11th Parliament · 1st Session
Mr. Speaker (Hon. Sir Littleton Groom) took the chair at 11 a.m., and read prayers.
Mr. M. CAMERON, as chairman, presented the report of the Parliamentary Standing Committee on Public Works, together with minutes of evidence, relating to the proposed construction of buildings for the Institute of Anatomy at Canberra.
Ordered to be printed.
Report (No. 1) presented by Mr. Mann, read by the Clerk and agreed to.
Personnel ofroyal Commission.
– Is the Prime Minister yet in a position to announce the personnel of the royal commission to inquire into the coal-mining industry, if not, will he be able to do so before the end of the week?
– I am not yet in a position to announce either the personnel of the commission or the terms of reference to it; but I am in communication with the Premier of New South Wales on the subject. The honorable member will realize that it is necessary in this case for the Commonwealth Government and the State Government to agree as to both the personnel and the terms of reference. I do not anticipate that I shall be able to make an announcement during this week.
– I have received an intimation from the honorable member for Batman (Mr. Brennan) that he desires to move the adjournment of the House this morning for the purpose of discussing a definite matter of urgent public importance, viz. : - “ The consent given by the Treasurer on behalf of the Government to the amendment of rules drawn by the Directors of the Commonwealth Bank by virtue of which amendment a pension of £1,000 per annum, subsidized from public funds and not provided for by statute, was secured to Mr. James Kell, formerly Governor of the Bank, which pension is continued payable to that officer whilst he is engaged in work competitive with the operations of the Bank. “
Five honorable members having risen in their places,
.- The motion of which I gave notice is one for the adjournment of the House to give an opportunity to discuss the consent given by the Treasurer on behalf of the Government to the amendment of rules drawn by the Directors of the Commonwealth Bank, by virtue of which amendment a pension of £1,000 per annum, subsidized from public funds and not provided for by statute, was secured to Mr. James Kell, formerly Governor of the Bank, which pension is continued payable to that officer whilst he is engaged in work competitive with the operations of the bank. I am sorry to have to break in upon the torrent of Government business with this discussion ; but I regard the subject as of such grave importance as to justify a vote of censure. Had the order of business permitted the moving of a censure motion I should have moved it. However, I sincerely hope that the Government will take the will for the deed.
This subject was ventilated in the House on the 22nd September last. Some observations I made upon that occasion will be found on page 7173 of Hansard for 1928. The Treasurer furnished a short reply to my statements, and a speech was also contributed by the honorable member for South Sydney (Mr. E. Riley). Questions upon the subject previously had elicited that Mr. Kell was re-appointed Governor of the Commonwealth Bank under the terms of the Commonwealth Bank Act 1911-24 for one year from and inclusive of the 10th October, 1925, at a salary of £4,000 per annum. The date of Mr. Kell’s actual retirement was the 31st May, 1927. It was further elicited that no right to a pension was acquired by Mr. Kell under the terms of his appointment, but that such a right was subsequently acquired as the result of payments made by him into the Bank Officers’ Superannuation Fund. So far the directors have declined to tell us how much Mr. Kell paid into the fund, but from information supplied to me from other sources I believe that the amount was about £800. By virtue of the amendment of the rules of the fund, Mr. Kell, for this payment, is drawing a pension of £1,000 per annum. The rules were altered on the 1st July, 1926, and Mr. Kell was due for retirement, as we have seen, on the 10th October, 1926, and actually went on leave on full pay on that date, after having been instrumental, as Governor of the Bank, in causing the superannuation rules to be altered to qualify himself for the pension. He announced in the columns of the press on the 21st August, 1926, that he would not be open for re-engagement on the expiration of his term of office in the following October. The dates that are of importance are the 1st July, 1926, when the rules were amended, and the 21st August, when the announcement was made that Mr. Kell would not be open for reappointment. It is, I submit, a reasonable inference, in these circumstances, that the rules were altered in contemplation of and to provide for Mr. Kell’s retirement, and that by virtue of the alterations he was able to qualify for a substantial pension.
In reply to a question by the honorable member for South Sydney on this subject the Treasurer stated that the following answer had been supplied by the bank -
The pension being paid to Mr. Kell is strictly in accord with his rights under the superannuation regulations as amended in June, 192G, he having complied with all the conditions provided under these during his term of appointment to the bank. The bank does not feel called upon to enter upon details connected with the business of the institution.
If that meant that the bank is to be free in its management from political interference, and that the financial relations between the bank and its customers are to be maintained inviolate, no one could commend adversely upon the statement; but my view is that honorable members of this House are entitled to the fullest information as to how the public revenues and, to a lesser degree, the interests of bank officers themselves are charged with the payment of this very handsome pension to the late Governor of the bank, which has not been provided for by statute, and has not been subject to parliamentary review.
The Labour party at least still regards the bank jealously as a people’s institution. It should be remembered that the bank was founded by advances from the Consolidated Revenue; that its accounts are subject to examination by the Auditor-General ; that its superior officers have always been appointed by the Governor-General under parliamentary scrutiny; that its debts are secured by the nation; and that, in a word, it is a national instrumentality which, in the view of the Opposition, is of the highest importance, as it was created to be a bulwark of national credit.
The Bank Act under which the bank’s superannuation fund was authorized provides that the rules of the fund may be altered only with the consent of the Treasurer. This is why the Government and the Treasurer are affected by what has happened. The duty is imposed upon the Treasurer of inquiring into all proposed alterations of the rules. In this regard I fear that he has, as on many other occasions, failed utterly to safeguard the public interests. On this subject the Treasurer observed previously that when the proposed alteration of the rules was submitted for his approval he asked for information as to how the altered rules would compare with similar rules of other institutions, and, having satisfied himself upon that point, he considered that he had done his duty. I am not sufficiently familiar with the regulations governing the granting of pensions to the officers of other banks to express an opinion as to whether these rules are similar to those of other institutions; but I should be glad if the Treasurer could place before us a single case in which any other banking institution has accorded such generous treatment to one of its officers under similar conditions to that under which the ex-governor of this bank has accorded a pension to himself. It is of some interest to note that one of the rules of the Australian Bank of Commerce, of which Mr. Kell is at present a director, reads as follows: -
If any officer entitled to a pension or gratuity shall enter the service of any other bank or financial institution or undertakes any other business which the Board of Directors of the Bank shall deem to be in competition or conflict with the interest of the Bank the Trustees may withhold payment of such pensions or gratuity from such officer for such time as they shall think fit.
Whilst I am not familiar with the regulations of other banks, I have some knowledge of the principles upon which superannuation is granted to members of the Commonwealth Public Service. I know that, as a result of profound investigation and research, we fashioned in this Parliament a superannuation bill for which you, Sir, in one of the high positions which you have held in this country, were sponsor in this House. It was not hastily drafted, or lightly conceived, hut, as I have said, was the result of very profound inquiry and research, and was prepared after a consideration of other funds similar to that which we proposed to establish. The administration of the Commonwealth Superannuation Act is subject to the review of Parliament, and the fund is controlled by an independent board responsible, of course, only to this Parliament. It is provided in that act that no officer of the Commonwealth Public Service shall draw a pension in excess of £416 per annum, although, unquestionably, many highly-paid officers of the Commonwealth Service are covered by the scheme. The Commonwealth Superannuation Act contemplates the retiring age of 65 years. 1 did not like to ask directly the age of Mr. Kell, but I am happy to learn that lie, full of health and vigour, has taken on a new task with another banking institution. I am not, however, happy to learn that that bank is working in competition with the Commonwealth Bank, while its ex-governor is drawing a pension which is partly subsidized by the revenue of this country.
It is interesting to recall that Mr. Kell’s appointment as Governor of the Commonwealth Bank was discussed as far back as 1912, when a member of the House of Representatives at the time stated that Mr. Kell’s salary previous to his appointment as Deputy Governor of the Commonwealth Bank at £1,500 a year, had been less than £700 a year. In justification of this rather startling promotion of Mr. Kell’s the then Prime Minister (Mr. Fisher) said that it had to be borne in mind that in accepting this new appointment Mr. Kell was forfeiting his rights under the superannuation scheme of the banking institution which he had left. It will be seen, however, that he was forfeiting very little, as his salary was increased from £700 to £1,500, and, later, to £4,000, and now, mainly through his own agency, he is entitled to a pension of £1,000 a year. The matter is brought up to date by some recent correspondence with the Treasury. I intend to quote from a letter signed by Mr. E. C. Riddle, the present governor of the bank, to the Secretary to the Treasury, written in October last, immediately after the rising of Parliament, and as a result of the discussion which had taken place shortly before. This letter has recently been made available to honorable members, and it is only fair to say that it was only asked for by honorable members on the re-assembling of Parliament. I shall deal with material portions of this communication. One passage reads -
The Board of Directors has considered the whole history of this matter as set forth herein, and fails to see that any information which it could properly give to the House lias been withheld.
It seems to me that the governor could properly give the fullest information on this matter of public interest, affecting a public utility and the expenditure of public funds. On the other hand, the reticence and refusal of the board indicates a desire to withhold information or to adopt a “ hush-up “ policy. If the words “hush-up” have an unpleasant flavour the responsibility rests with the bank and not with me. The letter continues -
The suggestion contained in discussions may be summed up in the suggestion that the directors and the board connived with Mr. Kell to alter the conditions of the Superannuation Fund for the purpose of providing certain advantages to that gentleman. Naturally the board denies this in toto.
The word “ connived “ is not mine. Indeed, conniving is hardly appropriate to the case, inasmuch as Mr. Kell was a member of the board, and as Governor was naturally its dominant member. He practically gave himself the pension rights which he now possesses. He disregarded the provisions of the act under which he was appointed, which excluded him from pension rights. He also disregarded the provisions of the super.annuation regluations, under which he was excluded from participating in such a pension. The letter goes on to state -
Alterations to the condition of the Superannuation Fund did, in its incidence, provide pension rights for Mr. Kell which, but for these alteration, he could not have acquired; but advantages also accrued to other members of the staff for the same reason, whilst, at the same time these alteration* advantaged every member of the stair.
Strictly speaking, Mr. Kell is not a member of the staff, and that is the reason why he was excluded from the operations of the superannuataion fund when it Avas first established. He was appointed, as we have seen, by the Governor-General, with certain well-defined statutory powers. The members of the staff are appointed, and may be discharged by the management, without regard to Parliament or the Governor-General. If Mr. Kell was pleased to regard himself as a member of the staff, it should be noted that no other member of the staff had authority to determine his own pension rights. The conditions of Mr. Kell’s appointment were not properly alterable by the directors or by him, but, nevertheless, these conditions were altered by Mr. Kell with the approval of the board, in a most arbitrary and self-promoting manner. The letter goes on -
It does not seem to the board that it is material to the question of Mr. Kell’s pension how much or how little he contributed.
In one sense it is true that the amount of his contribution, in comparison with the important principle involved, is a minor matter; but what was done is a grave interference by a senior servant of the public with the terms of his appointment as fixed by Parliament. The amount paid is, therefore, a matter of some importance. Mr. Kell’s pension is not paid solely from the contributions of members of the staff, and if it were, that would be a serious injustice to them, and in fact, it is. But the contributions of bank officials are subsidized by the bank from public revenue to the extent of 3$ per cent, of the total salaries. For that reason the public is intimately concerned in this matter, lt should know all the facts associated with this transaction, and should have an opportunity to protest if it disapproves of them. The contention that other members of the staff were advantaged by the alteration of the rules will not bear examination for a moment. It is true that, as a result of these alterations, the contribution from the bank was increased. The bank officers, other than Mr. Kell, were advantaged to some extent, but the benefit to Mr. Kell himself was that he was, for the first time, deliberately brought, within the operation of the rules which entitled him to a pension. The letter goes on to say -
It may be stated that the alterations to the Superannuation Fund were submitted by the board to the Government before Mr. Kell’s retirement had even been mooted, and that revised regulations of 1st July, 1926, were the culmination of protracted negotiations connected therewith. “When Mr. Kell’s retirement was mooted is one thing, but when it originated in his own mind is quite another. That we are unable to ascertain. Speculation upon it would be quite useless. We had, therefore better confine ourselves to facts. Mr. Kell had the rules altered in July, and in the following August intimated to the Prime Minister that, at the expiration of his term, in October, he would not seek reappointment. He intended to leave the service of the Bank in October. He accepted extended, leave on full pay, which brought him up to the date of his actual retirement in August, 1927. The letter further states -
The board in its wisdom feels that the question of what any member of the staff of the Commonwealth Bank has paid to the Superannuation Fund is not a matter for public discussion. The assurance of the directors that these matters are being conducted strictly and properly should surely be sufficient.
It would be a pity to comment upon such naivete. It is to be remembered that the pensions of judges and other highly-paid public officials have to run the gauntlet of public discussion and parliamentary criticism. That has been the policy since the inception of the Commonwealth. The granting of pensions to public officials in receipt of high salaries was long discouraged by the Commonwealth Parliament. The ambition of members of
Parliament has never soared quite so high iis to hope for a pension, but one could imagine what would happen if members secretly drew up and secretly submitted to the Treasurer a scheme for handsome pensions, substantially subsidized from the public revenue. It would hardly avail us to say that these matters were conducted strictly and properly. Steps should be taken to cancel this pension if the recipient persists in receiving it. 1 do not desire to be regarded as an advertiser of public scandals, but I submit that the impropriety of Mr. Kell receiving this pension, and the laxity shown by the Government in allowing it to be paid, are proper matters for public criticism, and even censure.
– I thank the honorable member for Batman (Mr. Brennan) for his courtesy in having acquainted me of his intention to move the adjournment of the House this morning to discuss the pension that is being paid to Mr. Kell, because I am thus enabled to give a recital of the facts, which I believe will remove any element of doubt that may exist, and prove that there is no substance in the charge that he has made. It is necessary to bring to the consideration of this matter a suspicious mind to find anything improper in the facts.
Mr. Kell is a bank officer who has had a very long experience in the Bank of Australasia and the Commonwealth Bank of Australia. At the present time he is in receipt of exactly the same pension that he would have received if he had continued in the service of the Bank of Australasia and risen to the position of eminence that he occupied so worthily in the Commonwealth Bank of Australia. The facts will prove that the alteration of the rules of which the honorable member for Batman has spoken, was neither inspired nor suggested by Mr. Kell during the time that he was Governor of the Commonwealth Bank, but, that, on the contrary, it was made entirely at the instigation of the directors of the bank subsequent to the creation of the board. Very shortly after the directors were appointed they raised the question of an alteration being made to the superannuation rules of the bank with a view to giving to its employees conditions as nearly as possible equal to those which were enjoyed by the employees of various other banking institutions in Australia. They felt that, if the Commonwealth Bank was to be a national bank and have the prestige that Parliament sought to give it, it should be placed in a .position to attract te its service the best banking brains in the community. At that time the superannuation terms which it offered were less favorable than those of other banks, and even at the present time they are not on an equality with them. The object of the board was to make them approximate as nearly as possible. But at the same time it wished to redeem a promise that had been made by Sir Denison Miller as governor of the bank, in 1916, four years after the bank was founded, that the senior officers would be just as well cared for in the matter of superannuation as would have been the case if they had continued in their previous service. It is true that, although the new set of rules was brought forward early in 1925, they did not actually become operative until 1926, the reason being that in the intervening period there were discussions and negotiations with the Government in regard to the form in which they were framed. The amendments were desired in order to provide that service prior to 1916 should count in considering pension rights, that being the year in which the old pension scheme had been initiated. Under that old scheme pensions were not payable to female officers who joined the service of the bank after they had reached the age of 35 years, or to male officers who had joined at a later age than 50 years. The pensions payable to female officers who joined between the ages of 25 and 35 years, and to male officers who joined between the ages of 40 and 50 years, were totally inadequate; while those payable to persons who entered the service at a low rate of pay were much less than in the case of other leading banking institutions. Consequently, a new set of rules was promulgated to rectify the position. The alteration under which Mr. Kell benefits is that which was made to section 3 of the rules. Section 3 in the old rules read -
All officers on the staff of the Bank at 31st December, 1915, excepting the Governor and the Deputy Governor, and all subsequent entrants without exception, shall contribute to the fund at the rate of 2 per centum per annum of their salaries, or such greater or lesser percentage as may from time to time be determined by the Governor, and such payments or contributions from the said officers shall be made at such times and in such manner as the Governor shall determine, or at his option may be deducted from time to time from the salaries payable to such officers.
It will be observed that the Governor and the Deputy Governor were excepted, and that provision was not made for senior officers. The provision made in compliance with the promise of Sir Denison Miller is contained in section 3 of the new rules, which reads -
Honorable members will see that the object was to include all of those who previously were not eligible. They had really commenced their service when the Bank was established. Many of them had occupied senior positions in other banking institutions, and were over 50 years of age. The stipulation that they should contribute to the superannuation fund of the Bank for a period of 15 years before they became entitled to a pension prevented them from drawing a pension. The alteration of the rule enabled them to enjoy the full benefits of the fund on the condition that they contributed at the rate of 2 per cent, on all salaries in respect of which contributions had not previously been made. They were allowed to pay in instalments, but were obliged to complete the payment by the 31st Decem ber, 1927, and also to pay interest at the rate of 5 per cent, per annum upon arrears. Could anything be fairer than that ? How are we to attract the best banking brains in the community if we do not offer superannuation terms equal to those which men enjoy in the service of the private banks? It is a notorious fact that the salary of the Governor of the Commonwealth Bank is not as large as that paid by private banking institutions to officers holding similar positions. Yet we wish the Commonwealth Bank to be a central bank, upon which all other institutions will rest! Surely that is not reasonable!
Let us consider the treatment accorded to its employees by other banking institutions. The Bank of New South Wales pays a maximum pension of £1,000 a year.
– On what salary?
– I think up to £5,000. They adopt a practice similar to that provided for in the altered superannuation rules; that is, the pension payable is based on the average of the salary received during the whole period. The rules provide that the minimum pension payable to an officer, conditional upon ten year’s service, is ten-fiftieths of his average salary during that period, and shall increase at the rate of onefiftieth part of his average salary for every further year of service. So that, after 45 years of service, a pension would be 45/50ths, or £90 for every £100 of the average salary earned during the whole term of service. The senior men in the service of the Bank of New South Wales, the Bank of Australasia, and the Union Bank - three of the leading banking institutions in Australia - retire on ‘ a pension of not less than £1,000 a year. An examination of the Commonwealth superannuation terms will show that this Parliament cannot cavil at anything which is contained in these rules, unless it be on the score that they are not as liberal as those offered by other banking institutions. An officer of the Commonwealth Bank who enters the service of the bank at seventeen years of age and retires at the age of 60 under the old rules would receive £318 a year. Under the present scheme he will be entitled to £382. An officer occupying a similar position in the Bank of Australasia would receive £428, plus a bonus of 25 per cent. The payment made by the Union Bank in similar circumstances would be £520, and by the Bank of New South Wales, £530. In these circumstances the Government had no hesitation in giving its approval to the suggested alteration of the rules when the matter was placed before it. I again emphasize the fact that the alteration was not made at the instigation of Mr. Kell, or suggested by him while he was in control of the bank’s operations. It was made by the board of directors, and for a very definite purpose. I fail to see how any element of suspicion can attach to” the transaction. It is only reasonable that the Governor and the “.Deputy Governor of the bank should be able to make provision for their old age, in the same way that provision can be made by any other member of the staff. It is hoped that in future years these high positions will be filled by men who are already in the service of the bank. Why should they be automatically debarred from the benefits of superannuation payments?
– Did the Governor of the bank pay the arrears of contributions?
– He paid the whole of the arrears, on the basis of 2 per cent, of his salary, with 5 per cent, interest thereon, during the period that he had been in the service of the bank.
– How much did he pay?
– I have not that information in my possession, but the honorable member can work out the figure if he cares to do so.
– The board has flatly refused to supply the information.
– We have divorced this institution from politics, and have placed it in the control of men possessing high qualifications. The profits it is making prove that it is being very ably managed, and the general esteem in which it is held by the community is an indication that it is looking after the interests of the people at large. It cannot progress if we continually meddle in its affairs. I ask the House to accept the facts as I have recited them, and to dispel the atmosphere of suspicion which has been imported into the matter. There is not the slightest reason for it.
I come now to the question which is raised in the latter part of the honorable member’s motion, that the Government should be censured for permitting Mr. Kell to occupy a position on the directorate of another bank while he is still in receipt of a pension from the Commonwealth Bank. All I wish to say with regard to that is that before Mr. Kell accepted that position - which does not at all militate against the activities of the Commonwealth Bank, because the function of that bank is to buttress the banking system of the community - he sought the approval of the board of directors. The business of the bank was extending rapidly, its profits were growing, and its branches were spreading throughout the land. The fable that the institution is moribund, has been thoroughly exploded. Mr. Kell took up his new appointment with the approval of the directors of the Commonwealth Bank, who saw nothing in it that was in any way antagonistic to the interests of that bank.
.- The Treasurer, when replying to the honorable member for Batman (Mr. Brennan) said that an air of suspicion has been created. We should consider facts, and not suspicion. The honorable gentleman declared that had Mr. Kell remained with the Bank of Australasia, and reached the eminence of his position with the Commonwealth Bank, he would have received a similar pension. But it must be remembered that when he transferred to the Commonwealth Bank he immediately enjoyed a salary which was more than double that previously received by him. One reason why his salary was then fixed so high was that he sacrificed his pension rights when he left the private bank. I remember that when the Commonwealth Bank was established there was some criticism about paying the governor a salary of £4,000 a year, as it was declared that such a high salary was not paid by the private banks. The explanation advanced was that that amount was necessary to compensate Sir Denison Miller for the loss of his pension rights, which he had sacrificed by leaving the service of a private bank to become Governor of the
Commonwealth Bank. Hitherto no provision has existed for the payment of superannuation to the Governor or Deputy Governor of the Commonwealth Bank. Their appointments were made under a statute of this Parliament, and very high salaries were fixed, with the knowledge that no superannuation rights were to be enjoyed by the holders of those offices. That rule has been altered. For many years no provision existed for the payment of pensions to judges of the Commonwealth courts, and whenever those officials were granted special pensions on retirement, as was done with the late Chief Justice Sir Samuel Griffith, a very eminent jurist, the matter was debated and decided by this Parliament, which represents the people who find the money. But the special arrangement which provided for the payment of superannuation to Mr. Kell did not come before Parliament for consideration, and that, I take it, is the gravamen of the charge of the honorable member for Batman. The existing rules were altered by the board of directors, of which the governor is the dominant factor, and, presumably, the alteration was agreed to by the Treasurer and the Government, without submitting the matter to Parliament. Have we, as representatives of the people, no rights? The Treasurer spoke about suspicion. In reply, I emphasize what was said by the honorable member for Batman. This Parliament has passed superannuation laws providing for the winter of the life of our public servants. It has always excluded members of Parliament from such a privilege because they are, as it were, the board of directors of the Public Service. Such action is, for practical reasons, right. What would be thought if Parliament were to amend the Superannuation Act and allow the Prime Minister and the Leader of the Opposition, or the Treasurer himself to pay £800 for a few months and then retire and draw a pension of £1,000 a year? That is an excellent analogy. Parliament provided a liberal salary for the position that was occupied by Mr. Kell, with the knowledge that the occupant would not enjoy superannuation rights. Yet six weeks prior to the public announcement by Mr. Kell that he proposed to retire - and one can imagine that his mind was made up some time before making that announcement - these rules were altered to enable him to pay £800 in order to secure a pension of £1,000 a year.
– But the circumstances had been under consideration eighteen months before the alteration was effected.
– The contention of the honorable gentleman that the suggestion was made some time prior to Mr. Kell’s retirement that senior officers should be brought under the provisions of the superannuation rules does not affect the position. For some reason or another the senior officers of the Bank staff were not included under the provisions of those rules. But to bring them under those rules was an altogether different matter from evading the determination of Parliament that the governor and deputy governor of the bank should not receive superannuation. An alteration was made without reference to Parliament, and within a few weeks prior to the retirement of Mr. Kell ! That is more than a coincidence. I ask the Treasurer whether the alteration of the original rule was laid on the table of this House?
– It was unnecessary to table the alteration, which was gazetted.
– Was it not necessary to consult this Parliament, which has a vital interest in the Commonwealth Bank ? The honorable gentleman suggested that: we have no right to meddle in the administration of the Bank. It is he and not us who does the meddling, and that is why we protest. I strongly believe that we should alienate the Commonwealth Bank from political control or interference. I also hold that we should not discuss the workings of the bank any more than is necessary, and not in any way that may prejudice its successful operation. But it must be remembered that the bank is a Commonwealth institution. Its funds are the people’s funds, and we, as their representatives, have our obligations to them, one of which is to take action if anything goes wrong. It is significant that, although Mr. Kell had no statutory superannuation rights, the rules were altered six weeks before be announced his intention to retire, and he was granted a pension of £1,000 a year.
– Did he retire because he had. reached the age limit?
– I understand that he had not reached the age limit. Six months before the date of his retirement he was granted six months’ leave of absence, I presume on full pay, so that he drew £2,000 in leave money, and then retired on a pension of £1,000 a year, for which he had paid only £800.
– And in addition he went to a job for which he is paid £1,000 a year.
– I come now to that most important aspect of the matter, over which the Treasurer so lightly’ passed. The honorable gentleman said that Mr. Kell had been appointed a director of a private bank, but that before accepting that position he announced his intention to the board of directors at the Commonwealth Bank, who gave their approval. That is the most serious part of the indictment. The position is really astounding. No member of the staff of the Commonwealth Bank is permitted to enter the service of an opposition bank and to retain his superannuation rights. And it must be remembered that a bank officer who acted in the capacity of teller or clerk could not carry into his new sphere the “degree of competition which would be possible on the part of an individual who had previously been a director of the Commonwealth Bank, and becomes a director of another bank. It is the director of a private bank who controls its policy, and who decides how it is possible to secure business held by the Commonwealth Bank. And yet such a person is permitted to retire from the bank, to enter into the service of a competitive private concern, and to draw superannuation at the rate of £1,000 a year, in defiance of the letter and spirit of all superannuation rules. The approval of the board of directors to such action indicates the approval of the Treasurer and of the Government, and therein lies the seriousness of the position. I do not for a moment cavil at a man drawing a pension, provided that it is a reasonable one. But Mr. Kell retired on a pension of £1,000 a year, although Parliament, in its wisdom, has enacted that the highest superannuation payable to the most senior officer in the Public Service shall be £416 a year. I applaud the provision of a pension to provide an officer with a competence with which he may .enjoy the declining years of his life; but I strongly object to that paid to Mr. Kell. The excuses of the Treasurer are of no avail. When the matter is stripped of all extraneous issues two facts remain outstanding. The first is that the rules were altered six weeks prior to the retirement of this officer, which surely is more than a coincidence, and. he was granted a pension of £1,000 a year. The second is that he was permitted to take up a position as director of a competitive private bank, and still allowed to draw his pension of £1,000.
– I am not surprised at this development. The board of directors of the Commonwealth Bank was appointed by the Government to try to kill the good influence of that institution.
– That is an absolute misstatement.
– It is a fact. Immediately this Government assumed office it began its political tinkering with the goodwill and efforts of the Commonwealth Bank. The statements that have emanated from the Treasurer to-day are surprising in the extreme, and the honorable gentleman little realizes how he hands himself over to his adversaries, bound hand and foot, by his confession that the directors of the Commonwealth Bank believe that that institution, established as a people’s bank, should not compete with private banks.
– That is an absolutely incorrect statement. I said nothing of the sort.
– The honorable gentleman said that that was one of the reasons why the board of directors consented to Mr. Kell occupying a position as director of a private bank.
– I did not.
– The honorable gentleman did, and his proofs will need a lot of sub-editing to disguise that statement.
– I stated that what was done was not antagonistic to the interests of the Commonwealth Bank.
– What did the Treasurer mean by that? The honorable gentleman denies the obvious meaning of his statement. I repeat, when the Government appointed a board of directors for the Commonwealth Bank, it did so with the . purpose of limiting the operations of that institution; of stultifying its efforts and its benefits to the public generally.
– The Government endeavoured to extend the beneficial influence of the Commonwealth Bank.
– That is not so. The desire of the public of Australia is that the Commonwealth Bank, which it believes was established to aid the community, should extend its ramifications and spread its branches throughout Australia.
The Treasurer knows that its board of directors is not giving effect to such a policy. All the time, assisted by the Government, they are manipulating its operations and curtailing its activities in every possible way. That is well known. I have no desire to indulge in personalities, but it is necessary to do so to a certain extent when dealing with the case of Mr. Kell. It was generally recognized that even when ‘ that ‘ gentleman was a deputy governor he was strongly imbued with the idea that private banks have conferred great and lasting benefits upon the community.
It is well known that he expressed the opinion that the private banks had done a great deal for Australia. In reply to that statement, Mr. Kell was informed that Australia had done a great deal for the private banks. The honorable member for Batman (Mr. Brennan) has performed a splendid public service in exposing this matter. He has shown that this Government is prepared to do anything to manipulate institutions established to benefit this country, so that they may not clash with private enterprise. Mr. Kell was in the service of the Commonwealth Bank from 1912 to 1927. During that time he became thoroughly conversant with its operations, and the conduct of its business. While still drawing a pension from the Commonwealth Bank, he is allowed to enter the service of another bank, working in competition with it. The Treasurer has said that no importance can be attached to that, but the private banks have a rule that no officer in their employ, who retires on a pension, may enter the service of another bank on penalty of his pension being withdrawn. The private banks have found it necessary to do this to protect themselves. The action of the Government in this respect is merely on a par with many other things it has done. The people of Australia will be gratified when, it is stripped of its power, and swept off the treasury bench to make room for those who will place the public welfare before private interest.
Question - That the motion be agreed to - put. The House divided.
Question so resolved in the negative.
Reservation of Stock Route
asked the Minister for Home Affairs, upon notice -
Will ho give consideration to the question of reserving a great northern stock route, at least a mile wide, from about Daly Waters through to Camooweal, with wells or bores at suitable intervals so that stock could be brought through with safety in almost’ any season, thus opening and promoting settlement of the Barkly Tableland; and will he also take up with the Queensland Government the matter of extending such route, similarly provided with water facilities, to Dajarra, or other suitable railhead in Queensland?
– In 1920 a stock route, one mile wide, which traverses the Barkly tablelands, was gazetted from Katherine River, North Australia, via Daly Waters, Newcastle Waters, Anthony’s Lagoon, Brunette Downs, Alexandra, and thence along the Rankine and Herbert Rivers to the crossing into Queensland near Lake Nash, south of Camooweal. This stock route is fully equipped with bores and wells at suitable intervals, and it is considered that so far as North Australia is concerned, stock may travel along that route with safety in almost any season. The question of taking up with the Queensland Government the matter of extending stock route facilities to a suitable railhead in Queensland, will receive consideration.
Molonglo River - Manuka Oval
asked the Minister for Home Affairs, upon notice -
Whether the result of the recent test of the Molonglo River, from a health point of view, is yet available?
– No, but I am endeavouring to expedite the matter, and shall advise the honorable member at a later date.
On the 14th March, the honorable member for Bourke (Mr. Anstey) asked the following questions, upon notice -
I am now in a position to advise the honorable member as follows: -
PAYMENT of Canberra Allowance.
asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follow : -
Housing allowances are paid to postal employees resident at Canberra in common with all other departmental officers at Canberra, where the rentals paid justify such allowances.
asked the Prime Minister, upon notice -
Has any appointment been made to the position of administrator of Norfolk Island; if so, who has been appointed?
– No appointment to this position has yet been made or decided upon.
Tenders for Hiring
asked the Minister representing the Minister for Defence, upon notice -
– Inquiries will be made and a reply will be furnished as early as possible.
asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follow -
asked the Prime Minister, upon notice -
With reference to the questions asked by the honorable member for Kalgoorlie on the 21st February and on the 14th instant, as to whether the Cabinet had yet considered the first recommendation of the Development and Migration Commission to assist the goldmining industry, and with reference to the ultimate reply of the Prime Minister that he hoped that this matter would be taken into consideration at the first meeting of Cabinet, will the Prime Minister now state whether the decision of Cabinet will be announced before the adjournment on the 22nd instant?
Cost - Arrivals of Migrants
asked the Prime Minister, upon notice -
– The information is being obtained.
asked the Prime Minister, upon notice -
With reference to his statement on the 18th instant regarding Mr. Broughton Edge, who has been appointed head of the geophysical survey group at a salary of £3,000 per annum, will the Prime Minister state -
what is the nature of the work being carried on by the geophysical experimental survey staff; and
in what section of this class of investigation has Mr. Broughton Edge had previous experience?
– The answers to the honorable member’s questions are as follow : -
Appointment of Woman Member - Felt Hat Industry
asked the Minister for Trade and Customs, upon notice -
Is it a fact, as stated by the Acting Honorary Secretary of the Australian Housewives’ Association in Melbourne on the 14th instant, that the Minister on a number of occasions promised this association that he would support the appointment of a woman to the Tariff Board ?
– Yes, on one occasion.
asked the Minister for Trade and Customs, upon notice -
– The answers to the honorable member’s questions are as follow: -
asked the Minister for Markets and Transport, upon notice -
– The court did not make any suggestion in the matter. It merely invited attention to a suggestion made by a witness. The expert advisers of the marine branch have given the matter full consideration, but are of the opinion that such a light is unnecessary.
asked the AttorneyGeneral, upon notice -
Will he furnisha return showing the number of licences under the Transport Workers Act which have been taken out -
prior to October. 1928;
between 17th and’ 20th October, 1928; and
each week since 20th October, 1928?
– The information will be obtained as soon as possible.
Contracts Inquiry Board
asked the Minister for Home Affairs, ‘Upon notice -
– The answers to the honorable member’s questions are as. follow : -
asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follow : -
Admittance of Undesibables
asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follow : -
asked the Minister for Trade and Customs, upon notice -
– The answers to the honorable member’s questions are as follow : -
Listeners’ Licence Fees
asked the PostmasterGeneral, upon notice -
With reference to his reply to the question by the honorable member for Boothby, that it would not bc possible for a fee of 10s. to provide in Australia a programme equal to that enjoyed by listeners-in in Great Britain -
Is it a fact that under the present broadcasting system the Australian public are not receiving a programme which is one fraction the value of that in Great Britain?
Is it a fact that more than the difference between the 10s. per annum licence-fee in Great Britain, and the 24s. charged in Australia is being distributed by way of profits to shareholders ?
– The answers to the honorable member’s questions are as follow : -
asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follow : -
Mr.FORDE asked the Minister for Trade and Customs, upon notice -
Is it a fact that the following resolution was passed by the annual meeting of the Bundaberg branch of the Australian Sugar Producers Association on the 5th instant: - “ That while appreciating the value of the present British preferential duty on Empire sugar, this council requests the Common wealth Government to endeavour to negotiate with the British Government a reciprocal tariff agreement providing for increased preference on sugar and other Australian products and covering a period of not less than ten years, thus reducing the wide margin at present existing between the amount of preference given by Australia on goods purchased from Britain (approximately £9,000,000 a year) and the amount of preference given by Great Britain on goods purchased from Australia (approximately £1,250,000 a year)”?
Will the Minister make the ‘ desired representations to the British Government in favour of a greater measure of ‘ tariff preference for Australian products?
– The resolution has not yet come under my notice.
asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follow : -
– During the last two or three weeks, several honorable’ members have asked me to announce the intention of the Government with regard to the two vacancies now existing on the Tariff Board. I desire now to state that we. propose to appoint to those vacancies Mr: Sydney Berchdolt of Sydney, and Mr. W. S. Kelly, of Giles Corner, South Australia. Also, it is proposed to re-appoint Mr. H. McConaghy, the present chairman of the board, and Mr. H. E. Guy, a member of the board, for a further period of three years, commencing from the same date as that upon which the two new members will take office. It is thought desirable that all the members of the board should be appointed from the same date, although Mr. McConaghy has still five months and Mr. Guy two months of their present term to run. Their appointments will be terminated, and the two gentlemen mentioned will be re-appointed as from the date on which the other appointments are made.
Motion (by Mr. Bruce) agreed to -
That the Bouse, at its rising, adjourn until to-morrow at 11 a.m.
– I move -
That the bill be now read a second time.
The measure contains several amendments of the principal act which experience has shown to be desirable. Some of these amendments are purely formal, and others are of a minor character; but one is of very real importance to the occupants of war service homes, and constitutes the main reason for the introduction of the bill. Honorable members will find it in clause 5, which amends section 35 of the principal act. At present, an occupant of a war service home is handicapped if he wishes to dispose of his interest in it, or transfer his liability to some other person, perhaps because the exigencies of his employment or his domestic arrangements make it necessary for him to remove to another town or to a different locality. If he can find another soldier applicant who is prepared to take over his property, he may dispose of his interest in it and transfer to the other soldier applicant his liability to the Commissioner; but more often than not it is extremely difficult, particularly in certain districts, to find a suitable ex-soldier applicant. Consequently, he is obliged to accept an offer, by a civilian, and before he can dispose of his interest in the home, he must discharge his liability in full to the Commissioner. This means, frequently, that he .has to find a cash buyer. In many cases he is compelled to sell his home at considerably below its true mar ket value in order to get the cash to discharge his liability to the Commissioner. All honorable members will admit that this is undesirable. To remove the disability, it is proposed to omit section 35 and insert in its stead the proposed now section to be found in clause 5. The new provisions will enable the transfer of a soldier’s interest in his home to a civilian if the Commissioner is satisfied that there is no soldier applicant who desires to purchase it. Of course, if a soldier applicant is prepared to purchase the occupant’s interest and take over the liability, he will have preference over a civilian; but where there is no soldier applicant, it will be possible under this amendment to have the home transferred to a civilian on terms which are acceptable to the Commissioner. It must be clearly understood, however, that a civilian will not enjoy the extremely favorable terms extended to soldier occupants of these homes. For example, he will not be able to obtain a house on the basis of payments equalling 3 per cent, interest on capital cost, but will be required to pay 6 per cent, or 6$ per cent. Neither will he enjoy the extremely long term of 35 years allowed to ex-soldier occupants in the case of a brick home and 25 years in the case of a timber house. The maximum term allowable to the civilian purchaser of a war service home will be 20 years.
– Is that what is provided under the housing scheme?
– I think it is. Furthermore, a civilian purchaser will have to pay a deposit of 10 per cent, of the purchase money, whereas the deposit required of a soldier applicant is, in the majority of cases, only £10. A civilian purchaser will also be called upon to pay a larger insurance premium. These proposed amendments to section 35 will remove a real disability which the soldier occupants of war service homes are suffering at present, and they are being made for the benefit of returned soldiers rather than civilians. Clause 4 proposes to amend section 31 so as to give unquestioned authority to the War Service Homes Commissioner to see that homes on which small deposits have been paid are maintained in such a reasonable state of repair as to safeguard the Commissioner’s security. Section 33 states that a property shall be kept in a state of “ tenantable “ repair. It is thought that the word “ tenantable “ may be regarded as synonymous with the habitability of a home, and it is suggested that a home may be habitable and yet in a very bad state of repair. It is proposed, therefore, to alter slightly the wording of the section to insure that a home is maintained in a reasonable state of repair, which, of course, is necessary in the case of propertics on which only small deposits have been paid. I may have a little more to say about this matter when the bill is in committee. Clause 6 makes certain amendments to section 39 of the principal act to give effect to the policy enunciated by the Treasurer in his budget speech. While on this point I think I cannot do better than read to the House an extract from the Minister’s speech dealing with this matter. On the 30th August, 1928, the Treasurer said -
Since the inception of the war service homes scheme, it has been the practice to pay into a trust fund all sums received for interest and rent on war service homes. These moneys have subsequently been used in the provision of new homes. In this manner, a reserve has been built up out of revenue, and th» assets of the fund now exceed the liabilities by approximately £3,750,000.
At the present time those assets exceed the liabilities by well, over £4,000,000. The Treasurer went on to say -
The Government considers the time has arrived when the interest and rent on war service homes should properly be credited to revenue and set off against the interest payable by the Commonwealth on loans raised for war service homes purposes. The Consolidated Revenue Fund Estimates for this year, therefore, include £800,000, representing receipts of interest and rents on war service homes. Parliament will be asked to amend the law to give effect to this proposal, and in future practically the full amount required for war “service homes will be provided on the loan Estimates.
The moneys received by the Commonwealth in repayment of the capital cost of war service homes will continue to be paid to the National Debt Sinking Fund for the redemption of debt in accordance with the practice established in 1023.
This clause will give effect to that policy. If the act were to remain as it is, the responsibility, in effect, would be thrown upon the Treasury, of providing nearly half the money required for war service homes from revenue instead of from. loan.
I think that it will be recognized that that would be quite unjustifiable and unnecessary, and, moreover, this change will not in any way touch the present reserve fund of more than £4,000,000 of assets over liabilities.
– Is it intended to keep that fund stationary?
– Possibly it will not remain quite stationary; but that money will be left in it. By clause 7, we propose to put back into the act, a section that is taken out by clause 3, which provides for the repeal of section 28b. It is merely proposed to take it out of Part VI. of the act, where it is wrongly placed, and to put it in Part VIII., to which it properly belongs. We are taking this opportunity, ‘ when the act is being amended in other and more important directions, to put this provision in its proper setting. The clause will merely give effect to the intention of the committee when the amendment was actually made. The other amendments made by the bill are purely formal and consequential in character, and I shall explain the necessity for them when the bill reaches the committee stage.
Debate (on motion by Mr. C. Riley) adjourned.
Order of the day called on for the further consideration in committee from 13th March (vide page 1118).
– I move -
That the order be discharged.
I take this step, because a few days ago, after the honorable member for Indi (Mr. Jones) had submitted an amendment, which was acceptable to the Government, it was found to be impossible to give effect to it owing to the restrictions and limitations of the resolution on which the bill was founded. If the committee agrees to the motion now submitted, I shall move immediately another resolution, which will be sufficiently wide to make it possible to give effect to the amendment. The Leader of the Opposition (Mr. Scullin) and honorable members particularly interested on this side, have given me an assurance that, if that step is taken, every facility will be afforded to pass the new resolution, and to enable the new bill, to be founded on it, to be taken without delay to the stage that was reached with the first bill when the amendment was proposed.
.- The Minister’s statement is quite correct. The agreement is that we shall not have the second-reading debate over again, because the Minister met us by agreeing to bring down a new bill. The assurance now is that when the new resolution, and the new bill to enable the amendment of the honorable member for Indi to be made, are before us, the discussion will be resumed at the stage previously reached.
Question resolved in the affirmative.
In Committee of Ways and Means:
I move -
This resolution is similar to that passed last week in connexion with the other hill, except that its scope has been widened sufficiently to enable effect to be given to the amendment submitted by the honorable member for Indi.
Question resolved in the affirmative.
Resolution reported; Standing Orders suspended; and resolution adopted.
That Mr. Bruce and Mr. Paterson do prepare and bring in a bill to carry out the foregoing resolution.
Bill presented by Mr. Paterson, and read a first time.
I move -
That the bill be now read a second time.
This measure is similar to that passed, by the House last week as far as the second-reading stage, except that in clause 2 there is the following definition of “ winery or distillery,” which was not contained in the previous bill : - “ winery or distillery “ means a winery or distillery which handles not less than ten tons of grapes for use in the manufacture of wine during any year in which a charge is imposed under this act.
The object of including that definition is to give effect to the suggestion of the honorable member for Indi. It will be noticed that the actual words that he suggested should be added to clause 3 have not been incorporated in the bill, but the effect of his proposal is obtained by the inclusion of this definition. This ensures that no levy will be made on the wine-maker who handles less than ten tons of grapes annually for the purpose of making wine or spirit for fortifying wine.
Question resolved in the affirmative.
Bill read a second time.
In committee -
Clauses 1 and 2 agreed to.
Sitting suspended from 12.45 to 2.15 p.m.
Clause 3 (Charge on grapes for winemaking) .
.- The wording of this clause would make it appear that a levy will be imposed on the winemakers. Nominally, that is so; but actually the levy will be paid by the grape-growers. Although the Wine Overseas Marketing Bill gives to the grape-growers no representation on the board to control the export of wine, they will be called upon to pay levies in respect of wine marketed overseas. In reply to a question by the honorable member for Wannon (Mr. Rodgers) the other day, the Minister said that of the wine produced in Australia, 60 per cent, was consumed locally and 40 per cent, exported.
– I referred to a year in which the exports were heavy.
– So far as I can ascertain, we have never exported more than 25 per cent, of the wine produced in this country. In 1925-26, of the 16,000,000 gallons of wine produced, only 1,700,000 gallons were exported.
– A great deal of that was distilled.
– In 1926-27, we exported only 3,000,000 gallons out of a total production of 20,000,000 gallons, and in the following year, during which 16,000,000 gallons were produced, only 3,770,000 gallons were exported. A fixed price is to be paid for the grapes used in the manufacture of wine to be exported overseas, but in respect of the much larger quantity of grapes to be used in the manufacture of wine for local consumption, there is to be no fixation of price. Wine-makers who purchase grapes for manufacture into wine for local consumption will deduct from the price payable to the grape-growers the amount of the levy they will be called upon to pay, so that while, nominally, they will pay the levy, it will actually be paid by the grapegrowers, who will thus be in the position of having to pay taxation without having representation on the board. Some time ago, all the grape-growers’ associations of the non-irrigated areas in South Australia propounded a scheme for the stabilization of the wine market, in which they proposed that the growers should have the same representation on the board to control the export of wine as the wine-makers would have. The honorable member for Angas (Mr. Parsons) said the other day that the grape-growers of South Australia did not desire representation on that board.
– The scheme to which the honorable member refers has been discarded by the South Australian grapegrowers.
– They also proposed that a levy should be imposed on wine-makers who manufacture wine for local consumption as well as on those who export wine. It would be better to impose a levy on the wine manufactured than on the grapes to be used in its manufacture. As it is, the grape-grower has no guarantee of protection. Even were a price fixed in respect of grapes to be manufactured into wine for local consumption, there is nothing to compel the wine-makers to buy the grapes. There is at present a glut of Australian wines in
England, and Australian wine-makers already have their cellars nearly full. The result is that growers must accept for their grapes whatever price is offered for them, or leave them to rot on the vines. I have been informed by grape-growers at Rutherglen that wine-makers who bought their grapes in previous years will not buy their grapes this year. Many of those grape-growers are returned soldiers, who were encouraged to take up land and to grow grapes on it, only to find now that they are in a desperate position. The wine bounty benefited the wine-makers more than it assisted the grape-growers. This bill will not remedy that state of affairs, for it will enable the wine-makers to retain their advantage. I wish to see the Wine Overseas Marketing Bill placed on the statute book, for I believe that the fund to be established thereunder will be of great advantage to the industry; but it would be better if the levy to be imposed under this measure were on the wine, and not on the grapes.
.- Nearly all the points raised by the honorable member for Indi (Mr. Jones) have been taken from a speech which I previously made in this chamber. The honorable member referred to a stabilization scheme proposed by the grape-growers of South Australia. It is true that at one time they were in favour of the scheme he mentioned, but after a conference with the Minister in Melbourne they agreed to abandon it in favour of another along the lines of that proposed in this measure. Only about a fortnight ago the president of the South Australian Grape Growers’ Association, Mr. W. Gursansky, and the secretary, Mr. J. Gersch, interviewed me at the Tanunda show and said that they had abandoned the idea of the grape-growers being represented on the board, and now favored the proposals of the Government, except that they desired additional representation for South Australia. That is the view that they at present hold. For the information of the honorable member for Indi, I point out that I am in almost daily contact with these men, and only yesterday received a letter from them relating to grape prices. That matter I have placed before the right honorable the Prime Minister. At the risk of being regarded as egotistical, I repeat that the grape-growers to-day are in the position which a year ago, when speaking to a similar measure, I said they would be in. I am sorry that my predictions on that occasion have been fulfilled, for I should have been much more pleased had I proved a bad prophet. The grapegrowers of Australia are in a desperate plight. The prices now being offered for their grapes are similar to those which obtained prior to the granting of the wine bounty. This measure and its kindred measure - the Wine Overseas Marketing Bill - are designed to overcome some of the difficulties surrounding the export of our wines. But there is a much greater problem before us, and the Government is doing its best to find a solution of it. The grape-growers are in no way responsible for the position in which their industry finds itself to-day. They have done their part in establishing their vineyards. They have toiled from daylight until dark, and their reward to-day is the sale of their products at unprofitable prices. In addition, because of the adverse climatic conditions, the crop this year is not more than 50 per cent, of normal.
– Does the honorable member agree that this legislation will place a further tax upon the grape-growers?
– If it provides for 1 0 per cent, of the benefits which the Minister says it will confer upon the industry, then itwill be welcomed by the growers. This is a question, not of shillings, but of pounds. The growers ure not even getting cash payments. In some instances they are being offered up to 60 per cent, cash and the balance in the’ bitter and not sweet by-and-by. The settlors on the river Murray perhaps will not feel the pinch until such time as the distilleries, of which the growers are cooperative owners, try to dispose of their products, and when they do that they will experience a short market. I appeal to the Government to tackle this problem during the recess, and to try to find some solution of it which will be of benefit to the growers. The present Government is not wholly to blame for the difficulties of the industry. Overplanting was brought about by the laudable desire of the State Governments to place our returned soldiers on the land. All parties were agreed on this policy. This overproduction, however, has affected detrimentally, not only the soldier settlers, but also every other grower. Had the industry not been subject to government action the growers would have been in a sound financial position. This is a warning to those who are anxious for the Government to have a finger in every pie. Representations should be made to the British Government to put Australian wines on a par with foreign wines imported into Great Britain. One of our greatest competitors in Great Britain is what is called British wine; but it is not wine at all in any sense of the word. That wine does not consist of fermented fresh grape juice, nor is it fortified with the spirit made from grapes. It is wine made from must and fortified with grain spirit.
– I ask the honorable member to confine his remarks to the clause before the committee. I have already allowed him a great deal of latitude.
– If we could stimulate the sale of Australian wines in Great Britain there would not be the need for the extensive advertising which is proposed under this bill, and, therefore, the charges would not be so great.. I give the bill my benediction, and I hope that it will accomplish 25 per cent., or even 10 per cent., of what the Minister hopes it will in the direction of benefitingthe growers.
.- The honorable member for Indi (Mr. Jones) said that as there were something like 16,000,000 gallons of wine produced in a year, my estimate of 40 per cent, being exported in any year must be wide of the mark. The figures were taken on the basis of a year when we had a large export. By the time that some of the 16,000,000 gallons was distilled to make spirit to fortify the remainder of the wine, the bulk would be reduced to a little more than 10,000,000 gallons.
Assuming that the whole of that wine were turned into sweet wine and 4,000,000 gallons, which was about the largest quantity exported in any one year, were exported, that would represent about 40 per cent. But I recognize that it is an over-estimate for an average year. The question whether the charge should be on wine or on grapes was given a great deal of consideration. It would be very easy to place a charge on export wine only, but I think that honorable members interested in this subject will realize that it would be a great mistake to do so, and that the local market should bear its fair share of this charge. In this connexion we considered levying the charge, for instance, upon fortified spirit, but it was decided that that would not be altogether satisfactory, because it excluded the possibility of levying on dry wines. Then we considered the other alternative of imposing a charge upon all wines manufactured in Australian wineries, but we found that it would be much more difficult to check the quantity of wine manufactured than it would be to check the number of tons of grapes which, go into a winery or distillery to be made into wine. I believe that there is little difference, so far as safeguarding the position of the growers is concerned, whether the charge is put on wine or on grapes. Everything that can humanly be done by the Commonwealth to safeguard the grower from having this charge passed on to him has been done. The wine-maker who buys grapes for both local trade and export can obtain the export bounty only if he pays the. fixed price, not merely for the grapes required for his export trade, but for the whole of his trade. I quite recognize, of course, that the wine-maker who buys grapes for local trade only, and does not export, escapes that condition, but the Commonwealth Government has done everything that lies in its power to safeguard the position of the grape-grower.
Clause agreed to.
Clauses 4 to 6 agreed to.
Title agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
Declaration or Urgency.
– I declare that the Economic Research Bill is an urgent bill.
Question - That the bill be considered an urgent bill - resolved in the affirmative.
Limitation of Time.
.- I move-
That the time allotted in connexion with, the hill be as follows: - For the second reading of the bill until 10.45 p.m. this day; for the committee stage of the bill until 2.45 p.m. on Wednesday, 20th March: and for the remaining stages of the bill until ‘t p.m. on Wednesday 20th March.
If honorable members, will examine the motion in its relation to the bill, they will see that a very fair measure of time hasbeen allotted to each stage. From the remarks made, particularly during the recent, discussion of the Tariff Board Bill, a number of honorable gentlemen seem tobe under the impression that the measure now before us covers the whole subject of economic research in Australia, and. therefore would need a considerable amount of discussion. But the bill provides only for the appointment of a director of economic research. The Government could have approached the Public Service Board, and if the board, upon investigation, had considered that the appointment of a Director of Economic Research was necessary, the appointment could have been made. The objection to that course was that the position was not considered a suitable one to which to appoint a permanent public servant, and that it was not desirable to fill the position by the appointment of a temporary public officer. The Director of Economic Research it is thought, should be absolutely free of government control. The main object of the bill is to provide for the tenure of office of the Director of Economic Research - one clause sets out the method by which his services may be dispensed with - and there can be no expansion under it. Parliamentary approval will be obtained for any additional employees for service in the bureau. The appointment of the staff will be subject to the approval of Parliament, and as this measure deals only with the tenure of the Director of Economic Research, I suggest that the time proposed to be allotted for its consideration is ample.
.- I disagree with the Prime Minister. I think that the time proposed for the consideration of this bill is an outrage. The measure is one which could be considered for weeks. However, at this stage I do not propose to do more than enter my protest against this method of doing business.
Question put. The House divided.
Majority . . 6
Question so resolved in the affirmative.
Debate resumed from 12th March (vide page 1022), on motion by Mr. Bruce -
That the bill be now read a second time.
.- It is not possible for Parliament to give due consideration to an important bill when it is asked to pass the second reading of it in half a day. I shall have to leave unsaid quite a number of things I intended to say, and very many honorable members of the Opposition will be prevented from speaking at all. The Prime Minister tells us that the object of this bill is the establishment of a Bureau of Economic Research to consider the economic effects of government policy. But what we really want in Australia is an investigation into the uneconomical expenditure of the present Government. There is an old saying that “ knowledge is power.” It is an easy matter to make out a case for investigation, and to delude the public mind into the belief that by appointing a number of individuals to investigate certain matters valuable information, will be obtained that will assist the State in solving all its great problems. I should be inclined to give more sympathetic consideration to the measure if the Prime Minister when introducing it had given more information, or if the measure itself contained any really concrete information; but it contains nothing but generalities, and one looks in vain in the speech of the Prime Minister for anything about the specific subjects that are to be investigated by this proposed bureau. As a matter of fact, Parliament is asked to sign a blank cheque. We are told by the Prime Minister that nothing can be done in connexion with the appointment of staff for the bureau until the Estimates are brought down to Parliament; but the better course would be for the Government to submit the whole of its proposals and its estimated expenditure in connexion with this bureau before asking Parliament to consent to its establishment. Once this bill is passed Parliament is committed to the establishment of this bureau, but before that is done we ought to be told what practical results are likely to be achieved by it. I ask the Government to tell honorable members what investigations are likely to be made and the extent of them, because this, of course, must determine the staff the bureau will require.
What is the estimated cost of the administration of this board and of its investigations? These are definite questions to which some answer should be given before honorable members are asked to vote for the second reading of the bill. The Prime Minister, in introducing the measure, said -
Unless we establish economic research on welldefined lines, our future problems will be more difficult than those which confront us today.
That is delightfully vague. If the bureau is to be established on welldefined lines, it should be easy to say what they are. According to the bill, the functions of the board will be -
– Surely that is definite enough?
– I shall proceed to show the indefiniteness of the proposals. As a matter of fact, the whole scheme is based upon a mass of generalities. The Prime Minister found it impossible to say anything specific on these matters, but we shall be glad to hear the honorable member for Warringah do so.
– It will not be difficult.
– If it will not be difficult for the honorable member, it should have been extremely simple for the Prime Minister; but the absence of any explanations in his speech seems to suggest that it was not so. We make the definite request now for an authoritative statement of the exact meaning of the clause setting out the powers and functions of the bureau. The Prime Minister’s speech contained the following sentence : -
It is better to establish a bureau of economic research under a first-class director, so that the many problems arising out of schemes approved by the Development and Migration Commission may be sent on to the bureau for investigation.
That is an amazing statement. If any one thing was claimed more than another when the appointment of the Development and Migration Commission was being considered, it was that the commission would effectively investigate all the problems submitted to it. These commissioners are costing the country £14,000 a year in salaries alone apart from the salaries of the staffs and now we are told that its work is so ineffective that its conclusions must be referred to the Bureau of Economic Research for further investigation. We are entitled to assume, therefore, that the Government has no confidence in the Development and Migration Commission; and as the Government was responsible for its appointment, we are justified in saying that we have no confidence in the Government. To my mind, the appointment of a bureau of economic research would be simply duplication. In November, 1927, the Development and Migration Commission reported upon its investigations into the dried-fruit industry, and recommended that a co-operative packing and selling organization should be established, and that the planting of vines should be discouraged. Nothing has been done in that regard. The commission went to Tasmania some time ago and advised the Tasmanian Government and people that they were doing things wrong, and should obtain expert advice. The Tasmanian Government thereupon said, “If we do not accept this advice, we shall probably be refused any additional grants from the Commonwealth Government, for we shall be told that, although we were advised to set our house in order, we did not do so. “ It, thereupon, appointed a number of experts. But, so far as I know, there have been no advantageous results. Is there an honorable member from Tasmania present who will say that Tasmania has got anything out “of the appointment of these experts, or has any prospect of getting anything out of it?
– We certainly have prospects.
– We shall be interested to hear the honorable member indicate what they are. All that we know at present is that the appointment of these experts has cost the State Government between £18,000 and £20,000 a year.
The Prime Minister in introducing this bill referred to bounties and other assistance given to the dried fruit, canned fruit, and other industries, and to the fruit pools which, he said, had cost the country £2,360,000. He went on to observe that this proved the necessity for establishing the Economic Research Bureau. He added that had we estimated the economic results of these bounties we should not now be confronted with such paralyzing problems. What did he mean? It is a common thing to be wise after the event. The man who goes to the races aud backs the wrong horse says to himself, “ Had I known my horse would have failed, I should have put my money on another.” It is well known that the dried fruit industry was encouraged in consequence of our war-time experience. During that period the price of currants, ‘sultanas, aud raisins advanced tremendously overseas, for the submarine menace made it impossible for the Mediterranean countries to get their products to the world’s markets. At that time Great Britain transferred her trade to us, and we were led to believe that she would continue to deal with us after the war. Consequently we settled many of our returned men on irrigation blocks, and encouraged them to grow fruit. But now that war conditions no longer prevail, a large quantity of Britain’s trade has reverted to Greece and Turkey, and we have lost our profitable market. Probably this could not have been foreseen. I suggest that a bureau of economic research would have failed just as every other organization did, to protect the country from such an experience.
I have searched the bill to find what the appointment of this bureau is likely to cost the country, but my search has been futile. All I can discover is that a Director of Economic Research is to be appointed, but nothing is said as to his allowances, travelling expenses, &c. All that appears in the bill on that point is that these shall be upon such conditions as are prescribed. The Prime Minister has mildly suggested that, by agreeing to this bill, honorable members will commit the country to nothing except the appointment of the director. But Parliament has been bluffed before like that. For instance, we were told in 1926 when the proposal to establish the Development and Migration Commission was before us, that our acceptance of the scheme would mean that migrants would no longer be brought out here until provision had been made for them; that the development of the land and other resources of Australia would thereafter proceed upon sound scientific lines, and that the workers of Australia would be found regular employment and those from overseas would be absorbed as soon as they arrived here. We were told, in other words, that development would precede migration. But that has noi been our experience, for our unemployed army has grown larger every year, while the cost of the Development and Migration has increased enormously. In 1925-26, before the Development and Migration Commission was appointed, the cost of the Department of Migration was £93,000. The cost of these activities has since increased as follows :- 1926-27, £99,400, plus £9,000 in salaries for the commissioners, or an increase of £15,000, and 1927-28, £113,000, plus £10,000 in salaries. The estimated cost for this year is £127,000, plus £13,000 in salaries. Honorable members will, therefore, do well to consider carefully the probable cost of this new department which the Government is seeking to set up.
The cost of the Federal Capital Commission has also increased enormously and illustrates the danger of establishing new boards. In the first six months of its life, it cost £19,000, or at the rate of £38,000 a year; in the first complete financial year of its operations, it cost £67,000 ; in the next year, it cost £99,000 ; and in the next, £112,000. For the six months ended the 30th December, 1928, the cost of it was £59,000, or at the rate of £118,000 a year.
The report of the Council for Scientific and Industrial Research was tabled last week. In it appears the following paragraph -
In common with other Commonwealth organizations, the council is reviewing all its expenditure and commitments in the light of the present financial position of the
Commonwealth as a whole. An internal economy committee has been set up to suggest possible economies not involving sacrifice of efficiency.
I f there is one body to which the primary producers of Australia are entitled to look for good results, it is the Council for Scientific and Industrial Research. Yet we find that the council has been forced to curtail its investigations because of the financial stringency, although it has not yet got properly into its stride. In these circumstances, there is no justification for setting up a bureau of economic research. In 1923-24 we bad an Institute of Science and Industry which cost the country £22,000. The cost of it in the next year was £24,000. At the beginning of 1925-26 the Council for Scientific and Industrial Research superseded the Institute of Science and Industry, and cost the country in that year, £37,000. In 1926-27 the cost of it was £39,000 ; and in 1927-28 it was £81,000. The estimated cost of it this year is £161,000. The cost of these boards and commissions grows like a snowball.
The Tariff Board provides us with still another illustration. In 1922-23 it cost £4,300. The cost of it in succeeding years up to last year, was as follows : £6,600, £9,800, £12,500, £11,600 and £11,900. The estimated cost of it this year is £12,500. It is little wonder therefore, that I should read the following paragraph in the leading article of the Melbourne Age yesterday: -
The Commonwealth Government is absorbing money gargantuously. No sane man believes that so much money is absolutely necessary. Only “members of the Pact Ministry and their sycophants believe that it is being expended prudently.
Here is another vague sentence from the speech of the Prime Minister, in introducing this bill -
I hope that when the bureau has been established, we shall be able to assist the universities to devote more time to economic research.
In what way would this bureau be able to assist in that matter? I take it that the Prime Minister was referring to the granting of a subsidy, but there is no need for this amount of circumlocution to determine that matter. We do not need a highly-paid director of economic research to advise the Government in that regard. The most effective way to get the science of economics studied would be to induce the universities to establish chairs and make investigations necessary. Far more fruitful results would be obtained by adopting that course than by setting up a number of departments. Certainly, there is no need to set up a department to subsidize the universities. I have made this quotation with the sole object of showing how hard put to it the Prime Minister is to find reasons to support the establishment of this bureau. I do not suggest that we should not have investigations into the science of economics; but I say that we have not been given sufficient information to warrant us in committing ourselves to these proposals at the present stage. We ought to be told frankly what is the purpose behind the measure. Of course, one can read a little between the lines. I draw the attention of honorable members to a statement of the Prime Minister that has a certain significance. The right honorable gentleman said -
As the Arbitration Court makes awards that are of transcending importance …. it is desirable that it should be able to seek advice as to the economic effect of its awards. At present there are no avenues from which the court can obtain this assistance.
Last year, in an amending Arbitration Act, this Government instructed the Arbitration Court to take into consideration the economic effect of any proposed award. Wow, a year later, we are told that there are no avenues from which the court can obtain information that will enable it to judge the economic effect of its awards. The introduction of this measure is an admission that the court has sought wrong avenues. The award of Judge Lukin in the timber workers’ case had, as its foundation, an economic report by some official; yet the Prime Minister says there were no avenues through which the necessary information could be obtained ! In this one statement of the Prime Minister we have a condemnation of the legislation passed last year to amend the Arbitration Act, because it instructed the court to take certain action without providing it with the means to take it. It is also a condemnation of Judge Lukin’s award, which prescribed what is not a living wage based on economic facts obtained from a source which, according to the Prime Minister, does not exist. That appears to me to be the reason for the introduction of this measure.
Referring to an application for an increased duty by some industry, the Prime Minister said -
Research into the economic results of the suggested tariff may disclose that it will have far-reaching and disastrous effects upon some other industry in Australia.
That is advanced as a reason for the establishment of this bureau. I ask the Prime Minister, what is to become of the Tariff Board? What is to be its function ? If it is not intended that it shall investigatae the effect on any industry of any increased or reduced duty, it has no right to exist.
– Section 15 of the principal act requires that it shall do that.
– Exactly ; and it has been working along those lines. I have read scores of its reports, and I believe that it has investigated the effect of every duty applied for, not only upon the industry to which the duty would apply, but also upon other industries. I quote the following paragraph from what its probably the last report issued by the Tariff Board. It relates to an application for a duty on pyrites -
In the opinion of the Tariff Board, the removal of the duty on pyrites would not be of advantage to the producers of sulphuric acid, nor would it confer any benefit on the users of that acid, or of superphosphates. On the other hand, it seems undoubted that the granting of the applicants’ request would prejudice the prospects of the mining aud treatment of Australian pyritic or sulphide ores, and this at a time when there are already indications of a very decided impetus in production from this source.
That paragraph indicates that the board has investigated the economic and other effects upon other industries.
– What would the position bc if the opinion of the Tariff Board differed from that of the Director of Economic Research?
– One can only leave that to the imagination. The point I wish to stress is that whatever investigation this Parliament deems to be necessary, upon any aspect of any industry, or upon any proposed law, should be a specific investigation; and there have already been created bodies which can make those specific investigations. Now we are to have an overriding bureau to inquire into the general economic effects of any award or any tariff proposal. The inspiration comes from quarters such as the Economic Mission that recently visited Australia from Great Britain, commonly known as “ The Big Four.” In one paragraph of their report they say -
A full scientific inquiry and investigation should forthwith be instituted by the Commonwealth Government into the whole question of the economic effect of the tariff and the incidence of its duties. Fending this inquiry there should be no avoidable increase of duties. “ No avoidable increase of duties “ is only a platitude.
– What is meant is “ no increase of duties.”
– That is what is meant. I ask the House to consider what is the purpose behind this proposal. Is it a roundabout way to cut down wages and reduce tariff duties ; or is it a genuine desire to obtain information in relation to legislative or administrative action ? If it is the latter, what is the Tariff Board doing, and why have the Developmental and Migration Commission and the Council for Scientific and Industrial Research been appointed? I have heard in this House, and read in the press, again and again, references to a vicious circle, which is said to be responsible for high wages, high cost of production, and high cost of living. The position is misrepresented. The circle did not commence by wages being raised and the cost of production and the cost of living going up in sympathy; the trouble became accentuated with the world war; when a handful of persons who had control of large sums of money profiteered in every country. In addition, enormous debts were incurred upon which there has been an evergrowing burden of interest. The result was an increase in the cost of living, which the workers have since been chasing. Yet the suggestion is made today that we can revert to pre-war conditions by lowering the wages of the workers ! It is contended that, as a consequence, all other costs would drop. There is one thing which cannot he reduced to the pre-war level, and that is the interest bill. No suggestion has been put forward for reducing it. If, by some arbitrary act, wages, cost of production, and cost of living could be brought back to the pre-war level, so long as the existing burden of interest had to be borne the result would be merely to double the value of every war bond held by every money-lender in the community. The -reason for the vicious circle is not to be found in the operation of wage-fixing tribunals or the protectionist policy of Australia. At a public function which I attended in Melbourne the other day I heard the statement “ This artificial standard created by the Tariff Board and the Arbitration Court.” What artificial standard? Arbitration courts have based their awards upon the necessities of life, with a little extra to provide a small margin for skill. The object of the tariff is to place a higher wall around this country so as to protect its industries from the artificial conditions created by the war, including the rate of exchange. If there is to be an investigation into any proposed increase of tariff duties, who will deny that that is the function of the Tariff Board? What, then, in addition, is intended to be done by this bill? Are we to take it that the Economic Research Bureau which it is proposed to set up shall investigate the general effects of the protectionist policy of Australia? There is no need to set up a bureau to do that. The text books teem with the opinions of the so-called leading economists of the world on the subject of freetrade and protection. The subject has been written about and argued about in Australia from the commencement of responsible government ; and in spite of the gloomy forebodings of certain so-called leading economists both the people and the Parliament of Australia have determined in favour of protection. After all, economics is concerned largely with matters of opinion. Two leading economists will express entirely different views. Scientists will disagree and financiers hardly ever agree on what is supposed to be the realm of high finance. Nearly every one of the text books had to be discarded while the war was in progress. Let us suppose that we appointed a Director of Economic Research and that he gathered around him a staff of men possessing the highest possible qualifications to whom were being paid big salaries. They might declare, after an investigation lasting months or even years, that our protectionist policy was opposed to the progress of Australia ; that we have to sell our surplus produce in other countries; that we cannot maintain existing standards; that prices of commodities must come down; that wages must be lowered, and that the tariff wall must be broken down. If a report along those lines were submitted, what action would the Government take? That is getting down to fundamentals. Would the Government adopt that report, backed up by the opinion of the best men it could collect, and in whom it had the greatest confidence? The people of Australia would be very interested to get an answer to that question. What are the possible answers to it? Let us assume the Government to say, “Yes, we shall accept this recommendation, given after full investigation has been made. “ The Government must then answer to the people of this country, who are not theorists, who are not concerned with the phraseology df economics, such as that of the passage read by the right honorable member for North Sydney, which no one in the House could understand. They are not concerned with the opinions of learned persons who talk about a wonderful flow of trade through uninterrupted channels, and of freedom of contract between master and man. But they are vitally concerned with the actualities of life, with the real things that matter. The people would say that, if they accepted that doctrine, their standard of living would come down, because the standards of other countries are lower than ours. They would very reasonably ask to what standard Australia was to descend, and it seems evident that we should have to come down to that of the country with the lowest standard among all those with which we were in competition. That being so, will the Prime Minister tell us whether he would accept a report from the bureau recommending that course?
– The Government might accept part of such a report, especially if it recommended taking a duty of £400 off a £600 machine.
– The honorable member has furnished a very good illustration in support of the point which I have been making. That is essentially a matter for the Tariff Board. A board that could not investigate and make a recommendation on such a case should be sacked, and a new one appointed. Surely it is not suggested that such work should be undertaken by the director of economic research? He, I presume, would be concerned with abstract economical problems in their relation to a protectionist policy, and their effect on the primary and secondary industries of Australia. I again ask whether, in the event of the director recommending a freotrade policy for Australia, would the Government accept it? If, on the other hand, the Government took no notice of the bureau it had created, it -would stultify itself. As a matter of fact, how much notice has it taken of the report of any of the bodies it has set up? It appointed a commission to investigate national insurance, and one of the principal functions of the commission was to inquire into unemployment. The commission made its investigation, and placed before the Government a unanimous recommendation in favour of establishing an unemployment insurance scheme. During the election campaign preceding the presentation of the report, the Prime Minister told the electors that, as soon as the report of the commission was tabled, the Government would bring down legislation to provide for unemployment insurance. That promise was made three and a half years ago. The report of the commission has been in the hands of the Government for nearly three years, but nothing has been done with it. Instead, the Government asked another commission to investigate unemployment. The work was handed over to the Development and Migration -Commission, which utilized the services of economic experts, professors at the universities. They have presented a report which has been tabled, printed, and pigeonholed, but nothing has been done about unemploy ment. Now the Prime Minister tells us that one of the things to be investigated by the Bureau of Economic Research is unemployment. Where is it all going to end? Let us have some proof that the boards already set up by the Government have been of value to the country; that their advice has been accepted, and is proving beneficial, before we are asked to commit ourselves to something concerning which the most meagre information has been furnished. No indication has been given as to what class of information the bureau is to collect, wh’at the cost of it will be, nor how large a staff it is proposed to employ. I have no quarrel wilh investigation as such. Like many others who were reared in the bush, I have tried, with limited opportunities at my disposal, to be a student. I have read eagerly the findings and opinions of experts and scientific men, and not lightly would I criticize the efforts of those who have made a special study of their subject. -But knowing what the Government has already done with its bureaux and boards, and having seen the futility of almost everything it has undertaken, I am not prepared to allow it to push this bill through the House without furnishing honorable members with more particulars, of the proposal than have been given up to date. Therefore, I move the following amendment : -
That all the words after the word “ That “ be omitted with a view to insert in lieu thereof the following words: - “in view of the meagre information available as to the nature and extent of the investigations to bc made and the financial obligations that wouldbe involved, and, further, in view of the heavy and increasing cost of existing boards and bureaux, the bill to establish a Bureau of Economic Rescareh should not be proceeded with.”
– I regard this as one of the most important bills likely to be brought before Parliament for some time. I regret that no matter what, measure is brought in, the tariff seems to obtrude itself, like King Charles’ head in the conversation of Mr. Dick, into the discussion. I believe that the bureau, when created, will have a very much wider and more beneficial work to do than dealing with the tariff, however important that may be. At the close of the war, when British industry was either going, or had gone, to pieces, the operation of a bureau such as this will be, had the effect of restoring to a marvellous extent the industrial life of Great Britain. A bureau was established, and a fund of £1,000,000 was placed at its disposal. Almost immediately the bureau was able to effect a saving of over £1,000,000 in the manufacture of electric wire. Another work which the bureau accomplished - and honorable members representing coal districts should be especially interested in this - was to put tens of thousands of miners back on the coal-fields.
– Yes, under what conditions !
– Under improved conditions. I have been informed that one of the factors which is causing trouble in the New South Wales coalfields at the present time is inefficient management. One of the first undertakings of the industrial bureau in England was to find out which mines had been working under unscientific and impracticable conditions, and whether they had any chance of becoming paying concerns. Only a fortnight ago the first steamship to cross the Line using powdered coal in her furnaces arrived in New Zealand. This has proved the success of the fuel, and should do much to enable the coal industry to compete successfully against oil for steamship propulsion.
– That was the result of technical not economic research.
– It was the result of scientific research initiated by the industrial bureau in England. Prior to that time, it had been found impossible to stack, or store, or carry powdered coal, because spontaneous combustion occurred in almost every case within a few days. Now special appliances are being installed in the engine-rooms of ships by means of which this difficulty is overcome.
According to this bill, it is proposed that the bureau shall inquire into primary and secondary industries, and into marketing. That fact alone commends it to me. Any one who has travelled through Australia recently knows that the primary industries are in an exceedingly unsatisfactory position.
Take the wheat industry, for instance. Out of 3S countries in the world which grow wheat, Australia stands 20th on the list for the average production per acre. Is any one satisfied with that? If by research, allied with practical work, it were found possible to add 1 bushel an acre to our yield, it would be a wonderful thing for the wheat industry. Does any one say that the wool industry in Australia to-day is in a satisfactory position ?
– What does the honorable member suggest?
-I suggest that, some means should be devised for utilizing in this country more of the wool we grow. Out of the total quantity of wool produced annually in Australia, 1,000,000,000 lb., only 6 per cent, is treated in Australia. Is anybody satisfied with that? The duty on woollen goods imported into Australia, allowing for the British preference, is from 30 per cent, to 45 per cent, on some goods, and from 35 per cent, to 50 per cent, on other articles. When wo add the cost of handling the wool in Australia, the freight to the Old Country, and the freight on the manufactured goods that are returned to Australia, the cost to the consumer is increased, in some cases, by over 10s. in the £1. Does any honorable member suggest that there is no room for improvement in that respect? I believe that one of the objects of the bureau will be to inquire into anomalies such as that, and I am not afraid that, with the Tariff Board in operation, the bureau would be a sort of fifth wheel to the coach.
– What about the Council for Scientific and Industrial Research ?
– That has not been the success that some of us anticipated. The Leader of the Opposition said that the appointment of the bureau would be a reflection on the Development and Migration Commission; I am rather hopeful that it will be. A properlystaffed bureau could materially assist three great natural industries. I refer, in the first place, to the coal-mining industry. 1 am told that the manner in which some of the mines have been worked in the Newcastle and Maitland districts is such as to make it almost impossible for them to pay, and that efforts are being made to compensate for the lack of efficiency by reducing the wages of the employees. The inquiry into the coal-mining industry of Great Britain resulted in a great improvement of its management and the machinery employed, as well as a greatly increased supply of labour. The need for giving attention to the problems facing the primary producers is urgent. I travelled recently throughout the whole of the wheat belt of Victoria, and I can say, with the honorable member for Wimmera (Mr. Stewart), that the wheat industry is confronted with grave trouble, and that problem must be faced. Then, take the fruit industry. A year ago, the thrip pest destroyed over 2,000,000 bushels of apples and pears in Victoria alone.
– I point out to the honorable member that the principle underlying the bill is the establishment of a bureau of economic research. The measure does not deal with scientific investigation.
– Black spot is causing the loss of hundreds of thousands of pounds every year to the orchardists of Australia. I need hardly remind honorable members of the ravages of the blowfly pest in Queensland. The prickly pear, also, might have been checked if a well-organized bureau, such as is now proposed, had been at work.
– The honorable member is still discussing the need for scientific investigation, but the whole concern of the bill is economic research.
– I shall quote only one more example, if I may. Scientists in Java have produced a “ wonder” cane. In 1925, only . 25 per cent, of the sugar lands were planted with this variety, but last year 95 per cent, of the holdings were growing this new variety, which produces 25 per cent, more sugar than the kinds formerly planted.
– The honorable member is out of order in going beyond economic research.
– Some honorable members have inquired the meaning of the term “ economics.” I describe it as the practical application of brains and science to any particular object. If I thought that the purpose of the bill was to establish a bureau that would merely deal with financial matters and the tariff, I should vote against it. This body should direct its energies to economic research, which I consider synonymous with scientific research, in connexion with primary production and marketing. Scientific research, allied with practical experience, has placed British industry in the satisfactory position that it now occupies,, despite the setback due to the late war. ‘ The application of science to industry is responsible for the remarkable advance made by the United States of America, where the manufacturers, by spending 35,000,000 dollars on economic research, have effected a saving in one year of over 500,000,000 dollars.
– But we have the Council for Scientific and Industrial Research.
– That has not proved the success that it was expected to be. I regard the establishment of new departments with great suspicion; but I have no doubt that the proposed bureau, if it devotes itself to investigation of the conditions of agricultural and horticultural life in Australia, will more than justify its appointment. In addition to the primary industries, it should pay attention to the secondary industries, and, if a suitable staff is selected, the cost will be returned to the Commonwealth many times over. Unless something is done immediately to arrest the drift in the coal-mining industry, and find means of utilizing our coal for purposes other than those for which it is now employed, by treating the byproducts in a scientific way, the future of the industry will be black, indeed. Wheat production must be improved, and we must rid the producers generally of some of the pests and plagues that are destroying some of our best primary industries. I give the bill my wholehearted support, because I believe that the bureau will materially assist in the development of our industries on more up-to-date lines than have been followed in the past. Some of those that are now staggering must be placed on an improved footing, or the result will be fatal. I realize that everything depends on the qualifications of the staff selected to do the work. This House can always judge the merits of the men appointed, and the value of their labours. As I have already pointed out, only 6 per cent, of our wool clip is used in Australia. I regret that the report of Mr. Stirling Taylor, who investigated conditions in the woollen industry, has not been published. Immediate research is needed to discover why only 6 per cent, of ], 000,000,000 lb. of the best wool in the world is used for manufacturing purposes in Australia, although most of it is sent back to this country in the form of manufactured goods, which carry a handicap of 10s. in the £. No one can say that the position of the wool industry is satisfactory when only 6 per cent, of our entire production is utilized in this country. Believing that the bill will have the effect of placing such great industries as the wheat, fruit, coal and sugar industries on a much better footing than they are in to-day, I have much pleasure in supporting it.
.- The Prime Minister (Mr. Bruce) in a delightfully vague speech, introduced to the House a bill for the establishment of an economic research bureau. Either bc did not know much about his subject or he was carefully endeavouring to hide his thoughts. Having evidently a dislike to take the House and country into his confidence, he endeavoured to hide the intention of the Government by repeating that blessed word, “ economics “ in every sentence of his speech. Surely honorable members are, when the Prime Minister is introducing legislation, entitled to have some information about it. Like the Leader of the Opposition (Mr. Scullin) I listened to the right honorable gentleman and tried to understand what the bill was for and what was the intention of the Government. I could learn nothing. When Hansard was published, I carefully read the speech, but I was left just as much in a fog as before.
– That may not necessarily have been the fault of the speech.
– No doubt the honorable member for Warringah (Mr. Parkhill) will speak on the bill and, like the Prime Minister, cloak his remarks with the blessed word “ economics. “ He may make a long and a loud speech, but he certainly will not tell us just what the bill means and what is the intention of the Government. Is this bill merely a beauti ful child which the Prime Minister is fathering, and which will ultimately grow to be a fine bouncing boy like the Development and Migration Commission, with its mouth wide open and its arms extended asking for more and still more? The Development and Migration Commission started with a director and a stenographer, but it now consists of some 30 experts, and Heaven only knows the extent of the staff in both Australia and London. Is this bill an effort on the part of the Government to place its responsibility and its dirty work on the shoulders of a director of economic research? Even before the child is born, it is given work to perform. Clause 6 of the Tariff Board Bill which we recently discussed, reads -
After section fifteen of the principal act, the following section is inserted: - “ 15a. After the appointment of a person to be director of economic research, the Minister may direct the board to confer with the director upon any particular matter referred to the board for inquiry and report, and, when so directed, the board shall so confer accordingly. “.
There is at the Sydney University, a lecturer named Mr. Benham, and for quite a time that gentleman has been expressing his views on fiscalism and freetrade. So enamoured did the Town and Country Union and other nebulous bodies become of him that they took him to their bosoms.
– The honorable member is quite wrong. It was the Retail Traders Association that called upon him to give evidence.
– Will the honorable member allow me to complete my remarks? Some of these bodies were so struck with the blatant freetrade ideas of Mr. Benham that they took that gentleman from his academic duties at the university and placed him in the cold and glaring light of an investigation by the Tariff Board. To cut the story short, let me say that he was indeed a crestfallen lecturer when he returned to his academic duties, and since then he has not been heard to advocate freetrade. One wonders whether such a lecturer on economics is to be given the extraordinary power prescribed in the bill. The gentleman who is to be the Director of Economic Research will carry out research in respect of primary industries. The Prime Minister did not tell us the nature of that research work. The honorable member for Franklin (Mr. Mcwilliams), confusing scientific research aud economics, commenced his speech by dealing with matters which are essentially scientific and not economic at all. He dealt with the wool industry. The Council for Scientific and Industrial Research has already published the last word on the scientific aspect of the production of wool. We could not, even by the greatest stretch of imagination, apply economics to the work of the Council for Scientific and Industrial Research. The honorable member then went off at a tangent. He referred to black spot, and was called to order by the Chair. Agricultural problems are constantly being dealt with by the various State agricultural bureaux and departments. For instance, the late Mr. Farrer, by producing the federation type of wheat, extended the- wheat belt of New South Wales for some 50 miles. That had nothing to do with economics. The Prime Minister dealt with questions which have no relation to economics. According to the bill, the duties of the director will relate to secondary industries, marketing, transport, customs and excise tariffs, bounties, industrial matters, taxation, finance and currency, and, in case there may be something missed, such other matters as are prescribed. If this bureau is established with authority to investigate all these problems and to direct the Government as to what it should do, then power will be placed in the hands of the director greater than that exercised by this Parliament. In view of the vagueness of the Prime Minister’s speech, I am not prepared to accept the bill. If such a bureau is to be established, its duties and functions should be defined. We should know what is the intention of the Government. We cannot but take cognizance of the attitude of the two parties which constitute the Government in relation to this bill. Up to date I have not yet heard of any economist who is a protectionist. If the Government has any protectionist-economist in view as director, I should like it to produce him. Our fiscal policy in Australia has, rightly or wrongly, been accepted by the great majority of the people, but this Govern- ment is doing its best to defeat their desires in that direction. It would indeed be an easy matter to appoint as director of the bureau, an economist such as Mr. Benham or some other free trader, and I have no doubt that such a person would carry out the desire of the Nationalist and Country parties to call a halt in the protection of Australian industries. Is it proposed, under cover of this bill, to attack the arbitration system or the standard of living in Australia? In 1928, the Arbitration Act was amended to include section 25p, which reads -
The court shall, before making any award or certifying any agreement, and in proceedings for the variation or cancellation of an award or agreement, take into consideration the probable economic effect of the agreement or award in relation to the community in general and the probable economic effect thereof upon the industry or industries concerned.
If we appoint as director of the bureau, an academic gentleman who has had no practical experience of industry, is only concerned with the text books which he has digested, and he is allowed to apply his opinions and settled ideas to the standard of wages and working conditions in Australia, that cannot be in the interests of the community generally. We on this side are not afraid of scientific investigation. We are not afraid of any investigation which will help the development of this country, but when in the guise of economic research, machinery is established for the breaking down of wages and conditions, then we must, enter our emphatic protest against it. The Parliament or the Government has already laid down the principle that in certain matters relating to the Tariff Board the director of the Economic Research Bureau shall be consulted.
– The wording is not “shall” but “may.”
– Members of the honorable member’s profession have for hundreds of years been arguing the distinction between “may” and “shall.” I have no doubt that the board will confer with the economists. What is the bill for if that is not the intention of the Government? I have already referred to a section of the Arbitration Act which requires the judge to consider the probable economic effect of his award upon the particular industry . concerned and upon other industries. My opinion is that the Government is attempting to do, by back-door methods, what it has not the courage to do openly, although I must admit that in some respects the Government has been very frank in its attacks upon the industrial conditions of the workers, who by organization and continuous fighting, have won rights of which they are proud and which are without parallel. An economist might say that it is economically unsound to continue to manufacture agricultural implements, subject to a 44-hour week and the payment of a basic wage. There would be some truth in that contention if our industries were to be judged by the standards of Europe or the theories of impractical economists. One of these gentlemen is to be given very wide powers. A mysterious committee of which Parliament was not previously aware, has submitted to the Prime Minister a report which the right honorable gentleman has not made available to the public. I have no doubt that when drafting the bill he conferred with that body. Professor Copland, who was a member of it, has said this of economists -
Inasmuch as economic problems are so directly connected with politics, it will not be possible to get that measure of confidence in the economist as such that is found when problems affecting pure science are submitted to the authorities concerned. It should also be recognized that there is much controversy among economists themselves, and this contributes somewhat to the tendency of public authorities to neglect the economist. But differences of opinion are decreasing, and the body of accepted truth is steadily increasing as in other sciences. This, again, is due in a large measure,, to the more exact methods of investigation and observation and the growth of research. Differences of opinion are to be expected. They occur in all sciences and are one of the most convincing indications that the science is being studied with vigour.
This nebulous science, which is still the subject of controversy between those who profess and practise it, is to be loaded on to our people.We are to be the first to create a central body of this kind. Australia has been called a country of experimental legislation, and generally I have no fear of political and industrial experiments. Always, when we find we are travelling on the wrong track, we can retrace our steps.
– But it is wise to get some information about the track before we start.
– I fear this proposal, not because it is an experiment, but because I believe that it is being directed against the economic conditions of the worker and the fiscal policy of Australia. Professor Copland continued -
The economist is very cautious in his support of State activity of any kind and prefers to have so-called private enterprise to deal with matters as much as possible, provided the result is in conformity with the public interest.
That is another indication that the director of economic research will probably be such a person as I fear he will he. The only economic research body that has been created by any government so far as I have been able to learn, is the Committee of Civil Research constituted by the British Government with the Prime Minister as president. It is mentioned in the House of Commons Papers in a Treasury minute dated 13th June, 1925. It was to consist of persons summoned by the Prime Minister and its duties were to be purely advisory; it was to have no administrative or executive functions. The Government may say that the proposed bureau of economic research also will be without administrative power, and will function purely as an advisory and consultative body. The duties of the Committee of Civil Research are thus defined -
The committee will be charged with the duty of giving connected forethought from a central standpoint to the development of economic, statistical and scientific research in relation to civil policy and administration, and it will define new areas in which inquiries would be valuable.
The committee had power to summon economic, scientific and statistical experts. With the exception of that body, the study of economics has been confined almost exclusively to colleges, universities, and private organizations and societies.
– What of the American Tariff Commission?
– It is constituted on similar lines to the Tariff Board, except that it may call to its assistance scientific and economic experts.
– It has 27 economists on its own staff.
– If so, that strengthens my argument. The Commonwealth has already in operation a Bureau of Census and Statistics. Economics cannot bo dissociated from statistics. Facts and figures form the basis of investigation, and opinions and deductions, which may or may not be correct, follow. Experts are available to the Tariff Board now to do the work which the proposed bureau of economic research is to do. The National Bureau of Economic Research in New York is one of the leading bodies of its kind in the world. It was established to conduct exact and impartial investigations in the fields of economic, social and industrial science, and to co-operate with government universities, societies and individuals. It is controlled by a board of directors, composed of representatives from economic and statistical associations, the Federation of Labour, chambers of commerce, bankers’ associations, the American Association of Farm Bureaux, and other social organizations interested in economic research. Because of its great scope and wide-spread control, it is a safe organization, but I am not prepared to accept a bureau controlled in the manner proposed in this bill. There is also in Washington an Institute of Economics established by private endowment. Its charter provides -
The institute shall be conducted with the sole object of ascertaining facts about current economic problems, and of interpreting these facts for the people of the United States of America in the most simple and understandable form.
Amongst the other bodies conducting investigations in America are the Federal Reserve Board, the Bureau of Foreign and’ Domestic Commerce, the Census Bureau, the Tariff Commission, the Interstate Commerce Commission, the Bureau of Agricultural Economics, the Bureau of Labour Statistics, and the Federal Trade Commission. Honorable members will see that although America has applied the study of economics to many and diverse subjects, it has not gone the length of establishing a central bureau in which all these activities shall be concentrated. One wonders whether the book published recently by the British Liberal party on the industrial future of Great Britain has influenced the Prime Minister o adopt the scheme of this bill, and if so, to what extent. The right honorable gentleman is in the . habit of going to Great Britain for his ideas. The booklet to which I have referred deals with economic research bureaux, among other things, and there is a great similarity between the views expressed in it and those in the bill. It appears likely that this bureau may become another octopus, like the Development and Migration Commission, and run the country into an expenditure of hundreds of thousands of pounds. I shall oppose the bill, because I believe that it is designed to deal a blow at the fiscal policy of the nation, and to make an insidious attack upon the wages, hours and other working conditions of our people. In other words, it is an attempt to do by an indirect means something which the Government is not prepared to do openly.
– The proposal of the Government to establish an economic research bureau is one which should have the earnest support of every honorable member of this House, but much to my surprise honorable members opposite have assumed a. very antagonistic attitude towards it. Their reason appears to be that they entirely distrust the fiscal policy of the Government, and maintain that this is no more than a backdoor method of reducing the degree of protection which is being afforded to our industries. I was delighted to hear the Minister for Trade and Customs (Mr. Gullett) on Wednesday outline in definite terms the objectives of the Government in this regard, for honorable members opposite have persistently accused him of endeavoring to use economic considerations to influence the Tariff Board to introduce freetrade principles. I believe that the establishment of the proposed bureau of economic research may be the means of saving the country enormous expenditure in the future, for it will, so far as is humanly possible, ensure that we develop properly in the future and along right lines. Honorable members opposite have declared over and over again that economics is not a science. But I remind them of Webster’s definition of economics, which was given by the Minister for. Trade and Customs the other night in the following words : -
The science which investigates the conditions and laws affecting the production, distribution and consumption of wealth.
Chambers’ English Dictionary defines economics as “ The science of political economy.” Economics is regarded the world over to-day as an important science, and also as an important factor in the welfare of a nation. In my opinion we cannot hope to make substantial progress unless we build upon a sound economic foundation. A government may have the firmest determination not to interfere with the functions of an industry, but there are times when it is called upon to do so, and it is of the utmost importance that the action taken is given the fullest consideration from an economic point of view. Although we may have a limited general knowledge of economics we need at our back some authority well versed in the higher branches of the science. We need, in short, some one to advise us who has graduated in economics. Unless our legislation is sound, economically speaking, we may discover in years to come that we have unwittingly involved the country in an unnecessary expenditure of millions of pounds. The Prime Minister in introducing this bill pointed out that the Murrumbidgee irrigation scheme in New South Wales ‘had cost approximately £9,000,000 up to the 30th June, 1927, but only about one-third of the irrigable land was being used, and the revenue from the scheme was barely sufficient to pay interest on part of the capital cost of it. Another outstanding example may be found, in the Murray River development scheme. Up to the 30th June, 1928, £30,000,000 had been spent in locking the river to conserve water for irrigation purposes, although we are finding it difficult to market the products that are now being grown in that area. It is doubtful whether those responsible for the initiation of these schemes would have pressed on with them to the same extent had they realized to the full the economic effects of their policy. I consider it reasonable to assume so at all events: Modern governments are confronted with numerous problems which become more and more technical every day. Many questions arise in these days which are really more economic than political, and we need a bureau of the kind it is proposed to establish to advise us in respect of them. It is of great national importance that we shall adopt a policy of national preparedness. Government departments, Ministers, and I venture to add Prime Ministers, who are naturally concerned to a large extent with the events of the daily round, should have at their command a reliable economic service. When unlooked for problems arise at a moment’s notice, as they must do from time to time, they should be able to place their hands immediately upon the information gathered by a skilled bureau such as it is proposed to establish. I do not believe that many of the mistakes that have been made by Nationalist and Labour Governments in the past, have been the result of illwill or prejudice; rather have they been caused by ignorance and a lack of preparedness to meet the circumstances that have arisen. We should have at our disposal expert information and systematized knowledge to deal with such situations. A department such as we are now considering could do a great deal to assist us in avoiding a repetition of past mistakes and to ensure that sound executive decisions will be made. Competent commissions are set up from time to time to inquire into many important questions, but frequently their recommendations are _ made available too late to meet the situation that has arisen. But even when the recommendations come to hand in good time, I believe that it would be wise to submit them to the director of economic research to consider the economic aspect of their findings. We in Australia like to pride ourselves that we are leaders of democratic thought and pioneers in economic government. Yet, hitherto, we have failed to include in our administrative scheme a “ thinking “ department, to make available to the Cabinet and individual Ministers the result of its scientific inquiry into economic subjects and to advise and warn them respecting broad questions of economic policy.
As I have said, the problems of Government are becoming more and more technical and complex daily. This applies to Australia as well as to other countries. Many other nations have, with conspicuous success, set up bureaux of economic research, and I do not think we can go far wrong in following their good example. I do not for a moment suggest that the experts associated with this bureau should determine in any way matters of policy, nor is that suggested in the bill. Such questions should be determined by the Government. But it is desirable that those in whose hands the government of this country is placed should have available sound economic advice in order rightly to determine questions of policy which arise.
This bureau should be of very great assistance to the Tariff Board. In formulating such a tariff schedule as we have, it is inevitable that numerous anomalies will occur, and it was with a view to correcting these that the Tariff Board was originally established. I consider that this bureau would be able to help the board tremendously in its all important work. The members of the board are doubtless able to obtain statistical information ; but not every man has a mind trained in economics to enable him to draw the correct deductions from the statistical information placed before him. A protective duty of 20 per cent., for example, in respect of a particular industry may possibly result in ruin to another industry, and. cause widespread unemployment. It surely is in the interests of the whole community, therefore, that the advice of expert economists should be obtained as to the effect of proposed increases or alterations in duties. Of course there must be a limit to the functions of a bureau of this kind, and it is wisely provided in the bill that this body shall act only in an advisory capacity. It will not be a function of the board to veto any application for an increase or retention of an existing duty. Its main work will be to engage in research and to supply economic information to the Tariff Board to be used at its discretion.
The bureau should also be of considerable assistance to the Arbitration Court in determining the many questions of great national importance which come before it from time to time. The honorable member for Darling (Mr. Blakeley) quoted section 25n of the Commonwealth Conciliation and Arbitration Act 1904-2S, which reads -
The court shall, before making any award or certifying any agreement, and in proceedings for the variation or cancellation of an award or agreement, take into consideration the probable economic effect of the agreement or award in relation to the community in general, and the probable economic effect thereof upon the industry or industries concerned.
The honorable member, however, did not read the proviso that -
Provided that this section shall not affect the practice of the court in fixing the basic wage.
The Government should have the best possible economic advice at its disposal. It should be made quite clear to the people of Australia that that advice will not be used only in times of crisis, but that the bureau will be ever watchful of, and will continually inquire into, the many problems that confront the Government, and thus enable it to meet difficulties as they arise, or, if possible, avert them. Unless we avail ourselves of the opportunities afforded by this measure to establish such a bureau, our problems will become increasingly difficult in the future, and our non-recognition of the value of science will result in our lagging behind other countries in production and national efficiency. Where should we be if the medical profession were to abandon research in connexion with the science of medicine, or if our engineers were to abandon research work in their particular science? From the point of view of defence alone, what would be our position if Great Britain did not continue experimenting with new types of armament, or if research work were abandoned in the realm of chemistry ? In short, how far should we have progressed without research in any branch of science ? When a person is ill, does he not seek the best available medical advice? Why, then, should not the Government obtain the best economic advice as to the steps which should be taken to cure our economic ills? I trust that the Government will appoint as the Director of Economic Research the most competent man available. This position is in my opinion of the greatest importance, and the Government would be ill advised to obtain any one other than a person with the highest qualifications. The following quotation from Britain’s Industrial Future will show the importance attached to this matter by the Liberal party in Great Britain : -
The chief of the economic general staff must he given a position of such power and importance that he can take up the handling of any question he chooses with the assurance that the Prime Minister and the Cabinet will, whether or not they do what ho asks, at least listen seriously to what he says. Sis position in time of peace must be comparable to the position in time of war of the first Sea Lord, or the chief of the Imperial staff.
That is to say, he must be an important officer of State. It should not be difficult, in the light of that opinion, to estimate the value of the proposed bureau, and the importance of the position which the Director will hold. With a view to showing what steps have been taken by the Imperial Government, I quote the following extract from a Treasury minute, dated the 13th June, 1925, appointing a Committee for Civil Research : -
The committee will, like the Committee of Imperial Defence, be an advisory body, and will have no administrative or executive functions.
The committee will be charged with the duty nf giving connected forethought from a central stand-point to the development of economic, scientific and statistical research in relation to civil policy and administration, and it will define new areas in which inquiry would be valuable. Within these limits, the committee may consider such questions as are referred to it by the Cabinet, the president, the chairman and government departments.
The British Economic Mission considered this matter, and in paragraph 7, page 34, of its report, made the following observation : -
It has been proposed to establish a service to deal with economic problems, and that this service should form part of the work of the Council for Scientific and Industrial Research; but the sphere of activities of the proposed service is, in our opinion, so important as to demand a separate organization. Moreover, we think that such an arrangement would bc desirable in order that the present work of the Council for Scientific and Industrial Research should not be prejudiced in any way by the actions or conclusions of the new service. This new service must necessarily deal with problems which directly affect the political life of the country, and it must accordingly be placed and regarded as entirely outside the sphere of political influence, and its recommendations considered as scientific and unbiased.
What is the position in other countries in relation to research in this particular science? I believe that the United States of America are best equipped in this regard. In that country economic researchhas been undertaken by the following, government departments : - Federal Reserve Department, the Bureau of Foreign and Domestic Commerce, the Census Bureau, the Tariff Commission, the Interstate Commerce Commission, theBureau of Agricultural Economics, the Bureau of Labour Statistics, and theFederal Trade Commission. In fact, it is said that the government service in the United States of America is honeycombed with economists. I understand that most of the work is carried out by trained investigators, and that in many cases the bureau has a specially organized research department in which only university graduates are employed for administrative positions. The president of the Economic Society of Australia and New Zealand, Mr. D. B. Copeland, M.A., D.Sc, in his work Studies in Economics and Social Science, says -
Thus, when Mr. Hoover (Mr. Herbert Hoover, Secretary for Commerce) wanted an investigation into the causes of unemployment and business fluctuations, he turned to the National Bureau of Economic Research, which, as already mentioned, employs economists for research.
The governments of Canada, Germany, and other countries also have special departments for carrying out economic research.
The last aspect of the bill upon which I desire to touch is the opening that it will provide for students of economics in Australia, and the extent to which it will aid our universities in the study of this great science. The only Australian university which, so far, has established a Chair of Economics, is the Sydney University, but I believe that one is to be established at the Melbourne University this year. The Prime Minister has already pointed out that the only opening for a student who displays ability in this science, is a teaching engagement at a university. The cleverest man does not always teach most ably. A man may be extremely clever but unable to impart his knowledge to others sufficiently well to make him a good teacher or lecturer. The establishment of this bureau will, then, provide wonderful opportunities for students who are more fitted for research work than for teaching. The number of Bachelors of Economics who have graduated at the Sydney University is 195, and there are 274 diploma holders. Last year there were 128 degree students and 82 diploma students at that university. Possibly the majority of them be*lieve that the study of economics will later be of assistance to them in their trade or profession; but there must be quite a number who will be delighted to have the opportunity to devote themselves to research work.
I am glad that the bill provides for the fullest co-operation in economic research with our academic and other bodies, that research studentships and fellowships are to be established, and that assistance is to be given to the promotion of economic research. I feel certain that the success of the bureau will be greatly enhanced if there is the fullest cooperation between it and our universities. In conjunction with the Development and Migration Commission and the Council for Scientific and Industrial Research, the Bureau of Economic Research will supply this Government and Parliament with the best available information upon every problem. That information will be well weighed and carefully considered from every scientific standpoint. The outcome will be greater efficiency and more rapid development, thus benefiting both existing and future generations in Australia.
– I believe that a case can be made out for the establishment of a bureau of economic research; but certainly an adequate reason for it has not been furnished by the Prime Minister and those honorable members on the ministerial side who have supported him. They have argued more in favour of technical, mechanical, and scientific research than of a survey of social and economic conditions. It is entirely beside the point to raise questions relating to the amount that would have been saved if there had been an inquiry prior to the construction of the Murrumbidgee lock, and the losses which would have been avoided in connexion with a hundred and one other develop mental schemes in Australia. Those matters have already been the subject of investigation by specific authorities. What is the function of the Council for Scientific and Industrial Research if it is not to ascertain whether it is better to build a chair with three or four legs instead of six? For what purpose is the Tariff Board in existence if it is not to determine precisely the advisability or otherwise of increasing the duty on, say, locks or allowing them to come in duty free?
– The director may be able to advise as to the effect on other industries.
– Under the terms of this bill he will not be better equipped than the authority to which the subject has been specifically allocated, to answer such questions accurately.
– He might have a wider knowledge.
– That is purely an assumption. I have read the bill, and I find that the Director shall carry out economic researches in respect of about 10 or 12 different problems, any one of which is in itself a complete subject for investigation by an authority. There is nothing in the bill, so far as I can see, to give to the Director power to subpoena witnesses, to swear them, or to examine them. He is to be purely a research worker, engaged in the examination of such data as is available in current periodicals, newspaper articles, official statistics, and of such other material as is available to every member of the community. The Director will have no better opportunities for examining economic problems than have any number of economic publicists who are at work in Australia to-day. While it is true that the only Chair of Economics in Australia is that at the Sydney University, it is not true that Australia is destitute of those who serve the science. There is in existence to-day a very influential and well organized society, including in its personnel not only a great number of laymen interested in the study of economic problems, but also the majority of those who have been associated with the science professionally. This society regularly publishes an official organ known as The
Economic Record, in which men of prominence put forward their opinions on many such problems as are to be referred to the Director of Economic Research. All economic research is investigation. Take, for instance, the coal situation in New South Wales. I submit that the Director of Economic Research will be no better equipped, under the terms of this bill, to make a survey of that problem than are numbers of economists in Australia at the present time. Many such economists are already engaged on this work, and have written very informative articles about it. They have used such data as is available to any well disposed research worker, and their conclusions, I make bold to predict, will prove as accurate a summing up of the position as the findings of the royal commission which it is proposed to set up. On this subject I hold an entirely different view from that of honorable members opposite. I do not think that the eradication of prickly pear comes within the scope of a bureau of social and economic research. That is entirely a scientific problem. So also with the unification of railway gauges, which is a problem for engineers and those possessing a specialized knowledge of transport. The business of an economist is to co-ordinate information relating to the industrial and social activities of a community; to examine those activities, and to present his conclusions as a whole in such a way that the community may derive an idea of the course of its national progress. The Bureau of Economic Research should not be asked to investigate such matters as the butter or the dried fruits bounties, and the fact that the Government insists upon it doing so emphasizes the desirability of carrying the amendment proposed by the Leader of the Opposition. As a reason for the establishment of this bureau, it is gravely suggested that it should investigate problems which, under other acts of Parliament, have been already allotted for consideration to specific investigatory or administrative bodies. Take, for example, the development of primary industries which is set out as the first object which the bureau will examine. I understand that during the lifetime of the last Parliament a com/mission composed of highly- qualified men - certainly adequately remunerated men - was appointed to engage in a survey of the problems associated with primary production, particularly in relation to the capacity of the industry to attract population. This body was to examine and report upon a great variety of schemes put forward for national development.
– Does the honorable member refer to the Development and Migration Commission?
– Yes. It is wrong for the Government to set up two examining authorities to investigate one problem. If the Development and Migration Commission is not investigating the primary industries, what on earth is it doing with the large number of investigating officers which it has gathered round itself, and to whom, during the last financial year, £20,000 was paid in salaries, apart from allowances? The Development and Migration Commission is also charged with the duty of investigating means of transport, and in that work last year spent £1,400, including salaries, fees, and allowances. Now the subject of transport is to be submitted to the Bureau of Economic Research for examination and investigation. I should not be opposed to these matters being referred to a properly organized bureau of economic research if it involved the abolition of all these other examining authorities. If this bureau was being created for the purpose of bringing together a number of boards and commissions that have been investigating social questions in Australia during the past few years, and which are still in existence, I could understand the purpose of the bill, because, whether the bill passes or not, it is evident that the Government intends to have research work carried out, and to expend considerable sums of public money in doing so. If we were to centralize the investigating mechanism of these bodies, and save the expenditure now being incurred under a variety of headings, a case could be made out in support of this measure, on the ground of economy and efficiency. But this bill proposes simply to duplicate the machinery which has been already set up, and to instruct an officer, yet to be appointed, to examine problems which have been already allocated for investigation to other examining authorities. I can see more than a probability that there will arise friction on important matters of tariff policy between the Director of Economic Research and the members of the Tariff Board. I can see, also, that members of the Development and Migration Commission, who have examined important matters in relation to, say, irrigation, railways construction, or the opening of new ports, may find themselves at odds with the Director of Economic Research in regard to the economic consequences which might follow the completion of such undertakings. In that case, what would be the value of their conflicting testimony?
I believe that if, instead of one director of economic research, two were appointed, they would not agree as to the economic consequences of many proposals which might be acceptable to this Parliament. In the last analysis, any contention as to probable economic consequences can be vindicated only by time itself. There is a good deal of justification for what has been said about the remarkable disrepute into which economists fell as the result of their predictions before the war. It is very doubtful whether there is an economist anywhere in the world to-day who agrees with what may be described as pure economic law. That term has been used frequently during this debate, and the honorable member for Perth (Mr. Mann) said that Australia would have to conform to economic law. After all, what is economic law? It appears to be something which every man may determine for himself. The contention that there are laws which dictate the trend of economic development, and that these laws must be obeyed, is entirely belied by the course of economic history. The whole struggle of man against natural forces has been motived by his desire to escape from economic or natural law, to erect barriers between himself and the consequences of his disobedience of such law. Nearly every text-book on economics begins with a description of what society would be like if a particular, economic man were to go to live on a previously uninhabited island. The doctrines that have been promulgated in the name of economics during the last hun- dred years have been weird and extraordinary. Such doctrines have been the basis of the writings of Ricardo, Jevons, and Malthus. Actually, there is no such thing as the economic man. The individual living entirely by himself, and for himself, is not to be found on this earth. Proof of my contention is to be found in the fact that all the parliaments of the world, all the communities of the world, and all the scientific men in the world, are for ever engaged in attempts to overcome economic law. The sole object of every new invention, and of every scheme devised by a legislature, such as bounties, tariffs and armaments by land and sea, is to overcome natural law or economic law. If, in the fabrication of laws, we are to follow the theories of economists, we shall pursue n policy of absolute negation towards social and economic problems for the next 40 years. Economists invariably find fault with what is being done, but hardly ever suggest the remedies that should be applied. The truth is that every new proposition that has been advanced, particularly in the last 50 years, for the amelioration of social conditions has been opposed by economists, because, it being contended that it would interfere with wl) at they have regarded as economic laws. I frankly admit that my purpose in this Parliament is to change the character of our social system, but economists, by and large, are conservatively minded, and are fearful of change. They are engaged, for the most part, in prophesying evil as the inevitable consequence of doing something different from what has been done in the past. It was an economist who suggested a very good definition of the difference between radicals aud tories. He said that a tory was a man who did not believe in doing anything the first time, and a radical was one who never did anything the second time.
Broadly, what does this bill contain for us in respect, of economic research, for the guidance of Australia? It simply makes provision for an investigation by one man and his assistants in regard to primary industry, secondary industry, marketing, transport, customs and excise tariffs, bounties, industrial matters, taxation, finance and currency, and, if that is not enough, “such other matters as may be prescribed.” Having regard to the fact that the Tariff Board is already investigating bounties, secondary and primary industries, and, in some respects, marketing, and that the Arbitration Court has already allotted to it the function of determining the major issues in relation to industrial matters, I could support a bill providing that a Bureau of Economic Research should survey the housing conditions of the Australian people, and their effect upon their health and efficiency. I could understand the problem of vocational education being submitted to such a bureau for inquiry and report, because that, too, relates not only to the industrial efficiency of Australia, but also to the proper utilization of the particular attributes that reside in a great variety of different temperaments and qualifications. It is true that, all over the world, the waste of human material, because of the absence of vocational guidance, constitutes an economic loss to the nation, infinitely greater t 1 an that which follows the acceptance of cither a wrong or a right policy in respect of a tariff or wage-fixation. I submit that, when we are invited to support a proposal of this kind, we should ask ourselves to what extent it would serve to bring about a proper distribution of wealth in Australia, what would follow as the result of the transfer of incomes from one class of recipients to another, and what would be the effect of an increase in the standard of living? You will remember, Mr. Speaker, that when an inquiry was held in 1919-20, into the cost of the maintenance in Australia of a workman, his wife and three children in decent comfort, a particular figure was arrived at as being the minimum sum required for the maintenance of that standard. But immediately the report of the commission was issued, the Commonwealth Statistician made a rejoinder to the effect that it would be impossible to pay that rate. I could quite understand the Bureau of Economic Research being asked, not only whether the rate suggested could be paid, but to determine the rate that could be paid. A satisfactory answer has never yet been given to the contention that wages should advance. The answer had always been. - and honorable members opposite chant it very frequently - that it would be impossible to pay the wage demanded. That may be quite true, but I submit that there ought to be not only a negative reply, but also a positive one. That is to say, having rejected the figures submitted, we should be able to substitute the sum that could be paid, which would represent an improvement on the existing standard, and at the same time, be within the economic competence of the nation. But the economist has always been afraid of positive decisions. He has protected himself, almost invariably, by insisting that it would be impossible to do a thing, without endangering the economic fabric. If we had submitted to us an index number relating to the economic capacity of the nation with respect to standards of living, it would fill a gap, the absence of which constitutes one of the factors accentuating the bitterness of the class struggle to-day.
The proposals that are contained in this bill will not add to the economic knowledge of Australia. The problems that are to be referred to the bureau have been, or are being, investigated already, either in whole or in part, but what of other problems such as industrial hygiene, the effect on invalidity of industrial conditions in mines, workshops or factories, and the loss to the nation owing to the use of a particular method of production that endangers the health of the workman ? Problems of that description, I submit, could quite properly, and, indeed, should, constitute the primary functions of a bureau of economic research. But the Government does not intend, under this bill, if we are to judge its proposals by the measure, to investigate the problems of housing, vocational education and efficiency, the distribution of wealth, the earning capacity of the workers, or the productive index number of our industries. It does not suggest by what means information is to be collected as to the wage-paying capacity of industries. Certainly, under another act, the Government has . authorized the Arbitration Court to take into account the economic capacity of an industry, and the effect of an award upon it; but what of the industries which could pay a. profitable wage over and above the cost of production, and the worker’s power to maintain his family and discharge his other financial obligations? The court has never yet sent round an accountant to examine, in times of prosperity, the profit and loss accounts of wealthy companies, and fix wages on the basis of the maximum ability of the industry to pay them. In the last case that came before the court, it did the very opposite. It took into account the position of a given number of companies. I would say to my friends on this side of the House that, personally, I should much prefer the investigation of the profit and loss accounts of firms engaged in arbitration proceedings to be conducted by a bureau of economic research than by a person unknown and unchallengeable, and simply authorized by the judge of the court to examine a limited number of company balancesheets. I resent, and, I think, everybody should resent the assumption that evidence restricted to a limited number of respondents iti any one case is an index to the general position of an industry as a whole.
This bill, so far as I can understand it, does not give to the director of the bureau the authority to seek the information that would be requisite to a complete examination of any question remitted to him. Another point that seems to be of importance is the reliability that has been placed by honorable members opposite upon the apparent wisdom that will repose in this bureau. In so far as research is valuable in those periods immediately following the publication of the census, I submit to the Prime Minister that he could do quite as effective work for economic truth in Australia by having the census taken every five years instead of in decennial periods as provided at present. Ten years is too long a period, in these rapidly changing times, for a community to have to wait for expositions of its industrial, social or economic conditions. As to data collected as far back as 1921, in order to obtain an estimate of the actual position to-day as to, say, the conjugal condition of the people of Australia, the masculinity in industries, or the relative “ wages of workers, would, in all probability, lead to serious error. I remind the House that-the estimates of the statisticians of New South Wales and New Zealand, who prepared estimates of the probable cost of systems of family allowances based on the previous census figures, have been falsified by the facts. Their estimates as to costs have been proved to be greatly exaggerated. I submit that it would be preferable to have a census taken every five years. Insofar as the bill commits specific functions to the bureau, it will not add to economic knowledge of this nature. The problems given to it, I submit, are already being adequately investigated, and, even if they are not, they are purely technical, scientific, and, in some respects, mechanical problems. These are not matters for oversight by an economist. They relate to specific industries, and should be dealt with accordingly.
The assumption of the honorable member for Darling that the government of the day will in all probability take little notice of any decisions, wise or otherwise, of the Director of Economic Research is not unreasonable. After all, the members of all parties in this House stand definitely for the elaboration of a policy on certain lines. The average seeker for data looks for material with which to reinforce his beliefs, and he is engaged, as often as not, in an attempt to overcome contentions which are contrary to his. That is not wrong, because every great achievement for the advancement of civilization has been brought about by those whom the world has derided. Every reform that the world has had, and which has been of benefit in the long run, has had to run the gauntlet of the opposition of established knowledge, whether political, theological, scientific, or any other. I do not object to the establishment of a bureau of economic and social research, but I cannot support the bill in its present form, limiting, as it does, the work of the Director purely to scientific aud technical inquiries, and excluding the examination of social problems as such. The problem of women in industries in this nation, and indeed in every nation, calls for the closest scrutiny and examination. I see nothing in the bill that has any relation to such problems except a vague allusion to industrial matters. The fact that the Government has, in a previous measure, decided that this bureau is to take part in consultations and conferences, suggests to me that the Prime Minister has taken an entirely wrong view of the services that a bureau of this description should render. If there is any one department of governmental activity which should be open and above board, it is that which has relation to economic investigations. There should be no secret conferences with tariff boards or arbitration judges. Neither the judge of the Arbitration Court nor the judges of tariff problems should be able to arrive at decisions upon material which has not been made public. The proposal to associate the universities of Australia with this bureau is unnecessary. It is the business of this Parliament to carry out the functions that have been allocated to it under the Constitution. I. should be in favour of this Parliament dealing with the work of the universities if education generally came within the province of the Commonwealth, but while education is entirely a matter for the States, it is wrong for us to suggest that we can teach them to make the work of the universities more effective and useful. I believe a strong and justifiable case can be put forward for the establishment of a bureau, but it should be entirely dissociated from any technical inquiries. It is not the business of a bureau of social and economic research to discover whether boots should have soles 3 inches or 1£ inches thick, nor is it the business of such a bureau to be engaged in ascertaining whether tariffs should be increased or decreased by 20 per cent, or 10 per cent. Its work is other than that. It should have, not a definite, but a loose association, with the work of the Statistician’s office. There should be a conjunction of their activities. It would be entirely wrong for the Statistician to be put in the position of having to authorize the issuing of opinions. His duties should be confined entirely to statistical work. The greater part of the activities of the research bureau will be founded upon the results disclosed by the Statistician, and I have no doubt that the scope of any particular statistical inquiry will be considerably influenced by the information which the economic research bureau considers it desirable to collect in order that it may come to sane conclusions.” I therefore submit that the amendment of the Leader of the Opposition is entirely reasonable. We are spending large sums of money in investigations under existing statutes, and until it is proposed to merge these activities, and bring them within the scope of this bill and the bureau proposed to be established under it, we should reject the measure. I urge the Government, if not to withdraw the bill, at least to postpone its consideration until the House assembles in the spring. It will then have a better comprehension of the financial situation, and be able to see more effectively how desirable it is, if this bureau is to be established, that it should take the place of whatever authorities are now engaged in carrying out related investigations.
– I submit to the House that if any justification were needed for the establishment of an Economic Research Bureau as proposed under the bill, the speech of the honorable member for Fremantle (Mr. Curtin) has shown the necessity for and usefulness of such a body. He has established facts which the Leader of the Opposition (Mr. Scullin) and the honorable member for Darling (Mr. Blakeley) have said were missing. They both complained that the Prime Minister’s speech did not set out the various operations to be undertaken by this research bureau, yet the honorable member for Fremantle found no complaint in that respect. He pointed out the wide field of usefulness in which this research bureau could be profitably employed. After all, there is little difference between the bureau proposed by the Government and that advocated by the honorable member for Fremantle. The bill provides for all that the honorable member requires. Productivity, wages, the employment of women and children are problems germane to the investigation proposed to be made by the bureau. The Prime Minister made it clear in his opening speech what the work of the bureau would be. The Leader of the Opposition and the honorable member for Darling both complained that the Prime Minister had not supplied sufficient information. Had they taken the trouble to read his speech they would have seen clearly that the bureau may make inquiries relating to tariffs, bounties, wages, standards of living, the expansion of primary and secondary industries and the increase of national wealth- It has to observe the effect of our fiscal policy, to decide between extreme opinions and beliefs and to submit the best information obtainable. The bureau may inquire into the production of wool and wheat under certain climatic conditions, also the care and breeding of live stock and the elimination, of animal and plant pests. If anything more is needed, the bill contains a series of subjects, such as primary industries, secondary industries, marketing, transport, customs and excise tariff. The bureau may also make investigations relating to bounties and industrial matters. Practically all the subjects mentioned by the honorable member for Fremantle come under the heading of industrial matters. There is also a wide field of investigation in respect of taxation, finance and currency. If that is not sufficient, then there are matters which may be prescribed. There is no limit, to the investigations of the bureau. Most of the subjects mentioned by the honorable member are subsidiary and would come under the purview of any searching investigation into the subjects enumerated in the bill. The argument of the Leader of the Opposition that the Prime Minister did not supply sufficient information to warrant the acceptance of this measure, falls to the ground in the face of the facts supplied by the honorable member for Fremantle. The Leader of the Opposition, during his speech, said very sententiously and impressively, “I wish to ask the Prime Minister a question. Supposing the research bureau comes to a finding which is contrary to the Government’s policy, on the tariff or fiscal question. What will the Government do then?” That is a very simple matter. The Government, I presume, will deal with the report on its merits, and if the report indicates that the policy pursued in regard to the tariff or other matters mentioned in the bill is wrong or not going far enough, then the Government will ask Parliament to retrace its steps on the lines indicated in the report. It will then be for honorable members to decide what is the right course.
Is it not better for this House to decide its fiscal and industrial policies in the light of all the authoritative information that can be obtained on various subjects? The Bureau of Economic Research will bring thinking people face to face with the realities of life, and afford them an opportunity to see economic principles applied to every-day problems. Honorable members of the Opposition seem to have some mysterious fear of the operation of the bureau. The only valuable contribution to the debate by the honorable member for Darling (Mr. Blakeley) was his succinct concluding statement that the bill aimed a blow at the fiscal, policy and the hours and wages of the workers. That statement summarizes the fears of honorable members opposite. They are like a sick man who will not consult a doctor, because he fears his diagnosis. The Labour members know that there is something wrong with our industrial position, but they are fearful of a diagnosis by experts well versed in economic principles, lest the general public be made aware of the hollowness and superficiality of the edifice that the tariff and our industrial legislation have built up, and demand something different.
– So the honorable member is opposed to the tariff?
– The honorable member cannot embarrass me in that way. I am not; but, an unscientific tariff and artificial industrial conditions have built up an economic structure that sets at defiance the immutable law of supply and demand. In attempting to defy that law honorable members are like Ajax defying the lightning. Even if they were in power they could not ignore fundamental facts, and they are only wasting time in attempting to do so now. The honorable member who has just resumed his seat advocated that the Arbitration Court should inquire into any thriving industry with a view to awarding higher wages. He said nothing of the action to be taken in regard to an industry that cannot afford to pay the existing rates of wages. This Government, and previous governments, have accepted the dictum of the late Mr. Justice Higgins many years ago that an industry which cannot afford to pay the basic wage must cease to exist. Whether that principle is right or wrong I am not prepared to discuss now, but no honorable member cun show me how the wages demanded by the workers can be paid by an industry that is not earning them. The application of a few economic principles to the problems of industry would not at all be a bad thing. After all, this House has agreed that various governmental bodies, including the Tariff Board, the Development and Migration Commission, and the Council of Scientific and Industrial Research shall have regard to economic facts. From what source are they to obtain the information which is to guide them? Would honorable members agree to each of those bodies setting up its own staff of economists? That would be unjustifiable extravagance. The bureau of economic research will gather and collate information for all of them in the most economical way. It is quite right that we should, as speedily as possible, bring into existence a research organization of tl is kind so that in all phases of government, action may be based upon the fullest and most authoritative information that can be obtained. No business man embarks upon a big enterprise without accurate data and a complete survey of its commercial prospects. The honorable member for Darling apparently is prepared to allow governments to advance blindly into new avenues of experiment, believing that when they find they have made mistakes they can retrace their steps. That is the most absurd and extravagant policy that could be enunciated by a responsible legislator. Procedure which is sound in business is equally sound in the government of a country. After all, parliament is only a board of directors controlling the biggest enterprise of the nation. The principles which would guide honorable members in the investment of their own money should be applied in the expenditure of the country’s money. This bill only proposes to do for Australia what other countries have done for themselves for many years past, and honorable members opposite would show a more progressive spirit if, instead of submitting a delaying amendment, they were to expedite the passage of the measure. Economic research is being undertaken in Canada and in the United States of America through the Tariff Commission, which has 26 econo mists on its own staff. It is not proposed that the Tariff Board shall create a staff of that character, but if this legislation is rejected the board may proceed to do so, and so may the Development and Migration Commission and the Council for Scientific and Industrial Research. The bill means a co-ordination of effort for the assistance of the various bodies engaged in investigation, and is one of the most welcome signs I have seen of the application of common sense and commercial wisdom to the affairs of government. Reference has been made to the book Britain’s Industrial Future, published by the British Liberal party. It is one of the best and most comprehensive surveys of the existing industrial situation throughout the world that has been published. It contains the concrete opinions of some of the foremost students of economy in Great Britain, including Mr. J. M. Keynes, the Right Honorable C. F. G. Masterman, Mr. Lloyd George, and Mr. Phillip Guedalla and others. The book is well worth reading and re-reading. The British Liberal party has spent enormous sums on publications of this kind. When I was in London, I met the secretary of Mr. Lloyd George’s political organization. At that time it had just published a book on agriculture, which contained information obtained by delegates sent to all parts of the world. The preparation and publication of it cost about £50,000, which was’ paid out of Mr. Lloyd George’s political fund. The book was made available to all parties. This organization also issued an extensive report on coal and power, and, later on, the land. The publication of thi3 information is in conformity with the tendency of progressive nations to collect information from all sources before committing the country to policies which may have far-reaching effects. I have listened carefully to the speeches which honorable members opposite have delivered, but have not been able to find in them any reasons which would justify opposition to the bill. On the other hand, honorable members on this side of the chamber who have spoken to the measure, have indicated clearly that the bureau will be of the utmost value to the country. I cannot, therefore, support the proposal that the measure should be withdrawn, even temporarily. If the bureau fulfils the purpose for which it is established, and there is no ground for assuming that it will not do so, it will cause a saving in expenditure.
– “What is the estimated cost of the bureau?
– I am unable to give the honorable member any definite information on that point, except to say (hat it will be infinitesimal compared with the advantages that will flow from it. The director will require some clerical assistance, but otherwise there should not be any heavy expense involved. I shall support the measure because I believe that it will be beneficial to the country. The bureau will become, as it were, a fingerpost pointing out the path that we should take to prevent waste of public money such as occurred in the past.
– The honorable member who has just resumed his seat has suggested that economy would follow the passing of this bill, but I cannot see that that is so, for we axe proposing to add another board or bureau to the already large number we have, and we are not proposing to abolish any. In the present financial position of the country this is not justified. “We have been told that we may expect a deficit of between £4,000,000 and £5,000,000 at the end of the financial year, so I cannot see that there is any justification for setting up a new department which must of necessity be costly. To say that this bureau will consist of only one man is absurd, for its powers and functions include the carrying out of economic research in respect of primary and secondary industries, marketing, transport, customs and excise tariffs, bounties, industrial matters, taxation, finance and currency, and “ such other matters as may be prescribed.” One man could not possibly deal with all those subjects adequately and advise the Government in respect of them. If the bureau is established we must face the- fact that it will involve the setting up of staffs in the different States as well as a central staff. The Prime Minister has said that America has a bureau of this description; but America has a population of 120,000,000, while we have a population of only 6,000,000. Australia has made substantial progress without a Bureau of Economic Research, and I cannot see that we need to embark upon this expenditure at present. If the Tariff Board requires economic information it may call one, or all, of the economists in Australia to give evidence before it. Wherever we go in the country to-day we hear complaints about the lavish and unwarranted expenditure of the Government on boards and commissions, and it would be ridiculous for us to refuse to listen to the voice of the people. This commission will merely cover some of the ground that is already being covered by other investigating authorities. We have no guarantee that its recommendations will be adopted by the Government. It is more than likely that they will be treated in the same way as the recommendations of the Development and Migration Commission. The lamp of experience lights the path that we should tread. Practically every honorable member of this Parliament has some knowledge of economics, and so have most of our business men. A person is not likely to invest his money in an economically unsound enterprise. Honorable members on this side of the chamber are opposed to the establishment of this bureau, because they fear that it may be used to undermine our national policy of protection. The Director of Economic Research can only tell us what we already know, that we cannot hope to compete economically with countries in which cheap colored labour is engaged. If it is proposed to extend our hosiery manufacturing industry, for instance, and the director of this bureau is called upon to give advice on the subject, he will probably say, “It would be economically unsound to embark upon this enterprise, because we should have to compete with countries with a low rate of wage.” But I point out that the Government, and practically every member of the Parliament, has been returned with a mandate from the people to encourage the establishment of secondary industries in Australia by means of our protective policy. The manner in which the Government is setting up boards and commissions of one kind and another is becoming a public scandal, particularly as many of these bodies overlap each other. We are unalterably opposed to the delegation of the powers of government to outside bodies. Parliament has been elected to govern the country and it should do so. Instead of endeavouring to escape the responsibilities of office, the Government should be devising ways and means of eliminating our adverse trade balance. Our duty is to afford our industries that degree of protection which will enable them to develop. The deluge of imports into Australia is totally against the public welfare. It is being proved every day that our tariff is not a protective, but merely a revenue-producing agency.
– It has been the means of our establishing some fine industries.
– It is true that we have established some industries, but we have many that are languishing. I cannot see that the setting up of a Bureau of Economic Research will do anything to revive these enterprises. On the other hand, it may do a great deal to destroy them. We are afraid that the bureau may be used to influence the Tariff Board against recommending adequate duties. But apart altogether from that consideration, we are not prepared at present to incur the expense that the establishment of this bureau would involve. There is no need for it. The Development and Migration Commission is already doing a great deal of the work that this bureau would do. It has lecturers touring the country advising the people what to grow and where to grow it. It also has professional economists associated with it. We should not be justified in duplicating its work. The fact of the matter is that the Government has run to seed, and it is time that the people awakened to the fact. The introduction of measures of this kind must inevitably mean that our financial difficulties will be increased. I shall therefore vote against the bill.
Silling suspended from 6.15 to 8 p.m.
.- Speaking broadly, Australia will welcome sound economic research into the present condition of our economic and industrial life. The Government is now endeavouring to propound a scheme that will let loose upon this country some of that clear thinking and that direct and positive research work which in the very short period since the war has revolutionized the industrial activities of the ‘modern world. The United States of America, Great Britain, Germany and France are conspicuous examples of countries which have passed by a rapid transformation from a state of war to a condition in which the needs of modern society are being served by the most advanced methods, many of which are the product of our war experience and the intensive concentration of that period. We have been inclined to deprecate to a very great extent the value of economic research, because in connexion with the Council for Scientific and Industrial Research, the Development and Migration Commission, the Arbitration Court, the Tariff Board, the Bureau of Census and Statistics, and even the Board of Trade, many have little hope that sufficient positive results will be achieved by those national organizations. But I am one of those who believe that if this country will face properly the question of an intelligent and diligent inquiry by competent persons into the problems of the nation, we can make research of positive value as an aid to national progress. This cannot be done merely by bringing down legislation, creating departments, marshalling staffs, and finding the necessary money for them to carry on. I do not believe that the provisions of this measure can of themselves achieve what the nation desires; but it establishes the startingpoint for a complete economic overhaul of our position. I listened with considerable interest to the speeches that, were delivered this afternoon, and was impressed by that of the honorable member for Fremantle (Mr. Curtin), who appears to possess a thoughtful mind which is willing to examine possibilities. The Leader of the Opposition (Mr. Scullin) discharged his official duty of attacking the measure hip and thigh. He paraded, one after another, the different organizations that have been created to undertake work somewhat similar to that which will engage the attention of the proposed Economic Research Bureau, detailed their cost, and on the assumption that their efforts had been fruitless, professed to have lost hope, and wholeheartedly condemned this measure. Before the bill can be other than a mere “ dry bones “ it must have breathed ‘into it the breath of life. The Prime Minister (Mr. Bruce) has set out with the commendable desire of stimulating modern economic research. The detached thinker is generally a great scholar, such as a university professor. He follows positive and clear lines of inquiry, and arrives at definite conclusions, which, generally speaking, he is afraid to subject to the scorching light of day, and put to the test of modern industrial and scientific application. Between that gentleman and the vibrating business world there is a wide gulf which has to be bridged. I have had many consultations with university professors on the subject of economic and industrial research, and have found them ready to state the conclusions they have formed as the result of their investigations. If the Prime Minister can call into a great national conference the States, which for a long time have been engaged in economic and scientific investigations, if he can co-opt the private scientists in Australia, and bring about co-operation between the detached thinker and the modern industrialist on both sides, we shall have reached a point from where the nation can start out on the road to economic reform. But I can see many barriers along the road. First of all, there is the fiscal policy of the nations, which has been determined not on a scientific basis, but as the result of yearsof political thought and action. Terms never permanently serve to describe policies. The paramount duty of any nation is to provide work for its own people. In the field of scientific and economic research we must determine the extent to which the existing barriers block the road of the modern economist. “We have a fiscal policy with which, in the main, I agree. “We have grafted on to it certain measures, such as the Arbitration Act, under which are given arbitrary decisions based not upon either economic or industrial investigation, but upon the so-called needs of the workers judged according to the cost of living.
– Is not that a fair basis ?
– In principle, it is; but it cuts right across the face of economics. So, also, to a great extent, does our fiscal system. This is not the time to discuss the rights or wrongs of Arbitration Court awards or the fiscal system; but it is a clear statement of the position to say that it is most difficult for anybody to determine what are sound economic doctrines when he has those factors to contend with. No one can exactly describe economics. But it is undoubted that nature will collect every debt that is owing to her, and that the adoption of false economics also will impose upon us later the necessity of correcting the error. I welcome this movement of the Prime Minister to engage the time of honorable members in a consideration of the value of economic research to the nation. Only ignorance can afford to reject it. Economic research is to-day the basis of modern progress and social advancement. I do not believe, however, that the bill alone will have the desired result. I should like to see something in the nature of a merger of the various activities which are engaged in the same field of economic research. For many years the States have expended much time and money in their universities, their agricultural departments, and many other fields of activity, in an endeavour to solve the scientific and economic problems connected with the operations of their great departments, and wonderful work has been done. “We have not arrived accidentally at the present stage of development of our social standards; the process has been a gradual one, and has been brought about by a combination of all the agencies that surround us. We shall not change the face of the economic world in Australia merely by passing legislation. I believe, however, that if all parties will search for the truth it will be found. We should do credit to ourselves if we determined to work unitedly to solve our problems by a better system than party politics and industrial warfare. This bill provides a starting point for investigations into economic problems. The Prime Minister, as the author of the measure, has given a very wide charter to the director, under section 11 of the bill. In that section the director is charged with the obligation of carrying out economic research in respect of primary industries, secondary industries, marketing, transport, customs and excise tariffs, bounties, industrial matters, taxation, finance, currency, and such other matters as are prescribed.
– In fact, into any old thing at all.
– No, that is not the right frame of mind in which to approach this matter. I submit, however, that no director of economic research, charged with so many and varied responsibilities, could carry out his duties pro,perly unless he had an army of investigators to help him. This might be avoided if the Government would co-opt the services of those now investigating such matters under the different State governments, and in the universities. Some of the best economic research is being done now under private auspices.
– The very thing we propose is to co-ordinate what is being done in that direction at the present time.
– I assure the right honorable gentleman that it is in no critical mood that I deal with this bill. I am glad that the Prime Minister saw fit to interject to the effect that it is the object of the Government to co-opt the services of the various State and private investigators.
– The Prime Minister said “ co-ordinate.”
– It is impossible to co-ordinate State activities under Federal auspices. We can co-ordinate Federal activities; but we can only co-opt the activities of State and private agents. Honorable members on the other side have rightly placed much stress upon the possible financial obligations to which this measure may commit the Government. If I thought that the passing of the bill would involve the Commonwealth in a heavy financial outlay, I should hesitate a long time before supporting it. There are already in existence several Commonwealth boards and commissions, and in some cases there is no clear line of demarcation between the duties they are supposed to carry out. Each should have a separate field of activity, so that there might be between them co-ordination and co-operation rather than conflict. This bill provides an opportunity for the better organization of the existing machinery of scientific investigation. Above all, I hope that the Prime Minister, in his search for a director, will seek to obtain one of the world’s great men.
– Not an Australian, I presume ?
– I do not care whether he is an Australian or not. If we have in Australia a man capable of doing this work so much the better. He would be a great national asset, and his appointment would be a step in the direction of national progress. I give my hearty support to this measure.
.- I object to this measure, on the grounds which have, to some extent, been outlined by the honorable member for Wannon (Mr. Rodgers), when he said that at this time we should endeavour to avoid undue expense. If this proposed bureau is to function at all, it must surround itself with a large and costly staff of experts. So wide a range of activities is outlined in clause 11 of the bill, that if the proposal is ever put into effect, it must result in the setting up of a dozen different sub-departments. The honorable member for Wannon spoke of co-opting the services of State investigating authorities, and the Prime Minister spoke of co-ordinating them. I feel, however, that so wide a field of research has been given to this proposed body that it must inevitably trespass on some of the activities already delegated to other authorities created by the Government. Is it fair at this time, when economy is being so vigorously preached - although not applied except to the workers - to load the people of Australia with the expense of an organization of this kind when much of its work is being done by expensive departments already in existence? Furthermore, there are organizations in every State doing research work at the present time. Is it likely that these bodies will cease their activities because this bureau has been established by the Federal Government? There is danger of friction and confusion between the State and federal investigating authorities. The right honorable gentleman for North Sydney (Mr. Hughes) said the other day that the Government waa farming out the functions which it ought to perform itself. This bill proposes to farm out a further list of activities which ought to be under government control. Not only is it proposed to do that, but it is also proposed to give to the bureau authority to farm out its functions in turn, because provision is made for granting assistance to other bodies doing economic research work. Where is all this going to end? Is it suggested that any director of economic research will be as competent to deal with the subjects mentioned, as are those boards and authorities already created for that specific purpose? So far as I am concerned, I do not object to investigation and research, but it is not right for the Government to spend large sums of money on a variety of organizations, to do the same work as the States are doing already. Clause 11 of the bill proposes to empower the bureau to investigate primary industries. Attached to the different State Departments of Agriculture are experts whose work it is to investigate soils, and other matters of concern to the primary producers. It is now proposed to appoint another body to do practically the same thing. In New South Wales, and in some of the other States also, are experts concerning themselves with the investigation of problems associated with tobacco culture. It was suggested by the honorable member for Wannon that we should go further and get the specialists who are working in the States to assist the bureau in its inquiries. I suggest that if this measure is proceeded with, we shall merely intensify the existing evil of overlapping State and federal departments. The Government should provide every facility for technical research which might be of assistance to manufacturers, thus enabling them to meet their overseas competitors on an equal footing, but I do not think that the appointment of a director of Economic Research would meet the needs of industry in this respect. It is suggested that the director should investigate marketing problems, but could such a man, who will probably be filled with academic ideas gathered in the rarified atmosphere of some university, offer advice of any value to those who to-day are confronted with the problem of finding profitable markets for our produce. Some one with a wider and more practical experience would be necessary to do that. I cannot understand how the Government could believe that any director of economic research could have a range of knowledge sufficiently wide to perform all the duties with which he is to be charged. Numerous experts will have to be attached to the department, which will probably, before long, cost something in the neighbourhood of £200,000 a year. The bureau also is to investigate transport problems. This subject has received much attention at different times from both Federal and State Governments and the railway commissioners of the different States. Could any economic bureau give as good advice on transport as could a conference of the different railway commissioners? I do not agree with all that the railway commissioners have do.ne, but at any rate, they are experts. They have made some valuable recommendations in regard to railway transport, and they have also given consideration to motor transport. They have not dealt with transport by sea, but on the subject of land communication they can speak with more authority than could any director of economic research brought from overseas. The other day, a bill was passed through this House amending the constitution of the Tariff Board, and delegating certain power to its members. We were told then that the men who had occupied positions on the old board were well experienced, and of the highest ability. No fault could be found with them, and the only suggestion offered was one from this side of the House, to the effect that they should give the whole of their time to the work. Is it suggested those who will be appointed to the new board will not be capable of dealing adequately with all the problems that will arise in connexion with Australia’s tariff- policy? If that is so, they will have no right to be members of that board. The average economist usually imports his personal views into his deductions, in order to back up arguments that he may have advanced previously. As a rule, he has written and published pamphlets or books on economic subjects. It is apparent that whoever is appointed to the position of director of the bureau will be a man whose views are known; but I do not think that he should be allowed to interfere in any way in tariff matters. The members of the Tariff Board, by reason of their long experience, are more competent to recommend what tariff duties should be imposed than any person who may be placed in charge of the bureau. If this body must be appointed, the position of director should be filled by a man who knows something of the needs of Australia and of the aspirations of its people. The tariff is not a matter to be decided by economists, or even by this Parliament; it has been determined by the people of Australia, who have pronounced definitely in favour of protection. I stand absolutely for a policy of full-blooded protection. Some honorable members contend that we on this side favour prohibitive duties, whether the articles in respect of which they are imposed can be made in this country or not; but we have said that goods that can be manufactured in Australia should be made here. I object to the intrusion of the proposed bureau into industrial matters. It has been stated that the Opposition views ‘ the appointment of this body with suspicion, and it is justified in adopting that attitude. The Government has already introduced an economist into the public life of this country by the appointment of Mr. Justice Lukin. We know his views on economic matters, because of the awards that he has given. Wo were informed the other day that the Arbitration Court had given consideration to the economic position from every aspect in making its awards. We take it that this high-minded gentleman to whom I have referred, had determined the true economic position of the timber industry, and the decision given by him indicated that the court was of the opinion that the industry was in a bad way. Now the Government will, probably, give the proposed Director of Economic Research, who will be engaged at a high salary, and will have an expensive staff, an. opportunity to investigate the same matter.
– The Prime Minister said to-day that the judges had no opportunity of exploring economic avenues.
– Either Mr. Justice Lutein’s award was wrong, or it would be improper to allow this bureau to intrude into the matter. This body is to have power to investigate all matters that may be prescribed. It is to be a supreme economic body that may inquire into every industrial activity.
– A supreme economic council !
– That is so. I do not object to the proper investigation of industrial matters; but, if a body such as this bureau is to be appointed, the time has arrived when we should dispense with other boards and commissions, both Federal and State, that are now making inquiries similar to those to be referred to the bureau. Public opinion is hardening in the direction of favoring the abolition of State Parliaments, and the transfer of their activities to the Federal sphere. That, of course, will lead to unification. If it is not intended to abolish those bodies, this bill will burden the people with an unjustifiable expenditure. Should the Government continue to farm out the functions of this Parliament, as well as its own, all that will be left for Ministers to do will be to draw their official salaries. We, on this side, contend that, if the bureau is to be established, the Council for Scientific and Industrial Research, the Development and Migration Commission, and various other organizations throughout the Commonwealth should be abolished.
– Honorable members generally will subscribe to the opinion that modern civilized man owes more than he can ever hope to repay to science and scientific research. Certain it is that the world could never maintain its present population but for the fructifying hand of science. Every day scientific research and scientific appliances are increasing the productivity of the soil, extending the domain of human effort, and adding to the conquests of man over the forces of nature. On several occasions this Parliament has shown itself to be no niggard in supporting scientific research. It has legislated for the establishment of a Council for Scientific and Industrial Research, and during its more or less checkered career it has attended at the birth of many boards and commissions about which we have heard something during the course of this debate. But the proposed bureau differs from all the bodies of the kind that have gone before it. Its scope is so wide and the duties of the director are, in a manner, so vague that they can hardly be defined. The director is to inquire into and advise upon practically everything, lie is to consider the circumstances of every phase of our economic life. Honorable members have spoken of economics in that detached and respectful^ way that men speak of those set far above them. But economics touches us at every moment of our lives. The man in the street is vitally affected by this measure, because his wages and what they will purchase will be determined by the economic doctrines and practices that will be applied on the advice of the Director of the Bureau of Economic Research. This bureau is not a bureau of science as the term is generally understood, but of economics. We welcome the man who can show us how to grow more and better wheat than has been produced in the past, as Farrer did ; who can point the way to conquer diseases in plants and animals as Pasteur did ; or how to produce steel better and more cheaply than before, as Bessemer did. The ninnes of such men are inscribed in the hearts of the people, as having done great things for civilization. But, while the value of their discoveries permits of demonstration in the realm of economics - that is to say, political economy - there is room for all sorts of opinions. Besides, apart from opinions, the facts over such a wide field of inquiry are too numerous to be compassed by one man. It is evident that a man who has to inquire into the primary and secondary industries, who has to consider all the phases of marketing and transport, who lias to cover with one capacious embrace customs and excise tariffs, and bounties, and then to survey industrial matters from China to Peru will have his hands full. We are much in the dark as to what is intended by the bill. Therefore, we desire to know what kind of man the Government intends to appoint as director, and exactly the- purpose for which this bureau is to be constituted. The wisdom of endeavouring to co-ordi- nate the activities of the existing boards and commissions is obvious. I should not venture the opinion that a bureau of economic research could not serve a most useful purpose in our national life, but when we are asked to clothe it with such wide powers we ought to know more of what it is to do and exactly how it is to do it. It is suggested that this bureau shall inquire into everything that concerns the economic life of -this country so that members of the Parliament shall come to their tasks with minds fully informed, knowing practically all that can he known upon the matters upon which they are to legislate. That is very well; but the difficulty is not so much in collating facts, but iu deducting from any given set of facts the right conclusion. And in this supremely difficult task we shall have only the advice of the director. What that advice will be will depend on the sort of economist appointed as director. There are many schools of economists. The other night the honorable member for Perth (Mr. Mann) spoke as if no economist of standing supported protective tariffs. I do not agree with him. But taking the broader question of the distribution of wealth between capital and labour, surely the advice tendered by the economist director on that question will depend largely upon the school to which he belongs. I have been reading lately a most admirable - and I wish I could say lucid - exposition of the communist theory by Stalin, and it is evident that if an economist of Stalin’s school were appointed, the advice he would give would hardly fit in with what the Government contemplates. Another man might lean towards the Marxian school, from which Stalin differs in some particulars. Questions such as labour, wages and industry are vitally important. Whether interest has a moral foundation is another question to which the economist will naturally give the answer of the school to which he belongs. Between men of the various schools there are many differences of opinion and their advice will take its colour from their opinion, whatever it is. As to the economic effect of a tariff, we have a board already in existence whose business it is to inquire into and report on such matters, not merely in detail, but also in general. It has to decide what effect the imposition of, say, a 20 per (rent, tariff on cotton goods would have, not only on the production of raw cotton and its manufacture, hut also upon other industries. The members of the board are specialists who do nothing else but inquire and report into tariff matters. Now, however, there is to be placed over their heads this economist, whose concern will be the whole range of human effort. Whose opinion are we to take - that of the board or of the director? I do not hesitate to say that no man can cover such a range of knowledge as to be expert on so many widely divergent questions, What then will be the position? The Tariff Board, after making diligent inquiry, calling evidence on oath, and hearing both parties, makes a recommendation. The Director of Economic Research is called in. He shows as well as he can what he thinks would be the effect upon our national life generally of adopting the recommendation. He may bc right or he may be wrong. How can any man say what the ultimate or even the approximate effect of any duty, will be upon the body economic. We might as well guess for ourselves, drawing upon our experience. Take for example the tillage of the soil. In one country soil tilled and manured in a certain way produces results different from those obtained in other countries or in other parts of the same country. Then consider industrial matters. The honorable member for Warringah (Mr. Parkhill) mentioned the dictum of the late Mr. Justice Higgins, that an industry that could not pay the basic wage did not deserve to live. This is a concept of economics diametrically opposed to the conventional doctrine. One might read the text-books on economics from beginning to end without finding any trace of it. It is a new doctrine, in accord with modern ideas, adopted in our arbitration law and for many years recognized as part and parcel of our national life; but it is fundamentally opposed to the doctrine of laissez faire. We have at the present moment a timber workers’ dispute. The timber industry has been thrown into confusion because it is alleged that it cannot pay the wage until recently regarded as fair and reasonable. The industry cannot pay it aid live, and so wages are to be reduced. In such a case, we have to choose between two diametrically opposed concepts of economics, that reach down into every worker’s home. The question then is: are industries to adjust themselves to the needs of the people, or are the people to adjust themselves to the needs of industry? That is a question of fundamental importance. Is the Director of Economics going to tell us by which of these doctrines we are to be guided? I could, to-morrow, lay my hands on a man who would tell us that our present system is fatal to the progress of this country. It would not be difficult to find a man who would tell us that the White Australian policy is economically unsound and nationally wrong. We are told from time to time, not only by people in our own country but by those outside it, that the duty of every country now is to break down tariff barriers in order that there shall be no hindrance to the free flow of trade throughout the world. That may be a good or bad doctrine but that it concerns the people of the Commonwealth vitally cannot be gainsaid. If we were to accept such doctrine on the advice of the Director of Economic Research, then there would be an end to government by the people. The people may be wrong; but they, and they alone, have the right to determine their own destiny. If they have not, then it is obvious that we have been laboring under a delusion these many years, when we have proudly boasted that this is a democracy. The great question is, who is to rule? If the people are not to determine wages and conditions of labour, if they are not to lay the foundations of our economic structure, what becomes of government by the people? Are the electors merely to go to the ballot-box to vote for Jones or Smith, knowing that neither will be able to do anything if elected to the Commonwealth Parliament? We must know what the director of the bureau is to do, and how he will do it. The advice that he gives will be coloured by the opinions of the school to which he belonged. If one consults the British Pharmacopoeia of a few years ago, one finds there mention of all kinds of drugs for the treatment of human ailments that have passed quite out of use. Not very long ago no matter what illness a man suffered from, he was cupped and bled, yet mankind lived on. A little later, one could not enter a surgery without running the risk of an operation for appendicitis. Science utters fatuously its shibboleths of the moment, and then drops thom for something new. We wish to know to what school this gentleman will belong for then we shall know the kind of advice he will give. Since government must ultimately be in the hands of the executive, the advice he gives must be consistent with the avowed or real policy of the administration in power; otherwise it will not be accepted. If some one whom I had appointed persisted in giving me advice that I thought would be fatal to my business, I should not put up with him long. When I ask persons for information that will help me, I want the right kind of answers. That i3 human nature. I do not condemn this measure. It may do some good. If it succeeds in co-ordinating the work of existing boards and commissions, it will at least have done something to justify its creation. Let us hope that it will be more fruitful in results than other bodies of the kind. We have spent a great amount of money on boards and commissions of various sorts. Some of them are doing good, but that concerning which most has been said - the Development and Migration Commission - has, up to the present, produced nothing worth the money spent upon it. Perhaps in the fulness of time the Bureau of Economic Research, like Aaron’s rod which swallowed all other rods, will gather to itself all the other boards, bureaux and commissions, and we shall get from it, as the Greeks got from the Delphic oracle, such answers as will satisfy its masters.
.- The Leader of the Opposition has moved -
That in view of the meagre information available as to the nature and extent of the investigations to be made and the financial obligations that would be involved, and, further, in view of the heavy and increasing cost of existing boards and bureaux, the bill for the establishment of a bureau of economic research should not be proceeded with.
It would be a wise precaution on the part of the House to delay the passing of this measure. The Labour party is not opposed to the fullest investigation of all problems, but we object to giving the Government earle blanche to appoint a director of economic research and probably a large number of other officers. Clause 4 provides -
There shall be a bureau of economic research consisting of the director and such officers as arc appointed for the purposes of this act.
We do not know how many officers are to be appointed. When Parliament is in recess the Government will be able to appoint a large number of its friends to highly paid positions, and one more will be added to the already extensive list of boards and committees to which the Government refers matters which it wishes to shelve. The Prime Minister, replying to a question asked in the House on the 11th September last, stated that since the 9th February, 1923, which is the year in which the Bruce-Page Government came into office, 58 royal commissions, boards, select committees, and permanent committees and commissions have been appointed, at a total expenditure of £031,000. It is little wonder that throughout Australia there is a growing feeling that this Government is merely farming out its administrative responsibilities to various extra-parliamentary bodies. This is, of course, a very convenient method of shelving problems that the Government does not wish to tackle immediately. The people of Queensland know very well that the Government has deferred the consideration of several important questions that should have been treated as urgent. For instance the effective protection of the cotton-growing industry is of vital concern to that State. This matter was referred to the Tariff Board over nine and a half months ago. The board took evidence and submitted a report to the Minister for Trade and Customs on the 5th March - that is over a fortnight ago. Parliament is now on the eve of a recess, and the Government has not yet announced its decision. Doubtless, if it takes no action, it will shelter itself behind the board, by saying that the report was not received in time to enable Cabinet to come to a decision before Parliament adjourned. These boards and bureaux provide the Government with an excuse for not dealing with urgent problems.
Probably the most extravagant of the 58 is the Development and Migration Commission, which consists of the chairman, Mr. Gepp, who receives a salary of £5,000; Mr. Devereaux, who draws £4,000, and Mr. Gunn, who is paid £2,500. The salaries paid to the commissioners, apart from their numerous satellites, total £11,500. The commission has built up a huge department, the total cost of which since 1926 has been £97,961 or, including migration activities, £2S0,922.
– What is the value of its achievements?
– The commission has submitted various reports. If Queensland or Tasmania asks for something to be done, the request is referred to that body. This method of procrastination saves the face of Ministers for a time; they are able to say that the request is being investigated. The Leader of the Opposition pointed out the growing cost of the various commissions, boards and committees. The Prime Minister has said that only a director of economic research is to be appointed, but, judging by past experience, we have reason to fear that he will soon have an army of experts about him. The expenditure of the Tariff Board in 1922-23, was only £4,300, but last year it was £12,500. That of the Institute of Science and Industry when it was first established, was £22,000, but the institute became, in 1925-26, the Council for Scientific and Industrial Research. In that year the expenditure was £37,000, but the estimate for 1928-29, is £161,000. The Federal Capital Commission’s expenditure in the first year of its operation was at the rate of £38,000 a year, but last year it totalled £112,000. All these bodies are intent on building up large staffs. They have numerous officers travelling about the country ou extravagant allowances, allegedly for the purpose of conducting investigations. Members of the Opposition are convinced that instead of creating a new investigating body, better service could be obtained from existing organizations. The Bureau of Economic Research is to conduct investigations in regard to the primary industries. That subject is wide enough to keep the bureau employed for many years. Mean while what would the Development aud Migration Commission be doing ? Do not its functions include the investigation of primary industries? Has not the Council for Scientific and Industrial Research also been engaged in similar inquiries? Is not the Tariff Board investigating the conditions of both primary and secondary industries? I find that its duties include inquiry into the necessity for granting bounties for the encouragement of any primary or secondary industry, the effect of existing bounties or of bounties subsequently granted, the charging of unnecessarily high prices, action in restraint of trade to the detriment of the public, actions which result in unnecessarily high prices being charged to the consumer, the fiscal and industrial effects of the customs laws, and the general effect of the working of the customs and excise tariffs. Yet, to-night the House is hurriedly agreeing to the appointment of another tribunal to duplicate and overlap the functions of existing bodies. Some honorable members opposite have said that they will support the bill because the bureau would conduct certain scientific investigations. But they lose sight of the fact that the Council for Scientific and Industrial Research is already doing good work in that regard. It is dealing with agricultural research in general, and problems relating to plants, irrigation, settlement, soils, animals, animal nutrition, entomology, including the buffalo-fly and the sheep blow-fly pests, forest products, cold storage, geophysical prospecting, dairying, and fuel. The Prime Minister said when commending this bill to the House: “All honorable gentlemen are agreed as to the desirability of research work being undertaken in the interests of our primary industries.” Is not this work already being done by existing bureaux or councils?
– They are not making purely economic investigations.
– The Prime Minister said that certain research work is to be carried out in the interests of the primary industries. He added -
So much depends upon the quality of the soil and the best types of wheat for different soils and varying climatic conditions that it is essential in the interest of the country that trained men shall devote their efforts to research work in those directions.
Have not the officers of the Council for Scientific and Industrial Research the qualifications necessary to do this work? Hie Journal of the Council for Scientific and Industrial Research for February, 1929, contains a list of the executive members of the council, the chairmen and members of the State committees and the co-opted members. The chairman of the council is Sir George Julius, B.Sc, B.E. ; the deputy chairman and chief executive officer is Dr. A. C. D. Rivett, M.A., Sc.D., and the other member is Professor A. E. D. Richardson, M.A., B.Sc. The chairmen of the State committees are in nearly every instance university professors holding high degrees, as also are the co-opted members. On the State committee for New South Wales are four university professors and five gentlemen holding degrees in science; on the Victorian committee there are four professors and six gentlemen holding degrees in science; on the South Australian committee, four professors and four gentlemen holding degrees in science; on the Queensland committee, four professors and two gentlemen holding degrees in science; on the Western Australian committee, four professors and five gentlemen holding degrees in science, and on the Tasmanian committee, two professors and two gentlemen holding degrees in science. Surely these persons possess the qualifications necessary ito carry out investigation work of the nature contemplated by those honorable gentlemen who said they would support the bill on the grounds that it would lead to more scientific investigations. I feel sure that if honorable members oppo’site would give a little more consideration to this measure they would realize that the establishment of this bureau must cause a great deal of duplication, for the bureau will very largely go over the same ground that is covered by the Council for Scientific and Industrial Research, which costs the country £45,000 per annum. The Prime Minister, in his secondreading speech on the bill, said that eighteen months ago he had appointed a committee consisting of Mr. Dyason, stockbroker and business expert of Melbourne, Major Giblin, the Government Statistician of Tasmania, Mr. Wickens, the Commonwealth Statistician,
Professor Brigden, of the Tasmanian University, and Professor Copland, of the Melbourne University, to inquire into the economic position of Australia. He admitted that he had not yet received their report, but he is nevertheless pressing us to agree without delay to the establishment of this bureau. Australia will certainly end the financial year with a huge deficit, yet the Government is asking us to provide another sink into which public money may be thrown. Honorable members on this side of the chamber do not object to investigations being made by scientific experts and professors of political economy into the problems of industry and production. We support such research work, but we are strenuously opposed to the appointment of a director of economic research under the conditions set out in the bill, for we fear that he may become the tool of thi Government for tinkering with the tariff. He may also be used to placate the big importing interests of Australia, and to please the freetrade wing of the Government. He will be appointed by the Government at a salary which it will fix for a period of seven years. The amount of his salary might depend upon his pliability. Realizing that he will owe his position to the Government, he will be a superman if he does not do his best to fall in withits wishes in regard ‘ to the tariff and wages problem.
For a long while Mr. Mark Harrison, the thoughtful editor of the Producers’ Review, a leading journal of its kind in Queensland, has urged the necessity for establishing a national bureau of economic research, but he has always made the point that it should be perfectly independent, and should not be at the beck and call of political parties. In an article on the subject in the issue of the Review on the 15th March, the following paragraph appears : -
On reading the act we are not elated, neither have wo the satisfaction of having achieved any great purpose. Throughout our series of articles on the necessity of finding means to define economic knowledge we have persistently stated that the investigations should be entirely removed from the political arena. We have said on many occasions: - “ Australia needs such a bureau. It should be an entirely independent body of scientific and practical investigators without partisanship, , , , If such a body wore clothed with adequate authority given security of tenure, and paid an adequate remuneration, its work might be of incalculable value. If Australia is ever going to become a commonwealth of industry it must get down to the basic facts and those facts must be collated by a thoroughly competent body of scientific investigators free from political control.”
The article continues -
We find on reading the Prime Minister’s :i.ct that the appointment of the director is purely at the discretion of the Government; that his remuneration is fixed by the Government, and that his tenure of office is limited to seven years. That means, unless the control of the bureau is in the hands of an individual of extraordinary independence of character, that its work will be circumscribed by the politicians. Wo had in mind a bureau differently constituted when we said - “ It is important that the national bureau of research should not be at the heck and call of any politician or political party. …”
Mr. Harrison lias made a close study of economic problems for many years, and is an authority in Queensland upon all matters affecting the welfare of the primary producers of that State. There is no doubt that he is displeased with the provisions of the bill, and suspects that the director of economic research will be the puppet of a political party.
Credence is lent to this view by remarks which have been made from time to time in the weekly bulletin issued to the press by the Country party. There can be no doubt that the object of the Country party is to break down the tariff wall which is at present protecting our industries, and I feel sure that the Government will take care to appoint as the director of economic research a gentleman who will give effect to its desires in this regard. It would not bc difficult to find a gentleman with freetrade tendencies who would call into question, for instance, the advisableness of continuing the embargo on the importation of sugar. He might recommend that sugar grown in cheap black labour countries should be admitted into Australia. He might also advise the Government that it is economically unsound to pursue our White Australia policy and to keep up our barriers against the introduction of New Zealand butter or Fijian bananas. He might suggest, too, that raw cotton and cotton yarn should be allowed prac tically unrestricted entry into Australia. At any rate we are justified in suspecting that this gentleman will do his best to please the Government which appoints him. He would have to be a person of extraordinarily independent tendencies to do otherwise. Because we consider that there is some sinister motive behind the attempt to establish the bureau at this time . as a mere puppet of the Government party we shall vote for Mr. Scullin’3 amendment and against the bill. The legislation and administration of the Government have given us every reason for assuming that it will leave no stone unturned to reduce our standard of living, to break down our tariff barriers, to please the big importers of Australia and to bring huge quantities of foreign goods, both primary and secondary, into the country, to the serious jeopardy of our primary and secondary industries.
– In this very interesting debate few, if any, honorable members have ventured to question the value or necessity for economic research and investigation. Even the honorable members who have opposed the bill have agreed that economic research of some description is necessary; but they have alleged that the motives of the Government in introducing the bill are unworthy, and that the instrument of economic inquiry proposed to be set up will be used indirectly to break down existing standards. It has also been urged that there are already sufficient agencies in existence to enable full economic information to be obtained on any question which may arise. Honorable members are well aware that opinions differ greatly upon economic subjects; but there appears to be a general agreement that skilled and unbiased inquiries into economic problems are capable of producing valuable results which will be useful to all of us, irrespective of our particular opinions. There are well established methods of economic research today, and there are available trained economists, though they are few in number, highly skilled specialists who could render very great assistance to any one associated with the control of public affairs. The training of au economist involves very special study. I have recently looked through the calendar of the Sydney University, and have been struck by the extent and scope of the subjects which must be studied before the degree of Economics may be secured from the university. The Melbourne University has recently established a Chair of Economics. There, again, a very wide educational course is prescribed, through which a student must pass before a qualification in economics can be granted. This measure is wholly in the direction of knowledge and enlightenment. It is intended to secure, and if passed will secure, more valuable and better arranged information, and more accurately analysed facts, for the use of not only honorable members and the Government, but also the people of Australia. We have recently had presented to us a report on child endowment. In the minority report, which is signed by the honorable member for Fremantle (Mr. Curtin) and Mrs. Muscio, there is a very interesting passage which I propose to read. It is entitled, “A Bureau of Social and Economic Research.” It says -
We wish strongly to recommend that the Federal Government establish some organization for thu study of social and economic conditions in Australia so that accurate and intelligently compiled information may be obtainable by governments to guide them in introducing measures for social reform. A large quantity of interesting data in the Statistician’s Office is not worked up, and other data could bc obtained. As members of the commission we felt strongly the lack of expert investigation into many of the questions which caine up in the course of the inquiry, and in the absence of such impartial expert research a good deal of the evidence tended to be mere opinion. Every social reform is an experiment, and intelligent observation should accompany all experiments. This applies not only to social reform but to developments of economic policy also. The industrial and social legislation of Australia offers a rich field for research. The returns made under the Family Endowment Act of New South Wales - to take a recent and closely relevant example - must be bringing into existence a body of information making possible a survey of the problems facing families on low incomes in our community. Amongst other things such a survey would help to throw light on the incidence of unemployment and its effect on family life. The lime lias arrived when a bureau of social and economic research should be set up in Australia, and we would recommend that this be done. Even one trained economist with an adequate clerical staff attached to the Statistician’s Office or to the Council of Scientific and Industrial Research could render valuable service, though the establishment of an independent bureau would be better. Such a bureau would co-ordinate and evaluate not only information obtained through the census and other official returns, but also the data obtainable through social workers; whether government officials or otherwise. Wider economic questions, too. such as the relation of economic policy to national prosperity, to amount and distribution of income, to cost of living, to unemployment, and so on, would be material for research by such a bureau. The advice of a body such as this would be invaluable in helping the Government to decide in what way to amend or enlarge any preliminary scheme of family allowances after it had been in operation some time.
I agree entirely with that passage.
– The speech which I delivered this afternoon was quite consistent with it.
– I have not suggested that it was not. The line between social research and economic research is very difficult to draw, and in the case of, let us say, such a problem as family allowances, I defy anybody to say where the social aspect ends and the economic aspect begins. Questions such as those which are mentioned in the passage I have read - industrial policy, national prosperity, and the like - are both social and economic, and the two aspects cannot be severed. The bureau which it is proposed to establish will discharge the very functions described in the report. There appears to be in the minds of honorable members who hold strong views in relation to fiscal or industrial policy some apprehension as to the effect of the establishment of an economic bureau. I suggest that any honorable member who lends his support to any policy should be prepared to ascertain, or to have ascertained for him, the whole of the facts which are relevant to that policy, to consider their significance, and then to face them. I am not- greatly concerned with the attribution of the terms “ natural “ and “ artificial “ to a state of affairs in any community. All conditions in modern industrial society are artificial in that they are the result of the action of men. There are no natural conditions, in the sense in which any real distinction can be drawn between natural and artificial conditions. A distinction is sometimes sought to be drawn between, for example, artificial and natural systems of fixing wages, prices, and the like; but all are the result of human activities, more or less organized. I do not pretend that a bureau of economic research would be particularly occupied in examining certain allegedly artificial conditions, because practically all modern conditions are in the real sense artificial.
– The establishment of a bureau is an artificial action.
– Everything we do in this House is artificial, because it is human interference with natural facts. I do not urge, nor do I think that any honorable member on this side has urged, that economic considerations should be the only considerations in determining policy. Years ago economics was known as “the dismal science,” and a vast structure of rules for the conduct of human affairs was reared upon the basis of the abstract idea of the economic man. Surely we have passed far beyond those conceptions ! When the right honorable member for Worth Sydney (Mr. Hughes) pointed out that considerations other than economic affect some of our leading policies, he was only uttering a commonplace and a platitude. We all know that that is so, and we accept the position. Considerations of national well-being, national development, and national safety, must affect the determination of many questions of policy. The defence of Australia is not a matter to be settled by economists; but we should have the means of ascertaining accurately the effect of expending so much money on defence. “White Australia” is a policy for which, perhaps, we are paying; but we are prepared to pay for it. A living wage in industry is an Australian ideal for which we may have to pay by giving some form of assistance or support to a particular industry. The right honorable member for North Sydney was in error when he said that the dispute in the timber industry was caused by a reduction of the basic wage. The basic wage was not affected by the recent award ; it was ascertained in accordance with the methods which are always adopted by the court.
– No; they have been changed.
– The application of the cost of living figures has led to a reduction in some cases, but no alteration has been made in the method of ascertaining the basic wage.
– The judge did change the method of ascertaining the basic wage, because he took four towns instead of twenty.
– That practice has frequently been followed in the court.
– The effect has been to reduce the basic wage.
– I do not wish to diverge into a discussion of the dispute in the timber industry. The real dispute is on the question of a 44-hour week, and that is an economic question. The claim for a working week of 44 hours was not made before the full bench of the Arbitration Court on the ground of health, fatigue, or the like. Those grounds were expressly and explicitly disclaimed by the trade union advocates, and the matter was examined on an economic basis. The whole of the argument was an economic argument. It was argued that industry generally was able to give this extra leisure and pleasure to the worker. That is purely an economic question.
– The Attorney-General knows that the dispute in the ranks of the bush workers has as its basis, not a 44-hour week, but a reduction of the basic wage.
– The bush workers are supporting the city workers. The method ‘ adopted by the judge to arrive at the basic wage has been employed very frequently in the Arbitration Court in the past. The only difference was with respect to the number of towns that were taken into account in determining the cost of living. There has been a certain variation between judges in dealing with different industries, but the principle followed has remained the same.
– The effect has been to reduce the basic wage by from 5s. to 6s. a week.
– I by no means agree with the statement of the honorable member; it is not accurate.
– If the honorable gentleman was paid £3 19s. instead of £4 4s., he would admit that I am right.
– Many of our actions as a people do not pay, and from a purely economic point of view they would be condemned. That, however, does not deter us, because there are other than economic grounds which we consider justify our expenditure. But when a national parliament enters upon an uneconomic policy it should do so with its eyes open, and have the means of ascertaining what it costs. In a large measure we are trustees for the money which is subscribed by the people in taxation. If we consider that we are entitled in a particular set of circumstances to adopt a policy which cannot be justified from an economic point of view, we should at least know what the country is paying for it. Here and there we may do what is uneconomic, but the nation as a whole is absolutely limited by economic conditions. The nation as a whole must live on what it produces, and that is a governing fact which we must all realize.
The objection has been raised that this is another board, or commission, or bureau, and we have heard much criticism about the number of such bodies which this Government has appointed. Everything which is called a board, though it be an air board, a defence board, a national debt sinking fund commission, or a fruit export control board, is lumped together with other such bodies, and presented as part of the alarming total of 58 which has been mentioned. The real question to ask is, not whether an organization is called a board or a commission or a council, but whether the work which it is doing ought to be done by or in connexion with the Commonwealth and whether it is being well done. It is often better to employ nonpermanent officers for certain classes of work. All the progressive governments throughout the world are finding that the complexity of modern conditions makes it necessary to call in the aid of skilled external assistants to deal with specific matters. This might be done by appointing permanent officers to the Civil Service, but on the whole, it is often better to set up special bodies not necessarily part of the Civil Service. The boards and commissions to which reference has been made in such vague and general terms ought to be judged by the standard I have suggested. Many Commonwealth agencies are dealing with economic matters. Mention has been made of the Development and Migration Commission, the Arbitration Court, and the Tariff Board. I pass over the Council for Scientific and Industrial Research, which does not deal with economic matters at all, and it is not desirable that it should. The honorable member for Capricornia (Mr. Forde) read a list of the distinguished men assisting in the work of the council. They are scientists, but not one of them is an economist, nor do they profess to be.
– How does the Minister know ?
– I think that I know nearly every one of them personally.
– That does not settle the question.
– If the honorable member will look at their degrees, he can settle it for himself. Honorable members who take the trouble to acquaint themselves with what is being done by the Council for Scientific and Industrial Research will know that it is not dealing with economic research at all. That may be deduced from its various publications. The Development and Migration Commission, the Arbitration Court and the Tariff Board must necessarily deal with economic matters, and, in the course of their work, must obtain skilled assistance on economic questions. The point to be considered is whether it is better to have one staff of economists, or several. The Government thinks that it is better that there should be a single staff, and that the different bodies which must deal with economic questions should call in the assistance of that staff, rather than establish separate little staffs for themselves, the members of which would be narrowed down in their work to the consideration of the specific problems with which their departments were concerned. The result ought to be to save money on the upkeep of staff, and to enable more valuable work to be done. The Leader of the Opposition has complained because the functions of the bureau are described in general terms. How does he suggest that they should be described ? It is impossible in a statute to do anything else. He asked what sort of problems were to be dealt with under the various heads mentioned in clause 11. There are many matters under each one of these heads which are of great importance. I suppose all honorable members have seen the various estimates which have been made of the cost of producing a bushel of wheat in Australia. I have seen estimates made under the auspices of agricultural societies, putting the cost of producing a bushel of wheat for one season, at figures varying between 3s. 6d. and 7s. 10d. There ought to be a proper official inquiry into that. Reference has been made in the bill to industrial matters. There is a considerable difference of opinion as to the proper method of ascertaining the cost of living in Australia, and as to the value of the index numbers at present used in the Arbitration Court. An inquiry into that matter is urgently needed, and it can only be made by a skilled economist with the necesssary staff to help him. I should like, also to see a study made of the effect of wage regulations in Australia on the margin for skill. Other important subjects of investigation are finance and taxation. The bureau might profitably investigate the effects of the Federal Land Tax, both in the country and in the city. It has been objected that the director, or the bureau itself, will be virtually in control of Parliament, the Government, the Arbitration Court, the Tariff Board, and everything else. That is an entirely wrong impression. ‘ The whole function of the bureau will be to conduct investigations concerning the economic effect of the various matters referred to it. That will si ill leave to bc determined by this House questions of policy. The bureau will merely provide the House with information which will be most valuable to all honorable members, whatever their political views may be. I ask honorable members to support the bill.
.- The Government has definitely made up its mind that this bill is to go through, so it does not matter much what is said about it. No matter who is appointed as head of the bureau, he will be the product of some particular school of thought, and his opinions will be moulded by that school. There is already in existence a Council of Scientific and Industrial Research. On the Council are men of high scientific attainments, and men of some industrial capacity, capable of investigating industrial problems. Is that body so incapable that another organization must be called into being to do the work for which it was appointed? Much has been said during the course of this debate about State instrumentalities, and State undertakings. In Queensland a great deal of very valuable work has been done in the way of scientific investigation into agricultural problems. Because of those achievements, the conference of Ministers of Agriculture held last year in Perth carried a resolution to the effect that an endeavour should be made to have agricultural investigations in the other States carried out on the lines followed in Queensland. The honorable member for Franklin (Mr. Mcwilliams) suggested that the sugar industry might be dealt with by this proposed bureau. I suggest that he inform his mind on what is already being done. The sugar industry in Queensland is being sufficiently investigated on a scientific basis at the present time. Attached to the Queensland Department of Agriculture are exports who study the soil in which the cane is grown, and advise the farmer as to what fertilizer he should use. The sugar industry, in all its phases, is carried on under scientific conditions. The Government is spending thousands of pounds every year in finding out the varieties of cane which will give the best results, and so complete is the co-operation between the Government experts and the various interests concerned, including the Colonial Sugar Refinery Company that, whereas a few years ago it took 10 tons of cane to produce 1 ton of raw sugar, it, takes now just under 7 tons. The honorable member for Perth (Mr. Mann) deprecated what he described as “ bolsteringup “ industry. It would be a good thing if the Government were to do a little more in that direction. When the proposed bureau has completed its investigations and sent in its report, Parliament must decide what is to be done regarding the recommendations made. All the information which the bureau could possibly give Parliament is available now to any student who cares to look for it. Moreover, the findings of the bureau will be coloured by the particular school of thought in which the members happen to have been brought up. The Attorney-General said that persons with strong industrial views were opposed to the setting up of this bureau. I object to it among other reasons, because the Prime Minister said the other day, when talking about the Tariff Board, that when the Director of Economic Research was appointed, he would be available at any time to consult with judges of the Arbitration Court. I know something about the work of the Arbitration Court, having been for some years an advocate appearing regularly before it. The Arbitration Court in framing its awards, does take into consideration the probable economic effect of its decisions. In the judgment given in the timber industry, due regard may not have been paid to the economic effect of the award on the industry; but in Queensland, ever since the establishment of the Arbitration Court in that State, that matter has always been considered, except when Acting-Judge Dickson made an award in connexion with the sugar industry that the growers could not afford to pay. When claims for certain wages and conditions or for variations of awards were made, the first question that was put to the parties by the Board of Trade in my State was, “ Have you considered the economic effect that the award will have on the industry, if your claim is granted in whole or in part?” When an application was made to the late Mr. Justice McCawley, Mr. Justice McNaughton, or the present judge, Mr. Justice Webb, for an increase in wages, a. reduction in hours, or other variation of an award, the same question was asked. For three years the matter of an award for rural industries was investigated. Conferences were held and further inquiries were made. Then the full bench decided that the award should be finalized by the late Mr. W. 1ST. Gillies. Here, indeed, was a case of which it might be said that the mountain had laboured and brought forth a mouse. Only one-eyed persons, such as the honorable member for Wide Bay (Mr. Bernard Corser) opposed the granting of that award.
If the Council for Scientific and Industrial Research is not doing the work required of it, the great expenditure that has already been incurred by the appointment of that body has been money more or less wasted. If the personnel of that council is inadequate, it should be increased, but if the director of the bureau to be appointed under this bill is to be permitted to give evidence in an Arbitration Court, he should be required to do so in open court, so that the advocates of the parties would have the opportunity to cross-examine him. With all due respect to economists, no matter how able they may be, their arguments can sometimes be disposed of easily. The suggestion of the Leader of the Opposition (Mr. Scullin) is a good one, in that it would give the Government time to consider the matter in every aspect. The honorable member for Wannon (Mr. Rodgers) said that the Government might import a man for the position of Director of the Bureau. I do not admit that a suitable man could not be found in Australia, and I would raise no great objection to the appointment of an economist from abroad, if that were necessary in order to obtain a man with suitable qualifications for the work; but would that man be obtained from protectionist America or from freetrade Great Britain? Under the bill, the bureau will be able to inquire into any subject suggested by the Government. I do not think that any honorable member on this side would be foolish enough to suggest that economic investigations are not desirable. The honorable member for Warringah (Mr. Parkhill), by some process of reasoning, arrived at the conclusion that the honorable member for Fremantle (Mr. Curtin) had made out a good case in favour of the bill. Although it might be a clever tactical move on his part to suggest that honorable members on this side are divided on the subject, the speech of the honorable member for Fremantle was undoubtedly couched in scathing terms; he condemned the bill rather than commended it. While I realize that we cannot have too much information on economic subjects, I do not think that the proposed bureau is required.
.- I claim to be largely responsible for the extraordinary energy displayed by the
Government in promoting scientific research. A couple of years ago, when the Parliament met in Melbourne, I tabled a motion on the subject. I am glad that the Government has realized the importance of economic research, and I think that it should be carried out on national lines. The. States cannot deal with it satisfactorily, because, no matter how desirous they may be of prosecuting their inquiries, the work is often interrupted through the lack of revenue. In the motion that I tabled in Melbourne I made provision under loan expenditure to obviate that difficulty. We should not be afraid of too much inquiry into matters affecting the welfare of the community. The climate of Australia is unexcelled in any part of the world. This country has been peopled by a virile race, and it has splendid opportunities for development and the application of science to industry, but the time has come when more concentrated efforts must be made in this direction than have been put forward in the past. I noticed that specific provision is not made in the bill for investigation of the problems of housing and unemployment. I fear that the proposed bureau will develop into a very large department. Who are the men who do the real work of investigating the problem of the application of science to production? It is done by the men in the laboratory, and the work-shop. The director of the proposed bureau will probably devote most of his time to drawing up long reports. Edison’s great services to mankind were performed in the workshop. A similar remark applies to Pasteur, who contributed much to the sum of human knowledge on health matters. We know also how far-reaching were the experiments of Farrer in the cultivation of wheat. His work was done in the vicinity of Canberra. Mr. Farrer held about 40 acres of land upon which he experimented with wheat. He finally evolved the Federation type of wheat which is now extensively grown throughout the world. The Council for Scientific and Industrial Research, in its first annual report, said -
Animal Genetics. - The genetic analysis of the economic character of live stock, including the meat quality and milk yield of cattle, wool quality and yield of wool and carcass of sheep, egg and meat quality and yield of poultry and the like, constitute a group of research problems which are of national importance and require specialized research for their solution, and form an appropriate field for Commonwealth investigation.
That council also recommended that the Commonwealth should institute inquiries respecting the treatment of soil, plant and animal life, and veterinary surgery. An institution for the investigation of these problems was established in Great Britain in 1843. It was founded by the late Sir J. B. Lawes. It is still in existence and its director, Sir John Russell, visited Australia a few months ago. Its investigations are mainly in the direction of the treatment of soils and plant life. Over 1,000 classes of soil are treated there. A similar institution is badly needed in Australia - an institution assisted by the Government. Many of our returned soldiers were placed on land, the properties of which had never been analyzed. This is one of the reasons of their failure. ~No information was available as to the nature of the soil and what it was best capable of producing. In the sugar districts of Queensland, the soil is so treated as to remove any prospect of . failure. The Sugar Refining Company and the State Government have the finest laboratories in Australia. Before the sugar cane is planted, the soil is analyzed to ascertain what ingredients are necessary to make it suitable for cane growing. The cane itself is analyzed and any defect in quality or growth is remedied by treating the soil. The bill provides that the director of the Economic Research Bureau may make inquiries concerning, finance and currency. If he inquires into the financial situation of this country, he will find many things not to his liking. About twelve months ago, I listened to a report of a university professor on the sugar industry, and he pointed out that a duty of £20 a ton on sugar was uneconomical and not in the interest of Australia. I did not agree with him, but, unfortunately, immediately after his speech, the debate was closed and I had no opportunity of discussing the subject with him. What professor of economics would sanction the duty on butter imported from overseas, or agree to the Paterson stabilization scheme? Economists generally are opposed to the payment of bounties and the provision of duties for the protection of primary and secondary industries. We must realize that they are theorists and not practical men. They forget that we are living in the twentieth century. In 1930, Commonwealth loans amounting to £72,666,040 will mature, and by that time the interest bill on that amount will have reached the alarming sum of over £43,599,624. No professor of economics would sanction our present loan policy. Most people prefer to invest in gilt-edge securities. The Australian Mutual Provident Society has subscribed £1,000,000 to a recent Commonwealth loan. It is an infinitely better investment than advancing money on mortgage at 7 per cent., which class of investment has an element of risk. Because Commonwealth loans are so attractive, less money is available for .commercial investments, and, therefore, the interest rates are increasing. If more money were available for commercial enterprise, interest rates would become lower, and that in a measure would relieve unemployment. We are exporting to South Africa the flower of our stud stock, and that is certainly not in the interests of this country. The Russians also recently bought 2,000 breeding ewes for the improvement of their flocks. We must not underrate our competitors; they are just as keen and capable as we are, and we are doing nothing to retain our hold on our markets. Our cattle are deteriorating rapidly, and there is little sale of Australian meat on the London market. About two and a half years ago the graziers and squatters’ organizations started to raise a fund of £200,000 for the improvement of Australian flocks and herds, but to date only £13,000 has been subscribed. I did not expect much better of them ; they are so blind to their own welfare that they will not take the steps necessary to preserve the means by which they live. While they are dilly dallying the nation’s assets are depreciating, and a long time will be required to restore them. As the years go by we must expect keener competition in the markets of the world. I read recently that the average length of the staple of South African wool had been increased by nearly 1 inch. That means a greater demand for the product of the Union. The Russians, too, are likely to prove serious competitors in the wool market, which is rapidly expanding; even the Chinese, Japanese and Indians now purchase woollen goods.
Some honorable members have referred to the influence which the Bureau of Economic Research will have on the Arbitration Court. When the Arbitration Bill was before the House I took strong exception to the direction to the judges to take into account the probable economic effects of their awards. Arbitration Courts are intended to deal with the wages and conditions of the workers. Judges are not qualified to deal with economics. They are not practical men and have no knowledge of commercial affairs. I believe that if they meddle in economics some of the awards of the court will be worse than the last Lukin award and they will take a considerable time to make the award. Judges are merely lawyers whose minds are filled with a lot of musty legal knowledge dating almost from the time of Adam and Eve. Some of them are unable to distinguish between the 18th and 20th centuries, and I am certain that the direction to the court to take into account economic effects will be the cause of further trouble.
There is no need for the Bureau of Economic Research to interfere in tariff matters. The Tariff Board was appointed to advise the Government after due inquiry, with regard to the protection of secondary industries, and before recommending the imposition of duties would satisfy itself that the people generally would not be unduly penalized. The main purpose of this bill seems to be to provide a means of hiding the maladministration of the Government. In the Prime Minister’s policy speeches of 1925 and 1928 a programme was outlined sufficient to keep this Parliamentoccupied for nine months in each of the next three years. National insurance alone Will require a month of discussion. The housing problem is another acute subject; but all the legislation promised by the Prime Minister has been pushed aside to allow of the hurried passage of this bill. Having obtained supply, the Governmnent will close Parliament till August, for we know that once a Government is provided with funds it hurries into the haven of recess and does not meet Parliament again until the votes arc exhausted. If Parliament had continued in session and an opportunity had been given for the consideration of my motion relating to the establishment of a research farm in the Federal Capital Territory, there might have been no need for this bill. Had Parliament approved of my proposal, a great scientific work could have been undertaken for the improvement of our flocks and herds, and the general development of Australian industries.
– Order ! The time allotted for the second-reading stage has expired.
Question - That the words proposed to be omitted (Mr. Scullin’s amendment) stand part of the question - put. The House divided.
Question so resolved in the affirmative.
Question - That the bill be now read a second time - put. The House divided.
Majority . . 6
Question so resolved in the affirmative.
Bill read a second time.
Clause 1 agreed to.
The following papers were presented : -
Defence Act, Naval Defence Act and Air Force Act - Defence Committee Regula tions - Statutory Rules 1929, No. 26.
Lands Acquisition Act - Land acquired at Woodside, South Australia - For Defence purposes.
House adjourned at 10.59 p.m.
Cite as: Australia, House of Representatives, Debates, 19 March 1929, viewed 22 October 2017, <http://historichansard.net/hofreps/1929/19290319_reps_11_120/>.