentleman tackle that nationalist? Not on the grounds that he was not an honorable man, that he was not a true representative and country member. Not on the ground that he had neglected his constituency, but upon three counts - 1. Upon the score of economy. 2. Upon the fact that he was aiding and abetting the imposition of a high tariff, which was crushing the primary producer, and, the third and chief count, that, as a country member, he had allied himself with the Nationalist party and could not serve that party and the primary producers of Gippsland , at one and the same time. Preaching that gospel of denunciation, the honorable gentleman, with the aid of labour votes, displaced his opponent from the constituency, which he had served so long and so well To-day the honorable gentleman sits on the front bench with former colleagues of the Honorable George Wise, supports a more spendthrift policy than- that gentleman was ever guilty of supporting, and stands for a higher tariff than ever he dreamed of in his whole political existence. Was there ever a more glaring case of inconsistency than this? Yet at the next election, to its everlasting disgrace, the Nationalist party turned down its former champion and placed the whole strength of its organization behind the individual who had defeated him at the previous election. The Country party was formed in the interests of economy. I intended to quote certain figures on that aspect of the case, but they have already been quoted, and I shall not repeat them. But there was another issue which led to the formation of the party. When the Treasurer first strode upon Australia’s political stage, he carried a banner that bore what was to many a new and strange device: I refer to the new State movement. This, the honorable gentleman declared, was the outstanding issue of Australian political life, and everything else sank into insignificance beside it. He would never have become a member of this Parliament had it not been for his advocacy of the new State movement. The honorable member for Gwydir (Mr. Abbott) also preached that gospel on the hustings. The same is true of the honorable member for New England (Mr. Thompson), the honorable member for Riverina (Mr. Killen), and the honorable member for Richmond (Mr. R. Green). These gentlemen all came into this House some years ago as advocates of the new State movement, and displaced Nationalists who did not support it. But what has been the record of their party? Is the formation of new States any nearer to-day than it was on the day of their election? I assert that their record on this issue is as barren as the hills of Oodnadatta. The tariff issue has always been regarded in this country, and indeed in every country, as a big political issue, and the Country party began its career with a low-tariff policy. Even prior to the last election that was still its policy, for the following paragraph appears in an ex-‘ traordinary agreement that was made at that time between the representatives of the Nationalist and the Country parties in Western Australia and was acquiesced in by the Leader of the Government in the Senate -
That, as tlie present high tariff is inimical to the best interests of Western Australia, the full strength of the two associations shall be devoted to securing a substantial reduction in the existing tariff. That, as a reduction can only be secured through our parliamentary representatives, neither shall give its endorsement to any candidate not in agreement with this policy. That, subject to the abovementioned conditions of policy being accepted as the basis of an appeal to the electors, the Primary Producers’ Association is willing to co-operate with the United party of Western Australia in running a joint team, consisting of two representatives of the United party and one representative of the Country party for the forthcoming Senate elections. The team , so selected .shall receive the endorsement and support of both associataions, and no other candidate shall be nominated, endorsed, or supported by either association.
What has been the policy of the Government since the election? It has continually increased the tariff. It is due to the Nationalist party that I should admit that it is a most versatile body. In the eastern States it marched under the flag of high protection, and in Western Australia it flew the low-tariff banner. The Minister for Trade aud Customs (Mr. Pratten), who represents a New South Wales constituency, is pledged to a policy of high tariff, while his colleague in the Cabinet (Senator Pearce) is pledged to a low-tariff policy. It would be interesting to know whether the Prime Minister was cognizant of the arrangement that was made between the Nationalist and Country parties in Western Australia. Either the right honorable gentleman acquiesced in this hybrid policy, or else his colleague in Western Australia entered into the agreement without the cognizance of his leader. So much for Western Australia. Let me now read a resolution which the Victorian Farmers’ Union adopted on 13th March, 1925. The 350 delegates present at the meeting unanimously resolved -
That this conference considers the Australian Commonwealth tariff unnecessarily high, and that its incidence is hurtful to the great primary producing interests, and also to the welfare and progress of the Australian community as a whole, and this conference further considers that a percentage reduction should be made annually on all tariff items dealing with the staple necessities of primary and secondary industries.
Although that resolution was adopted two years ago it still outlines the policy of the Victorian Farmers’ Union, which has now become the Victorian Country party, and the Minister for Markets and Migration (Mr. Paterson), the Postmaster-General (Mr. Gibson), and the Minister for Works and Railways (Mr. Hill) are still pledged to it. The Secretary of the Victorian
Country party referred to this subject, in a speech which lie delivered at Kyabram, and which was reported in the Argus of the loth June last as follows: -
Compliance had not yet been made by the Federal Ministry with continued requests by primary producers to bring about, a general reduction in the incidence of the tariff. Primary producers were more convinced than ever that tlie almost prohibitive duties attached to many of the most important importations were hurtful to the best interests of Australia, mid that, more than any other factor, was the reason for so many boards, so many committees, and so many encroachments by unnatural menus to bring about results that a simple lowering of duties would certainly achieve. Australia would bc benefited greatly if a percentage reduction were made annually on all tariff items dealing with basic necessities of primary and secondary industries.
If any further evidence is needed, we have the words which the Treasurer himself used when, as a private member, he spoke during the budget debate in this House on the 12th October, 1921, in which he attacked his present Leader. He is reported in Ilansard as follows: -
The Treasurer is actually budgeting to secure more- revenue from the tariff this year than last year. The increase in Customs should cause him (Mr. Bruce) to go into sackcloth and place ashes upon his head.
The total amount received that year in Customs and excise duties was about £27,000,000. To-day the Treasurer is budgeting for an income from these sources of £44,800,000. Yet he goes throughout the length and breadth of the country talking about my inconsistency. At any rate, he should be a good judge of inconsistency. We have the spectacle before us of the Leader of the Country party, who is pledged to lower Customs duties, budgeting for the highest Customs receipts on record. During the last five years he has received £76,000,000 more from Customs and excise duties than any other Treasurer in the history of the Commonwealth.
– What has the Minister for Trade and Customs to say to that?
– I ask the honorable member for Forrest (Mr. Prowse) what the leader of his own party has to say to it? As the honorable member for Dalley (Mr. Theodore), pointed out this afternoon, the receipts from Customs, excluding excise, in 1921-22, which was the last, complete year prior to the accession to office of the present Treasurer, amounted to £17,328,000. The estimate for 1927-2S is £33,150,000, an increase of more than 91 per cent. This is the result of the administration of the gentleman, who went throughout the country denouncing the Nationalist party, capturing Nationalist seats with the aid of Labour votes, and preaching economy, new States, and tariff reduction.
– I well remember that he captured Nationalist seats.
– The honorable member for Wannon (Mr. Rodgers) has good reason for remembering it. The members of this party are to-day going through various constituencies whispering in some places, and openly declaring in others, that their party is still a separate and independent entity. Some of them have declared that the County party is in no danger of being swallowed by the Nationalist party, but that there is considerable likelihood of the Nationalist party being swallowed by the Country party. The idea of the Treasurer’s party swallowing the Nationalist party reminds me of the story of the nigger who went fishing. He caught a much bigger fish than he intended to catch, and it dragged him overboard. As he was being drawn through the water at a rapid rate, he managed to gasp, “ Is this nigger a’fishin’, or is this fish a’niggerin’?” Where are these gentlemen who in 1920-21, so wholeheartedly denounced nationalism and all for which it stood? Whose attitude has changed? Will any one of these honorable members dare to say that the Nationalist party has changed its attitude? They are silent. It is well known that the Nationalist party is the same to-day as it was then. It is composed of the same members, supported by the same press, financed by the same interests, and pursues the same objectives. In 1921 there was no epithet too base or slanderous for these honorable gentlemen to hurl at that party. They were profiteers, according to the Postmaster-General; wasters and spendthrifts, according to the Minister for Works and Railways (Mr. Hill). They were looters and burglars in the words of the Treasurer. What is the attitude of the Nationalists to-day? That of the Leader of the Country party is one of abject servility to them. He now says to them - “ Whither thou goest, I will go ; and where thou lodges t, I will lodge : thy people shall he my people, and thy God my God.” Yet he goes to my constituency and talks about inconsistency. I preach, a t any rate, the same gospel to-day as I preached on the first day that I entered this Parliament. If I attack my Nationalist friends, Avith whom I have often disagreed in the past, and may again, my hostility is open. I do not shoot them from behind; they know where I stand. But they do not know where the Minister for Works and Railways and the Treasurer stand. The philosophy of the Leader of the Country party - if I may still designate it the Country party - is, “ Life is short. Let us eat, drink, and be merry, for to-morrow we may die politically.” And to his Cabinet colleague he whispers, ‘”’ We pass through life but once. Lee us browse amidst tlie wild flowers of office while we may, for we shall not pass this way again.” The honorable gentleman is quite right. He can “putover “ the people the economy, new States, and low tariff “stunts” but once - only once. Where are these gentlemen who sent me urgent telegrams declaring that Parliament is the proper place to debate these issues. They have disappeared from, the chamber. Why should these salaried rural philosophers on the front bench, who go through the country and, masking with fine phrases the basest of all political surrenders, say to the producers, when they protest against tariff increases, .”How much worse would things be if we were not here? Imagine what kind of a tariff you would get from the Minister for Trade and Customs if we were not in the Cabinet to check him.” They go throughout the rural constituencies inviting the producers to sing hymns of praise for the crumbs they have won from their Nationalist masters. What manner of men are these who advocate certain political policies outside, and then abandon them in this chamber? The issue is not the merits or demerits of high or low duties. It is whether these men should go through the country in support of political principles, ousting members from their seats, and then return to the House and adopt the very principles of those whom they dispossess. What matters it to these gentlemen if the people are still crying for economy and the new Staters plead in vain for new States?
– What has the honorable member done for them?
– The honorable . member’s leader declares that nothing can be clone by those outside the Cabinet, but inside it one can do everything. Let the honorable member ask what his leader has done. These political gods are in their heaven ; all is right with the world. They went throughout the country boasting of the fact that they had secured so many portfolios, and they said that that was one of the reasons why the primary producers should support them. Having obtained those portfolios, they declare that they are in a position to dominate the policy of the government of the day. Where is the evidence of that domination ? We have an adverse trade balance which is the greatest in the history of the country. Almost every State is in grave financial difficulty. The plight of some of the States can almost be described as desperate. The work of repatriating our soldiers is in a most chaotic condition. Thousands of returned men have slaved ever since they came back from the war, and they are iu a more hopeless position to-day than when they first went on the land. More unemployment is noticeable throughout Australia to-day than for many years. In travelling about the country I have never before seen so many men carrying their swags on the roads as I have recently. Whatever our individual views may be on the subject of immigration, all honorable members must agree, irrespective of party considerations, that it is foolish to bring hundreds of persons into the country from abroad when there are thousands of good Australians tramping the roads in search of work. Putting aside the cause of it, we must face the position that confronts us, for it is a lamentable one. The primary industries, taken on the whole, were never in a more parlous condition than they are to-day. after five years with a so-called “ dominant” party on the treasury benches. The wool industry has felt the economic pressure probably less than any other, because the labour engaged in it is less proportionately than in other industries. I am as familiar as most men with the production costs in wheat-growing, and, allowing for good and bad seasons, it is not a payable occupation at present prices. In my own electorate, a typical Mallee district, I know returned soldiers who are working, not 44 hours a week, but, in many cases, 88 hours a week. They have denied themselves all luxuries. Their women folk slave under conditions that are a reflection on this country. After working for ten solid years they are poorer to-day than when they started. This is due to the high costs of production, and, particularly, to the high cost of implements, in spite of the figures furnished by the Ministerfor Trade and Customs in trying to persuade the producers that the burden amounts to only 1s. 6d. a week. These men are convinced that, if the present high costs continue, the wheat-growing industry will be killed. In the Mallee districts breakages of agricultural implements are frequent, and the life of the machines is short. The States are asking for Commonwealth assistance in the form of bounties, and we have reached a position in which it devolves upon this Parliament, as well as upon the State Parliaments seriously to take stock of the position. There is a condition almost of revolt against the continual increase in production costs. Honorable members on the Opposition side declare that the increased tariff has been swallowed up by the rapacity of the manufacturers, who have increased the cost of their goods and forced the working man to apply to the Arbitration Court for increased wages. The representatives of organized capital, on the other hand, declare that the fault lies with the worker. All that the producers know is that costs have increased to such an extent that they cannot longer bear the burden. Why impose upon them alone the task of competing in the world’s markets? Why do not the secondary industries take their share of the load ? Millions of people overseas require boots. Millions are waiting to be properly clothed. There is an unlimited demand for the products of our secondary industries at world’s market rates. If the Minister for Customs and the honorable member for Dalley (Mr. Theodore), who appear to be a pair of political Siamese twins upon this issue, could have their way and would shut out all exports, we should still be compelled to send tens of millions sterling overseas annually in order to meet bur indebtedness. Therefore, we must continue to export. The honorable member for Waunon advocated last night a discontinuance of borrowing. I do not agree with him. Such a policy would mean the cessation of many important public works.
– At any rate a refusal to borrow overseas would be a refusal to pay for overseas goods we do not want.
– Yes, but the remedy is not to be found in a stoppage of borrowing. For instance, the conservation works along the Murray River are of vital importance to Australia, and will, I believe, be thoroughly reproductive.
– On a capital expenditure of £14,000,000?
– That is another point, and a very serious one, but my reply to the honorable member for Wannon is that a discontinuance of borrowing will mean the immediate cessation of those important works, and the dismissal of the men engaged upon them. The curtailment of unreproductive expenditure is necessary, but the remedy is not in curtailed expenditure so much as in increased production. Therein lies the real remedy. This Parliament will have to face that issue, and I speak now directly to those representatives of city constituencies who frankly admit that they have not their fingers on , the pulse of primary production as have those of us who live in rural districts. Australia will never be lifted out of its present unhappy financial position and become a great nation until we get down to fundamentals.The first step necessary is to stabilize the primary industries on a permanent basis, and to do that we must at the outset find ways and means to stabilize the price of land.
– Human ingenuity cannot do it.
– The honorable member will agree with me that if we could produce a new variety of wheat that would increase our yield by 50 per. cent., the immediate effect would be a rise in the price of land and a corresponding increase in the cost of production. The stabilizing of land prices is a big problem, but we should not shirk it merely becauseof its magnitude. The second necessity is a better system of finance. At present most of the rural industries are financed through branches of the associated banks. I recognize the good services the banks have rendered to the community, and I do not suggest that they are parasites and should be hunted from the country, but too often their policy has been a selfish and short-sighted one, so that when things are booming and crops are good, not only are advances easy to obtain, but producers are actually encouraged to increase their overdrafts. and thus the boom is accentuated. In times of stress, however, they allow the financial pendulum to swing from extreme optimism to undue pessimism. The third principle Iadvocate is the organization of the primary industries upon a federal basis, to provide for the scientific marketing of products within Australia in order to eliminate as far as possible undue waste in distribution. If that can be done, and I believe it can, it will ensure a better return to the producer and lower costs to the consumer. At present, owing to constitutional limitations, this Parliament cannot grapple with this problem on a federal basis. It can be dealt with only on a federal basis, and I regret that the questions submitted to the people in connexion with the last referendum did not include one relating to an extension of powers to enable industries within Australia to be federally controlled. Fourthly, there should be a survey of primary production in order to determine what products are best suited for export. An export trade is essential to the stability of this country, and about 97 per cent. of the present exports are provided by the primary industries. In the production of wool the plant and labour required are not so great as in other forms of primary production.We should find out what industries other than wool-growing can best compete in the markets of the world. I believe that wheat is one of them. By scientific marketing, bulk handling, local and overseas pools, and the elimination of unnecessary middlemen, the wheat-growing industry could be placed upon an economic basis so that growers could year in and year out compete in the markets of the world. Any industry that could be rightly classed as a potential exporter should be encouraged and extended. Of course, by a system of bounties and fostering any industry could become an exporting industry. I do not advocate an extreme policy in that direction; but this Parliament should not expect those engaged in primary production to accept lower standards of living than are demanded by, and granted to, other sections of the community. Those engaged in exporting industries particularly should be encouraged by a system of bounties or Customs rebates upon all plant used in production. For instance, it is fundamentally wrong to expect those engaged in the production of wheat or dried fruits for export to pay high Customs duties, or their equivalent in higher prices for local manufactures, in respect of the implements and tools of their industry, and yet receive only the world’s market prices for what they have to sell.
– The honorable member will admit that there would be no dried fruits industry but for the highly protective duty.
– Yes ; but the high protection policy is at present giving the industry a back kick which it never expected. It does not object to paying the high Australian wages and other costs in respect of the 25 per cent. of its production that is consumed locally, but it cannot afford to pay those rates in respect of the 75 per cent. that has to compete overseas against the products of cheap Mediterranean labour. The final suggestion I have to make is that taxation should be readjusted and that rail and ocean freights upon all primary products for export shouldbe reduced. In short, the general principle to be adopted by this Parliament should be that those engaged in exporting primary industries should receive the same rights and privileges and enjoy the same standard of living as are conceded to other sections of the community.
– How. would the honorable gentleman reduce ocean freights?
– Possibly by a system of subsidies. The primary industries cannot continue under present conditions. The dairymen in the electorate of the Minister for Markets and Migration (Mr. Paterson) recently threatened that unless the Government imposed a duty of 6d. a pound on imported butter the honorable gentleman’s retirement from the Ministry would be demanded. Throughout the country there is the same clamour; the primary producers are refusing to be any longer the working bullocks or unpaid peasantry of the community. One of three things must happen : The cost of production must come clown, or there must be a system of bounties on export to insure to those engaged in the trade the cost of production, or the primary producers of Australia will have tofollow the example of the secondary industries, and curtail production to the limit of profitable markets.
– That would be fatal to Australia.
– It would. The position is regrettable; but the fact is that the men and women outback who are engaged in these industries are enduring lower standards of life than any other citizen of the Commonwealth, although they work harder for longer hours. I could take honorable members into the scrub near where I live and show them men and women, including returned soldiers, living under conditions that are a reflection upon this community. Today, after years of slavery, their assets mortgaged to the hilt, they have approached the Victorian Government asking for assistance to secure their seed and manure requirements for the coming year. These facts cannot be ignored by this Parliament. We shall never build up a great nation upon an impoverished peasantry. Honorable members may talk about secondary industries as much as they like; but the only basis upon which we shall ever build up a great nation is the stabilization of our primary indusdustries with a contented and happy country community, living, not necessarily in the lap of luxury, but at least like human beings, which is the right of every citizen in this country. This Parliament will never adequately grapple with this position until there is in it a party that will set the interests of the primary producers first. Too long has the primary producer been the football of the political parties. The workers of this country are represented by the Opposition, and it has done sterling work for them.
Mr.Fenton. - And also for the man on the land.
– I frankly confess that the Opposition has on many occasions helped the man on the land. On the other side of the House we have the representatives of the manufacturing and vested interests of this country.
– Is that all?
– I am coming to that point. If the workers of this country and the manufacturers and financial interests are entitled to direct and definite representation in this House, surely the Australian primary producers are of sufficient importance to also be represented by a political party that will set their interests first. I wish to say, in justice and fairness to some honorable members in the corner, that they are being dragged unwillingly along the path that their leaders have taken. They know not where they are going. Their leader is leaving them without a political feather to fly with.
– It is the same party of which the honorable member was a member for many years.
– Surely the honorable member does not believe that. Is the tariff policy of the Country party the same as it was when I was with it? I am surprised at the honorable member’s interjection. Honorable members in the corner have talked of independence; but the Country party to-day is not independent. It is a kept party. I repeat the word to emphasize it - a kept party. How much longer are those honorable members, mistaking their leader’s energy for ability, and his shiftiness for skill, goingto be dragged along the road to political oblivion? The budget is ‘typical of the honorable gentleman who presented it. It has been rightly described as a rich man’s budget. The Treasurer should stamp across it the text, “Whosoever hath, to him shall he given; and whosoever hath not, from him shall be taken, even that which he seemeth to have.” Of what use to the struggling primary producers are the Treasurer’s concessions in income and land taxation? The Leader of the Country party is pledged to reduce Customs and excise duties, and yet he .is reducing land tax, income tax, and amusement tax. He reduces those burdens, but increases the burden of Customs and excise which, rightly or wrongly, is the most obnoxious of all forms of taxation to the primary producer. I repeat the statement that stung the Treasurer recently to reply through the press, that there has never been a more glaring example of betrayal by any political party in the history of Australian politics than the betrayal of the primary producers of Australia by the Federal Country party upon the tariff issue. A- former member of this House made himself famous by declaring, “ What is a million?” The Treasurer says, “What is £20,000,000?” It is a mere 23 weeks’ collection through the Customs. The money market is tighter to-day than it has been for many years. Every State of the Commonwealth, with the k exception of Tasmania, which has received a subsidy, has had deficits year after year. Yet this political Nero sits fiddling in the midst of it all with a £20,000,000 road scheme and a £20,000,000 housing scheme. He recently introduced into this House a measure for the dismemberment of the Commonwealth Bank, and he endeavoured to convince honorable members that the housing scheme made that step necessary. To use his own words, a heavy burden would be placed upon the directors of the Commonwealth Bank, and consequently steps would have to be taken to separate the administration of the central trading and rural credits department from that of the savings department. To secure the adoption of their proposal it was stated that this alteration was being made with the full cognizance and acquiescence of the bank directors. The Treasurer declared that one of the commissioners of the savings bank was to be a member of the board, of directors of the bank, so that there would be perfect co-operation between the two branches. Whether or not the honorable gentleman actually said he had consulted with the directors, he certainly gave me to understand that he had, and I believe this House took his statement in the same way. I believe the House understood him to mean that the alterations he proposed to make in the bank were being made after full consultation with the board of directors of the Commonwealth Bank, and after he had received their approval. Then the honorable gentleman astounded the House by the statement which he made here to-day. I think it was the honorable member for Perth (Mr. Mann) who ventured the observation that he would very much like to know just what was the actual opinion of the Commonwealth Bank directors on this subject, and it was moved that a select committee be appointed to ascertain the views of the board. The House was under the impression, as a result of the Treasurer’s speech, and his replies to interjections, that the bank directors fully understood the proposal, and actually acquiesced in it. Yet to-day we have the honorable gentleman declaring - he will correct me if I am wrong, because he read tlie statement very hurriedly and sat down as if pleased to have an unpleasant job finished- that lie had had a conference with the Governor and two other directors, and that, as a. result of that the division of the bank was not necessary. This happened notwithstanding the fact that he had previously declared that he had acted only after full consultation with the directors regarding the principles of the measure, but note that he did not say this particular measure.
– I did say this measure.
– If the honorable gentleman says he did, I accept his correction. The honorable gentleman’s statement goes on to say that the directors did not understand the exact intention of the Legislature as to the carrying out of the housing functions, and that on further consideration they were now of the opinion that under the provisions of the measure the board could carry out its administration. This statement was made with the approval of the board, as the Treasurer somewhat naively stated. But was it not made at the dictation of the board? Is it correct that the board regarded this matter so seriously that some of its members came to Canberra to confer with the Government upon it? Have we ever had in the history of this Parliament a more extraordinary position than this? Scarcely has the measure gone through this House than the members of the board, who are directly and vitally concerned, in effect induce the Government to withdraw, or at any rate suspend, the legislation which has just been passed. It is a most extraordinary position, and not to the credit of this Parliament.
– I am very pleased it happened.
– It raises this important point: what confidence can we place in future in the Treasurer, or in the Government, when anything further is proposed? The Government has let its supporters down badly on this matter, and it has evidently let -the Commonwealth Bank directors down also. This budget is typical of the honorable gentleman who presented it. If he reads his own 1921 speech, in which he condemned his present leader, he will, if he has not the hide of a tin hare, slink out of this chamber in shame.
.- To judge by the speeches delivered in this House during the past few days, one would think there was going to be an election next week. Those speeches have been delivered, not with the intention of giving any information to the House, but for the purpose of making the speakers’ position more secure with their own constituents, or of doing a little propaganda with someone else’s constituents. I am sorry for the members of the Opposition proper, because the pre-selection plebiscite will take place in a little while, and four or five of their number are marked for slaughter unless they take up the proper attitude. One cannot blame them when their political lives are at stake, and they have got to make good or someone else will do so for them. There has been much talk also from other members, particularly from the honorable member for Henty (Mr.
Gullett). I was surprised to hear him make the statement that he does not believe in the legislation of the Treasurer. There is no such thing as the legislation of the Treasurer. The legislation brought in here is that of the Government.
– That is nonsense.
– If the honorable gentleman believes it is nonsense, he is more ignorant than I thought he was, and under the circumstances has no right to be sitting in this Parliament. All legislation is brought in by the Government. We members of the’ Country party might take exception to measures introduced by the Prime Minister, because he is a member of the Nationalist party. We have as much right to do that as has the honorable member for Henty to object to measures introduced by the Treasurer. As regards increases in the tariff, he knows, as do honorable members opposite, that there was not one proposal brought before this House for an increase of duty during the 6$ years that I have been here that had not been advocated by the Labour party. The Labour party supported the increases, not for the purpose of securing additional revenue, but to provide additional work. We have heard from members on this side of the House, also, that men were out of work, and that increased duties were necessary to protect industries which might provide them with employment. I am sorry that my friend from Wimmera (Mr. Stewart) has left the chamber. Every one who listened to the personal attack he made on a man whose shoe he is not fit to clean knows that there is something behind it. To find the real reason it is necessary to go back to the days before the 1925 election. A composite party was formed in 1923.- Then a composite government came into power in Victoria, with Mr. Allan as Premier. The honorable member for Wimmera thought that, by withdrawing from the Government, he could take the whole party with him. If the Government were smashed then naturally the Treasurer could no longer be leader of the party. The honorable member for Wimmera, having caused the trouble, would possibly then be leader. The elections would take place, and probably the parties would have come back practically as they were. Another pact would have to he formed, but it would be dictated by the honorable member for Wimmera, and would provide for his being Prime Minister just as Mr. Allan became Premier of Victoria. His whole speech was purely personal venom, born of disappointment, ambition and a knowledge that he “ had missed the bus,” for which he has been sorry ever since. Such overwhelming conceit has probably never been heard of before. That was at the back of his action. But he did not find the party behind him, nor did he find that the party wanted to throw him out. We paid not the slightest attention to the honorable member, but allowed him to attend our meetings, and listen to us, and then let him go out to poison hostile minds as much as he chose. We are familiar with his theatrical attitude. We know that he is the man who goes before the people as the advocate of individual action, as the man who claims to be the protagonist oi the rights of the people. The honor.able member then claimed that he was tied up, and now he states that he can do as he likes. Every one could recognize the venom that emanated from the honorable member to-night, and all who know the Treasurer must acknowledge <that the honorable member for Wimmera ;is not ,fit to tie his boot lace.
– Order !
– There is no man for whom I have greater personal regard nhan the Treasurer, and to-night the hon- orable member for Wimmera had the effrontery to impugn his ability. At one :time the honorable member thought that the Treasurer was exceedingly skilful. The honorable member must still entertain that opinion, or he never entertained it at all. It makes my blood boil when I hear a man fulminate as did the honorable member. After associating for years with his pals, who refused to throw him out, he now turns on them and can say nothing good about them. His pre- sent attitude, in contrast with his f former, takes from him the respect of all decentminded people and makes him ‘an object of the deepest contempt. We know that the honorable member does not meet with the opposition of the Labour party :in his electorate, merely because that party realizes that he is of more value to them than a Labour man would be. To-night we witnessed the spectacle of honorable members of the Labour party prompting him with information and cheering him, and the honorable member was glad to accept those cheers. The Leader of the Opposition (Mr. Charlton) has quoted figures, and has claimed that they can be substantiated. I shall also quote figures that can be substantiated. Honorable members opposite have indulged mostly in generalities, in an endeavour to denounce the financial administration of this Government. I think it was the honorable member for Dalley (Mr. Theodore), when Premier and Treasurer of Queeusland, who stated that “Finance is the test of government.” “ That is true, and bacl finance indicates rotten government. That being so, there has never been a more striking example of rotten government than the administration of Queensland under the leadership of the honorable member for Dalley. This Government certainly ,can point to excellent achievements during the last five years, and it need’ not be ashamed of any one of its financial efforts. Th” Leader of the Opposition, for whom every honorable member in this chamber has a great personal regard, no doubtbelieves in what he says, but we feel sorry for him when he is endeavouring to make a case for the Opposition, realizing all the time that there is some one standing behind him watching his every step, and waiting eagerly for him to make a false one. The whole proceedings during the last few days have been confined to personal attacks and gross misrepresentation. During .the last general election campaign a similar state of affairs existed, and honorable members opposite misrepresented this Government in connexion with the Commonwealth Bank, the Geelong Woollen Mills, and the purchase of cruisers, always twisting and distorting figures to suit themselves. During this debate figures have been quoted form the Commonwealth Y ear-Booh, and from the Treasurer’s budget, to support certain claims. Figures may bc manipulated to prove anything It was claimed that this Government instead of reducing the public debt, had increased it by £45,000,000; that when this Government assumed office, the public debt was £416,000,000, and that to-day it is £461,000,000, an increase of £45,000,000. That is true, but the little word “ gross “ was emitted from the comparison. Its inclusion puts an entirely different complexion upon the position. The gross debt of the Commonwealth has increased by £45,000,000, but the gross debt includes money which the Commonwealth raised for the States, and which the States must repay. In 1922 the net public debt ‘ was £339,000,000. and to-day it is £340,000,000^ an increase of £1,000,000. If we compare the public debt for the year “1923 with that of 1927, it discloses an increase of £5,000,000, but I am taking the year 1922 as a basis, as this Government then assumed office during the year following. The population of the country has increased considerably during the interim, necessitating additional demands on the finances off the Government for developmental purposes. During the last four years the State debts have increased from £474,000,000 to £606,000,000, and most of these States were Labour governed for the period under review. We may safely assume that a similar state of affairs would exist in the federal sphere if Labour were in power here. During the four-year period 1 have quoted, the Queensland public debt increased from £79,000,000 to £96,000,000, a difference of £17,000,000, and its per capita debt increased from £103 to £112. The last report of the Auditor-General shows that the Queensland public debt has again increased, from £96,000,000 to £102,000,000, making a total increase of £23,000,000 for the five years. In face of that, the comparative Commonwealth debt increase is insignificant., A similar state of affairs exists in practically all of the other States of Australia, and it must react upon the people. Honorable members opposite endeavour to mislead the people by stating that the position is the fault of the Commonwealth, and not of the State Governments. We have been told that there has been a vast increase in expenditure since this
Government assumed office. Let me give the exact figures. The expenditure for 1927 was £60,732,617, which works out at £9 7s. 4d. -per head of the population ; the expenditure last year was £61,S20,215, which works out at £10 ls. per head; and the expenditure in 1923 was £53,670,S85, which works out at £9 3s. per head. How has the extra money been spent? The increased expenditure of various State Labour Governments has gone in wild-cat enterprises, cattle stations, and other State undertakings. Reverting for a moment to the increase in the Commonwealth public debt, may I point out that an expenditure of between £12,000,000 and £14,000,000 on the Commonwealth ships still has to be met and is included in the Commonwealth debt. The figures show that the, increase in Commonwealth expenditure during the last four years has amounted to about £7,000,000. The accounts set the expenditure out under the headings of wai’ appropriations, special appropriations, and departmental expenditure. The Government has no option but to meet the commitments under the first two headings. The amount that will be paid to the States this year above what they would have received had the per capita scheme still been continued is £900,445, so that the States will be able to reduce their taxation by that amount if they desire to do so. The extra amount paid in increased invalid and old-age pensions last year - 1927 - above that paid iu the year 1923, is £3,720,573, which is, roughly, about 12s. per head of the population. Increases in interest and sinking fund appropriations account for £547,382, the sum of £100,000 has been provided for prospecting for oil and minerals, and £652,991 has been provided for bounties. Our payments in invalid and old-age pensions amount now to £9,144,589 annually. That is, roughly, £1 10s. per head of population, but in the four years the payments have been increased by no less than 12s. per head of the whole population. So the increase in pensions accounts for the greater part of the increase in gross expenditure. Would any honorable member suggest that our pension payments should be reduced? As I have pointed out, the extra amount that will be paid to the States this year in place of the old per capita payments is £900,445 over last year’s payments. The extra amount spent in providing for interest and sinking funds is £143,874, and the extra amount in bounties is £287,188 over that spent in 1926. As a matter of fact, the Government may only fairly be attacked on its departmental expenditure, but there has been very little increase in this respect during the last four years. Departmental expenditure last year amounted to £2,937,233. In 1926 £2,854,591 was spent under this heading, and in 1923 the figure was £2,772,920. The increase in the four years will, therefore, be only about £164,000. It is well known that the work of the departments is continually increasing. If we look at the figures on a. per capita basis, we find that there has actually been a decrease in departmental expenditure in the four years of 2d. per head of the population, so how can it be said that there has been no economy? The Government has reduced departmental expenditure, and it has consistently reduced direct taxation, which is the only kind of taxation that it is able to reduce. In the last four years the following extra amounts have been spent: - Naval, military, and air defences, £8,227,614; bounties and assistance to primary producers, £2.510,172; road work, £3,750,000; wire netting, £250,000; scientific and industrial research, £350,000; and on oil and mineral prospecting, £200,000; making a total of more than £15,300,000. In addition, a total of £36,000,000 has been paid off the war debt, also over £9,000,000 more has been paid in old-age pensions than if the pension had remained as it was when the Government took office. In my opinion, these results are simply marvellous, and are an unanswerable reply to critics who say that the Government has not economized, in spite of the huge extra amounts it has disbursed. I wish now to deal briefly with the revenue figures. Since 1923 our revenue has increased from £54,691,035 “ to £63,36S,214. The income has been obtained from two sources, namely, indirect and direct taxation. The total increase estimated for the year 1927 over the actual receipts of last year is £4,372.631, and over 1923, £S,677,179. The Customs revenue in itself accounts for more than that, for since 1923 it has increased by £10,680.349. It will thus be seen that indirect taxation has increased by a larger amount than the total increase, which means that direct taxation must have been reduced. The honorable member for Dalley (Mr. Theodore) argued that indirect taxation hit the poor man while direct taxatiton hit only those persons in the community who were best able to pay. Let us look at the figures per head of the population. When the honorable member for Dalley was Premier of Queensland he declared that all government revenue was derived from taxation. The country people in Queensland know to their cost that that is true, because they hove been very heavily taxed through the railways owing to the mismanagement of the Theodore Government. The indirect Commonwealth taxes this year represent £7 2s. 6d. a head, as against £5 0s. 3d. four years ago. The direct tax this year amount to £2 10s. 7d. a head, and four years ago it was £4 0s. Id.- The direct and indirect tax combined was £9 0s. 3id. in 1922, while in 1927 it amounted to £9 13s. Id., or an increase of 12s. 9d. The increase of old-age pensions was £3,854,533 over the amount paid in 1922, or 12s. 4d. a head, and the roads vote about 6s. a head, so these two together showed a total increase of about 1Ss. a head of the population. Is any member in favour of wiping out these expenditures? One would think the Labour party and other critics were. The present year, _ 1927-2S, shows estimated receipts of total taxation of £9 7s. lOd, an increase of 7s. 7d. a head from what it was in 1922, and 5s. 2d. less than last year, 1926-27. Although it is claimed that indirect taxes bear heavily on the poor man, I point out that, of the* £43,000,000 raised through the’ Customs this year, £25,000,000 was collected from road users and the purchasers of petrol, wine and spirits, and tobacco.
– Tobacco duties affect the working man.
– That argument is not sound, for only a special class use drink, tobacco, &c, and not every man, woman and .child. In addition, another £6,000,000 was collected in duties on machinery and metals, making no less than £31,000,000, or over £5 a head on the special items enumerated. Out of the £7 2s. 6d. a head paid in indirect taxes this year, only about £1 18s. was contributed by the man in the street, and can be evenly divided among the whole. All taxes effect every man, woman, and child in the community, when they add to the cost of living. The working man is compensated for this increase by the Arbitration Court, but the country people cannot pass it on at all, and have to bear the brunt of it. So bounties and other help such as roads, netting, and taxation relief become necessary for them. Manufacturing industries are not encouraged in Queensland because that State still suffers from the “ Theodore blight,” and, so long as it remains, manufacturers will refrain from establishing businesses there. A reduction of direct taxation would help industries and provide increased employment. The present Government has consistently reduced direct taxation: but can any honorable member mention a way in which it is possible to reduce indirect taxation? These taxes are passed on by all except the man on the land and the investment income man. The honorable member for Dalley favours prohibitive duties. If the tariff were reduced, imports would increase and the Customs revenue would be greater than ever, and” the country would be inundated by unemployed, whose keep would eventually fall back on the man on the land. Prohibitive duties would absolutely kill the primary producer who cannot pass on the increased burden. Yet that is the remedy advocated by the honorable member for Dalley who travelled throughout Queensland asking the farmers to support the Labour party. That they never did, and never will do. I want the country people to note particularly what he proposes to do. He has changed his tune for the simple reason that he now represents an industrial electorate which includes Cockatoo Island Dockyard. He dare not go into any country electorate and tell the people that the remedy for their present troubles is a reduction of indirect, taxation and the imposition of prohibitive duties, because it would mean a still greater increase for everything the country man buys. The Treasurer has been blamed for increasing the indirect taxation, but every increase of duty was asked for by honorable members opposite. Always we were told that increased protection would encourage the local industry, and enable it to produce more cheaply,, but within a very short time the manufacturers were calling for still higher duties. Why? The explanation is plain - the manufacturer cannot compete against the overseas goods’ even though they areloaded with heavy duties. The unions demand a close preserve and ask that dutiesbe increased so that there will be no competition from overseas ; but any increased price that the manufacturer is able to charge for his goods must be passed on to them in the form of higher pay and shorter hours, but never anything to the consumer. I have never heard honorable members opposite advocate increased protection for the same reasons asare advanced by high protectionists in the United States of America. The American manufacturers say “ Let us have a high tariff Avail that will block out foreign goods, and when we have the local market to ourselves Ave shall be able to engage in massed production, and produce a cheaper article.” And they do that. But never does a cheaper article come out of Australian factories as a result of high protection. Labourists demand that any increase in the price of local goods made possible by the heavy duty on imports shall be shared amongst the employees, and that nothing shall be given to the consumers who have paid for that protection. They ask that the door be closed against imports, not in order to facilitate mass production and the cheapening of goods to the consumer, but in order that they may get an industry into their own grip and levy toll on their fellows, particularly the men living in the country who cannot pass it on. Reducing the value of production in 1925 to the purchasing power of the sovereign in 1911, Ave find that production has decreased 5 per cent in the fourteen years. That 5 per cent. Avas equivalent to £21,000,000 on the 1925 production, which. invested at compound interest, would pay off the Avar debt in fourteen years, and the whole of the national debt in 21 years. Between 1911 and 1925 there was great mechanical progress and invention. The power of the machinery employed in our factories increased from 343,000 horse-power to 1,335,000 horsepower, and the value of plant from £31,000,000 to £112,000,000. Yet in spite of those advances and the increased local market created by high Customs duties, the value of production in 1925 was 5 per cent. below that in 1911. That is the explanation of the present unemployment. The only remedy for Australia’s industrial conditions is greater and more economical production. We can rectify the adverse trade balance by selling more goods, and this can be done only by producing more cheaply. If we close the door against all imports and the prices of local manufactures rise, the primary producers will find that the more he exports the more he will lose, because his costs will be greater. Therefore, he will adopt the Labour party’s policy of producing less, and the nation will suffer by a loss in exports. The real solution of the problem is to produce more of the goods we sell overseas; and todo that and enable the exporter to sell at a profit, we must manufacture more in our factories at a lower cost. I have never heard members of the Opposition suggest that remedy. They never tell the members of the unions that they must “ buck in ; “ they never advocate the adoption of piecework and payment by results. The more a man is paid, the more he will produce. The more profit an employer gets from his business, the more capital he will invest in extending it. If his profit is not satisfactory, he will not invest more money. The attitude of the worker is the same. Pay him by results, and the more money he gets into his pocket the more goods he will produce. Unfortunately, the doctrine preached to the workers from time to time is that there is a vast fund of wealth of which the manufacturers’ motor car is one outward and visible symbol, and if the employee gets another pound a week in wages, all that will happen will be that the boss will have to walk to work. The only fund out of which profits and wages are paid is production, and the limitation of it hurts not only those engaged in industry, but the, whole nation. The blame for our adverse trade balance and the unemployment in all States must be placed on those honorable members opposite who call themselves leaders of Labour, but follow all the time. We saw that illustrated in the recent election in New South Wales, when they were “ tumbling over themselves “ to follow the crowd behind Mr. Lang, as they were afraid of the plebiscites. Labour members have the remedy in their own hands. If they will advocate payment by results, more goods will be produced, and they will be sold at a cheaper price. Nothing is wrong with the position in Federal politics; the trouble is in the State Parliaments, inmost of which the Treasury benches are occupied by Labour. Federal electors have only to look at what has happened in Queensland and New South Wales to see how dangerous it would be to return Labour to power in the Federal Parliament. Honorable members opposite call themselves the representatives of labour; actually they do not represent labour in this country, but only a section of it, which is white-anting the nation. The budget proposals of the Government indicate clearly that the finances have been carefully nurtured. The people of Australia are well aware of this. They know also what would have been the position if the finances of the Commonwealth had been in the hands of the representatives of Labour if one may judge by what has happened in certain of the States. Honorable members opposite know that the amendment will not be carried, notwithstanding all that they have been telling the people during the last two or three days, and they do not care, because their main object is propaganda to save their own seats.
– We have listened to-night to a number of vigorous speeches containing some most illuminating statements concerning the budget proposals of the Government. While I agree with much that has been said I cannot subscribe to the whole of the criticism that has been levelled against, the Government. We expect destructive criticism from members of the
Opposition. It is true that honorable members on this side of the chamber do not see eve to eye with the Ministry in all things; but we are not under the control of any outside body or influence. We are free agents, freely supporting a Government which, by the vote cf the people, is occupying the treasury bench on a certain policy that was agreed to by two mutually independent political parties working in co-operation. Some members on this side owe no allegiance to the Country party as a party ; hu t we are in alliance with it, and the Leader of that party is the Treasurer in the present composite Government. It would be well if the honorable member for Henty (Mr. Gullett) had borne this in mind when making his attack on that honorable gentleman. I am not in complete harmony with the opinions of many honorable members on this side of the committee. As a matter of fact, I am diametrically opposed to the views held on some matters by members with whom I am in co-operation in supporting the Government. But I am with them and they are with me in opposition to extremists who are endeavouring to secure control of the treasury bench in this Parliament, and in State Parliaments throughout Australia. Bearing this central fact in mind, we swallow a good many things which otherwise we might regard as too unpalatable to swallow, still less to digest. It is all very well for honorable members opposite to throw dust in the eyes of the people by pretending that they are the true-blue representatives of Labour, and that no one else can lay claim to that title. Despite their protestations, they are, willy-nilly, in alliance, and must necessarily be in alliance, with those who hold extreme views imported from other countries.
– Why not say Russia?
– We on this side stand for a Nationalist policy manufactured in Australia. We are not dependent upon any other country. I can assure honorable members opposite that it will take them a long time to persuade a great majority of the workers of Australia that the Russian-made policy of socialization of industry, production, distribution, and exchange to which they are as a party committed, is the best for Australia. I listened with interest to the speech of the honorable member for Wimmera (Mr. Stewart). Certainly it lacked nothing in vigour or directness, and I could not help admiring him for his earnestness. With a great deal of what he said I am also in accord. Especially do I approve of his references to the damaging influences of high tariffs upon primary industry. Honorable members generally will agree that, apart from his personal references to his former ministerial colleague, . the Treasurer, he made a most effective speech, and, from his point of view, delivered a telling indictment against the Government. I have a high personal regard for the honorable member for Wimmera. We have a common bond of union in our early nautical associations; but I object to his classing me as a representative of vested interests. The honorable member for Wimmera spoke favourably of the Labour party in respect of certain of its actions, which, he said, were of benefit to the primary producers. He then referred to honorable members on this side of the House as-, representatives of vested interests.
– That is quite right.’
– It may be right up to a certain point. I dare say that there are honorable members on this side who do not mind being called the representatives of vested interests; but I am a Nationalist, which means that I am not a representative of any particular class or section of the community, but of every class or section. There is a distinction between the Nationalist party and the other political parties in this chamber. One party calls itself the representative of the labouring classes, another calls itself the representative of the primary producers, but the .Nationalist party knows no distinction between labour or capital, country or city. We are a Nationalist party in a national Parliament, representing people who have national aspirations. We fairly and truly try to represent not one class, but every class of the community. I claim to be just as much a representative of labour as ‘any pledged Labour member, only with this difference, that whereas he is shackled, I am free.
I can openly advocate what I believe to be the interests of labour. Those who call themselves members of the Labour party are bound by certain pledges, and are controlled by outside bodies, who manufacture opinions and, in some cases, even consciences for them. I honestly believe that some honorable members opposite bear unwillingly the yoke placed on their necks by the outside controlling executive authority of their party. There are many honorable members on this side whose sympathies are with the legitimate aspirations of the genuine Labour movement, but who cannot conscientiously ally themselves with the Labour party as it is constituted to-day. I am one of them, and represent a constituency which is largely industrial, and is mainly represented in the State Parliaments by men who call themselves Labour members. I could not retain that seat if it were not for the votes of working men. In spite of the most strenuous efforts of the members of the Labour party for the last 25 years to capture that seat from me, I have been able to hold it against all the forces and all the big guns that have been imported to assist in the election campaigns. I hold my seat mainly because the working men of my constituency are sensible men. The stereotyped platitudes and fanatical ideas imported from Russia because of the poverty of ideas among the members of the Labour party, do not appeal to the sensible working men of this country. They appeal to the flappers, both male and female, who have not attained the age of discernment between horse sense and mere foolish claptrap. These vapourings and these shibboleths may appeal to them, but not to those who have the interests of Australia and their own personal interests at heart, and who know on which side their bread is buttered. The Nationalist candidate for the Federal Parliament, at any rate, is reckoned to be good enough for the working men of my electorate.
– That certainly seems to be so in Queensland.
– The Queensland working men do not seem to be particularly enamoured of theRussian policy,judging by the few representatives of that State in the Federal Parliament.
Notwithstanding that Labour is in the ascendancy in the State Parliament, due largely to the gerrymandering of electorates, one would almost need a microscope to find Queensland Labour representatives in this chamber. In the midst of all the criticism that has been levelled against the Treasurer, I should like to say a word of commendation on his behalf, as an offset to the onslaughts of one or two previous speakers. The budget has been favorably commented upon by the press all over Australia.
– The Labour press strongly criticized it.
– It was only the other day that one of the honorable member’s colleagues quoted with great gusto, and with every sign ofcommendation, a leading article that appeared in a capitalistic newspaper. Newspapers exist by favour of the public, and therefore, if the people largely contribute to Nationalist newspapers, the natural and obvious inference is that they are in sympathy with Nationalist principles. At any rate, in respect of the budget, there was a general chorus of approval by the press, which was echoed and endorsed by the public in the various States. One of the reasons for the enthusiasm with which the budget has been received by the public is the fact that it is based upon a sincere and genuine attempt to place the finances of this country upon a sound, practical, and economical basis. One of the best things that . this Government has done has been to abolish the per capita payments. We all recollect the storm of opposition that arose, not only from that side, but also from this side of the House, and also from various newspapers, against the proposed abolition of the per capita payments. Notwithstanding that the Government, with the support of its followers, abolished the per capita payment, objection to the proposal was raised in the first instance by the less populous States owing to the fear that under the new arrangement their financial position would be weakened. The Government, - however, convened a conference of Commonwealth and State Ministers, which the Government met in a most generous spirit, and adopted a system which has earned general approval, and taxpayers in all the States have now been placed on a more equitable basis. Not the least important feature of the Treasurer’s financial proposals is the arrangement under which united action is to be taken in the matter of debt redemption, the control of future borrowings, and the stabilization of the loan market which should result in Australia’s credit being materially improved. If the Government had not done more than this, it would have gained the commendation of the taxpayers. It has also substantially reduced our war debt, in connexion with which a sinking fund has been established, and has also reduced taxation which will be hailed with delight, particularly by those who are contributing fairly large sums in the form of land and income taxation. As a great majority of taxpayers will not, however, be relieved to any great extent, I hope to hear of some intimation later from the Treasurer that it is the intention of the Government - I hope it is not yet too late - to proceed further in the direction of reducing indirect as well as direct taxation.
House adjourned at 11.28 p.m.
Cite as: Australia, House of Representatives, Debates, 16 November 1927, viewed 22 October 2017, <http://historichansard.net/hofreps/1927/19271116_reps_10_116/>.