12th Parliament · 1st Session
Mr. Speaker (Hon. Norman Makia) took the Chair at 11 a.m., and offered prayers.
Mr. Latham’s Speech
– Has the Prime Minister seen an eight-column advertisement which appeared in the Melbourne Herald of Wednesday evening, headed” Mr. Latham’s strong attack on the Budget”? Will he inform the House whether this advertisement has been paid for by the Government, or by the Nationalist union?
– The Government has not paid for any such advertisement.
– In view of the repeated statements to the effect that petrol is being retailed to consumers in Australia at extortionate prices, will the Minister for Trade and Customs arrange for an officer of his Department to inquire into the matter with a view to preventing exploitation ?
– Wherever there is any indication of exploitation in regard to either petrol or other commodities, expert officers of the Department are detailed to make inquiries. Particular attention is being paid to the prices of petrol at the present time.
Butter Boxes - Periodicals, Books and Newspa pers - Galvanized Iron - Primary Products.
– Will the Prime Minister state whether it is proposed to collect the sales tax on butter boxes?
– It is proposed to exempt butter boxes.
– Will the Treasurer state whether the sales tax will apply to periodicals, books and newspapers ?
– It will not apply to newspapers, but I am not certain how it will affect books and periodicals. I have not yet gone into that matter, but I shall do so.
– Will the Minister for Trade and Customs state whether the sales tax on imported timber and galvanized iron is to be paid by the importer when the goods are cleared, or whether it will be the responsibility of the merchant to pay the tax when he makes sales to his customers?
– The manner in which the tax will operate will be explained in detail when I introduce the bill dealing with the matter. Generally, the principle followed will be that the sales tax will be paid by the last wholesaler to sell to the retailer. If the importer sells to the retailer direct he will pay the tax, but if the importer sells to wholesalers who, in turn, sell to the retailers, the wholesalers will pay the tax.
– I have received from the manager of Westralian Farmers Limited the following telegram -
As sales tax must seriously affect all primary producers. Kindly do utmost have all farmers’ products exempt, including bran, pollard, chaff, hay, straw, potatoes.
In view of the Prime Minister’s appeal to the farmers to produce more, will he give favorable consideration to the request that primary products, including those mentioned in the telegram, shall be exempt from the sales tax?
– In view of the great importance of primary products generally, particularly those which are exported, consideration has already been given to this matter, and the articles mentioned are to be exempt from the operation of the tax.
– Will the Minister for Markets state whether the report of Mr. Gunn on the hop industry has yet been received by him, and if so, will he lay the report upon the table of the Souse?
-The report has been received, and consideration is being given to what further action shall be taken.
– Will the Minister give an assurance that the report will be laid on the table of the House as early as possible?
– When I have had time to come to a determination regarding the report, it will be made available to honorable members.
– Will the Minister for Markets state whether he is correctly reported in the Canberra Times of this morning, in a statement in which are published opinions expressed by him regarding the action of certain members of the Senate in voting against the Wheat Marketing Bill?
– The report published in the Canberra Times of this morning is substantially correct.
Mr. ARCHDALE PARKHILL.What action has been taken by the Assistant Minister (Mr. Forde) in connexion with the request of a deputation that the duties ou sheet glass shall be removed, seeing that no such glass is yet manufactured in the country?
– The duties should be taken off.
– The fullest consideration is now being given to the representations of the deputation, and a reply will be furnished as soon as possible.
– Will the Prime Minister state whether the primage duty will be refunded on butter boxes imported from New Zealand and re-exported with butter sent overseas?
– Practically no articles will be exempt from the payment of primage duty.
– Not even those reexported ?
– The Customs Department will go into that matter, and honorable members will be advised about it later.
asked the Minister for Defence, upon notice -
– The answers to the honorable member’s questions are as follow : -
Safes and Strong-room Doors.
asked the Treasurer, upon notice -
– The question has been referred to the Commonwealth Bank for advice. The reply, when received, will bo made available to the honorable member.
asked the Minister for Trade and Customs, upon notice -
Whether he has considered representations which have been made to his department asking for an amendment of the Customs Act to allow a reduction of the amount of duty on goods in bond which arrive in Australia damaged by fire or water?
– The Customs Act already provides for the reduction of duty on damaged goods while still in bond. I am not aware of any recent representations on the subject.
Duty on Imports - Exports.
asked the Minister for Trade and Customs, upon notice -
Whether he will supply a return showing the rate of customs duties on imported timbers in 1919 and in 1930, also the tonnage and value of Australian timbers exported in 1919-20 and in 1928-29?
– The information will be obtained.
Control by British Admiralty.
asked the Minister for Defence, upon notice -
– No statement has come before the Government on this matter.
asked the Minister for Health, upon notice -
– The answers to the honorable member’s questions are as follow : -
asked the Minister for Trade and Customs, upon notice -
Whether the present imports of galvanized iron amountto 2,000 tons per month; if so, will he cease paying the bounty on the Australian product, and place an adequate customs duty on imported galvanized iron in place thereof?
– The information will be obtained.
asked the Minister for Trade and Customs, upon notice -
In view of the fact that the rates of duty on outside casing have been fixed at 20 per cent. British ad valorem, and 30 per cent. foreign ad valorem, why are the Customs officials insisting on payment at the foreign rate on casings of goods shipped from Great Britain ?
– Because the casing being of oversea timber, and usually made with foreign nails, does not qualify for British preference.
asked the Prime . Min ister, upon notice -
Whether he will give Parliamentan opportunity of approving or disapproving of any agreement which permits a continuation of thesugar embargo before such agreement has been, finalized?
– The honorable member’s suggestion will receive consideration.
asked the Minister for Defence, upon notice -
Is it a fact that H.M.A.S. Canberra has already to have a new gun turret; if so, will heinform the House as to the reason for this, and whether it is due to faulty construction when the ship was built?
– -The information it being obtained, and a reply will be furnished to the honorable member as soon as possible.
Effect on Price of Matches.
asked the Minister for
Trade and Customs, upon notice -
Is ita fact that since the recent tariff the wholesale firms who sell Bryant and May’s Australian-made matches have increased the price to retailers from 5s.1½d. to 5s.5d. per gross; if so -
Can he state what remedyhe proposes for this increase, and how the position can be met if the whole salersand not the protected manufacturers fail to honour the agreement not to raise prices?
b ) If the names of these wholesalefirms are furnished to him, will he pillory them by public announcement or their profiteering?
Will he arrange with the protected manufacturers as a condition of their tariff concessions that they will directly supply retailers if the wholesalers unfairly raise prices?
– The information will be obtained.
– Yesterday the honorable member for Moreton (Mr. Francis) asked me whether the report on the subject of intensification of production in the dairying industry was yet available.
I am advised that the report is in course of preparation, but that it has not been possible to complete it within the time expected. The report is, however, being expedited. The present indications are that it will be available towards the middle of August.
The following paper was presented: -
Defence - Australian Military Forces - Report for the Inspector-General, by General Sir H. G. Chauvel, G.C.M.G., K.C.B. (Chief of the General Staff), Part I., 15th April, 1030.
Ordered to be printed.
Motion, by Mr. Scullin, agreed to -
That the House, at its rising, adjourn until 10 a.m. to-morrow.
In Committee of Supply:
Consideration resumed from 23rd July (vide page 4550), on motion by Mr. Scullin -
That the first item in the Estimates for Additions, New Works, Buildings, &c., under Division 1 - the Department of Defence - namely, “ Naval Establishments - Machinery and Plant, £1,500,” be agreed to.
Upon which Mr. Latham had moved by way of amendment -
That the item be reduced by £1.
– When I concluded last night I was explaining that the primage duty and sales tax, though unprecedented in Australian history, were necessary because previous governments had already explored every other avenue for raising revenue. I said I would give the reason for the present parlous condition of the Commonwealth. I quoted a letter in which the writer drew attention to what Mr. Houlder, of the Houlder Shire Steamship Company said of the boom, borrow and burst policy of the Commonwealth, where it would lead to, and how we would stand when the British financial authorities became cognizant of our position. That is the position in which we are in to-day. It is revealed by the Estimates, which point to this obvious fact that, as the- honorable member for Warringah has said, the existing financial depression is Australia-wide. Recently the Premier of Victoria was assailed by the municipal associations in regard to the finances of that State. Following the Leader of the Opposition (Mr. Latham), they asked the Premier of Victoria whether it was not necessary to reduce the salaries of members of Parliament. That was the first line of offence of the Nationalist party. Mr. Hogan answered by quoting figures in regard to the cost of the public services of that State. Those figures trenchantly reveal a position that exists not only in Victoria but also throughout Australia. The Premier of Victoria refused to reduce the salaries of members of Parliament, and in defence of his attitude he pointed out that parliamentary salaries, including those of Ministers, amounted to only £38,406, out of a total yearly expenditure of £27,251,000. He stated that the parliamentary salaries, compared with the total expenditure, represented but a drop in the ocean, and that any reduction would not appreciably affect the financial position. In addition he pointed out that parliamentarians had received no increase of salary during the last ten years, and that they did not enjoy automatic or yearly increases in salary, which were usual in other walks of life. It is true that members of Parliament may set a price upon their labour and demand the payment to which they consider they are justly entitled. The salary of federal members is not high, particularly in view of the fact that we have been dragged to Canberra, far away from civilization. We are not one penny overpaid. The Premier of Victoria further stated that the cost of the State Public Service in 1913-14, excluding interest, was £8,363,311, and, in- eluding interest, £10,682,614. In 1927- 28 - I presume that the figures for the vear 192S-29 were not available - the cost of the State Public Service., excluding interest, was £19,701,771, and including interest, £27,251,000. “While the interest payments in respect of the Public Service increased by 225.5 per cent., the cost of the Service - services rendered whether by the highest or the lowest officials - increased only by 135.5 per cent. Between the years 1913-14 and 1927-28- the war years, when profiteering was rampant - the cost not of services rendered, but of transfers of credit necessary for the proper government of this country, increased by 225.5 per cent. That is to a great extent the reason why we have become financially embarrassed. Mr. Hogan, unfortunuately, omitted to make that point. While we continue to administer our public services on those lines, we shall remain in our present financial turmoil. Those figures did not pass unnoticed by the Victorian Public Service. According to the Age of the 12th of this month, Mr. A. Caldwell, the president of that Service organization, commented upon the attitude of those who were attacking it. He suggested that the Premier, of Victoria should reduce the State interest bill, and introduce safeguards against the evasion of income taxation by wealthy persons, because of weaknesses in the law, and that the income tax should be raised to the level at which it stood in England. Mr. Caldwell was of the opinion that, in view of the increase in the cost of living and of the splendid service rendered by the Pub- lie Service to that State, its members were not overpaid. The fault for our financial position lies in our borrowings abroad and the high interest payments thereon. A day or two ago I questioned the Treasurer respecting the financial position revealed by the Estimates, and I am sorry to say that the Treasury officials did not play the game with me. They did not reveal the facts. I asked what was our public indebtedness for war service, and the reply was that the yearly interest on the Commonwealth liability of £289,995,532, was £15,257,295. On page 16 of the Estimates appear such items as war loan, war gratuities, and indebtedness to the Government of the United
Kingdom under the funding arrangements. Our finances are there set out in detail. The interest bill on those items of war expenditure is £17,3S0,808, and not £15,257,295 as stated by the Treasury in reply to my question. According to the Estimates, the interest on war debt is £17,308,S08 and on other than war debt, £4,916,176. The Commonwealth is paying that amount of interest upon its borrowings. Yesterday I was informed in reply to a question that the original borrowings for war purposes amounted to £376,832,935 and that the interest paid thereon to date amounted to £219,229,957. That is a stupendous sum.
– The interest payments will soon be larger than the principal.
– In ten years time we shall have paid in interest an amount equivalent to the whole of the war borrowings and still have on our hands the original debt less any reductions by contributions out of general revenue.
– How can we escape from that obligation without repaying the principal amount?
– The suggestions made by the Leader of the Opposition, if adopted, would not solve the problem. He made no reference to the interest on our war or other debt; so far as he is concerned, the Commonwealth can continue to pay that interest. He would save £1,000,000 annually by reducing the salaries of public servants and parliamentarians who, by the services that they render, honestly earn what they receive. That would be a wage cut pure and simple. Another of his proposals is to withdraw the maternity allowance from some mothers in this country. Then, he would save £146,000 a year by wiping out the bounties that are now being paid. Is it not better to pay that amount, and so stimulate industry, even if we pay some of it “ through the nose “ ? So long as the resources of this country are developed, why find fault with such expenditure? Are the results that accrue from the payment of interest comparable with those that are obtained from the assistance that is given to industries? The Leader of the Opposition does not say a word about the biggest incubus that rests upon the Commonwealth to-day; but he would neglect opportunities to develop our industries. The object of every bounty, whether it be paid on the production of butter, wine, dried fruits, flax, or any other commodity, is to develop our industries, and to lessen the burden under which our people are struggling to-day.
Another direction in which the Leader of the Opposition would economise is in connection with, the grant for unemployment relief. He would allow starvation and degradation to stalk naked through the country. Unemployment is sufficiently serious at the present time to make us refrain from doing anything that is calculated to increase it. The honorable gentleman proudly referred to the fact that the ratio of unemployment is now IS per cent. Early in this session he said that it was 13 per cent. If his proposals were adopted, it would be 55 per cent, next year ; every one would be begging for a crust, except those who happen to he firmly entrenched by reason of their wealth, and can live on the interest that they draw. There is no hope for the workers in the suggestions of the honorable gentleman.
A further retrograde step that he proposes is to reduce by £1,500,000 the grant for the construction of roads. According to him, our roads must be allowed to deteriorate because it is necessary for us to economise. Honorable members should be able to sense the motive behind any proposal, and visualize where it will lead us. What would be the position if the vote for road construction were reduced by £1,500,000? Unemployment would follow in the train of such a step, and there would be stagnation.
The honorable gentleman also says that the coal subsidy of £150,000 should not be paid. There again he favours the maintenance of penury, degradation and misery, because there has been a big struggle between the coal barons who own the mines and the coal-miners, by whose efforts the coal is made available for profitable use. The interests of the big fellow arc to be conserved, while the poorer class can “ go hang “.
The final proposal of the honorable gentleman is that £3,000 should be saved on the industrial peace tribunals. Honorable members opposite do not want industrial peace; they have already indicated that they favour the law of the tooth and the claw; an open go; the law of supply and demand, freedom of contract, a reversion to “ the good old days “. Peace tribunals are the last things that they desire. They claim that they are in favour of industrial peace, but they talk with tongue in cheek, and their professions are a huge joke. 1 ask honorable members to analyse the alternatives to the budget proposals that have been submitted by the Leader of the Opposition, and to decide whether they will prove beneficial in correcting the present financial position. I say that they will not. What we are struggling under to-day is the burden of interest that has been, is being, and will be incurred in the future, unless prohibitive measures are adopted?
– What does the honorable member propose?
– The honorable member for Fawkner and the honorable member for Lilley have asked me for my alternative. I point to the figures that, relate to the war debt. They are one of the blackest blots on the escutcheon of thiB Commonwealth. I helped to do what, was considered essential for the safety of this nation. The honorable member for Fawkner knows as well as I do, that over a quarter of a million men went from this country to do that job, and that they did it. In France and on the other battle fronts lie 60,000 Australians who made the supreme sacrifice to save this Commonwealth from what it was presumed, would be its fate had we lost the war; and the number is considerably augmented when we add those who made other sacrifices. But those who put their’ money into war loans did not make a pennyworth of sacrifice. The figures reveal that they have received by way of interest almost as much as they put in. In another ten years this Commonwealth will have paid them in interest what they invested, and will still be indebted to them to the extent of the principal amount. [Quorum formed.’] That is the cause of the trouble that we are now in. I raise my voice in the strongest protest against the continuance of the policy of paying for an investment that was designed to protect the interests of those who at that time had this country in their power.
– How does the honorable member propose to reduce the amount?
– I shall not leave the honorable member in the dark. My proposal will make him hold up his hands in holy horror. I do not know what his attitude was during the war, nor do I care; but no one can justify the payment of £219,000,000 to people who never made an ounce of sacrifice, nor suggest that hundreds of thousands of our people shall walk the streets unemployed so that we may continue to make those payments.
– What does the honorable member propose to do about it?
– I shall state my proposal directly, but I know that the Government will not accept it. The honorable member knows what my views are on the subject.
– It looks as though the honorable member is ashamed to say what they are.
– I am not. But I want to emphasize my point so that the honorable member will not be able to escape from.it. I am drawing attention to the enormity of the offence that is being committed by those who stand for the present practice. Men are being penalized so that interest may be paid on idle capital. What is the honorable member going to do about it? Will he say that this is an equitable charge upon the returned soldiers of this country?
– What does the honorable member propose to do about it ?
– When a sufficient number of persons think as I do in regard to this iniquitous burden that is placed upon our people, and that will be placed upon posterity, no hesitation will be displayed in adopting what I propose, and no one will be hurt or unjustly treated in consequence. The interest that is being paid on idle capital is the cause of our troubles to-day. I have heard the honorable member for Fawkner frequently approach very near to the preaching of a sermon on Christian principles in this chamber. I invite him. nay, I challenge him, to read biblical history, and therein to learn the fate of usurers in the days when Christianity was not a fad, as it is to-day, but was more practically applied. He dare not stand up and say what was their [i<!4;i fate in the times of which I speak. These people are ultra usurers, because they are charging interest without having rendered any service or made any sacrifice. Other people lost their lives, and many are in ill health to-day, in consequence of what they did.
– What does the honorable member propose to do about it ?
– I shall say presently what I would do to solve the problem, but first let me say that I intend to take every opportunity that is presented to me to tell the people exactly what is happening. Whenever honorable members opposite address the members of Millions Clubs, Constitutional Clubs, or other similar bodies on this subject, they forget to refer to the fact that £219,000,000 of interest has been paid to the moneylenders for the rendering of no service whatever. The people who lent this so-called money did not render any service to the country, yet they are now calling upon the whole community to pay tribute to them. Their promises to the soldiers have not been fulfilled, because the men who fought in the war are themselves now obliged to make their contribution towards the heavy interest costs incurred through the borrowing of this alleged money.
– But the honorable member has not yet said what he proposes to do about it.
– My present object is to place all the facts before the honorable and learned member, so that when he comes to pronounce judgment upon my proposal he will not be ignorant of either my motives or the facts of the case. I desire to lay all the facts naked before him. The first point that he must recollect is that we have already paid £219,000,000 of blood money- as it was called years ago - to the money-lenders.
– Who provided this money on which we are now paying interest?
– The so-called patriots of this country. But who provided the flesh and blood which fought the war? The honorable member knows very well that the mothers and fathers of’ the country provided it. And now many of the fathers, at any rate, are obliged to seek relief work in order that we may keep up our interest payments on moneythat was never actually borrowed.
– Much of the money was provided by the poor people of the community.
– They did not provide a penny of it. The credit of the country was manipulated by our financiers, who misled the people into believing that they were lending money when they were doing nothing of the kind.
– Anyhow, this Government is asking the people to provide it with more money now, and the honorable member is supporting it in so doing.
– The honorable member for Warringah (Mr. Parkhill) knows very well that the Government is taking this action in opposition to my views.
– I rise to a point of order. I ask whether this constant interruption of the debate is in keeping with the practice of this Parliament?
The CHAIRMAN (Mr. McGrath).I appeal to honorable members to cease their interjections.
– The honorable member for Warringah knows that if I had the power to do so I would take a very different line of action from that which the Government has* adopted.
– Yet the honorable member intends to vote for the Government proposals’ although he disagrees with them. In that respect he is guilty of lack of honesty and sincerity.
– These continued interjections are entirely out of order, and if they do not cease I shall be forced to take certain action.
– I should like to see you do so, Mr. Chairman.
– I do not desire the Minister for Health to interrupt.
– The honorable member for Warringah has accused me of dishonesty and insincerity; but he knows very well that I shall do the same thing that he would do if he were in my place. I shall support the Government in this instance, because I approve of its policy in general, though not its policy in this particular. I believe that the continued payment of interest on this so-called loan money is wrong, and should be stopped.
– Does the honorable member suggest that the persons to whom war bonds were issued did not pay money for them?
– That is exactly what I suggest.
– But the honorable member accepted interest in respect cif the war bonds which were issued in his name.
– Ah, I thought I should catch the honorable member for Warringah sooner or later. Let me remind honorable members that I enlisted for active service and went to the war when I was 46 years of age. I need not have gone, as they very well know. Certain circumstances arose which appeared to me to make it desirable for me to help a certain gentleman out of a difficulty. Some honorable members know the name of this person. I bought a £30 bond from him, and I also bought a £50 bond, and lodged them both in the Commonwealth Bank. I was asked by the authorities what they should do with the interest, and I replied “Pay it back to the Commonwealth Government for I do not want it.” There is my answer to the honorable member for Warringah. The interest continued to be paid back to the Commonwealth Government until the. Go,vernment, which honorable members opposite supported, gaoled me. I waa gaoled simply because I was a politician. Honorable members know very well that trouble broke out on the troopship Argyllshire in Sydney, but none of the men concerned in it were gaoled. But although no trouble occurred on my boat. I was put into prison.
– I am still awaiting an answer to my question as to what the honorable member proposes to do to reduce the interest bill.
– I shall give the honor: able member an answer in good time. At present, in between the interjections that are being made, I am trying to explain how the Commonwealth came to be involved in this whole business. According to honorable members opposite, this incubus should be allowed to press on the people for all time.
– But how does the honorable member propose to reduce the bill ?
– I am coming to that. The honorable member for Darwin (Mr. Bell) has said that real money was loaned to the Commonwealth for the prosecution of the war, and that -some of it came from the poor people of the community. I say that not a penny of it came from them. Take my own case. I paid a cheque and some bank notes into the Commonwealth Bank for my bonds, and they were credited to my account; but I was issued with other paper which was just as useful to me as the paper which I gave for it, for I was able to use it in the same way. The bonds which I received were equivalent in value to me to the paper which I gave in exchange for them. Honorable members know very well that during the war period a notice appeared in the windows of many of our business houses which read “ Commonwealth bonds taken.” The bonds were, therefore, just as useful to the ordinary man as his bank notes and cheques, and the cheques and bank notes were just as useful as the bonds. Yet in their zeal to repay the people who were largely responsible for this exchange of paper, honorable members opposite want to cut down the wages of the Civil Service, reduce the maternity allowance, cut out the roads grant, and inflict other hardships upon the community. This is to be done simply to pay tribute to the usurers who bled the Commonwealth white during the war, and who have ever since been bleeding it by taking unearned interest from it.
– But will the honorable member say what he proposes to do to reduce the interest bill?
– Yes; I have a very sound method of reducing it.
– Did the honorable member ever try to get a war bond without paying for it ?
– The war bonds, as everybody knows, have coupons attached to them. Many people used the bonds and coupons just as they used bank notes and cheques. A man could go into a shop almost anywhere and pay for anything that he wanted with a war bond. I would pay to the bond-holders exactly what the bond-holders paid to the Government. If I were the Commonwealth Treasurer, and was assured of sufficient support from my party, I would instruct the Treasury officials to hand back to the bond-holders Government security - Government notes, if you like - equal in value to the bonds that they held. This would obviate the payment of any further interest. Seeing that I have made this statement, I hope that it will never be said in the future that I have not indicated definitely what I would do to meet the position.
It is very well known that the national credit was used years ago in a way which enabled certain big public works to be constructed without the raising of socalled loans on which interest would have to be paid. Just as Government securities were issued in respect of those works, so they could be issued in cancellation of our war debt.
– I should have no objection to the honorable member reducing the interest bill by repaying the principal.
– I am glad that the honorable member for Fawkner (Mr. Maxwell) is converted to my view. To -put it in a nutshell, I would repay the principal in the manner in which the principal was loaned to the Government.
– By making the printing presses work harder!
– Not at all. I should do it by merely pushing the pen. I should not be so silly as to print £1,000 notes, to be kept in a strong room. I have no time for such futilities as that. If the honorable member for Lilley (Mr. Mackay), for instance, held any bonds, I should simply say to the proper authorities, “Mr. Mackay has a credit of so much in respect of certain war loans. Pay him the amount in Commonwealth notes.” The honorable gentleman could then bank the notes in the Commonwealth Bank or any other bank, or do as he liked with them. That is the way in which I would liquidate the war debt. If we had a Treasurer in office who possessed sufficient courage, and had sufficient support behind him, to do this, it could be done without hardship to anybody, and with great benefit to the whole community, and we should no longer be required to meet the heavy interest charges that we are at present meeting. I shall take another opportunity of developing this subject still further.
I wish to deal for a few moments with the incubus of interest charges which is crushing our railways, and which the workers of Australia are being asked to pay. The following official figures show the profit or loss in the working of Australian State railways, together with the loss after paying interest, and also the amount of interest paid: - lt will be seen that the profit on the working of the New South Wales railways was £4,637,506; hut as the interest amounted to £5,676,952, the loss, after paying the interest, was- £1,039,386. The railways of Australia are working at a profit, but when the usurer’s pound of flesh, and as much blood as ho can extract, has been secured, they show a loss. Although this is styled a live debt, and the war liability is called a dead debt, they are both as dead as Julius Caesar. The total profit on the working of the State railways is £9,908,326; but the. interest amounts to £14,708,565, leaving a loss, after the payment of interest, of £4,800,239. That was the position in 1929, and in the currout year the position is much worse. Losses amounting to £3,000,000 in New South Wales, and £1,000,000 in Victoria are expected. For whose benefit are the railways of Australia conducted? For whom do we all toil and moil when we pay interest to the extent of £22,000,000 a year on our total debt, and interest on our war debt amounting to £17,380,S08 ?
I leave the matter at that. I shall have another opportunity ofl speaking on this subject. I hope that I have not left any honorable member in doubt regarding my attitude to the budget. I do not agree with any of the reductions proposed by honorable members opposite. [ stand for a repudiation of interest charges on any further loan commitments, because the credit of the Commonwealth can be, and has been, used for the benefit of the nation. As to the war debts, it is time we said to the “ patriots “, “ Hands off! No longer shall you throttle the people who have sacrificed themselves to protect you. You have bled them white, and placed on them and on posterity a staggering debt to the extent revealed by this budget.”
– It is quite clear to all of us where the honorable member for Adelaide (Mr. Yates) stands. I think that we are under an obligation to him for having gone to such pains to clarify a difficult situation, and to relieve that curiosity which most of us have felt for a long time concerning the financial panacea that he has been concealing from us. His solution of the financial difficulties of the Commonwealth is that which was adopted by that delightful character of Dickens, Mr. Micawber, who, on being pressed to pay a debt, would give a bill, with the exclamation,’ “ Thank God, that’s settled The honorable member proposes merely to give the money-lenders - the usurers as he calls them - an acquittance.
– Drawn upon whom ?
– Upon the people of Australia; but he does not propose to provide the money with which to meet that acquittance, and when the bond; holders go to the bank for their money there will be none to meet it, unless the printing presses are set to work to provide paper money. The Government which the honorable member supports is now appealing to the public for a loan, aud the one ray of sunshine in tho budget is that, despite all our troubles, we can still borrow from ourselves. Although our credit abroad is low, it is good at home; our. own people trust their Government. If subscriptions to the present £10,000,000 loan were not coming in day by day, the Government would not be able to carry on. I submit that the honorable gentleman, as a responsible member of this Parliament, should recognize this position. What would be the response to the present loan if the Government said to the people “ We shall take your money, but we shall pay you nothing for it, and you will never see the principal again”? Let echo answer. The honorable member might as well say to one of his fellow-members, “ Lend me £100. I shall pay you no interest, and I may never pay you back the principal, hut trust rue fis one good fellow to another.”
An interjection from the gallery-
– If the person in the gallery who has interjected offends again, I shall have him removed.
– It seems to me that the crux of this debate is the suggested reduction in governmental expenditure of £4,000,000. The brain power of this Parliament is now concentrated upon the problem of how we may cut down our expenditure by this sum. It seems to me that we are taking the steam.hammer to crack a nut. Outsiders must think that there is an amazing lack of statesmanship among us if our whole time is being occupied in an almost futile way in trying to decide on which items in the Estimates this £4,000,000 is to be saved.
To make my position quite clear, let me say, at the outset, that although it is a legitimate political gesture on the part of the Leader of the Opposition to move for a reduction in the Estimates^- this was repeatedly done in connexion with other budgets when the party now in l>ower was in Opposition - I consider that every honorable member on this side, and certainly every member of the party to which I belong, has a perfect right to indicate in which directions he thinks economies should be effected. I tlo not for a moment agree with some of the proposals of the Leader of the Opposition. Even though I may support the general proposition that the Estimates should be reduced in order that £4,000,000 might be saved, I cannot favour some of the proposed reductions. To the suggested savings of £1,000,000 on the Public Service and the Parliament, £130,000 on bounties, and £1,500,000 on roads, I take, exception. Item such as unemployment relief, the coal subsidy, industrial peace tribunals, and the maternity bonus are open to argument, and lend themselves to reductions.
E particularly object to the proposed grant of £1,000,000 by the Commonwealth to the States, which is one of the causes of this overloaded budget, and of our present financial difficulties. The Government of New South Wales has just imposed a tax of 3d. in the £1, without exemption, except of those persons with incomes under £80 a year, and that represents a heavy increase in income taxation. The tax applies practically to all wage-earners, and it is expected to bring in £3,000,000, which, it is estimated, will provide for most of the unemployment in that State. That is a fair tax. There is no reason why the Commonwealth Government, which is hard up itself, and which, according to the honorable member for Adelaide, may be reduced to repudiation of some of its financial commitments, should intrude itself into a sphere into which it was not invited, and say to the States’ “Here is £.1,000,000. We have not the money; but wo are going to find some way of raising it, and of getting it back from you.” This is simply giving away money for which the States have not asked. Then the Government proposes various devices for getting the money back, with a’ million or two extra. I object to that item, not because I am unsympathetic towards the unemployed. I realize that the Commonwealth is faced with a terrible problem. We have always had this trouble; but it has steadily increased in intensity in the last twelve months, until now it has become most serious for the whole of Australia, and it is the duty of governments to relieve it. The States are standing up to their responsibilities, and the Commonwealth, so far as it is able, is doing its share, too. But the various steps proposed by the Government to relieve the financial situation would merely intensify unemployment. One of the greatest causes of this evil is excessive taxation.
This Government proposes to tax the hide off industry. All the governments in Australia are doing that, and that is one of the reasons why our internal loans are so popular. Investors are looking for gilt-edged securities : ordinary private investments are not regarded as safe. This uneasiness is not duo to the amount of interest offered on the money invested; there is a general feeling that it is unsafe to invest money in any undertaking that has not the security of the Commonwealth behind it. That is why the people are readily taking up Commonwealth loans at 6 per cent.
– Even these will not be safe if the views of the honorable member for Adelaide (Mr. Yates) are put into effect.
– That is so. It is the duty of every honorable member of this House to examine the causes of the present depression, and to suggest remedies. If our suggestions are not acted upon, we shall have at least the satisfaction of knowing that we have done our duty as we see it. At the present time the term “ economic “ is being very greatly overworked. There is not an article printed in any newspaper in Australia which does not use it half a dozen times. There is not a speaker in this House who does not use it probably a hundred times in the course of his speech. It is a word with which the whole community is very much concerned, but I doubt whether any other word in the dictionary has ever proved more misleading, or created greater confusion of thought. We have our economists, and no doubt some of them are able and useful gentlemen, but is there in Australia to-day any economist whose pronouncements have served to clarify the situation in any way? I do not think that the” utterances of politicians or statesmen have been very helpful either. Are we any nearer- to the solution of our economic problems than we were ten years ago?
– We do not try to prove the advice given.
– But every economist offers different advice. No two of them express exactly the same opinion about the same problem. I am not going to pose as an economist. I have read their opinions with great interest, and tried to form my own conclusions. In my opinion, the causes of the present crisis, so far as the Commonwealth is concerned, are a decline in customs revenue amounting to £8,000,000 this year, plus a decline of £5,000,000 in the two preceding years, together with our heavy war debt commitments. The decline in customs revenue is the immediate cause of our troubles ; and the long standing cause is our wartime commitments amounting to £31,000,000 a year. We have to pay £21,000,000 in interest on war loans, and that payment is inescapable for the next fifty or sixty years, at any rate. An additional £10,000,000 has to be paid for repatriation purposes, including military pensions. Thus, out of every £2 collected by the Commonwealth, £1 has to be tucked away to meet wartime commitments. That burden must be borne, and nothing is gained by complaining about it. The loss of customs revenue is not necessary, however, and we have a right to complain about it. As a member of the Country party, representing a section of the community which is severely hi; by the decline in customs revenue, I protest against the Government’s policy. The Prime Minister in his budget speech said that the main cause of the huge deficit this year was the decline of £8,000,000 in the customs revenue, due to the imposition of embargoes and prohibitive duties. These impositions, he said, were necessary in order to correct our adverse trade balance. That may have been one of the reasons for them, but was it the orb reason ? Was there not behind what was done a feeling that here was a heavensent opportunity to carry out the policy which the Labour party has enthusiastically . enunciated ever since . the war, namely, that Australia should be made absolutely self-contained industrially. Long before the present crisis arose, I heard the late Treasurer, Mr. Theodore, express in this House the belief that we would have to adopt a policy of prohibition of imports, and he has said very much the same thing outside the House. It is evident, therefore, -that the policy which the Government has now put into operation has been for years a definite part of its political and industrial programme.
The Labour party favours the prohibition of imports, not because it regards that policy as economically sound; but because it regards it as necessary for its own preservation. I do not want to be unfair to my friends opposite; but they must recognize that I speak the truth. Selfpreservation is the first law of men’s political natures. The Labour party to-day is absolutely dependent for support, and its hopes of office, on the masses of industrialists in the big capital cities, which have thriven on the policy of high protection. Year by year for the last quarter of a century the number of the industrialists in the big capital cities has grown tremendously mainly due to the development of factories. At every redistribution country districts have lost representation, and the cities have gained. This has gone on until in New South Wales and Victoria it has become necessary to regard the city vote as of less value than the country vote, in order to give the country people some say in the government of the country. The Labour party has benefited from this situation. Decade after decade the metropolitan populations are becoming more industrialized, and Labour is winning more and more seats. The policy of Labour, therefore, in the interests of its own preservation, is to intensify the present high protection policy, so that we shall not only shut out all imports, but increase the amount of employment offering in the big cities, so as to guarantee the Labour party a monopoly of political power, both in Federal and State spheres. If this policy is pursued, the inevitable conclusion must be that parties other than Labour will lose all prospect of ever gaining political control, either in the Commonwealth or in the States - a condition of affairs which, at the present rate, is probably not more than ten years distant. The industrial classes in the cities are becoming so regimented by the trade union movement that it is becoming increasingly difficult for the rural interests to obtain any say in the government of the country. The political dice are loaded against us, and the Country party must make a stand on what it regards as the basic causes of our present troubles. The Leader of the Country party (Dr. Earle Page) outlined the only policy in which there lies salvation for Australia. If we accept the position that the rural industries - such as wool-raising, wheatgrowing, &c. - should be preserved, and our export trade maintained, we must take steps to prevent the drift of the rural population to the cities.
– Did we not bring in the Wheat Marketing Bill?
– Yes, and most members of the Country party supported it. In the opinion of the Labour party, the great thing is to keep the population in the cities, and its policy is having the direct effect of sucking the rural population into the great metropolitan areas, in which are concentrated over 90 per cent, of the country’s factories. The Government has seized on the present crisis as an excuse for putting into effect in a single instalment a policy which it might otherwise have taken ten years to carry out. This year alone its policy has resulted in a loss of £8,000,000 of customs revenue. What will happen next year? Perhaps £10,000,000 may be lost. Are we to go on losing such enormous .sums every year, and will this condition of national hysteria be perpetuated? Half the population is talking about economics of which it knows nothing. Professors of economics are springing up like mushrooms in the night, and offering us different advice every morning. The Government has made no attempt to stabilize the position. It has not looked ahead. The budget makes provision for this year only, and more drastic measures will probably have to be taken to balance our finances next year. The States are taking their cue from the Commonwealth. The Government should not allow itself to be stampeded into pursuing a policy which is causing widespread depression and anxiety throughout Australia. If its policy is responsible for this enormous drop in revenue it is reasonable to suggest that that policy should be altered. That is what the Country party is suggesting. I am sorry that our friends of the Nationalist party have not devoted as much attention to tariff matters as they might have done. With one or two exceptions they are not awake to the’ gravity of the situation.
– They have other interests to serve.
– Probably; but we of the Country party represent the country people, who are being crucified by this policy. We should be recreant to our trust, and contemptible in the eyes of the people, if we did not point out the real cause of the crisis, and indicate where the Government’s policy is leading the country.
The excessive borrowings during the last ten years have been . responsible for the existing, financial depression in the States. The figures are absolutely staggering. The war debt in 1930 was £44 5s- 9d. per head, and other debts £129 17s. 13d. per head. The increase in the debt since 19.1.4 has been £105 12s. per head. That shows conclusively that the real trouble with Australia is not its war-time commitments, which we can carry, but the excessive borrowing which has been carried on by all the States. Now we have reached the point of exhaustion. The States predicted that a financial depression was inevitable, yet they continued like a dissolute character to spend extravagantly until they reached the final stage, when the last shilling had to be considered. Are they repentant? There is no sign of repentance among any of the State Governments to-day. If they could borrow money, they would resume the orgy of expenditure to which they have been accustomed for the last ten or fifteen years. It is the duty of the Commonwealth Parliament, if possible, to put a sprag into the wheel of the States. Wo are the representatives of the people, and the real national problems of Australia are upon our shoulders.- Wc should do everything within our power to prevent. the States from resuming their borrowing mania, which has brought Australia almost to the verge of financial ruin. The Bruce-Page Government, which I supported for six and a half years, has received many kicks, and probably some of them were deserved. Every Government deserves kicks. But what has been steadily ignored is the fact, that the Bruce-Page Government was the only Government that made a serious attempt to cope with the problem of the future borrowing of Australia. It is mainly because of that Government’s insistence upon the taking over of the State debts by the Commonwealth, and the establishment of a permanent and sound debt redemption fund to which the Commonwealth is a heavy contributor, that any credit is left to us to-day. If the Bruce-Page Government had not cleaned up a portion of the financial mess, we should now have no credit abroad at all. The little that is left to us is the only thing that enables us to carry on. The Bruce-Page Government made provision for future borrowing. I do not think that it has received due credit for that action, the value of which, as time goes on, will be recognized.
The States have borrowed as much as they can, and now it is a matter of taxing the people in order to pay interest on our loans. For many years, interest payments were mci out of revenue, but that practice bas ceased. Our railways represent 90 per cent, .of the public debt, yet they asclosing about £10,000,000 per annum. They have helped considerably in bringing about Australia’s deficit. Last year, the loss on the railways was £8,000,000. That loss is accumulating all the time, and there is no sign of improvement. In New South. Wales, the loss was £3,000,000; in South Australia: £2,000,000; in Victoria, £1,000,000, ami in Queensland, £2,000,000. It is becoming a normal position. Yet those assets, which are losing money all the time, represent 90 per cent, of the money that has been borrowed by the States.
Mi-. Lewis - Would the honorable member increase fares and freights?
– We cannot make the railways pay while the country population is declining, and our rural industries are stagnating. According to Commonwealth statistics, the great majority of the country towns of Australia show n definite decline in population at the end of every decade, while the capital cities show a definite increase.
– The loss on the railways is due to the competition of motor transport.
– That is one factor.
– Docs the honorable member believe that the Commonwealth should take over the State railways?
– That is another question altogether. One of the big factors in the loss on the railways is that the population of country districts is declining year by year.
– What is the remedy?
– I do not expect men who have lived in the city all their lives - trade union secretaries, such as the honorable member, for Corio (Mr. Lewis) - to have any country outlook nt all.
– The honorable member mould not talk about things of which he Was no knowledge.
– The honorable member, since he has been in this chamber, has acted like a little boy. He has done nothing but throw mud and stones at honorable members who are trying to solve the problems of the day. His practice of saying “Yah, yah”, and “Boo, boo” to every suggestion from this side has been pursued too far. The honorable member is gaining a reputation that will take some living down.
Our excessive borrowing policy has led to the closing, down of government works, and a consequent increase of unemployment. One of the main reasons for the enormous, increase of unemployment in the capital cities is that the State Governments have unnecessarily closed down certain works. We must recognize that the great bulk of our loans have been expended in the capital cities. Land values have consequently been inflated, although to-day they have slumped slightly. The total losses of the States are represented by expenditure that has been incurred mainly in the capital cities, and the direct outcome of the expenditure has been an enormous inflation of land values. One way out of our difficulty is to tax those land values, but that form of taxation has been shirked in respect of the capital cities. A tax of id. was levied in connexion with the North Shore bridge which was to cost £4,000.000, but which will probably cost £8,000,000. That work has enormously enhanced land values on both sides of the harbour, particularly on the north side, and yet the people who pay this tax of id. have not ceased to agitate for its withdrawal. All this expenditure, which has been incurred mainly to benefit the capital cities and to fill the pockets of the city land-owners and speculators, has brought about no increase of land values in country districts. Sydney has had one of the greatest building booms in Australia’s history ; but it is coming to an end. The country people should not have to bear the same burden as the people of the cities, which have derived practically the full benefit of our borrowing policy during the last ten years.
Another factor in our present financial position is the decline of the national income which the Prime Minister estimates as between £50,000,000 and £70,000,000. Other people estimate it at £100,000,000. We have been told by experts that there has been a reduction of 20 per cent, in our taxable income; therefore, the Federal and State Governments have 20 per cent, less income to tax. Yet what has happened? Those Governments have increased taxation by 20 per cent., and, in some cases, by more than that. During the last 12 months, the Commonwealth Government has increased income taxation by much more than 20 per cent. The total amount of State taxation, apart altogether from railway revenue, increased, between the years 1924 and 1929, from £20,000,000 to £32,000,000, an increase of over 50 per cent. In the same period, our taxable income decreased by 20 per cent. There are many economic factors to consider in attempting to correct the financial position. One salient point is that the States have borrowed prodigiously, and expended the money on works which are not paying interest. That has to come to an end; in fact, it. has come to an end. Because of that the States to-day cannot maintain the same rate of employment as before, and, consequently, people have been thrown out of work. The salient point, so far as the Commonwealth is concerned, is the policy of this Government in practically closing up the main sources of our revenue, which are income and land taxation and customs revenue. We have now no money to expend. We are losing, and will’ continue to lose, a certain amount of revenue, and, until the Government changes its policy, we have to look around for avenues of revenue to enable us to make up the leeway.
We cannot alter the Government’s policy while we remain in opposition; we can only make suggestions for the establishment of Australia’s credit abroad, at the same time doing the least harm to those sections of the community that are least able to bear the increased burden of taxation. One proposal is that there should be a general reduction in the cost of government. The cost of government has increased prodigiously in Australia during the last ten years. Our population has also increased by at least a million. But the increase of expenditure is out of all proportion to the increase of population. Most of our expenditure has been incurred on works of potential value, but which are not paying interest to-day. It is obvious that a saving of £4,000,000, as suggested by the Leader of the Opposition (Mr. Latham), will not right the position. This is a much bigger issue altogether. It is a matter of fundamental policy. Since we have closed our main sources of revenue, such as taxation and imports, we shall have this problem of deficits before us next year and probably for all time.
Sitting suspended from 12.45 to 2.15 p.m.
– Thereseems to be no prospect of reaching a decision regarding which items of expenditure shall be reduced. As the matter is of such great importance, there is a clear case for a non-party gesture. I am not suggesting anything in the way of a non-party government; that, I realize, is out of the question at the moment. But a non-party committee, representative equally of both sides of this chamber, should be asked to decide whether, and in what directions, £4,000,000 can be saved this year, and to report its conclusions to Parliament. If it turned out that that committee, which should consist of the leading members on both sides, was not able to formulate a practicable proposal, it would be quite clear that it was a matter for honorable members themselves to determine on a party basis. The press and the public outside are demanding a reduction of government expenditure, and there is apparently a considerable difference of opinion as to whether it is practicable to make that reduction. We should pay deference to outside opinion to the extent of doing everything possible to ascertain whether that demand is justified. If my suggestion were adopted, honorable members on this side would approach the matter in a truly non-party spirit, and a great deal of debate upon this budget would be avoided. A new era in politics would be ushered in, and we should witness a genuine non-party effort to deal with the problems that are causing such grave consequences in Australia to-day. My proposal is confined to the decision whether £4,000,000 can be saved in the expenditure of this year ; it has no relation to general political issues. In the last five years, apart from Customs revenue and business undertakings in the Commonwealth, as well as railways and business undertakings in the States, the expenditure of Australia, State and Federal, has increased by £50,000,000. That represents a very big issue for the public, and it cannot be dealt with in a cheese-paring, pettifogging spirit. The closing of the parliamentary refreshment rooms, as the honorable member for Angas (Mr. Gabb) suggested, would be of no use. A saving of only £5,000 would be made in that way, whereas £50,000,000 are involved. That is one of the most childish suggestions that have been made in the course of this debate. The purpose of the parliamentary refreshment rooms is not merely to save honorable members the trouble of walking to their hotels for meals. As an institution they are a parliamentary tradition of very long standing. If the honorable member’s suggestion were adopted, we should be the laughing-stock of Australia. It would be said thatwe gave our attention to paltry matters, and shirked big issues.
– We are now the laughingstock of Australia in regard to many things.
– It is such suggestions that make us a laughing-stock, because they show that we are not big enough to deal with important issues. The closing of the parliamentary refreshment rooms would throw out of employment men who have given life-long service to the Commonwealth. The big national crisis with which we are faced cannot be tackled in that way.
The way out of our troubles is by a reduction of government expenditure. The principal cause of those troubles is government expenditure, not upon administration as such, but upon unprofitable undertakings. That is clearly proved by statistics. It is questionable whether we can carry on those unprofitable undertakings for an indefinite period. Apparently we shall have to do so for some time to come; and the question arises, can we make up the leeway by savings in administration ? . Possibly we can ; but where are we to begin? It is suggested that a commencement could be made by reducing the salaries of Ministers and members of Parliament and of public servants generally. The contention is that thereby a saving of £1,000,000 per annum would be effected. The deficit in customs revenue this year is £8,000,000, and it may be increased by another £8,000,000 next year if the policy of the prohibition of imports continues; therefore, our position would not be materially improved by adopting that suggestion. Is it proposed that there shall be a further cut next year? The suggestion may possess certain merits if it be confined to this year. But if equally serious problems have to be faced next year, it will not get us out of the wood; it will merely help to intensify the general depression, and prove that Parliament is floundering, and has no practical solution for its problems. Any man who says that he is not worth the money he is receiving, is foolish; such a statement is a confession that he has been receiving it under false pretences. I do not consider for a moment that that is a sound attitude to adopt, and I do not propose to ally myself with it. But if it is the general opinion of the public that we should reduce our salaries and those of the Public Service, we must endeavour to ascertain where such a course is likely to lead us in the future. We cannot continue to reduce salaries. It is argued that the object is to relieve unemployment. Unemployment is always with Us; but according to the Leader of the Opposition (Mr. Latham), the ratio is now 18 per cent., or one in every six persons. That is a very serious matter to the people. But will unemployment be relieved by the reduction of our salaries and those of the Public Service? If it will, by all means let us make the reduction. But if it is merely a gesture to pander to the mean, contemptible spirit that for the last few years has been fostered in Australia against parliamentarians, simply because they are parliamentarians, it will- be a sign of cowardice on our part if we make it. The Commonwealth Parliament is the Parliament of Australia. It has a prestige to uphold, and it cannot uphold that prestige if it is susceptible to every period of depression and every wave of hysteria that results therefrom. We should have sufficient backbone to say that the salary of the members of this ‘Parliament shall be a certain amount, and not be subject to alteration, and that the salaries of public servants are to be determined under the arbitration system of this country without interference by this Parliament. If we did that we would show that we had the courage of our convictions. But if we take fright because there is an outcry outside as the result of an unpopular budget, where shall we end? Eventually the stage would be reached when it would not be worth anybody’s while to be a member of the Public Service. It is not fair either to ourselves or to the Government that this issue should be continually raised. We find that, as a result of the ever-swelling popular cry that the salaries of members of Parliament should be reduced, there is no stability in State politics to-day. In New South Wales the salaries of members of Parliament have been raised twice and reduced twice in the last ten years. I do not believe that that Parliament has gained in popularity, or that its prestige has been enhanced in any way as a result.
– And not one additional man has obtained work.
– I strongly agree that it would be a good gesture to make, in that it would show that we were prepared to share the sacrifices that have to be made by everybody else. But there must be some finality; if we share them to-day, are we to be expected to share them to-morrow; and, if there is a return to prosperity are we to have them restored? Everybody else expects the arbitration system to make good in times of prosperity what is lost in times of adversity. But that is not suggested in this case; the idea appears to be that our salaries must come down - and once they are down they will stay down. Is it not contemptible for one party to make political capital out of this question of salaries ? I do not subscribe for a moment to such a policy. I am not prepared to support a proposal to reduce the salaries of members, knowing that it will not be carried, so that I may make for myself a halo, and be able to say, “I was in favour of it, but the Labour fellows would not agree to it, and the only reason that 1 accept my salary of £1,000 to-day is that the Labour party will not allow me to take less”. Persons who would take that stand are too contemptible to be members of the National Parliament. I do not say that we should not receive less if the public generally think that we are not worth what we are getting; but as we have no arbitration system for fixing our salaries, we must ourselves accept the responsibility for fixing them. This should not be made a party issue; it is unfair to subject one party to adverse criticism for fixing salaries which members of all parties receive. This vexed question could be settled once and for all if the members of all parties would meet in conference and settle it. If we reckon in the members of all parties in both Houses of the Parliament, we shall find that the parties are fairly equal in numbers, and I venture to say that if they were to meet together and hold a secret ballot on this subject, a true indication of the opinion of all members would be obtained; no one party would have to bear the blame for the decision, and everybody would be satisfied. It is entirely unfair tln.it one party should endeavour to make political capital out of the decision of another party on this subject. If the procedure that I have suggested were adopted, not only the general public but the members of all parties also would be satisfied.
– We should then all be able to go out and say that we had voted against higher salaries!
– It is quite likely that some honorable members would vote for an increase of salaries to £2,000.
– I now come to the subject of unemployment. Our first business is to determine how much of the responsibility for this rests with the Commonwealth Government. It is generally admitted that the States are principally responsible for the unfortunate position that prevails to-day, for they found it impossible, to continue their heavy borrowing policies, and, therefore, had to discontinue the construction of big public works. But it has also been suggested that the fiscal policy of the Common wealth has had a good deal to do willi the croation of unemployment, and h;i.* reflected adversely, upon the financial stability of the States. If that is so. the Commonwealth may justly be called upon to assist the States to settle their unemployment problems. But should any such contribution be made by a reduction of Civil Service salaries? That, I submit, would be quite the wrong way to raise money for this purpose. The Civil Service should not be the cockshy of politics, and should not be specially penalized every time a wave of depression occurs. We have provided certain arbitration machinery for the determination of Civil Service salaries, and the matter should be left for settlement by those means. Our Arbitration Court has already taken steps to regulate wages in the shearing industry to the prevailing economic conditions. If the Government feels that Civil Service salaries should be reviewed, it should submit the matter to the Public Service Arbitrator, but it certainly should” not take direct action itself. The parties represented in the Opposition in this Parliament have always taken the stand that Parliament should not fix wages and conditions, but that that work should be done by the properly constituted arbitration tribunals. I maintain that that is the right attitude to adopt. If any other action is taken in a period like this, our arbitration system must fall into disrepute, and that will cause instability and trouble in all our industrial relations. It is possible that the number of employees in the. Civil Service could be reduced. If a person engaged in a private business undertaking finds that his business is falling away, he has to dispense with some of his employees. That is an economic necessity in ordinary business. There is no reason why it should not also be regarded as an economic necessity in a government undertaking. As a matter of fact, the Postmaster-General’s Department, which is, to a large extent, a business undertaking, has adopted that method of meeting existing conditions, for the services of many temporary employees have been dispensed with. There was not sufficient work to keep all the men in full employment, so some had to go. For the same reason, the staff of the Defence Depart- ment has been reduced. There is no substantial reason why the work of all our public departments should not be reviewed with the object of dispensing with any unnecessary employees.
It may be said that that would add to the number of unemployed in our midst. If that- should be so, we should have to find some other method of dealing with that problem. It seems to me that the only practicable way to meet the situation is to tax the people in employment with the object of raising money to assist those who are temporarily out of work. That would be a very different thing from reducing wages, and would, in my opinion, give a sense of stability which could not be given by the making of reductions in wages. If the people in permanent work realized that it was necessary for them to pay increased taxation to assist those who were out of work, I believe that they would regard it as inevitable, and pay up cheerfully. But they could not be expected to regard with equanimity any proposal to reduce their wages. I am definitely opposed to the policy of reducing’ the Public Service salaries.
– Would not that be inevitable if the policy of the Opposition were approved?
– I consider that it would be a far better policy for us to tax the people in work in order to provide employment for those who are out of work. No one would begrudge the payment of any additional taxation for that purpose. In New South Wales every worker who is in receipt of more than £80 per annum has to pay a tax of 3d. in the £1 in order to build up a fund to assist the unemployed. I have to pay it myself, and, so far as I know, there has been no general outcry against the system. No one objects to contributing to this fund so long as he knows that the money will be well spent ; but that is a matter which rests entirely with the government concerned, and over which the taxpayers have no control. The civil servants would rightly consider themselves to be victimized if they were called upon to pay extra taxation as well as submit to a reduction of 10 per cent, or 20 per cent, in their wages because the country is passing through a period of depression. I hope that the Government will not entertain for a moment any proposal to reduce the salaries of civil servants, but that it will rather take steps to dispense with the service of unnecessary employees and impose additional income taxation ‘upon those who are able to bear it, with the object of assisting those who are out of work.
It has been said that Australia is practically -bankrupt; but I entirely disagree with .the statement. The deposits in our savings banks on the 31st December, 1929, totalled £220,000,000, and were made up largely of the savings of wageearners. At the end of 1925 the assetsof our life assurance companies were valued at £305,000,000. In these circumstances it cannot surely seriously be said that the country is bankrupt. Tho Melbourne Age made the statement recently that the wage-earners of Australia were receiving 60 per cent, of the wealth produced here. If that is so they should be able to bear additional taxation to provide for IS per cent, of unemployment. If those figures are correct, I suggest that the Government would be wiser to impose additional income taxation on the people to provide for the unemployed, than to reduce salaries which have been fixed ‘by arbitration tribunals.
I do not favour a reduction of the Federal Aid Roads grant. An amount of £1,500,000 is to be provided for road purposes this year, and it is practically the only sum which the country districts are receiving from the Commonwealth.The making of this grant has been more satisfactory to country local governing authorities and country people generally than almost anything else that the Commonwealth has done. The granting of money by the Commonwealth foi- road purposes is in harmony with the policy of the Country party, and I stand by it. The big cities and the metropolitan press have protested against the incurring of this expenditure, but, as the city roads are practically perfect, such protests come with very bad grace from them. This money is raised by the imposition of a tax of 2d. a gallon on petrol, and I .do not believe that anybody would. object to the continuation of that taxation for road purposes. If the Federal Aid Roads Agreement were terminated, I doubt very much whether’ the tax would be lifted; in my opinion, it would continue to be imposed and the money would be paid into Consolidated Revenue and some of it used, possibly, for unemployment relief. That would be most unsatisfactory to the country. I strongly urge the retention of the Federal Aid Roads Agreement.
That is one of the matters which the committee, which I suggest should be appointed, could consider. I do not say that such a committee would be able to devise ways and means of reducing expenditure by £4,000,000, but if it investigated the whole position and made a recommendation to Parliament, its recommendation would doubtless be approved, for it would be regarded as having been arrived at without party bias
– How does the honorable member propose that this committee should be constituted? What representation of parties does the honorable member suggest ?
– Equal representation. I believe that the moment such a committee began its work its members would lose their political bias, and make their inquiries from the viewpoint of the interests of the people generally.
I shall conclude with a reference to the work of the Select Committee on the Tobacco Industry. I notice by the press that there has recently been a big merger ‘ of English and Australian tobacco manufacturers. The BritishAustralasian Tobacco Company has been making a profit of £1,000,000 a year for some years. Now Godfrey Phillips and Company Limited is about to start business in Melbourne, with a capital of £500,000, and Carreras Limited, of London, which has a paid up capital of over £2,000,000, is amalgamating with G. G. Goode Limited, the well-known Melbourne tobacco manufacturers. Thus we shall have three big tobacco companies operating in Australia, and I suppose that the ultimate object will be to bring about an “honorable understanding”, in order to fleece the consumers. We have a Labour Government in power to-day.
– In office!
– The honorable member means that ‘the Trades Hall is in power, though the Government is in office.
– Here is an opportunity for the Labour party to see that the people are not exploited by these big combines. Almost every necessity of life is under the control of some gigantic capitalistic organization that is taking heavy toll of the people. These combines are not reducing their prices in order to conform to the reduced standard of living. Although the basic wage has been reduced, the prices charged by these big rings and combines are practically on the same level as they have always been. That is another reason why the economic problems of this country should be considered on non-party lines.
– Does the honorable member propose that there should be a Government tobacco monopoly ?
– No; the effect of monopolies on the cost of living in Australia is not being properly considered, particularly by the Labour party.
For many years a big tobacco-combine in Australia has been making a steady margin of profit, and when its profit! have been threatened, it has raised its prices to the consumers, with the resultthat smokers are now paying from 50 per cent, to 100 per cent, more for their tobacco than the prices ruling prior to the late war. When the Government imposed slightly higher duties on its raw material, this company passed on the increased cost to the public. Last year it made a profit of over £1,000,000.
– What was the amount of the capital invested?
– We have been unable to ascertain the amount; it is one of the mysteries of high finance. The published profits are over £1,000,000, and heaven alone knows what are the unpublished profits. If smokers are to be forced to pay excessive prices for their tobacco, it is time we made this exclusively an Australian industry. If the people have to pay any price that » the combine chooses to fix, despite the wave of depression that is sweeping over the country, this Parliament should consider whether it is possible, through the tariff if necessary, to enable Australia to produce all the tobacco consumed here.
We are now importing £3,000,000 worth of leaf from the United States of America, and it is mostly grown by black labour; we have never made a serious attempt to keep that money in our own country. All the efforts of the small number of tobacco-growers in Australia to develop the industry have been largely counteracted by the gigantic organization known as the BritishAustralasian Tobacco Company, which, for various reasons stated in the report of the select committee, prefers to huy its raw materials from the United States of America. We have had proof in the last few days that, if the local industry is to be placed on a sound footing, uncompromising action is necessary. No mercy will be given by any combine or capitalistic organization that has a monopoly in Australia, whether of petrol, tobacco, or moving pictures. Whichever way we turn we find one of these great combines taking a heavy toll of the people. The blame for this has been attributed to Parliament, ‘but the trouble is that these monopolies will not allow their fixed rates of profit to be reduced, and any increased taxes levied on them are passed on to the public.
The select committee on the tobacco industry carried out its investigations for six months, and it has submitted to the Government a practical scheme by which we may build up the industry of tobaccogrowing in Australia, and compel the combines to purchase the raw material grown here by white labour, and pay a decent price for it. If the recommendations of the committee are adopted, that can be done, and the sum of £3,000,000 a year will be diverted from the United States of America to the Commonwealth. The primary producers who depend mainly on wheat should have a few profitable side-lines, and tobacco-growing is one from which at least 10,000 small farmers could obtain a considerable income every year, without much trouble or expense. Up to the present, governments have not faced this problem seriously.
The tobacco industry brings to the Commonwealth about £7,000,000 a year in customs and excise duties. We could still obtain that revenue if we grew every pound of tobacco consumed in Australia. In the last five years, our growers have produced tobacco, samples of which are equal in quality to the leaf that has taken the United States of America 300 years to evolve. If the growers were assured of a permanent industry, and if it were the policy of the country to encourage the people to smoke Australian tobacco, in another five or ten years very little leaf would be imported from the United States of America. Every new arrival in Australia, whether born here or an immigrant, is a potential smoker. Therefore, tobacco-growing is one of the most valuable industries that could be established. The select committee has done its work, and it now be*hoves the Government and the Parliament to do its part. I shall leave other aspects of the matter to be dealt with by other members of the select committee.
– The report of the committee provides no remedy for the combine trouble.
– I think that it does. The committee could not deal with the fixing of prices; but it proposed a means by which the growing of tobacco in this country could be encouraged. The outcome of the merger, to which I have referred, may be the formation of a big “ honorable understanding,” by which the price of leaf in Australia will be permanently fixed. In that case let us make the growing of the leaf required for the Australian tobacco trade a perquisite of Australian farmers, and not of negro labourers in the United States of America.
The committee has recommended a scheme’ which involves Commonwealth control. It is said by newspapers that are really dominated by the tobacco combine - some of the directors of newspapers are on the directorate of the tobacco combine - that the committee desires to create another department, which would result in more federal extravagance; but that is not true. All that we have suggested is that the existing department, which comprises merely an expert, employed by the Commonwealth, and a small staff, should be transferred from Melbourne to Canberra, and that the- expert should be made solely responsible for showing the farmers how to grow tobacco on the most approved lines, so that the industry may become increasingly valuable to the Commonwealth. I commend this scheme to the Government, and I hope that Senator Daly, to whom the consideration of the matter has been referred, will view the recommendations of the committee sympathetically, paying particular attention to its suggestion that one officer be put in complete charge of the department, and not made subordinate, as in the past, to a number of men connected with other departments. This would certainly result in more economical administration, and greater success in the encouragement of the industry.
.- It was refreshing to hear the speech of the honorable member for New England (Mr. Thompson) because he is the first member of the Opposition who has not attributed the present economic condition of Australia to the present Government. His is the first speech that has contained any semblance of practical suggestions for over-coming our present difficulties. His remarks were concise and logical, and, although I could not agree with all that he said, I concur in his observation that consideration of the budget should be removed from party politics.
– The proposed reduction of salaries is an important matter.
– Those who have suggested that reduction would, if they were sitting on this side of the chamber, be the first to oppose any such suggestion from the other side. It has been amusing to hear some of the reasons given for the proposed reductions in expenditure. If the budget inspires condemnation, it is condemnation of the administration of the late Ministry, during its period of office of six-and-a-half years; but the problem cannot be solved by placing the blame on any government. The Leader of the Opposition suggested means by which the expected deficit of £4,000,000 could be wiped out. He suggested that, in order to save £4,000.000, reductions should bo made in the salaries of members of Parliament and of public servants. I should have thought that the experience of the Bruce-
Page Government at the last election would have taught honorable member? that the people of Australia are determined that the remuneration and conditions of the workers, including public servants, must be settled by arbitration. But why has the honorable member noi begun at the top? He starts with the wage-earners, and gradually ascends through the Public Service to members of this Parliament. [Quorum formed.] If the Leader of the Opposition, and other honorable members opposite, believe that a reduction of salaries will solve our problems, why did they not start with the office of the Governor-General? 1 refer to that gentleman with all respect. I have no quarrel with him; but I do quarrel with the practice of paying £10,000 a year for the support of one person. A little further down the list we come to five justices of the High Court, whose salaries aggregate £17,926. Then there is a High Commissioner, who receives £3,000 a year, and a Chief Judge and three other judges of the Arbitration Court, who receive between them £10,500 a year. I have mentioned just ten persons who together draw £40,500 from the revenues of the Commonwealth. Honorable members opposite deny that they are biased or partisan in their outlook; but it is significant that their suggestions for economy begin with the wage-earners, and do not go beyond the public servants and members of this Parliament. Why do they not suggest that interest rates should be reduced?
– Will the honorable member tell us how to reduce interest rate? on the national debt?
– If we are to solve the problems that confront us, it will not be done by lopping a little bit off our expenditure here and there. We must get down to bedrock. In 1901 the first Parliament of the Commonwealth met, and the slogan of the day was “One flag, ‘one destiny, and one people; a united Australia, a commonwealth, and a nation.” That was nearly 30 years ago, and we still have six State Parliaments, besides a Federal Parliament. Each State Parliament is making laws, often in conflict with the laws of other States - a practice which has led to a great deal of costly litigation, particularly in regard to industrial affairs. In the Commonwealth YearBook for 1929, there is a statement setting out the number of legislators in each State of the Commonwealth, and the allowances they receive. It is as follows : -
Seeing that the cost per head for the Commonwealth Parliament is the lowest of all, the time has come, I think, for the abolition of State Parliaments. The cost of government in Australia is excessive. The public debt for the States and Commonwealth for the year 1927-28 was £1,094,974,058. Honorable members opposite are perpetually crying that the cost of production in Australia is too high.
– Hear, hear !
– If the honorable member had ever had to toil all day for the basic wage in order to pay his rent and other bills each Monday morning, he would not have been so ready to interject “Hear, hear.”
– He is one of the landlords.
– Probably. If he had been one of the victims of the landlords, his feelings would have been different. For the year 1929 the total interest payments on Australia’s public debt amounted to £55,499,485, of which £27,530,993 was payable overseas, and £27,968,492 in Australia. Climatic conditions throughout this continent are such that we can produce almost every com modity our people require. Australia extends for 2,000 miles from east to west, and 1,600 miles from north to south. How is it, then, that with a population of only 6,750,000, so many of our people are unable to get a decent living? Too many in this country cannot get enough to eat and drink. There must be something radically wrong with our social order, and the facts I have mentioned are a sufficient condemnation of it. The people are taxed to pay interest on money borrowed to build railways, roads, tramways, waterworks, and other utilities, which have improved the value of land for the benefit of a few land monopolists. A few privileged persons are allowed to appropriate the extra land values which have been created by the community. It is no excuse to say that we must have paupers and unemployment because those evils exist in older countries. That is a confession that the present capitalistic system has outlived its usefulness and cannot cope with the situation. So far as Australia is concerned, that is true. Quite apart from the money aspect, we must ask ourselves whether Australia is large and productive enough to support its present population. If it is, why are we not allowed to reach that stage of development? If those who monopolize the different utilities throughout the world had served the great Architect and Creator of the universe as they faithfully serve and worship the golden calf, civilization would not be in the awful plight that it is in to-day. Not one State Parliament has made a sustained and earnest effort to solve the land problem or to tackle the questions of decentralization, water conservation and irrigation. It may be said that these are State matters, but even admitting that, the States have dabbled in these problems so long that it is clearly evident that they cannot handle them efficiently. That is a sound argument for the abolition of State Parliaments and the institution of uniform laws for Australia, applicable particularly to the control of finance and land settlement.
During the nine years to the end of 1929, the loss to Australia in stock .wealth, principally in respect of sheep and cattle, reached the appalling sum of £40,000,000. Unfortunately, to some degree, that loss could not be helped. On the other hand this problem has been shelved and side tracked. It is a national matter. The time of this Parliament has been wasted in recriminations, one side against the other. We must tackle this problem seriously, because unemployment is becoming damnably acute. The present industrial situation is a gross reflection upon our present system of control, and some relief measures will have to be undertaken outside of some honorable members standing in this chamber and making speeches that are of no value at all to the country. There are 250,000 persons unemployed in Australia. We have, also, vast areas awaiting development. It may be said that there is no money available to develop those areas; but I contend that were the dogs of war let loose to-morrow ample money would be available to finance the conflict. It has been said that it is not a fair analogy to compare the expenditure on construction with the expenditure on war, because a nation in the throes of war will go to extreme lengths. Is it not a reflection upon the present system of government that this nation, that would go to any length to raise money to pursue the destruction of human life and property, pleads poverty if money is required for the purpose of construction ? The vacant lands of Australia are crying out for development. No attempt has been made to provide water conservation or irrigation facilities, with a view to absorbing the unemployed and developing the natural resources of this country. [Quorum formed.’]
Much has been said during this debate concerning the trek to the cities of people who have been forced off the land. There is one way in which we can combat this drift to the cities. Numbers of people in the cities would prefer to be in the country, but because of the sad neglect of our resources by both State and Commonwealth Parliaments, there is no opportunity for them to go on the land. 1 suggest that we irrigate the outback country adjacent to the River Darling, which has a gradual fall of 4£ inches to the mile for a distance of 1,050 miles. The Darling River waters could be easily conserved and utilized for the purpose of irrigation. The soil in that area is most fertile and would readily respond. I have seen all classes of produce grown under irrigation a little farther north than Bourke. Further, if a railway were constructed from Bourke to Darwin via Winton, it would provide a means of transport for the stock and produce raised in that part of Australia. If proper facilities were provided, the people who are to-day centralized in the capital cities would readily return to the country. The neglect to develop this country can be traced, not to the high cost of production alone, but to the inequitable distribution of the wealth produced in this country. Irrespective of what has been said about the depression existing in Australia to-day, the year 1929, from the standpoint of the private banking institutions, was one of the most prosperous in our history; yet there is more poverty, unemployment, and degradation existing in Australia than ever before. Our present system of control has fallen down on its job, and the time has arrived when some other system should be instituted.
The honorable member for Adelaide (Mr. Yates ) dealt extensively with a certain scheme that he has in mind. It is not a new scheme, and I do not say that it is unsound. It certainly could not produce results worse than those that we have experienced for the last few years. It is necessary for me to go back some centuries in history to trace the origin of our financial system. In the year 1546 the practice of charging interest oil money was made legal in England, and the rate was fixed at 10 per cent. In 1624 it was reduced to 8 per cent.; in 1651, to 6 per cent. ; and, in 1714, to 5 per cent. ; but it was not until the year 164’5 that the bankers of England made much use of that system of finance. It has been in operation ever since. It is strange that, as the trials and tribulations of the people have increased, so the wealth produced in this country has also increased. There must be something radically wrong with our system of government when the wealth production of Australia in 1929 “was over £500,000,000; and the wages paid to those associated “n producing it only £91,00,000. The balance of the money has been used to meet our interest obligations to those who control the financial institutions of this and other countries. They work hand in glove with the land monopolists, and they control the destiny of every man, woman, and child of the universe.
It has been said that the Australian worker is a slacker and loafer, and that that has contributed to the excessive cost of production. That is mere idle, vindictive, and vituperative talk. It is proved by statistics that have been compiled by responsible persons, that in the field of- production every unit in tha Commonwealth produces more than double the amount received by way of wages. That brings me back to the fundamental issue that must be attacked by this or any other Government in the world if it is to be regarded as worthy to govern, and if it has an atom of humanity in its intentions towards the people. Unemployment is the outcome of this system, in conjunction with the system of combines and monopolies, particularly land monopolies, that control everything that the people must have. The worker is told continually that the management is most reluctant to inform him that it must terminate his services, because there is not work for him to do; but there is no law in the land to protect him from those who demand what they consider they are entitled to in the way of payment of accounts. I am not suggesting that payment should be avoided. But why attack those who are denied the right to work and earn the money necessary to meet their obligations. The boys who went to the war were told that the best that could be done for them was not good enough; yet, owing to the activites of those who control the wealth production of the world to-day, those who fought for democracy are denied the right and the opportunity to work. They do not want a dole; they wish to earn sufficient to buy the wherewithal to keep body and soul together. Why are they denied that right? Because the people who control the financial institutions manipulate the reins, and at their whim or wish industry can either progress or languish. I_ hope that I shall live to see the day when “ production for use “, not “ production for profit “ is the slogan of the world. Some of the greatest so-called patriots in Australia are members of these institutions. Through their activites during the war period, able-bodied men were induced to fight overseas. They could not find words sufficiently alluring to extol the virtues of the workers of this and every other country, when they wanted them to shoulder a rifle; they would give them anything, and do anything for them. It is twelve years since there was need to shoulder a rifle, and what have the banking institutions or the insurance companies done towards fulfilling their obligations to the men who left Australia to protect their interests in the shambles ‘ overseas? The honorable member for Adelaide (Mr. Yates) said this morning that they had collected the interest on their bonds, and that that is as far as their activites as patriots will allow them to go. They are using their evil influences to retard the progress of Australian industries. The development of those industries is further hampered by the fact that some so-called Australian people have not sufficient faith in their own country to spend the money that they earn in the purchase of Australian goods made by Australian workmen from Australian raw material. If every Australian were a patriot at heart he would see that all his earnings were spent in a reciprocal spirit in the purchase of Australian-made goods, with a view to developing Australian industries. All that these people are concerned about is their pound of flesh, in the shape of interest. Apart from its tariff policy, this Government is not able to cope with the existing disabilities.
I am proud of the fact that I am a supporter of a Government that, in adverse circumstances, has done so remarkably well. In having brought forward this budget, it has done what no other Government in the history of Australia has had the courage to do. Certainly the proposals of the Government will impose hardship upon a number of people ; but ultimately it will be found that it is not so much the fault of the present Government as of those that have preceded it. We have been left a legacy such as no other government in the world has been left. This Government has shown a determination to bring the people of Australia to a realization of the fact that, as a nation, we have responsibilities, and that we must shoulder them. Previous administrations, by admitting defeat, proved that they had not the courage to grapple with the position by taking the control of the affairs of the Commonwealth, so far as was humanly possible, out of the hands of financial institutions in other countries. Although the budget contains some hard and unpalatable proposals, in the existing circumstances there is no justification for the criticism that has been levelled against it by honorable members opposite. It affords a striking condemnation of the previous Government for having submitted itself to the whims and wishes of overseas financiers. To a certain extent, history is repeating itself. Honorable members who sit on this side realize that they must attack fundamentals if they are to get anywhere; and that is why they are attacking the existthe control of wealth production.
In 1911 the Labour party established the Commonwealth Bank. One can almost hear still the hideous howl that arose from the Opposition at that time. One cannot forget the . nara things that were said against the then Government for daring to lay its hands on banking, and the hard things that were printed by the press regarding the wild-cat socialistic schemes of that Labour Government.
There is no better illustration of what oan be done than that which is furnished by the records of the past. The Commonwealth Bank, under direct government control, had acted as a people’s bank and not a bankers’ bank. The late Lord Forrest asked the following question in the Commonwealth Parliament on the 17th May, 1916 (Hansard, page 7923) :-
How has the £43,000,000 raised from the note fund been expended, and what are the details of expenditure? .
The reply was as follows : -
The loans to the Commonwealth have been expended as follows:-
I’he amount of £20,634,000 borrowed by the States has no doubt been spent in creating similar assets, and the accrued profits from the notes fund had reached the amount of £17,566,545 on the 30th June, 1929. This means, in effect, that notes to that amount have been cancelled, leaving £11,187,855 outstanding, with the assets still earning interest. This is a demonstration of the Guernsey experience being multiplied sevenfold. The process could still be repeated with the same result. This is the only way of freeing Australia from the stranglehold of the money power, both in Australia and overseas, which has produced such disastrous results, and is glibly called an economic crisis.
When this Government, assumed office after thirteen years of anti-Labour rule, it found that the Commonwealth Bank had been robbed of almost all its power to protect the .general community - it had, in fact, .become a banker’s bank - that the national debt had been increased at the rate of very many million pounds annually; and that unemployment had grown to such an extent that misery, poverty, and degradation were more pronounced than ever before in our history. The Government was obliged therefore to do its utmost to awaken the people to a sense of their responsibility.
Honorable members interjecting-
-Ever since I have been, a member of this Parliament I have endeavoured to extend courtesy to other honorable members, and particularly to members of the Opposition ; I trust therefore, that they will extend similar courtesy to me.
– - The interjections were not being directed at the honorable member. [Quorum formed.]
– During this debate a number of honorable members have endeavoured to explain the causes of our present troubles, but very few constructive ideas have been advanced for a solution of them. The Leader of the Opposition could only suggest a reduction of salaries. The honorable member for New England (Mr. Thompson) has made the only sensible suggestion that has come, so far, from the Opposition. He proposed that a committee equally representative of the Government and the Opposition should be appointed to consider ways and means of overcoming our difficulties.
– Will the Government accept that suggestion?
– I do not know, and .1 am not suggesting that it should be accepted; but it is at least a reasonable suggestion. The trouble would be, however, that as the committee would be composed of an equal number of members from each party, the members of each party would stand firmly by their own proposals. I am afraid that there would not be a spirit of compromise, and that the committee would not be able to reach a satisfactory decision.
The figures for the first quarter of the last financial year show that the value of our exports for that, period fell short of the value of our imports by £14,925,142. In that respect the.country was £5,000,000 worse off than it was in the corresponding quarter of the previous financial year. The position would be even worse than it is if the Commonwealth had not. begun to export a portion of the gold which it was holding against the note issue. But. that expedient can, at the best, serve as only a temporary relief.
There are so far as I can see only three ways of remedying our difficulties. One is by the drastic prohibition of imports which can be done without - and the number of them is legion. Another is by borrowing the millions of money of which the country is short. The borrowing would have to be from abroad in gold, for local paper money would be of no use in our present crisis. Even if such a tremendous sum could be obtained this year, which is highly improbable, it could not be obtained every year; nor can the Commonwealth’s gold reserves be exported every year. So this course would not afford even reliable temporary relief. The third expedient is to cease the payment of interest on our external debt ; or, in other words, to repudiate our debts. What kind of relief, this might be would depend on how two powerful external governments, urged to action by two armies of external creditors, would take the loss, which would be large enough to excite any creditor. Failure, which is not the result of any national misfortune,, but the outcome of bad government and riotous living, does not arouse sympathy. especially if the bankrupt has emphasized his ability to pay by providing libraries of literature about his great natural resources. It smells too much of premeditated dishonesty. At any rate, the creditors might say so in a moment of excitement. A similar event has led before now to the temporary suspension of the defaulting government, and the placing of its finances under the control of capable foreign experts. The first of these remedies, namely, drastic prohibition of imports which we can do without, has been adopted by the Government. In this respect the Government has taken its courage in both hands, although honorable members opposite are not prepared to give it any credit for doing so. The adoption of this policy must afford the country permanent relief, but it has made necessary the imposition of further heavy taxation to make up for the loss that has been incurred through the customs. The second possible remedy, namely, overseas borrowing in gold, could only’ be practised, if at all, for only a limited period. The third alternative, the repudiation of our debts, would not be acceptable to anybody. The Government has, therefore, adopted the only practicable proposal for meeting the situation. Because this involves the imposition of additional taxation, the daily newspapers of Australia have almost with one voice demanded that the sacrifices shall be borne equally by all sections of the community, and that wages must be reduced; but they propose to bear their own share of the sacrifice by increasing the cost of their newspapers, in New South Wales, at any rate, by 50 per cent. !
There is no doubt that the budget proposals of the Government have caused a great deal of adverse comment in certain quarters, but, on the other hand, they have been received by all thoughtful people as. evidence that the Government intends to awaken the nation to a sense of its responsibilities. It was no pleasure to the Government to introduce this budget; but it put duty before pleasure, and acted with rare courage.
In all the circumstances, I appeal to honorable members opposite to cease from their bitter and vindictive attacks upon the workers of Australia. They are ready enough to praise the working community when it suits them; but, as I said on a previous occasion, in a time of crisis, their first desire is to reduce wages. On the present occasion the workers are being attacked viciously and unfairly. Conduct of this kind cannot engender that spirit of goodwill and co-operation which is essential if we are to overcome our difficulties. In our present circumstances all sections of the community should work hand in hand to lift the country out of the slough of despond in which it finds itself. When the Leader of the Opposition suggested that the wages of the workers should be reduced, why did he not also suggest that the excessive salaries which are being paid to ten individuals, amounting to £40,500 per annum, should also be reduced? They are telling the Labour party and the workers to economise; but how much thought did the Bruce-Page Government give to economy? Did that Ministry ever attempt to create a reciprocal spirit in the minds of the workers, or to do anything of a tangible character to develop the resources of Australia? Lectures on the need to economize are quite unnecessary for men on the basic wage, who, on account of the economic pressure, are compelled to economise from the cradle to the grave.
In six and a half years, the late Government appointed 21 royal commissions at a cost of £107,765 to do work which the members of the Ministry were elected by the people to do themselves. Those commissions did nothing, and they found out nothing; the net result of their appointment was that a huge sum was paid by the Commonwealth. Members of the party opposite declare that costs of production in Australia are too high, and they would deny the workers the right to receive sufficient for their labour to keep body and soul together. They also talk about reducing the maternity allowance.
– Does the honorable member consider that the wife of a man in receipt of £1,000 a year should collect that allowance?
– When the Labour party put that legislation on the statute-book, it never intended that there should be any discrimination in the granting of the allowance. My party has democratic ideals. My only complaint about that payment is that it is not nearly large enough.
– It ought to be doubled.
– I agree with the honorable member. Money could be found for war purposes, and it seems highly unjust chat honorable members opposite should suggest a reduction in the maternity allowance.
Their party, which represents the capitalistic system, should have been ousted from office years ago, because, under the capitalistic system, the workers throughout the world have always suffered from poverty. Every time honorable members meet in this chamber the Lord’s Prayer is recited. “ Thy will bo done on earth,” indexed! The workers have always to worry how to make ends meet, under the present lopsided condition of society, and the sole worry of the party opposite is how to evade paying the workers the wages to which they are justly entitled.
The actions of the people who support honorable members opposite are responsible for the non-solution of the most pressing national problems. An attempt should have been made to break up the land monopolies, and, by the construction of national roads, to develop the back country, so that the workers of Australia would not be troubled with the evils suf fered by the down-trodden populations of countries on the other side of the world. Honorable members opposite talk of economy on the one hand, and of immigration on the other, without mentioning the need for national control of wealth production. The present Government had every justification for checking immigration until Australia was in a position to absorb at least some of those who are now unemployed. I have raised my voice in protest against the present economic system, and I hope that the time is not far distant when the Government will take complete control of the Commonwealth Bank in the interests of the people. [Quorum formed.’]
.- Many hard things have been said, and, I think, deservedly, about this budget. It will probably be remembered in Australia as the Black Budget, because its introduction marks the blackest period in the financial history of the Commonwealth. It inflicts undeserved and unnecessary penalties of a grievous kind upon all classes of the people. It flogs and intimidates capital, robs it of profit, and paralyses and prostrates it as an employer of labour. Lt deliberately closes thousands of avenues of employment against the workers. It makes dearer, many necessaries of the workers’ homes. This is, as I have said, a budget without either policy or purpose, and yet, incredible as it may seem, it represents Labour’s longdeferred and oft-promised solution of the financial problems which beset the country. After many years of angry criticism, of impassioned appeals, and promises of salvation for all. if Labour were returned to office, this pitiful jumble of futility and folly is the grotesque outcome. This amazing document is the fashioning of the thirteen wise men of the Labour party. If one were to select at random thirteen men from among the 250,000 unfortunate unemployed in Australia to-day, and get them to prepare a Commonwealth budget, they could not make a worse effort than this. I do not know whether there is a political lunatic asylum in this country, but if there is this budget was surely conceived in it.
Labour was to give the country economy, but its proposed expenditure for the next financial year is £4,000,000 higher than the actual expenditure of its predecessors only two years ago. Labour was to lighten the load on the people, and yet it lias increased taxation on every man, woman and child in the Commonwealth, by 6s. 6d. a head over and above what was levied by its predecessors in 1928-29. Labour was to stimulate industry, and it has reduced industry to a state of semiparalysis. Labour was to provide employment - “ Work for all “ stared at the people from every placard before the last election - but it has failed to find a job for every sixth man in the community. That is an unfortunate failure from the point of view of the 250,000 unemployed workers whom honorable members opposite are supposed to represent. Labour was to give us peace in industry, and it lias given us the peace which comes from the idle pick and shovel, the closed bush mill and the silent suburban factory. This black budget, which spells doom to so many interests and industries, does not, however, stand as an isolated and independent blunder; rather is it the culmination of eight months of unprecedented government folly. The initial step towards this budget was taken by the Government on the 21st November last, when it brought down its first crazily-conceived tariff schedule. With the appearance of each succeeding schedule it became increasingly evident that a budget of this kind was inevitable.
We have been told over and over again during this debate that the position in which the Government finds itself to-day is due to the sins of the Government which went before it. Let us consider the situation as it existed when this Government took office, and see what it did with the opportunity then presented. Every honest man will admit that the situation as the Government found it was not good ; that it was indeed very difficult. The Government came into office at a time of acute financial stringency, with a falling national income, and, to complete these unfortunate circumstances the season was bad. The country was indeed in a difficult position, but not in a desperate one. Had the Government at that time acted cautiously and wisely, the necessity for this appalling budget would never have arisen. There was only one course open to a government with any conception of sound finance. Had the Government faced the position squarely, and practised strict economy, it would noi have been necessary to increase taxation heavily at ,the present time. Had expenditure been curtailed wherever possible, had the proposals of the late Government for making up the deficiency in taxation been pursued, and had the Government at the same time adopted a well-considered policy of tariff reform, 1 believe that the country, though still far from prosperous, would not have been in anything like the difficult position in which it finds itself now. When this Government took control the economic situation was disclosed by the percentage of unemployment, than which there is no better index of national welfare. The unemployment situation was then bad, though not so bad as to-day. The percentage of unemployed was a little over 11 per cent.; the normal percentage is 5 per cent. Unfortunately, the Government attempted to carry out some, at any rate, of its election promises, with the result that it embarked upon a policy which has proved disastrous to the country. As I have said before, it adopted a policy of actual violence. First of all, it began, as the right honorable member for Cowper (Dr. Earle Page) pointed out in his admirable speech here the other day, to attack our credit abroad. By a series of administrative and legislative acts it reduced the credit of the country to a level never before reached, and it has contributed to the amazing growth of unemployment by a series of punitive tariff schedules. In November last it. brought in the first big prohibitive tariff schedule, and instantly threw out of business a’ few hundred merchants, and rendered unemployed many thousands of workers and country agents. The first step in its policy of economic reform was a destructive one. It took those people off the market as consumers. There was no need for that; no justification for it whatever. Had the Government endeavoured to readjust the financial position by dealing with the exchanges, and had it proceeded with a policy of moderate tariff reform, a great many of these people who have been ruined, or who have lost their employment, though they would have been gradually compelled to change over from importers and distributors to internal distributors,1 would have been tided over the period of transition by the financial institutions of the country, and the present financial chaos would have been avoided. [Quorum formed.] The blow, coming’ as it did, put thousands of people immediately out of profit, or out of work. By that action the Government increased the number of unemployed by 50,000 or 60,000 persons. That step, and those which succeeded it, were quite deliberate. I am trying to get down to the reasons for this new taxation. It is estimated that, as a result of the Government’s drastic tariff schedules and prohibitions, customs and excise revenue this year will be £7,750,000 below what it was last year, while the returns from direct taxation will be about £2,000,000 less, making a total reduction of £10,000,000. In passing, I might say that, though the tariff is not chiefly to blame for the falling off in returns from direct taxation, it is partly responsible, because it has seriously dislocated the business of the country. The total .new revenue required this year will’ be £14,000,000. We obtain £1,500,000 from the liquidation of ex-enemy properties. I t is worth while remembering that that payment will not bo recurring, so that we shall probably be faced next year with the raising of an additional £1,500,000 from various taxation sources. The Government has quite unnecessarily, wilfully, and to serve no good purpose, as will be shown by the result, sacrificed at least four million or five million pounds of customs and excise revenue. Had we relied upon the effect of the exchange rate, the diminishing purchasing capacity of the country, together with some tariff reform, would have reduced revenue by £3,000,000 or £4,000,000 instead of by £7,750,000. However, we are £12,500,000 short, as a result of this drastic shifting of taxation arising definitely and certainly out of this Government’s tariff policy. It is proposed to make up that shortage in the main by obtaining £5,000,000 from the sales tax and £5,700,000 from customs and excise by means of the primage tax.
There is no policy or purpose behind this budget, or behind the Government’s work since it has been in office. It is impos sible to discover where the Government is going. I do not know what its objective is, and 1 do not think that anybody else does, judging by its various legislative and administrative proposals. These extraordinarily excessive tariffs and this shifting of taxation has thrown the whole of the Commonwealth into turmoil and must bring about great financial loss and widespread unemployment.
One of the most immediate beneficiaries of the tariff is the manufacturer. Let us see how he fares under this budget. The manufacturer who is encouraged, fostered, and assisted by the tariff is now being hil particularly hard by this budget. The spoilt darling of yesterday is now being harshly exploited. Take the sales tax. There is to be a tex of 2-£ per cent, on the products of all Australian factories. That tax falls at once upon the very people whom the increased tariff, which made .the sales tax inevitable, was especially to benefit. With Australia in its present position, we cannot place a 2-1 per cent, tax upon the product of Australian factories, without enormously reducing sales and production, and increasing unemployment. So that, the sales tax to the industrial world, which only the other day was cheering all over Australia because of the increased tariff, falls with great severity upon the manufacturers and their employees. Take the primage duty in relation to the Australian manufacturer. A great section of Australian manufacturing is carried en with imported raw material, such as rubber, chocolate and tin plate. The manufacturers who use those imported materials are subject not only to the 2-J per cent, sales tax, but also to another 2-1 per cent, primage tax. Could there be anything more insane than for the Government to set out yesterday to assist the manufacturers of Australia by introducing a deliberate series of Customs Acts and then to-day to turn round and impose a tax of 2-J per cent, on millions of pounds worth of imported raw material used by those manufacturers, and another 2-£ per cent, tax on the product of their factories. I say without hesitation that under the old tariff and the old system of taxation, with the exercise of a stiff measure of economy in expenditure, the manufacturers of this country would be much better off than they are at this moment, and tens of thousands of industrial workers now out of jobs would have been at their work. That is only the beginning of the tale of taxation. The honorable member for Warringah (Mr. Archdale Parkhill) went fully into the question of its incidence upon the worker. I agree largely with him, so I shall not follow him along the same path. Both of these taxes fall upon the primary producers of this country.
There is first the primage tax. As the honorable member for Wakefield (Mr. Hawker) emphasized in his admirable speech, there is a primage tax on all the big lines of the farmers’ necessities, such as superphosphate, phosphate rock and other manures, sacks, wool packs and other requirements which are at the very origin of production. This is a definite tax on rural production and on the export of primary produce, that export which the Government ostensibly desires to promote.
The Government is exercising extraordinary discrimination in the application of the sales tax. The farmers’ products, such as wheat, milk, butter and cheese, that are consumed in the industrial areas, are to be exempt from the application of the sales tax; but all that the farmer purchases from the cities, all his machinery and household goods, practically everything that he buys, is to be ° subject to this tax. It is an amazing act of discrimination in favour of the industrial people. We have an extraordinary example of the contradictory nature of the Government’s policy as a whole. I refer to the tariff prohibitions against all agricultural implements and machinery and to the sales tax in connexion with the production in this country of those articles. When the Government put on a prohibition against agricultural machinery and implements a great deal was made of the fact that the Sunshine Harvester Company, and other manufacturers of those articles in this country, had agreed to make a reduction of 5 per cent, in their prices. That, I consider, was a bad bargain. We had at the outset the genius of the McKay family, but the spur behind the Sunshine Company has always been overseas competition.
Yet we have given that up for a paltry reduction of 5 per cent, in prices. What happens to that now? The sales tax immediately takes half of it. Could the Government do anything more extraordinary than that? By the time the manufacturers impose their profit on the 2i per cent, tax, the whole of the reduction of 5 per cent, in prices will be practically absorbed. There is also the loss of the value of a certain amount of competition in this country.
This shifting of taxation is unnecessary. Had the Government worked down the old lines and practised economy, it could have raised the little extra money that it required, say, £500,000, by taxing amusements, such as pictures and racing. The tax was waiting to be put on at the American end of the film industry. But because of certain things which happened during the last elections, this Government has refrained from taxing picture amusements. Had the Government followed down the old lines of taxation and practised economy, neither the primage duty nor the sales tax would have been necessary at this moment. There seems to be an idea abroad ‘that for some amazing reason taxation in Australia this year has been increased by £12,500,000. But that is not so. All this upset is due to the changing over from several forms of taxation to which we had become accustomed, to new forms of taxation, and that change at this particular time is disastrous. Let me give an illustration of what, this taxation inevitably means in loss of profit and employment. The special newsprint tax, the additional income tax, and increased postage will mean to some of the great newspaper companies increased taxation to the extent of over £20,000. That represents 2 per cent, upon a capital of £1,000,000. The result inevitably must be economy right through. It is no exaggeration to say that, as a result of this taxation, the newspaper proprietors will reduce their staffs by at least 10 per cent., and that immediately thousands of people will be emptied on to the streets. The blame for that will rest upon this budget - which, as I have endeavoured to show, would not have been necessary had the Government had a proper appreciation of Australian conditions, had it avoided violent changes and extremism, and had it not been guilty of the inexcusable folly of tariff-making in a hurry. The Assistant Minister (Mr. Forde) smiles at my repeated condemnation of the tariff.
– I cannot refrain from smiling at the honorable member’s ranting humbug!
– The honorable gentleman is smiling at the prospect of an additional 50,000 or 60,000 persons being’ unemployed as a result of the tariff proposals of this Government. The wholesale and widespread disruption of industry has brought about additional unemployment to that extent.
– There would have been twice the existing number of unemployed but for the tariff.
– This budget will throw many more thousands into unemployment.
– What would the honorable gentleman have done?
– I have already told the committee what I would have done; I would have proceeded cautiously and quietly at a time like this, as would 49 out of 50 governing bodies in the world. There is no necessity for this drastic treatment of the patient, this concentrated purge that has been administered. There has never been, in either this or any other country, such a demonstration of economic and financial ignorance by a government.
I take this opportunity to refer to a few of the mysterious and inscrutable impositions of duties, that otherwise I should not be able to discuss because of the deliberate policy of smother that has been adopted by the Government, and its refusal to give us an opportunity to debate the tariff item by item in committee. A particularly glaring example has been referred to by way of a question on two occasions within the last week; that is the imposition of enormously increased duties upon sheet glass, or what is known as figured, rolled glass. Every square inch of sheet glass that is used in this country is imported, and always has been.
– It always would be, if the honorable member had his way.
– I know that the honorable member for Cook is particularly interested in this matter. I believe that he will be the first to agree that an awful error has been committed, and that the sooner it is put right the better for everybody, including the reputation of the Australian manufacturer. An enormous quantity of this glass goes into every new building in the Commonwealth, from the most palatial city office down to the humblest home. Until the other day a flat rate revenue duty of 2s. per 100 feet of this glass was imposed. The new duties that have been announced disclose an increase of approximately 210 per cent, on 16-oz. Belgian sheet glass, and of 164 per cent, on 21-oz. glass. These duties were imposed in favour of Australian Glass Manufacturers Limited, a millionaire merger company which, in the last two- years, has paid 12^ per cent, in various forms of dividends, and has had big sums to carry to reserve. For a number of years its dividend has amounted’ to 10 per cent. It is one of the most profitable industrial concerns in the Commonwealth at the present time.
– Is it on that principle that the honorable member it launching his attack?
– No. I am using this as an illustration of what the Minister can do, and has done. Immediately after these new duties were imposed, the acting chairman of directors of Australian Glass Manufacturers Limited, Major-General H. W. Grimwade, made the following statement at the annual meeting of the company in Melbourne : -
Under normal conditions the construction and instalment of this industry-
That is, an industry to make cheap glass in Australia - was planned for October; but unforeseen conditions must delay its getting into production for an indefinite period.
Nobody in Australia to-day is manufacturing this household necessity, and the only firm that is interested in it has indefinitely postponed its intention to manufacture it.
– That is not the case.
– Is the honorable member for Cook prepared to deny the accuracy of the statement made by the noting chairman of directors of the company?
– Yes; it is not correct.
– Prohibitive duties lui ve been imposed against Belgium, which takes from Australia goods to the value of £9,000,000 annually, and sends to Australia only £900,000 worth. Not only has the Assistant Minister imposed these duties, but he will not take them off, nl though representation after representation has been made to him to do so. A deputation which I attended waited upon him only the other day. If we could only g’.t newspaper reports of scores of these deputations of protest to the Minister, we would secure the publication of disclosures of blunders in tariff-making without parallel in this country. But they are held behind closed doors, with thu press rigorously excluded, and the 1,eople have no idea of what is taking place. It is because of the Assistant Minister’s knowledge of cases of injustice and folly that this committee is refused mi opportunity to discuss the different items.
– Was any glass imported ?
– I thank the right honorable gentleman for his reminder. On account of the diminution in the number of houses and other buildings being constructed, there is in this country to-day a considerable quantity of this class of glass. It is held by a few big firms; the small merchants and distributors cannot obtain supplies anywhere. The other day a deputation, which was accompanied .by a representative of the Belgian Government, waited upon the Assistant Minister and made representations to him in the matter. Hundreds of men of a very good type are using glasshouses to-day for the raising of tomatoes and other forms of fruit and vegetables. Some of them have told me that, as a result, of the operation of these duties, the price of sheet glass has been increased by 100 per cent. Having imposed these duties, the Assistant Minister is standing pat. I do not know why, nor does any one else in Heaven or on. earth.
– He himself does not know why.
– I agree with the right honorable member.
I wish to refer to an extraordinary case of discrimination between a great American and a great British firm. While the Assistant Minister was Acting Minister for Trade and Customs, he decided to admit to Australia, after the imposition of the embargo, £50,000 worth of preserves, pickles, sauces, and other products manufactured by the great firm of Heinz. Limited in the United States of America. Those are rural products, and are obtainable in this country. The honorable gentleman took this action against the interests of the primary producers of Australia.
– That is not true.
– We are generally told that what is obtainable in Australia is good enough for an Australian. If that is not true of primary products, it is true of nothing. The honorable gentleman admitted these products on the understanding that ‘Heinz would commence manufacturing in Australia within, a few months. About the same time, or immediately afterwards, an application was made to him by the famous firm of Rowntree, British chocolate manufacturers, which incidentally is one of the grandest firms in the world in regard toits relations towards its employees. It. wished to commence operations in Australia, but, viewing the position throughrational eyes, did not think it was wise to establish an independent confectionery business. It proposed an affiliation with one of the big firms already operating in this country, and arrangements were made to that end. The proposal involved’ the introduction to Australia- of a substantial amount of capital, and some of the best brains in the confectionery world. The firm, wishing to keep the name of Rowntree on the Australian market in the meantime, applied - as did Heinz Limited” - for an exemption with respect to- £50,000 worth of confectionery.
– That is not true; it did not ask for an exemption for £50,000 worth.
– I ask that that, statement be withdrawn.
– The Assistant Minister must withdraw the statement.
– I said that the statement was Dot true; but I will say that it was ii prevarication of the truth.
– I must also ask that that statement should be withdrawn. Why does not the Assistant Minister set an example to the committee?
– I withdraw the remark ; but the honorable member’s statement was not in accordance with the facts.
– That withdrawal is worthy of the Assistant Minister. One of our present troubles is that the members of the Ministry will not discuss the tariff schedules. The firm of Rowntree was absolutely and flatly refused the exemption for which it asked, although an exemption was given to Heinz and Company, a foreign firm operating in a country with which our balance of trade is more adverse than it is with Great Britain. I shall leave that subject for i.he moment.
An incident that occurred while we were considering the Flax and Linseed Bounties Bill, though of minor importance, was illuminating as showing the outlook of the Government. It was provided in that bill that bounty should bc paid to companies producing flax until their earnings reached 15 per cent. The usual provision in such bills is 10 per cent, and I asked the Minister to accept. ;m amendment to bring this bill into conformity in that respect with other similar legislation. The Acting Minister said “ I will accept the amendment “. But he went on to say that the extra 5 per cent, had been included in this case because the company had undertaken to use any additional profits over the 10 per cent, to increase its equipment. That is a new policy. Not only does the Government propose to pay a bounty to make up the difference between a partial and a reasonable dividend, but also to nil able these manufacturing adventurers to build up their capital. It is a small thing, but it throws some light behind the closed doors of the Customs Department.
When the Sewing Machine Bounty Bill was before the committee the Opposition endeavoured to provide that the proposed bounty on sewing machine heads should he reduced by half; but the Assistant Minister opposed the amendment and gave as his reason for doing so that all the money proposed to be expended on bounty in respect to this industry would be needed during the present financial year. Yet the estimates now before the committee provide, not £26,000, which was the full amount appropriated for this bounty, but £6,000, which will provide for a bounty on the production of only 3,000 sewing machine heads. So the Government proposes to levy on the wives of the working people of Australia to the extent of £20,000 more .than it will require for the current twelve months.
We had another side-light thrown on the administration of this department at question time this morning. The honorable member for Warringah (Mr. Parkhill) asked why certain British imports, on which the duty was 20 per cent. British, and 30 per cent, foreign, were charged the full foreign rate of duty. The reply was that as the packing cases were made of “ overseas timber “ - whatever that may mean - and “foreign nails” were used in them, the goods did not qualify for British preference. Surely things are coming to an extraordinary pass when such things can happen! How did the Customs Department know that foreign nails were used? I trust that the Assistant Minister will throw some light on these matters if, indeed, he can be persuaded, by any means, to discuss them. I suppose we shall be told that what has been done in this instance can bc classed in somewhat the same category as what happened with the wine casks, which were not permitted to be used a second time I
I wish cordially to associate myself with the amendment moved by the Leader of the Opposition, and to express my hearty approval of his proposal that. the salaries of members of Parliament should be reduced. But to make my position quite clear, I must say that I know of no more profitless or worse paid position than that of the member of this Parliament. Taking into account all the years that I have been a member of Parliament, and counting in the election which I contested, but did not win, I can honestly say that my net salary has not returned to me the basic wage. But this is a time when Parliament should give a lead to the country, and it can best do so by reducing members’ salaries. On one ground alone, namely, that the capacity of our employers, the people of Australia, to pay our salaries has been reduced, I think that a reduction is warranted. Every man, woman, and child in this country is either directly or indirectly a taxpayer, and, therefore, contributes to the cost of Parliament. Salaries and wages have already been reduced in certain directions to bring them into conformity, with prevailing conditions. Quite recently the pastoralists were able to convince the Arbitration Court that on account of the falling off in their returns, and the relative unprofitableness of the pastoral industry, a reduction of 20 per cent, in the wages of shearers was justified. Individual pastoralists, therefore, have not the same capacity to contribute towards parliamentary salaries that they formerly had. Seeing that the shearers have also had their wages reduced, and that every time they smoke a pipe of tobacco they contribute towards the revenue of this country to a greater extent than formerly, they also have not the same capacity to contribute to our salaries. Many other classes in the community are feeling the pinch of these hard times, and have been obliged to conform to the depressed economic conditions that prevail. In all these circumstances I submit that honorable members should play the game with the people of Australia, and reduce their salaries. Such an action would greatly become them.
– What amount does the honorable member suggest should be paid?
– I am quite prepared to leave that to the Government, and I am willing to accept anything that the honorable member will accept.
– If the honorable member for Henty would surrender his private income, and live on his salary, I would be prepared to go with him.
– If the honorable member for Corio did that he would suffer a very unpleasant financial crash.
I also wish to associate myself with the proposal of the Leader of the Opposition that salaries should be temporarily reduced in the Commonwealth Public Service to conform with the economic situation in which we find ourselves.
What I have said about the reduced capacity of the pastoralists and shearers to pay the existing salaries to members of Parliament, applies with equal force to their capacity to pay the existing salaries of public servants. I do not think that Commonwealth public servants are overpaid, or that they have ever been overpaid. In very many directions they are not as well paid as persons engaged in private enterprises. The Commonwealth Public Service is highly efficient, and is conspicuous for its devotion to the interests of the Commonwealth. The honorable member for the Northern Territory need not sneer. Let me tell him that I know this Service intimately. I was a member of it for some time, and have been closely associated with it in an administrative capacity. I have the highest esteem for it. But nevertheless I feel that the existing salaries should be temporarily reduced. I warmly support the Leader of the Opposition in asking for a reduction of £4,000,000 in the cost of government generally, and it is for the Ministry to say how that saving is to be brought about.
– Does the honorable member suggest a reduction in the salaries of public servants, as part of that saving?
– Yes ; a temporary reduction. In conclusion, I again condemn the budget, because it will inflict great hardship, and will have evil effects which could, and should, be avoided.
.- The first part of the speech of the honorable member for Henty (Mr. Gullett) gave me considerable food for thought, because it displayed his inconsistency. I propose to quote extracts from the speech he made on the budget of 1927-28. That speech caused Mr. Bruce, the late Prime Minister, to trounce him unmercifully, and ultimately to take him into the Cabinet as Minister for Trade and Customs, in order to keep him quiet. Referring to the right honorable member for Cowper (Dr. Earle Page), he stated in that speech, on the 16th November. 1927-
He owes his position to the promises he made to Australia, which were properly accepted, to practice economy in the management of the public finances. Since then, what is the record of the honorable gentleman? Yet, beginning with the financial year 1023, his first year of office, he has increased annually the total taxation of this country by £9,000,000. … I cannot follow a Treasurer who increases per capita taxation on a country so overburdened and impoverished by debt and taxation as Australia is at the present time. . . . Much of our taxation to-day is a legacy from the war, the winning of which meant- more to some people than to others. It meant infinitely more to the rich than to the poor. Had Germany won the war, and been able to collect reparations from us and impose other exacting conditions which the Allies were not able to impose on her, the burden would not have been felt very much by the labourer, the artisan, the salaried man, or even the professional; but the millionaire and the men with £10,000 a year or £5,000 a year would have been very hard hit indeed. Therefore, it was for the rich more than for any other class that the war was fought.
I now turn to the Leader of the Opposition (Mr. Latham), who believes in restricting the maternity allowance to families in which the breadwinner is in receipt of not more than £6 a week. The honorable gentleman did not say whether he thought that the payment should be made only when the average wage throughout the year did not exceed £6 a week.
– I agree that the details of the scheme would have to be worked out.
– I propose to consider this matter from the point of view of parents with large families, and I ask whether a family living on a regular income of even £6 a week, or £312 per annum, would be able to live extravagantly if there were two or three children. This is one of the most callous proposals ever made. Of course, we know that the restriction of the allowance, as proposed by the Leader of the Opposition (Mr. Latham), would not trouble him personally.
– I have never accepted the allowance. I did not consider it right, in my financial position, to take this money from public funds.
– The proposal of the honorable gentleman, if adopted, would amount to repudiation of the promise made to the people that mothers would receive a sum sufficient to provide them with medical attention at a very critical period.
By inference and innuendo, the Leader of the Opposition suggested that there should be restriction and careful watching of the pensions paid to invalid and aged persons, and to returned soldiers.
– I said nothing about restrictions of pensions.
– The honorable member said that this matter must be watched carefully.
– Careful and responsible administration is all for which we on this side could ask.
– The honorable gentleman meant, apparently, that pensions had been given too liberally in the past, and that some tightening up of the system should be made. Otherwise why did he mention the matter?
– I said that I did not propose any reduction in the pensions.
– But surely he implied that a leakage was occurring in the paymerit of pensions. The people of Australia, and politicians, particularly, know that the administration of that department has already been tightened up so far as the pensions granted to returned soldiers and aged persons are concerned. Before pensions were granted to the men who returned from the late war, impaired in health, physically and mentally, a thorough investigation was made of their claims. I can mention the case of an unfortunate old man who cannot obtain the old-age pension’ to-day, because he is insured for £100 and has £10 or £20 invested in an incorporated society. The man’s name is Howard, and his address is Bridgestreet, Cessnock. I know also of a young woman who lost her right arm. She is regarded as not totally and permanently incapacitated, and so she has been refused an invalid pension. Her name is Miss Maybury, of Weston. Another case is that of Miss Mason, of Cardiff, who can get about only on crutches. She is debarred from receiving a pension, because it is claimed, she can follow a clerical occupation. What chance has she, and the others I have mentioned, of obtaining any of the few elusive jobs available in competition with others robust in health, and possessing full educational qualifications? Even the Public Service will not employ them. Applicants for employment in the Service have to pass, not only an educational test, but a medical examination as well. Yet honorable members opposite suggest that savings could be effected in the Pensions Department. I say that no savings can be made there. The last speaker got his inspiration from the Melbourne Herald, which suggested that restrictions might be imposed on the’ granting of invalid and old-age pensions, and pensions of returned soldiers. Everyone knows how difficult it is already for returned soldiers to establish their claims for pensions, yet .they were promised everything before they went to the war.
When the Minister for Health (Mr. Anstey) was speaking in this debate on Tuesday last he referred to the interest on war loans. The honorable member for Warringah (Mr. Parkhill) interjected to ask the Minister whether he favoured repudiating interest on war debts, and I answered the interjection by saying that I did favour it. According to press reports he replied that I was irresponsible. I did not hear him, but if I had heard him I would have said that I was just as responsible to my constituents as he is to his. As for the repudiation of interest on war loans, I would be prepared to do that to-morrow. I should have no qualms of conscience about it whatever. Australia to-day is being bled white to pay interest on those loans. If it is good enough to suggest that savings should be effected by restricting returned soldiers’ pensions, the time has surely arrived when we should say to the war bond-holders, “You have drawn sufficient interest on your money; be satisfied with getting your money back.” If that were done it would get the country out of the financial morass in which it is to-day. Nobody here is game enough to do that, however. Some countries have done it. Some of them have not even given back the capital.
– I think that most of the bond-holders would be satisfied to get their capital back.
– Well, let them have it, and tell them to go. If they had the welfare of their country at heart as much as they professed to have when they waved flags during the war, and encouraged the now returned soldiers to rush off to fight for their protection, they would say, “ The country can have our money; we could not go to the war. The returned soldiers have not even their health. We have our health, because for business reasons we could not go to the war. We were making money.” The bond-holders exploited the community during the war,, and from the proceeds of their exploitation invested in war loans. I remember that at one time during the war the full amount of a loan was not subscribed. The press made fi vigorous appeal for funds. Finally the rate of interest had to be raised to 5£ per cent. Then the investors rushed the loan. One insurance company alone put in £6,000,000. The returned soldiers have very little, and out of that little they are taxed to pay interest on the loans floated to keep them at the war. My predecessor in this House, Mr. Charlton, once brought forward a proposal to exempt returned soldiers from the payment of income tax, but the Government, then supported by honorable members opposite, refused to consider it. Nevertheless, those who did not go to the war, but who put the money they made out of the war into war loans, are free of Commonwealth taxation on the interest they draw.
The honorable member for Warringah (Mr. Parkhill) professes to be greatly concerned about the workers. Upon occasions he seems almost to shed tears of blood for them. Yet he supported the last Administration, which was responsible for ejecting returned soldiers from, war service homes during the industrial trouble on the coal-fields. Incidentally, I might say, these alleged bolshevistic miners sent two battalions to the war, one battalion of infantry, and one of miners. When they came back many of them built war service homes. During the industrial trouble on the coal-fields I approached the honorable member for Gippsland (Mr. Paterson), who was then administering the War Service Homes Department, and appealed to him to show leniency to the returned soldiers threatened with ejection. His reply was, “ I can do nothing “. I am proud to be associated with the present Minister iti charge (Mr. Parker Moloney), who, as soon as he came into office, cancelled those ejection orders. Many of the returned soldiers who were ejected by the last Administration have been restored to their homes, and even those who are behind in their payments have been allowed to stay on until things get better.
– At the public expense?
– Yes; at the public expense.. The public promised, through the last Government, that it would look after the returned soldiers who caine back from the war impaired in health. Yet the last Government ejected them from their bornes when they got behind in their payments.
Now we come to this suggestion for a reduction of parliamentary salaries. I am entirely opposed to any reduction of Parliamentary allowance. As a member of this Parliament, I earn every penny of my salary. I am engaged upon the duties of the nation. My hours of work are unduly long, and I have to look after the interests of my constituents. They themselves are opposed to a reduction in the standard of living. Actually my salary as a parliamentarian representing an industrial centre is somewhat fictitious, because I have many calls upon it by impoverished and destitute persons. The Leader of the Opposition omitted to include the Governor-General’s salary in his list of reductions. Evidently he is not to be touched by this suggested policy of economy.
– The Governor-General’s salary is fixed under the Constitution, and this Parliament cannot alter it.
– There should be no difficulty in reducing the salary of the GovernorGeneral. At present lie receives £10,000 per annum, and his residences in Melbourne, Sydney and Canberra are maintained at a cost to the taxpayers of £14,150. In addition, his office expenses amount to £5,347, making a total in all of £29,497 for’ the upkeep of a useless office of ceremony. If the Governor-General is entitled to £29,497, I consider that I am entitled to twice as much.
The Leader of the Opposition has made no suggestion for a reduction in the interest payments of those who are purchasing war service homes. Many of the re- turned soldiers on the coal-fields of Newcastle have been ejected from their homes, because of their inability to keep up their payments. The war service homes have depreciated in value, but the rate of interest on the capital cost has not been reduced. The interest rate in many cases is 8 per cent. That rate is still maintained even though the value of the houses has depreciated to the extent of £200 or £300.
The Leader of the Opposition has said that the amount of £150,000 set aside for repatriation purposes, is for the northern coal-mines only, but the Government has made it distinctly understood that the scheme is Australiawide. The honorable member also suggested that the coal trade has brightened up, and that this money should not now be made available. Let me remind him that the coal trade has not brightened up. The coal-mines are working on an average of from four to seven days a fortnight, although the exPrime Minister promised the coal-miners that if they accepted a reduction in wages, our overseas trade would increase. There has been no increase in overseas trade, although the price of coal has been re:duced. The coal-miners are working- intermittently. The lockout lasted 15 months, and wrought social and moral devastation. It was conceived by the sordid greed of the worshippers of Mammon, who are ever content to translate human life with its varying concomitants into terms of dividends, markets, and percentages. The moral havoc which has been wrought in orderly aud disorderly sequence constitutes at once a challenge to the ethical senses of the community. The only desire of the unfortunate victims of the lockout was to maintain the standard of living prescribed under the arbitration laws of this country. The story of the sacrifices of the coal-miners and their dependants might fittingly be told with tears and traced in blood. Not one class of the community was unaffected. The Government of this country and the coal-owners have lost the little confidence that the miners had in them. A truce now obtains, but not peace. Economic necessity produced a truce, but the confidence that is necessary to -produce peace- is wanting. There can be no peace among people who are starving. [Quorum formed.] The coal-miners recognize that they were merely pawns in the political game.
The Government should give serious consideration to the manufacture of byproducts from coal. If this industry could be established successfully, it would relieve much of the unemployment that at present, exists on the coal-fields. I have just received a letter from the Secretary of the Coal Miners Association to the effect that there are 3,000 men unemployed iti the northern district alone. They are not likely to be again absorbed in industry. In addition there are in the northern district 800 boys between the ages of fourteen and eighteen years who have not yet done a day’s work. They also cannot be absorbed in the industry. The time has arrived when serious consideration should be given to the extraction of oil from coal. The Government is to be commended on its action in appointing a committee of experts to investigate this question. But we must guard against the danger of the American oil trusts throwing cold water upon any proposal to extract oil from coal. When the Shale Oil Bounty Bill is under discussion I propose to move that the bounty be extended to byproducts from coal. The only alternative would be to nationalize the industry. The Leader of the Opposition suggested that the amount set aside for succouring the wives and families of the miners who have been victimized for so long by the coal-owners should not now be made available. I have with me a review of the State coal mine at Wonthaggi, Victoria. It is stated therein that under the method of compiling the profit and loss account, the amounts written off under the heading of depreciation have resulted in placing the depreciation fund in credit for almost double the entire commitments of the mine in respect of capital, loan charges and current. I suppose that this is looked upon as good business. But it confers no benefit upon the miners who win this wealth. They have to be satisfied with the lowest wages that the owners are able to bluff the Arbitration Court to award them. Actually, under the specious methods that were adopted, the depreciation amounted to no less than £595,954, or an over charge of £239,055. I may say that the Victorian Audit Department refused to allow an amount of £37,267 15s. lOd. refund to the Victorian Railways Commissioners, as a direct charge against the cost of winning coal. The value of this industry to Victoria is comparable with the yalué of the coal mines in the northern districts of New South Wales to that State. The net profit of Wonthaggi for 1929 was £113,115, which is equal to 3s. 8½d. a ton. During the years 1911 to 1929 that mine actually made net profits totalling over £410,000. Yet the Leader of the Opposition (Mr. Latham) would decrease the expenditure of the Commonwealth, not by reducing interest, but by taking from the wives and children of miners the paltry amount that has been set aside bo that they may have some little comfort instead of the misery that has been caused by the rapacity of the coal barons ! What has been stated with respect to the Victorian State mine is what will be revealed in connexion with the New South Wales mines, so soon as we can get an honest and “ dinky die “ account of their operations.
A further suggestion of the Leader of the Opposition is that the expenditure should be curtailed by withholding bounties from industries, by reducing the roads grant to the extent of £1,500,000, and by withholding the offered £1,000,000 for unemployment relief. The object of this Government in giving bounties is to increase the volume of employment by encouraging the manufacture of Australian commodities. Every bounty that has been granted by this Government has been absolutely warranted.
The honorable member for Warringah (Mr. Archdale Parkhill) wailed and gnashed his teeth, and wept tears of blood, over the unemployed; yet he stands behind the proposal of his leader to withdraw the offer of £1,000,000 for the relief of unemployment, and to accentuate the existing difficulties in relation to unemployment by the reduction of the roads grant. I have no desire to draw harrowing pictures, or to play upon the sympathies of any person; but before this Parliament goes into recess I hope that the Government will do more to help these unfortunate people than it has made provision for in the Estimates. In every industrial town and city in the Commonwealth there are large numbers of unemployed who have not the. wherewithal to exist. “When they approach the State authorities for relief, they are subjected to the most degrading examination it is possible to imagine. Whenever they demonstrate to the people and the Government the plight that they are in, they are clubbed and knocked down by the police. In every little village will be found children who, a few years ago, were healthy and able to enjoy to the full the sunlight and spaciousness that nature has provided for them. To-day their bodies are emaciated, and the iron has entered their souls. The lives of these little innocents should be filled with nothing but joy, but instead they know nothing but despair. By every mail I receive letters from men seeking employment, but under me present system nothing can be done for them. If it is a question of paying interest to war mongers or of feeding the people of Australia, I say, “ To hell with the war mongers, and the bond holders, who are bleeding this country white.” The unfortunate people who are unemployed are absolutely driven to desperation. Some of them commit crimes, others throw themselves over the Gap. Women who are about to bring children into the world are dying of undernourishment. Yet we say that, under the orthodox system of banking and borrowing, we can do nothing for them! Although I am not a financier, and do not understand financial questions, I have had a crude idea instilled into me by some of my colleagues, who have converted me to the belief that we should let these interest-mongers go, and get money through the Commonwealth Bank by issuing credit that will not carry interest. It is said by some people that that cannot be done. I am of the opinion that it can be done. Such a system was adopted by the Commonwealth when the east-west railway was constructed. Great Britain was forced to adopt similar measures during the war, and she continued them up to 1928. I admit that the proposals outlined in the budget provide the only way out under the present orthodox system; but they will only pro long the agony. The credit of this country should be utilized. What, I ask, is the difference between issuing a bank note and issuing a cheque? There is none except that a note that is issued by the country has the backing of the resources of the country - its wool, its wheat, its mineral wealth.
I hope that the Government will give consideration to the exempting from the operation of the sales tax of explosives that are used in the mining industry. As honorable members are aware, the the coal-miners recently agreed to a big reduction being made in their wages. In some cases, that reduction amounts to 12s. a day. At the present price of explosives, the cost on that item alone of getting out the quantity of coal required, is from 7s. to 8s. a day. If the sales tax is made to apply to the explosives that these men use, it will mean that their earnings will he reduced still further.
I hope that the budget will be passed, and that in the near future consideration will be given to the utilizing of the credits of this country in the interests of the unemployed throughout Australia.
Sitting suspended from 6.15 to 8 p.m. [Quorum formed.]
.- I have listened now for two days to the speeches which have been delivered on the budget proposals of the Government, and I must congratulate honorable members on this side of the committee upon having made a number of constructive suggestions. I support the views expressed by the Leader of the Opposition (Mr. Latham), and the Leader of the Country party (Dr. Earle Page). But to-day we have had a plethora of speeches from the supporters of the Government, and, singularly enough, the majority of them have been against the proposals of the Government, but a little more against the policy of the Opposition. In these circumstances I do not envy the Prime Minister the solidarity of his following. I must congratulate the honorable member for Adelaide (Mr. Yates), upon having secured at least two converts to-day to his socialistic, financial repudiation ideas. One of these is the honorable member for Hunter (Mr. James), arid the other an unknown gentleman in the gallery. It is (‘.assuring, however, that the views of the honorable member have not yet been assimilated and accepted by the Government.
One entertained a certain amount of confidence in the Government after hearing the speech delivered by the Prime Minister at the beginning of this session on the policy of his Ministry. The first paragraph in the report of that speech reads - in placing before honorable members an outline of thu legislative programme which they will be asked to consider in the next few months, it is desirable to dwell for a moment on the difficult financial and economic position confronting the Commonwealth at the present time.
Fundamentally, wu are suffering from the effects of world-wide depression, accentuated by over-borrowing.
The concluding paragraph was as follows : -
The difficulties confronting Australia are serious, and a proper realization of them should result in whole-hearted co-operation of all sections in the working out of a satisfactory solution. Indeed, at the present juncture, the Parliament might fittingly become an economic conference of representatives of the people meeting to discuss the general position.
Those statements predicated a willingness to consider the views of honorable members of all parties ; but evidently the supporters of the Government are not very ready to adopt that course. In fact, they have been almost offensive in their comments on the speeches of honorable members of the Opposition, and have imputed motives to them which were entirely unwarranted, seeing that the views expressed were sincerely held. In these circumstances, one must greatly discount the value of the overtures of the Loader of the Government.
I have not been able to discover any real difference between the sentiments expressed by the present Prime Minister and those of his predecessor in office. Both gentlemen regard the position of Australia as serious. The Labour party is sitting on the Government side of this chamber to-day, because of certain promises which it made during the election campaign, but had not the slightest hope of ever fulfilling. It is now trying to justify its position by blaming the previous Government for its faults and failings.
– What is wrong with that?
– I suppose there is nothing wrong with it if honorable members opposite can “ get away with “ it. I did not agree with all that the previous Government did during its term of office, and I frequently criticized its proposals. But I believe that Australia is beginning to realize that the Bruce-Page Government in its last two years of office, at any rate, began to see the seriousness of our position. It certainly took the country into its confidence in that respect.
A comparison of the budget proposals of this Government with those of the previous Government forces one to the conclusion that this is much more of a spendthrift Government than the BrucePage Government, for while the latter Government had a certain amount of revenue to justify its expenditure, this Government is proposing to spend even more than the previous Administration spent in its last year of office, although the country has something like £70,000,000 less income i;o justify that course.
It is within the memory of honorable members that, early in 1929, the former Prime Minister, Mr. Bruce, invited the Premiers of the States to meet him in conference in Canberra. At the opening of that conference he delivered a classic address, which reviewed the serious position of Australia from the financial and economic stand-points. The right honorable gentleman said that it was essentia] that the cost of production should he reduced. His words in this connexion were as follow: -
The question that has to be faced is - how can this increased prosperity be brought about? During recent years we have attempted to do it by the free use of borrowed money. In pursuance of this policy, Australia has. since 1920, spent some £300,000.000 of borrowed money on capital works. The results of this expenditure, however, have not been such as to warrant its indefinite continuance upon the basis which has existed in the past. It is essential, therefore, that we should consider the reasons that , have led to the failure to achieve greater prosperity and increased population as a result of this heavy expenditure of loan money. It is true that, in gome cases, the money has been spent upon unsound or unwise projects, but, speaking generally, this has ‘not been the case, and, in fact, our production has substantially increased.
In 1920-21 the value of production from all recorded industries was £390,514,000, whilst Mw figures for 1926-27 were £440.874.000, which represents an increase of £56.000,000. tn the former year, however, prices were at l>eak levels. Applying the index numbers relating to production prices to the foregoing totals, the value of production at 1920-21 prices for the two years referred to would be -
which represents an increase of £94,000,000.
Unfortunately, however, production has not been on an economic basis, and one of the greatest problems wu have to face arises from the fact that the prices we are receiving in the markets of the world for our surplus products are not equivalent to the costs of production. A critical examination of our present position leads inevitably to the conclusion that the basic cause of all the economic troubles of Australia to-day is the high cost of production, the reduction pf which is the first step that we must take to bring about a solution of our problems.
Mr. Collier, a big Australian, who was at that time the Labour Premier of Western Australia, commented on Mr. Bruce’s speech in the following words : -
I join with the other Premiers in expressing appreciation of the very comprehensive and illuminating statement read by the Prime Minister this morning. There are several subjects that I wish to refer to, and in regard to which the remarks of the Prime Minister cannot be controverted. A cursory examination of the position of Australia to-day must convince us that economically it, is unsound. We have lived through the war years, and the abnormal conditions that arose out of the war. We find to-day that, because of our relatively high cost of production, we are unable to compete with the other countries of the world. I venture to say that if we have a severe drop in the prices of our staple products, such as wool and wheat, associated with a bad season or two, Australia will be faced with the greatest crisis in its history. The cost of production must undoubtedly be reduced. We shall probably differ in opinion as to how that problem is to be solved. Some people contend that the Commonwealth Parliament has, to a considerable degree, been responsible for the high cost of production, because of its ever-increasing tariff. The Prime Minister has shown that whereas, 21 years ago, there were only seven or eight items on which the ad valorem duty was 40 nor cent., there are now over 200. I think that there is a considerable volume of opinion in Australia that that increase in tariff has contributed very materially to the increased cost of production, so much so that the people who urn engaged in our primary industries, particularly those growing wheat and wool, have almost reached the point of refusing to increase their production. This difficulty has beon accentuated because of the recent fall in the price of wheat. If the price of wheat is low for next year and in succeeding years, wheatgrowing will become unprofitable. Any one who has had experience of wheat-growing in Australia knows that to ensure a profit tho price of wheat should, at the lowest, be 4s. ti bushel, and that is approximately the price prevailing to-day. The inevitable result of low prices for our primary industries will be a slackening of production. There will bc a falling off of the total wealth production of Autralia, and that will be followed by a general depression in business and a large increase of unemployment. Our real problem is to bring about a reduction in the cost of production.
It is rather lamentable that certain honorable members seem to imagine that a reduction in wages places the working man at. a disadvantage. Six years ago I said that everybody in Australia would be better off if the income of all sections of the community were reduced by 30 per cent.
– Why not reduce rents, interest and profit?
– I included all income. Rents have been made high because of the high cost of building houses, which is largely due to the reduced output and the high wages of the employees in the building trade.
A great number of thinking people in this country believed that if Britain won the late war, and the people had only bread and dripping to live on, they might well be thankful, because Australia would still be a free nation; but much to the surprise of many of us, Australia seemed to be even more prosperous after the war than before it. [Quorum formed.] I think that the reason for that apparent prosperity can easily be given. When the war closed we were able to transport our produce overseas, and we enjoyed the benefit of many millions more than was expected for our wool and wheat. The formation of Bawra gave us £20,000,000 more than was anticipated for our wool. It was decided to distribute £25,000,000 in gratuities to the returned soldiers. ‘ and to spend £1-7,000,000 or £18,000,000 in the provision of war service homes. The great mistake made, not only by Parliament, but also by individuals, was in assuming ‘that that evanescent income would be permanent. We now have to pay back some of the money that helped to bring about that apparent prosperity. No government in Australia can take credit for the high prices obtained for wheat and wool at that time. Other countries sought to return to pre-war standards, but in Australia, owing to the power of the more densely populated States, and the unions of manufacturers and A labour, the war-time standard of wages and conditions was not merely maintained, but wages and tariffs were increased, and improved labour conditions were granted.
– Who gave those improved conditions to the workers?
– The Arbitration Court; but the apparent prosperity, which made the granting of those conditions possible, was due to the beneficial effects of high prices for wool and wheat. The receipts, for those commodities this year have fallen back to the extent of about £70,000,000, and now Australia has hot sufficient income to maintain the standards set up during the period of buoyant revenue.
Great exception is taken to the downward trend of wages. Honorable members seem to forget that, after all, money is only a medium of exchange. According to the Sydney Morning Herald the Treasurer of New South Wales, Mr. Stevens, recently said -
We have been charged with reducing the spending power of the people, and those who make this charge would have you believe that Governments can increase prosperity by increasing wages and salaries. We are at times prone to forget that wages come from a huge common fund on which we all live, and that that fund is built up by the value of production, supplemented by loan credits. If this wage fund falls - and every one agrees that it has fallen - then collectively the. wages and earnings of us all decline. If Parliament was to fix the basic wage at £6 every one who bad a job and was working under State awards would receive an increase of £2 per week. But the community would not be richer. In fact, it would be poorer, because the costs of production would be so increased that many an industry would go out of existence. Do not be afraid of the suggestion that costs of production must be reduced. There is no alternative. Living costs and value3 generally must fall as a result of the altered condition of things.
Anybody whose income drops by 30 or 50 per cent, has only one course open to him ; he must, reduce his expenditure. What applies to individuals is equally true in the case of nations. I desire to pay my way, and, if I find my income depleted, I begin to consider iri what directions I can economize. I do not approve of the methods recommended by the honorable member for Adelaide (Mr. Yates), and the honorable member for Hunter (Mr. James), for discharging the obligations of the nation. Mr. Stevens went on to say -
Those who advocate that you will cure unemployment by producing less are either incapable of assessing the true position or they are too cowardly to face the issue. Unemployment is the natural result of the decreased income of the community, and, until we can get that income back to its former level, every one must be prepared to work harder and take less, and because of the definite conviction that this is truthfully the position, the Government, finds justification for the policy embodied in the legislation recently introduced. We have not set out- to buy popularity; we have set out to do our duty to every nian and woman in the community. We want to solve unemployment so as to restore contentment and relieve distress, and there is no other way open to us than that of facing the real issues and adjusting our costs of government and our costs of production to meet the reduced national income. ‘
To my mind, this Government has displayed political hypocrisy to a considerable degree. Some time ago a bill was passed in this chamber providing for a guarantee of 4s. a bushel .to the wheatgrower. That measure was rejected in the other branch of the legislature, and, since that time the Government has been shedding crocodile tears; but the action of the Senate has relieved it of a great responsibility. I thoroughly agree with the suggestion submitted by the honorable member for Wakefield (Mr. Hawker). The Minister for Markets and Migration has said in this House that he believes the cost of producing wheat to be 4s. a bushel. The Prime Minister, as well as the Premiers of the States, has urged the wheat-growers to grow more wheat. The Treasurer of New South Wales appealed to them to produce more wheat, because they would thereby produce more wealth. The hypocrisy of the Federal Government’s appeal, however, is evident when we see the same Government imposing upon the wheat-growers ever-increasing burdens. The scriptures relate that when the Israelites were in Egypt, Pharaoh required them to produce so many bricks per diem. Although they fulfilled his demand, he was not satisfied, and required them to find their own straw, and still produce the same number of bricks.
The cruelty of Pharaoh to the Israelites is not equalled by the harsh treatment meted out to the farmers by this Government in imposing on them primage duties and sales tax. Surely the Prime Minister could not have meant what he said in the considered statement of policy which was printed for circulation among honorable members of this House. Either he was not sincere, or his party “ got him by the wool,” and he exercises no real power at all. It would appear almost as if the Minister for Customs directs the policy of the Government, and has insisted on placing these imposts on the sacks which the farmer requires to harvest his crop, on the twine with which he sews the sacks, and on the fertilizers he puts into his soil. If these imposts are allowed to remain, the position of Australia must eventually become infinitely worse than it is to-day. I am one of those who believe that the natural resources of this country are sufficient to enable every one to be happy and well-off. Some of our socialist friends opposite remind me of the Irish socialist who had two pigs. His doctrine was that all should share alike. He was asked whether, if he had two horses, he would be prepared to give one to his neighbour who had none. He said that he would, and if he had two cows, he would give one of them to his neighbour also. “ Well, he was asked, “ if you had two pigs, would you be prepared to give one of them away ?” “ D- you “ said the Irishman, “ You know’ I have two pigs.” When it is proposed that some of the socialists in this House should give a little of their £1,000 a year for the relief of those who have not even a few pounds, they decline, thus exposing their hypocrisy. They are very ready to draw on the credit of some one else, but are not prepared to give one bean of their own salary for the unemployed.
The honorable member for New England (Mr. Thompson) in his speech this afternoon, said that economists always differed in the advice they gave to the people of Australia. He went on to say that the words “economy” and “ economics “ were used hundreds of times in the speeches made . in this House, but that such words seemed only to lead to confusion of thought. I have here a document prepared by economists in the United States of America for presentation to the President of that country. It bears the signature of over 1,000 economists, including professors of universities from 46 States. Among the signatures are such well-known names as Irving Fisher, of Yale, and Frank W. Taussig, of Harvard. The document is as follows : -
The undersigned American economists and teachers of economics strongly urge that any measure which provides for a general upward revision of tariff rates be denied passage by Congress, or if passed, be vetoed by the President.
We are convinced that increased restrictive duties would be a mistake. They would operate, in general, to increase the prices which domestic consumers would have to pay. By raising prices they would encourage concerns with higher costs to undertake production, thus compelling the consumer to subsidize waste and inefficiency in industry.
At the same time they would force him to pay higher rates of profit to established firms which enjoyed lower production costs. A higher level of duties, such as is contemplated by the Smoot-Hawley bill, would, therefore, raise the cost of living and injure the great majority of our citizens.
Pew people could hope to gain from such a change. Miners, construction, transportation, and public utility works, professional people and those employed in banks, hotels, newspaper offices, in the wholesale and retail trades, and scores of other occupations would clearly lose, since they produce no products which could be specially favoured by tariff barriers.
The vast majority of farmers also would lose. Their cotton, pork, lard, and wheat are export crops, and are sold in the world market.
They have no important competition in the home market. They cannot benefit, therefore, from any tariff which is imposed upon the basic commodities which they produce.
They would lose through the increased duties on manufactured goods, however, and in a double, fashion. First, as consumers, they would have to pay still higher prices for the products made of textiles, chemicals, iron and steel, which they buy. Second, as producers, their ability to sell their products would be further restricted by the barriers placed in the way of foreigners who “wished to sell manufactured goods to us.
Our export trade, in general, would suffer. Countries cannot permanently buy from us unless they are permitted to sell to us, and the more we restrict the importation of goods’ from them by means of ever higher tariffs, the more we reduce the possibility of our exporting to them.
This applies to such exporting industries as copper, automobiles, agricultural machinery, typewriters, and the like fully as much as it does to farming. The difficulties of these industries are likely to be increased still further if we pass a Higher tariff.
I thought that honorable members opposite would be able to see the analogy between the position described by the economists of America, and that which obtains in Australia to-day. Have we not recently had the experience of other countries retaliating against its because of the prohibitive duties we have imposed? Our trade with Belgium showed a favorable balance of about £9,000,000 a year; but, not content with that, we placed prohibitive duties on her exports to Australia, so that she very naturally said, “ You are not friendly to us, and we will not continue to buy from you.” France similarly has discriminated against our wheat, while retaliatory action is being considered by Italy and Egypt. The statement of the economists continues -
There are already many evidences that such action would inevitably provoke other countries to pay us back in kind by levying retaliatory duties against our goods. There are few more ironical spectacles than that of the American Government as it seeks, on the one hand, to promote exports through the activity of the Bureau of Foreign and Domestic Commerce, while, on the other hand, by increasing tariffs it makes exportation ever more difficult.
We do not believe that American manufacturers, in general, need higher tariffs. The report of the President’s Committee on Recent Economic Changes has shown that industrial efficiency has increased, that costs have fallen, that profits have grown with amazing rapidity since the end of the World War. Already our factories supply our people with over 90 per cent, of the manufactured goods which they consume, and our producers look to foreign markets to absorb the increasing output of their machines.
Further barriers to trade will serve them not well, but ill.
America is now facing the problem of unemployment. The proponents of higher tariffs claim that an increase in rates will give work to the idle. This is noi; true. We cannot increase employment by restricting trade. American industry, in the present crisis, might well be spared the burden of adjusting itself to higher schedules of duties.
Finally, we would urge our Government to consider the bitterness which a policy of higher tariffs would inevitably inject into our international relations. The United States of America was ably represented at the world economic conference which was held under the auspices of the League of Nations in 1927. This conference adopted a resolution announcing that “ the time lias come to put an end to the increase in tariffs and to move in the opposite direction.”
The higher duties proposed in our pending legislation violate the spirit of this agreement, and plainly invite other nations to com- pete with us in raising further barriers to trade. A tarin” war does not furnish good soil for the growth of world peace.
The originators and first signers of the document were -
Paul H. Douglas, Professor of Economics, University of Chicago; Irving Fisher, Professor of Economies, Yale University; Frank D. Graham, Professor of Economies, Princeton University; Ernest M. Patterson, Professor of Economics, University of Pennsylvania; Henry R. Seager, Professor of Economics, Columbia University; Frank W. Taussig, Professor of Economics, Harvard University; Clair Wilcox, Associate Professor of Economics, Swarth11lore College
I have referred before in this chamber to the inconsistent attitude of the Labour section of the community. The Minister for Defence (Mr. A. Green) is cutting away our means of defence. He believes that we should go before the League of Nations to advocate the peaceful settlement of international disputes. But if we go to the conference at Geneva, and the other nations are able to show that we are occupying a territory with two people to the square mile, at the same time denying their nationals the right to come here even though their territories are carrying from 200 to 300 persons to the square mile, we shall not have a leg to stand on. Are we a nation specially favoured by the Almighty that we should be entitled to hold this land practically unpopulated, without any interference on the part of other nations? While our population remains as it is, we have no grounds for appealing to the League of Nations for assistance in the event of an enemy attack. Yet this Government is wrecking our defence. Our position would be very difficult if the hand of every other nation were against us. The report of the 1028 professors of economics is sufficient reply to the honorable member for New England (Mr. Thompson). Economics is like the rays of the sun. It has. no respect for countries. Economics is a law, and any violation of it will bring its natural consequences. The Government should seriously reconsider the proposals that it has placed before this country. If they are put into operation they will have a strangling effect upon the community. We are taking a step in the wrong direction by increasing the tariff and placing embargoes on certain imports. That must necessarily increase our difficulties. The Labour party, when in opposition, criticized the deficits of the Bruce-Page Government; but now it is in office it is budgeting for a deficit four or five times as great.
– To meet the wishes of the honorable member, let me say that the Government it budgeting to meet a shortage. What is the effect of blocking imports? What is retarding our exports? Is it not that the cost of production in Australia is making production unprofitable to the man on the land? Is it not that the burdens placed upon him prevent him from producing at a profit as he should? This Government has piled additional burdens upon him by increasing the tariff and the cost of production generally. Out of its mouth it condemns itself. The customs revenue will be depleted by £6,000,000 or £8,000,000. That, of course, will give an opportunity for vested interests in Australia to fleece the community. The taxpayers, and particularly the primary producers, will have to make up that further loss. We cannot expect other nations to buy our goods when we buy nothing from them. The economic advice that has been given to us by experts has been totally ignored. The sooner we recognize the immutable law of economics, the sooner will Australia regain a sound financial footing. The report of the Royal Commission on the Constitution makes some reference to the unequal operation of the Federal policy in respect of the States.
– Why not ask leave to have the report inserted in Hansard?
– I have no objection, if it will suit honorable members’ convenience. I ask leave to insert portion of the report in Hansard.
– The report states:-
The investigations made by the commission in the different States, and the evidence tendered in Western Australia, South Australia, and Tasmania, indicate that certain phases of Commonwealth policy - whatever their immediate effect upon Australia as a whole - have been seriously detrimental to those States of smaller population that depend for the most part upon primary production. The public finances and the commercial and industrial development of those States have been prejudiced to an extent quite incompatible with the requirements of a federal union, and dangerous to the well-being and progress of the Commonwealth as a whole. It is not without significance that this conclusion is in accordance with the findings of the three royal commissions - in each case composed of persons entirely dissociated from the States concerned - that have made independent inquiries into the disabilities of the States of Western Australia, Tasmania, and South Australia. The same opinion was expressed by the Imperial Economic Delegation that recently visited Australia, and by the informal committee of experts set up by the Prime Minister to report on the economic effects of the Australian tariff. From the reports of these bodies, and the evidence submitted to this commission, it appears to me to be clear that a condition of affairs has been created that cannot be met by temporary grants or other forms of palliative. The continued prosperity and advancement of the Commonwealth must depend very largely on the capacity of the now sparsely-peopled States to exploit their resources and to absorb additional people - results that cannot bc achieved unless they aru accorded a sufficient, measure of financial and economic freedom ‘to enable them to work nut their own salvation.
On this point I desire to direct attention to the statement submitted to the commission by Professor J. B. Brigden and Mr. L. F. Giblin, M.A., appearing on pages 1700 and 1710 of the evidence, and also to the concluding pages of the report of- the informal committee of experts already referred to, and which consisted of J. B. Brigden, M.A., economist and deputy chairman of executive, Australian Overseas Transport Association; D. B. Copland, M.A., D.Sc, Professor of Commerce, University of Melbourne; E. C. Dyason, B.Sc, B.M.E.; L. F. Giblin, M.A., Ritchie Professor of Economics, University of Melbourne; C. H. Wickens, I.S.O., F.I.A., F.S.S., Hon. M.S.S. (Paris), Commonwealth Statistician and Actuary. In Appendix W to its report the committee of experts declares that “the unequal effects between States are probably the most embarrassing consequences of the tariff,” and that the tariff has “ materially affected the relative prosperity of the different States.” As indicating the very marked difference in the effect of the tariff on different States, the committee points out that the subsidies to production through the tariff are twice as great per head of population in Victoria and Queensland as in Western Australia, South Australia, and Tasmania, whilst on the other hand the costs of protection fall much more heavily on the three latter States. Summarizing its conclusions regarding these States, the committee says : “ Their taxable capacity is lowered, so that their rates of taxation have to be increased; industry is further encouraged to concentrate in the more fortunate States, and the cumulative effects which follow intensify the inequalities created by the tariff itself.”
In recent years four or five royal commissions have been appointed. They have all agreed that certain of the States are at a serious disadvantage because of federation. Those States are Tasmania, South Australia and Western Australia. Each of those royal commissions has agreed that the high protective policy of Australia and the Navigation Act has been detrimental to those States, and have laid a burden upon them that has made it impossible for them to develop their areas properly and adequately. Western Australia comprises about onethird of the territory of Australia, and it is the least developed of all the States. It has a population of 450,000 noble souls, who, as some of the commissioners have said, are accomplishing mammoth tasks in the development of its resources. The settlers of Western Australia are producing from the soil. Australia is naturally a great primary producing country, but it is hamstrung, shackled, and hobbled at every turn. Western Australia is compelled to buy in a protectionist market and to sell in the open markets of the world in competition with coloured labour. Last year we bought from the eastern States £10,600,000 worth of goods and sold to them £1,200,000 worth of goods, an adverse balance to Western Australia of £9,400,000. Had that State been able to buy its requirements free of legislative restrictions, it would have been able to expend an additional £3,000,000 in developing its territory. Federation is the greatest enemy of Western Australia. Other countries are helping that State more than are the eastern States. The Government will not heed the advice of the representatives of Western Australia, who, under the Constitution, are few, and I warn it seriously of the consequences of losing such a good customer as Western Australia.
– In that interjection we have an instance of the jibes, sneers and goadings to which the representatives of Western Australia are becoming accustomed. We are British subjects and there is such a thing as British justice. The injustice that is being done to Western Australia cannot long remain disregarded. The in dustries of the eastern States are being bolstered up by bounties, increased tariffs and embargoes. Western Australia has to pay more for its requirements, and the only result is to provide additional unemployment in the eastern States. My remarks are not empty fulminations, because they are borne out by the report of the Royal Commission on the Constitution which took evidence throughout Australia. The fact that three of the States are withering away like dying limbs shows that “something is rotten in the State of Denmark.” This Parliament should take cognisance of the report of that royal commission. We should get back to the pre-war standard of living. I am prepared, with the rest of the community, to make a sacrifice in the interests of Australia. We should make a gesture to the public. By reducing the standard of living we shall increase our income, and in the end the community will be better off, and there will be less unemployment. I support the motion moved by the Leader of the Opposition (Mr.. Latham), and when the motion foreshadowed by the honorable member for Wakefield (Mr. Hawker) is before the committee I shall support it also. I urge the Government not to place any further shackles on the primary producer, who is already suffering severely because pf declining prices. The Government is making a great deal of capital out of the fact that it offered to the farmers a guarantee of 4s. a bushel; but I would point out that the establishment of a compulsory pool would have placed our primary producers in bondage. It was a means by which the Government hoped to control the wheat of this country. The Government has little sympathy with the farmers, because it is now taxing the fertilizers used to stimulate the growth of their crops. It is taxing all the farmers’ requirements. If the Government refuses to withdraw its proposals, the people of Australia will know that the Labour party is no friend of the primary producers.
.- It is not my intention to inflict upon the committee a speech lasting an hour and 35 minutes. Such speeches are a travesty on the conduct of our proceedings.- The
Standing Orders should not allow speeches of such a length upon a subject that has already been threshed out, the same thing having been said many times, often in the same silly way.
– How long did the hon- . orable member speak on the Conciliation and Arbitration Bill?
– In my ignorance, an hour and 40 minutes. I assure the honorable gentleman that I shall not offend again in that respect.
The view that I take is that the party which sits on this side was given control of the government of Australia at an uprecedently bad time, and is facing the position in a courageous and businesslike fashion. Instead of having a colossal deficit, it proposes to balance the ledger by additional taxation, and strict economy. It is necessary to impose new revenue duties that are estimated to yield £5,700,000, a sales tax from which £5,000,000 will be received, extra postal rates to bring in another £1,000,000, and additional income taxation to the extent of £800,000. That new taxation is warranted. Australia could not borrow any more money, even if she wanted to do so. The last government had wonderful success in the raising of loans ; but the overseas loan market is closed against the present Government. During the year 1926-27, on account of the blundering of the last Government, Australia imported goods to the value of £164,000,000; and in six years that Government raised nineteen loam aggregating £125,000,000. The Scullin Government can raise nothing in England, despite the boast that the Mother Country is a buttress to Australia. The arrival of the ex-Prime Minister in London coincided with a considerable drop in the value of Australian securities.
– What is the honorable member suggesting?
– I leave that to the honorable member’s judgment. He surely will admit that the ex-Prime Minister was given the biggest jolt received by any man in the political life of Australia, and on that account would not be anxious for this Government to succeed. I do not regard that gentleman as an Australian. He was educated in England, enlisted in an English regiment, and never at any time had Australian ideals.
This Government is facing a financial crisis the like of which has never. previously been known. It has set out to prohibit the importation of certain commodities, and thus prevent the adverse trade balance from going further against us. Criticism has been levelled against the Government on account of its prohibition of the importation of certain goods. During the year 1927-2S Australia imported £39,000 worth of biscuits, although there were biscuit factories in every city. Cheese, a primary product, was imported to the value of £45,000. There are confectionery works in practically every city -and town, yet the imports of that commodity totalled £137,000. Preserved fruits, a commodity of which Australia has a glut practically every season, were imported to the value of £45,000. Vegetables grow in every part of every State except the hottest portions, yet in the canned form they were imported to the value of £95,000. The imports of meat totalled £78,000, despite the fact that this country is capable of producing the requirements of the world, Soap was imported to the value of £116,000, although there are soap works in every capital city. In my electorate there are two woollen mills that can produce Australia’s requirements of blankets and rugs, yet the imports under that head amounted to £84,000. Barbed wire, which ordinarily is machine-made, and which can be turned out in Australia equal in quality to that produced in any other part of the world, was imported to the extent of £20,000 worth. Despite the existence of colossal enterprises like those of H. V. McKay and other firms, in every State except Western Australia, our imports of agricultural machinery totalled £154,000. Wireless requisites were imported to the value of £399,000. It has now been proved beyond doubt that every wireless part is being made in Australia. The imports of bolts and nuts totalled £238,000. I venture to assert that, apart from private enterprise, governmental workshops can produce in a month all the bolts and nuts that are required by every activity in Australia ; yet we imported them at a time when men who were skilled at that work were unemployed. The value of the imports of roofing tiles was £201,000, notwithstanding the fact that in at least eight or nine electorates tiles are made that are considered to be the equal of any manufactured overseas. Tobacco Avas imported to the value of £600,000. Australian leaf will come into its own after this Parliament has discussed the report of the select committee that recently inquired into the matter. From information that I have received, I believe that our leaf is equal to any produced elsewhere.
In the correction of the adverse trade balance, it was necessary to adopt three methods - to prohibit the importation of certain lines, to place high duties on others, and, in certain cases, to restrict imports. The Assistant Minister did not overstate the position when he said that additional employment had been provided. I do not say that immediately hundreds of thousands of men are going to obtain work; but I know that the giving of adequate protection has resulted’ in between 100 and 150 people in my electorate having obtained employment since this Government came into power.
Honorable members opposite have quoted from newspapers adverse criticism of the present Administration. The Commercial News and Shipping List, published in Sydney, cannot, by any stretch of the imagination, be described as a Labour organ. In its issue of the 16th July last it published the following: -
The terrific budget, prepared by Mr. Theodore, and hurled at the House of Representatives by Mr. Scullin on Wednesday last, represents the definite return of all the promissory notes scattered round the world by the mad, bad, treasurers of the past. For years every journal that has attempted to warn Australia of the chaos to which its infernal policy of boom, borrow, and boom, would inevitably take it, was denounced as a calamity howler, and’ accused of disparaging the country. This was particularly so with the Taploid Press. Such storms of vituperation were let loose upon those who uttered a note of warning that even the recent British Economic Mission was afraid to register its full aud complete opinion of Australia’s financial condition.
When the Scullin-Theodore Ministry arrived it found that the financial obligations of Australia had been increased from £284,000,000, or £57 0s. Sd. per head in 191 S, to the colossal sum of £494,000,000, or £78 12s. 7d. per head. The mess was so colossal that the Ministry almost regretted that it had won’ the election. The interest bill had increased from twelve and a half million sterling in 1918, to twenty- five and three-quarter million sterling in 1928, whilst the population had increased by approximately a shade over one million souls. These figures refer to only the Commonwealth liabilities, and the position is infinitely mortghastly if the liabilities of the States are taken into consideration. In fact, the total liabilities are now over £1,200,000,000 - a sum altogether beyond the capacity of the population of six and one quarter million people.
To make matters worse, Australia was failing to pay her way. Our exports of all commodities were insufficient to pay the interest on loans or the cost of the commodities imported from overseas. The deficit on trade with the United States ranged from £22,000,000 to £28.000,000 per annum for over fifteen year*. When interest bills fell due and loans had to be redeemed, treasurers got rid of the liabilities by the process of floating a new loan to pay off old liabilities. The last days of the Bruce-Page Ministry heralded the coming crash. Australia began to find herself hard up. Her exports dwindled in volume and value When Scullin and Theodore ambled into the marble halls of authority at Canberra, they met face to face the hideous spectre of national bankruptcy. The desperate budget flung, like a severed head, on the table of the startled and horrified House of Representatives last Wednesday afternoon is only the desperate floundering of a debtor Government to grab money from any and everywhere. Scullin is faced with a deficit of £14,000,000. “No further drift in Commonwealth finances,” said Mr. Scullin, “ can he permitted.” This means pay, pay, pay!
Commenting on the budget, this financial writer says -
The position of the Government is desperate. It has no alternative but to increase taxation. It can float no more loans if it wished to. Its sole resources now are what it can collect from Australian pockets in the form of taxation, loans aud forced contributions.
Evidently, the whole of the financial press of Australia is not opposed to the efforts of this Government to place Australia on an even keel. Two weeks ago, practically every daily newspaper in Australia devoted, not columns, but pages to a criticism of what they termed, “the calamity budget.” To-day that abuse has died down. I believe that quite a lot of people, who at one time supported our friends opposite, on the last occasion voted for the Labour party. They are looking to that party to cease the policy of borrowing overseas, and to establish Australian industries, always with a due regard for the interests of the Motherland, but primarily having in mind the interests of ‘our own people. The drastic financial proposals of this Government were rendered necessary, not by its own acts, but by the forces that have controlled the finances of Australia during the last ten years. It is endeavouring to legislate for every section. On behalf of the working people it evolved a system of arbitration that I believe will give general satisfaction to both employers and employees. It has endeavoured to establish secondary industries by means of a high tariff, although by so doing it has had to sacrifice revenue from customs duties to the extent of £8,000,000 a year. It has looked after the interests of the man on the land, by the introduction of a bill making provision for a compulsory wheat pool, and guaranteeing the farmers 4s. a bushel for their wheat delivered at railway sidings. The bill was passed by this House, but thrown out by another place. The result will probably be that the farmers will receive ls. a bushel less for their wheat than would otherwise have been the case. The Government made an honest and fearless attempt to help the farmers, who, in my opinion, deserve help.
The Leader of the Opposition has said that since this Government has assumed office the amount of unemployment iu Australia has increased from 13 per cent, to 18 per cent.; but an examination of the figures shows that during the regime of the Bruce-Page Government unemployment increased from 6 per cent, to 13 per cent. We see, therefore, that in the boom years of Australia, unemployment increased by 7 per cent., whereas in thi 8 time of unprecedented difficulty and depression it has increased by only 5 per cent. One reason for the increase is that the Loan Council cut down the borrowing programmes of the Commonwealth and States from £43,000,000 to £21,000,000, with one slash. This has meant that Australia’s largest employers, namely, the governments, have lost about 50 per cent, of their spending power. It is unfortunate that so many of our unskilled workers are out of employment, but it seems to me that the position will not be rectified until honorable members of all parties in this chamber are prepared to consider it without bias.
The Leader of the Opposition has seriously suggested that the Government could improve its financial position by reducing Public Service salaries by £1,000,000. That would mean practically a 10 per cent, reduction. But the honorable gentleman knows very well that, as the Labour party declared at the polls last year, it would not reduce wages below the rates granted by our various arbitration tribunals, it must stand firm on that undertaking. The report of the Public Service Commissioners for last year discloses that there are 28,530 officers in the Commonwealth Service, who receive an aggregate of £7,989,000 in salaries. The average rate of salary is £279 per annum, or £5 7s. 3d. per week. A 10 per cent reduction would bring salaries down to an average of £4 16s. per week. The Public Service Board reported that in its opinion reductions could be made in travelling allowances, overtime rates, payment for Sunday work, higher duty allowances, and so on. To my mind, the board exceeded its duty in making such suggestions, for these conditions were fixed, after a thorough investigation, by the Public Service Arbitrator. I was also amazed to read that this board, which has the duty of classifying the Service, but not of fixing rates of wages, had reported that, the various allowances granted to Public Servants had been abused, and that higher payment to officers temporarily filling higher positions was not justified. In a service of the magnitude of the Commonwealth Public Service there must always he officers discharging duties of a higher grade than those for which they are paid. This is unavoidable, because of deaths, sickness, changes of staff, and the like. Seeing that the public servants are subjected to the same rates of taxation as ordinary persons in the community, it would be altogether unjust to single them out for a special reduction of salary. The suggestion of the Leader of the Opposition that the average rate of pay in the Service should be reduced by nearly lis. a week is stupid. Every honorable member of this Parliament knows that he spends more than £4 16s. a week while he is away from his home; yet the Leader of the Opposition suggests that that amount is sufficient to enable a public servant to maintain his family and himself in reasonable comfort. I. am amazed that a gentleman of the undoubted capacity of the Leader of the Opposition should have made such a suggestion. I have no ‘Comment to make upon the suggestions made by the Deputy Leader of the Opposition, for I consider his speech to be the vapourings of a man who does not know what he is talking about.
It has also been suggested by honorable members opposite that old-age and invalid pensions and war pensions should be ‘reviewed.
– , - Who made that suggestion ?
– The Leader of the Opposition (Mr. Latham) said that that was one subject that should be considered with a view to bringing about a reduction of £4,000,000 in our expenditure.
– I deny that the Leader of the Opposition ever suggested that pensions should be reduced.
– He did suggest it, and the Minister in charge of Repatriation yesterday said that he had had an examination made of the pensions paid through the Repatriation Department, and had ascertained that 99 per cent, of thom were thoroughly justified, and that only 1 per . cent, of them could possibly be reduced. .’ During the election campaign last year, Mr. Hurry, who was formerly the member for Bendigo, suggested that the deficit, in the government accounts should be met by the imposition of a heavy amusement tax or by a reduction of pensions. The right honorable member for Cowper (Dr. Earle Page) made a similar suggestion in Adelaide.
– I deny that the Opposition has ever suggested that pensions should be reduced.
– If I had my way, I would pay to our totally incapacitated soldiers a pension equal to the wage which they were earning before they went to the war, and not merely the 30s. per week which they are now receiving. Honorable members opposite supported a government which, having been in office for seven years, left the country in the most serious financial position in which it has ever been, and the only proposal that they now have to offer to meet the situation is the damnable one of a reduction of old-age pensions from £1 to some unmentioned figure, a review of war pensions, a reduction of the maternity allowance by £200,000, and a reduction of Public Service salaries by £1,000,000. The suggestions are all unthinkable and unutterably stupid. It is well known that the wealthy classes and poorer people in this community have alike taken full advantage of the maternity allowance, and while the Government the honorable members opposite supported was in office it had not the courage to attempt to reduce the allowance.
I shall have an opportunity before very long of discussing, in Melbourne, these wonderful suggestions of Nationalism to assist Australia to get out of her difficulties, and I shall have no hesitation whatever in saying plainly what I think of them. Members of the Opposition have declared that this Parliament should not grant £1,000,000 to the States for the relief of unemployment. These political failures opposite would make confusion worse confounded by refusing to grant this money to the State Governments, so that starving people may be immediately fed. If it were in my power to do so, I would make £10,000,000 available to the States for this laudable purpose. On the 17th July, I asked how much of the federal grant had been asked for by each of the States, and the answer was that New South Wales had applied for £246,000; Victoria, £121,000; Queensland, £28,000; South Australia, £81,000; Western Australia, £148,000 ; and Tasmania, £23,000. Almost the whole of that money is being spent on wages, and the money is not drawn until the work is done. As a new member, I sometimes wonder whether my hearing is faulty, or whether I am losing my senses, when I hear honorable members opposite suggest that it is wrong for this Government to make £2,000,000 available for the relief of a section of the community that is on the verge of starvation. If honorable members opposite have any complaint on that score, I advise them to refer it to the electors; I do not doubt what the answer of the electors would be.
Criticism has been offered concerning the proposal to grant £100,000 for the repatriation of unemployed coal-miners. I regret that the Government is not iri a position to make £20,000,000 available to provide employment, not only for the coal-miners, who were rendered idle through no fault of their own, but also for some 30,000 railway men who have lost their jobs in recent years, and other workmen who have been thrown idle, because of the mechanization of industry. The coal-miners were locked out by the colliery proprietors who, under the laws of the land, were allowed to starve the men for fifteen months. The leaders of the miners’ organization and the coalowners are well aware that owing to the change-over from black coal to oil, there must necessarily be a surplus of miners. Even if a record price were obtained for wheat in the coming season, and if the price of wool rose to the high level of a few years ago, there would still be a big army of unemployed, owing to the improvement of industrial methods. We must grapple with the problem of making available, not doles, but work.
The present budget is thoroughly justified. Economies have been practised, wherever possible, and the suggestions made by the Leader of the Opposition (Mr, Latham) are vague and stupid.
– And insincere.
– Yes; members of the Opposition seem to be indulging in a sham fight; but their tactics will re-act upon them when they ask the people to justify their criticism of this Government’s attempt to deal with the present financial crisis. Political capital has been made out of the fearful financial muddle that is directly due to the mismanagement that occurred during the late Government’s term of office. The Labour party has had few years of control of the Commonwealth Treasury. It was not responsible for the large number of loans floated abroad, nor for their renewal at exorbitant rates. The late Government must take the blame for the fact that our imports in recent years have exceeded our exports by many millions. The revenue to be raised by the method outlined in the budget will be wisely spent, and I believe that the cessation of borrowing abroad, and sound administration, will bring about an era of greater prosperity in Australia than would have been enjoyed had the late Government remained in power.
.- It is easy to speak airily about spending £10,000,000 on unemployment. Such talk is suitable pabulum for the Sydney Domain or the Yarra Bank; but it is out of place in a Parliament, which is charged with the responsibility of carrying on the affairs of the country, and providing the necessary funds.
If the expression is permissible, I give the lie direct to the statement of the last speaker that the Leader of the Opposition proposed in any way to reduce pensions. [Quorum formed.] I should be sorry to suggest that the honorable member for Bendigo (Mr. Keane) intentionally said what is untrue, but his statement was untrue, and if it was made merely as a preliminary to circulating it throughout the country, it would be a lie, and I want to nail it down here. It is not true, and it should not go any further. The Leader of the Opposition did not propose at any time that a cut of 10 per cent., or any other amount, should be made in the salaries of civil servants. What he suggested was that a saving could be made in administration under the heading of Parliament, and the other departments of the Public Service. It must be evident to honorable members that considerable savings could be effected in this Parliament, while it should be possible to save £1,000,000 a year in the administration of the departments without reducing the salary of a single employee. Referring to unemployment, the Prime Minister stated in his budget speech that -
Additional funds were provided for the Postmaster-General’s Department enabling employees, who would otherwise have been dismissed, to be retained to the number of 1,720. . . .
As a result of adverse financial and business conditions, telephone installations fell from 29,000 in 1928-29 to 15,000 last year.
It is evident that the work of the department has decreased, and that there is not employment for these 1,720 men. They should have been dismissed if the Governmeet was administering the department economically; but, in order to retain their votes and their interest, the Government has made available sufficient money to keep them continuously employed. In that one ‘direction alone the Government could have saved £320,000 if it had done its duty. The Postmaster-General had no right to keep these men on. He should regard himself as being in a position of trust, and it is his duty to administer the finances of his department as honorably and as efficiently as if he were working for a private employer. If there are in the employ of the department 1,720 men for whom there is no work, it is the duty of the Minister to dismiss them; and if there were in this country a proper public opinion he would be obliged to do so. If such a public opinion exists in the Postmaster-General’s own electorate, he will, at the next election, be turned out ignominiously for neglect of duty.
The main consideration in regard to this budget is whether the country’s financial difficulties should be overcome solely by imposing fresh taxation, or whether the remedy should be sought through economy. When the Treasurer found himself faced with a gap of £14,000,000 between revenue and expenditure, he had to make up his mind which of these alternatives to choose. He had promised the country during the last election campaign that he would economize; but he also gave a pledge to his unionist supporters that there would be no reduction of their wages. ‘ As events have turned out, it has been impossible for him to keep both pledges, and he has decided to honour, at the expense of the community, his promise to his regimented supporters. Of the speakers who have preceded me on the other side of the House, very few have devoted much time to justifying the budget. Criticism of that document has been met almost entirely by counter attacks. It has been claimed that the last Government was extravagant. I am prepared to assume that it was extravagant. I go further, and admit that every Government in Australia during the past ten years and, indeed, the people of Australia as a whole, have been extravagant in that they have spent beyond their means, and have not provided for the future. That, however, does not furnish justification for continuing the extravagance. The fact that extravagance in the past has landed us in our present bad position is the strongest pos- sible reason why the Government in power should say, “ Now we will put in the peg : we will have no more extravagance ‘”. That is the policy which should have been adopted by a prudent Treasurer having at heart the interests of his country. The criticisms levelled against the past Government are mainly irrelevant to the discussion of this budget. The real question before us to-day is, not the mistakes of any past government, but how shall we remedy the troubles confronting Australia to-day. It will not assist up in the future to recount what other governments have done in the past. Let the past go; we should concentrate on the present. The Government propose? to meet the situation by taxing more and spending more. We in opposition say that the Government should economize; that it should tax less, and balance the ledger by economy. If it is necessary to impose fresh burdens, let them be distributed as evenly as possible among those in a position to bear them, and in proportion to their capacity to do so. There is what I might describe as a large underworld in Australia which cannot be called upon to make any further sacrifice at this time. Many of those people are on the verge of starvation, and they must necessarily be exempt. I should draw the line at those in receipt of the basic wage. Every person who has an income above the basic wage should be obliged to contribute his quota according to his means, and on an ascending scale. Some would contribute by taxation, and others by reduction of income. The aim should be to reduce government expenditure, and to spread equitably over the community the hardships entailed. I would exempt no one in receipt of an income above the basic wage, not even the incoming GovernorGeneral.
It is a pity that we, the members of this Parliament, do not dissociate ourselves from our party relationships, and assume the position of a board of directors engaged in the government of the country. If we were free from the fear of retaliation from sections which might be offended, and could act in the best interests of the country, I have no doubt that an instruction would be given to the Treasurer to balance the ledger, not by increased taxation, but by effecting economies. I believe that the Prime Minister, if he were free, would favour that policy. From my observations of him 1 cannot imagine that if he were free to act as he really thought best, he would impose extra taxation to the extent of £2 per head on every man, woman and child in this country. This impoverished community is already taxed beyond its capacity. But the Prime Minister is not free. He owes a duty to his regimented supporters, who placed him in his present position, and to whom, he looks to maintain him there. His policy is to protect those who already have, while the half million people now at poverty’s point, are to be left to shift for themselves. Our financial position is indeed difficult, but a deficit is not to be regarded as inescapable because of our wartime commitments. The war debt is a contributing cause of our present difficulties, but it is not the whole cause. It is only £284,000,000 out of a total national debt of £1,100,000,000 The annual charges for interest, sinking fund, repatriation, pensions, &c, is shown in this budget to be, in round figures, £30,000,000. That amount is covered by two items of taxation - income tax and probate duty. [Quorum formed.] There has been an increase by the Commonwealth and State Governments of £25,000,000 in income taxation, and £5,000,000 in probate duties, making a total of £30,000,000, which is the actual cost in connexion with the war. I mention that fact in reply to the argument put forward that the burdens of the war are being borne by the poor of this country. That is not true. The burdens of the war are being met, as they properly should be, by a levy on the wealth of this country as a whole. The question naturally arises: What is the cause of the present condition of national adversity, almost insolvency, of every government in Australia? The answer is that that condition is due to the enlarged operations of governments throughout Australia. In 1914 the expenditure of Australian governments was £65,000,000, and in 1930, £195,000,000, an increase of £130,000,000, of which war commitments amounted to £30,000,000. There has, therefore, been an increase of £100,000,000, outside of war expenditure, in those years in governmental expen diture in Australia. That is a magnificent field for the exercise of economy, not only by this Government, but also by the State Governments. The National Parliament occupies the largest division of expenditure, and it, therefore, should lead the way. Its duty is to set about reducing the expenditure of government, which is the only means by which Australia can be placed upon a proper and sound financial condition.
.- This is probably the most momentous budget that has ever been presented to this Parliament, and, as a representative of the people of Australia, and particularly of the constituents of Boothby, it is only fitting that I should discuss the financial position as disclosed by it. Australia is faced with a serious financial depression. I have listened attentively to the speeches of the Leader of the Opposition (Mr. Latham), the Deputy Leader of the Opposition (Mr. Gullett), the right honorable member for Cowper (Dr. Earle Page), and the honorable member for Warringah (Mr. Archdale Parkhill). All those honorable members have had ministerial experience, with the exception of the honorable member for Warringah. In view of the critical financial position I had hoped that they would be able to place before the Government some constructive suggestions to assist it in its efforts to improve our finances; but it is to be regretted that their speeches, as a whole, were of little or no value. One suggestion was that there should be a reduction in the cost of the Public Service.
– And in the salaries of members of Parliament.
– The honorable member said that at least £1,000,000 could be saved out of the total salary bill of the Public Service of £10,000,000.
– I did not say that.
– That was the gravamen of the argument of honorable members opposite. They at least considered that there should be reduction in the salaries of the public servants. The Government intends to watch closely the expenditure incurred by the various departments. It has, to a great extent, been reduced to a minimum. A considerable saving has been made by the abolition of the Development and Migration Commission and big savings have been made in other departments. This Government has effected some economies, which is more than the BrucePage Government did during its regime of six and a half years. That Government must be held responsible for our present financial position.
– But was it responsible for the low prices ruling for our exports?
– Many of the troubles with which we are confronted can be laid at the door of the Bruce-Page Government This Government, which gained the Treasury bench only last October, has had little say in the administration of this country, and if there has been any maladministration, the fault must lie with the former government. Australia has now to take stock, and the Government will do so. I congratulate the Prime Minister on making an earnest effort to improve our finances. One of the contributing factors to the existing depression is the low prices ruling for our exports. The Prime Minister has informed us that the loss to Australia of real income consequent upon this and other factors is estimated at between £50,000,000 and £70,000,000. That is indeed a serious blow to Australia at this critical stage of its history. It is a terrible blow to South Australia, which has just suffered a severe drought.
– That State has had a series of droughts.
– It has suffered many droughts, aud it is in a sorry condition. Fortunately it has recently had good rains. The financial proposals of the Government will press heavily upon the people of Australia, and particularly of South Australia. To make matters worse, the overseas money market has been closed against us. All these factors are militating against the progress of Australia. The people have less spending power. Trade has fallen off, and that in turn has caused increased unemployment. It is a serious position when unemployment is rife in a young country like Australia. I trust that in the near future our financial position will improve, and that better prices will rule for our exports. The Government has endea voured to relieve the position by making available to the States £2,000,000 for relief works It has stipulated that such works must be specified, and classified, before the money is allocated to the States. That is a necessary safeguard. In that way unemployment will be relieved, and, at the same time, national works will be carried out.
I shudder to think what would happen if we had a National instead of a Labour Government on the treasury bench to-day. If we can take the speech of the Leader of the Opposition as a guide, the poor worker would have a much leaner time than he is now experiencing. This Government is, at least, endeavouring to do something for him. It would like to do more, and I hope that in the long run it will be successful in that direction. Through the medium of the tariff, it is trying to encourage thrift by cutting out luxuries, and concentrating more and more on the necessaries of life. It is pleasing to learn that the tariff protection which is being afforded by this Government is encouraging secondary industries, and that many more men are being employed. It is interesting to note the remarkable increase that has taken place in the number of factories established. The statistics that have been issued by the federal authorities show that the number is now 2,121 greater than it was in 1925. There are 22,000 more employees, the amountpaid in wages annually has increased by £9,626,000, and the value of manufactured goods produced has risen by nearly £40,000,000. [Quorum formed.] The policy of the present Government during the next few years, in my opinion, will lead to much greater progress being made. Speaking generally, Australia is beginning to think in accordance with the slogan “ Buy Australian-made goods, and keep our people in employment.” That is a sound line of policy, and it has my whole-hearted support. I shudder to think what would have happened had the Bruce-Page Government still been in power. It would have continued’ to encourage imports, and our financial position would have been worse than it is to-day.
The Government has tackled .the exchange position by endeavouring to make the value of our exports exceed the value of our imports. It is endeavouring to stimulate manufacture in Australia, so that our own labour will be employed, and the money that is now sent overseas will remain in our own country.
It is well known that, as a consequence of the policy of restricting imports, our customs revenue will suffer. Unfortunately, that cannot be avoided. The Government realized that something had to be done, and wisely chose this particular line of action.
The fiscal and financial policy of the Bruce-Page Government, I believe, led Australia into many of thedifficulties that face us to-day. The Treasurer (Mr. Scullin) has explained that the failure of the London loan market as a supplementary source of national income precipitated the monetary stringency from which the whole Commonwealth is now suffering. When the Scullin Government gained the treasury bench it was faced with a shortage of funds in London to meet our external commitments, and to pay for services rendered and goods purchased abroad. That was a serious position ; but it is pleasing to note that temporarily the Government has been able to overcome the difficulty. It is hard to understand why the previous Government did not endeavour while on the Treasury bench to raise in London a loan to meet their everincreasing overdrafts. That failure to obtain the necessary accommodation in London certainly made matters very difficult for the present Government. The States are badly in need of funds to meet their commitments. I understand that the Loan Council must secure overseas about £30,000,000 to clear up the London position. Sir Otto Niemeyer is now in Australia and is learning at first hand of the Government’s serious attempt to adjust our affairs and bring about a happier state financially. It is pleasing to note that the loan prospects in London are improving. That is evident from the following cable message that has been sent to Australia : -
Running on lines suggested from London four months ago, the agreement between the Commonwealth banks is welcomed. It is considered that it will make assurance doubly sure as far as investors are concerned. It will also improve the prospects for a loan when the
Commonwealth decides to try the London market. In conjunction with the measures already taken at both ends, it will help to restore the exchange position and the rationing of credits by banks.
The policy of the Scullin Government in the direction of righting our financial position has evidently been well received at the heart of the Empire. It is encouraging to find that the people at Home are quite satisfied with the line of action that this Government is following.
– So far as exchange is concerned, it was the action of the banks and not of the Government.
– I repeat that the people at Home are pleased with the action that the Government has taken, and the policy that it is adopting. There can be no doubt in the minds of the people that the Government is making an earnest attempt to square the ledger.
There is a big burden on the people in connexion with the war debt. The amount of war debts owing by the Federal Government is £289,990,532, and the indebtedness of the States on account of soldier settlement and war loans is £27,748,068. The yearly interest on the Commonwealth liability is £15,357,295. The total debt contracted by the Commonwealth for war and repatriation totalled £376,832,935, and the interest paid to date amounts to £219,229,957. One wonders how long Australia can carry that huge burden. It is high time this question was tackled seriously. I, for one, hope that when the Prime Minister attends the Imperial Conference in London, this will be one of the subjects listed for discussion. I trust that, at the round-table conferences that will be held between the representatives of the various parts of the Empire, there will be evolved some scheme to rid us of this tremendous incubus.
Let us examine the position as it stood at the close of the Bruce-Page Administration. The Commonwealth Statistician has released some illuminating information. He shows that the gross indebtedness of the several States at the 30th June, 1929, was £726,406,490, or £114 4s. a head of population. After deducting £2,733,675 on account of accrued sinking funds, the net debt stood at £723,672,815. The combined Commonwealth and State debt was £1,104,028,062, or £173 per head of population. Of that sum, £572,282,903 was redeemable overseas.
The Finance Bulletin for 1928-29 reveals other interesting facts relating to Commonwealth Government, State Government, local government, and private finance. It shows that the Consolidated Revenue of the Commonwealth for that year was £78,984,551, or £12 9s. 3d. per head of population; customs and excise collections were £41,058,571, or £6 9s. 7d, per head, and that other taxation realized £15,244,918, or £2 8s. Id. per head, while our expenditure amounted to £81,343,526, or £12 16s. 9d. per head. Our loan expenditure for the same year amounted to £5,974,868, bringing the aggregate expenditure at the 30th June to £66,084,434. On that date the gross public debt was £541,986,111, of which £164,364,539 belonged to the States. The net Commonwealth debt was £377,621,572, or £59 5s. per head of population. Of that sum £159,786,291 was redeemable overseas. The revenues of the several States aggregated £119,689,258, or £18 18s. 6d. per head, while the expenditure was £120,925,565, or £19 2s. 6d. per head. The net loan expenditure of the States was £31,776,517, making the aggregate at the 30th June, £739,199,881.
Those figures show clearly the position in which the last Government placed Australia. When this Government assumed office last October, it found that on the 30th June, 1929, there was an accumulated deficit of £4,987,717, and that there would be a deficit in the current year’s accounts. To meet this deficit the Government has been forced to impose additional taxation. The year ended with a deficit of £1,470,164, which was mainly due to the reduced volume of imports. When Labour assumed office, the Commonwealth accounts showed a credit balance of £420,000 in Australia, but a debit balance of £3,370,000 in London. The net Commonwealth debit balance in cash was, therefore, £2,950,000. This is the explanation of much of our present trouble.
Let us for one moment consider the tremendous task that was set for the incoming Government. The total new money required for 1929-30 to carry out the loan programmes of the Common- wealth and the States, and to cover arrears of borrowing and deficits to be funded, was £42,000,000. In addition, the Government was faced with the duty of providing £71,000,000 within one year of assuming office, for the conversion or redemption in Australia of maturing Commonwealth loans. No previous Government had been faced with such a difficult task.
It is pleasing, however, to be able to show a more cheerful picture. On the 30th June last 4,937,428 savings bank accounts were open in Australia, with deposits totalling £225,485,704, and 36 life assurance companies holding assets valued at £127,000,000 were operating here in 1928. At the end of that year there were 2,453,602 policies in existence for assured sums aggregating more than £342,000,000. The total revenue of the 161 friendly societies operating in. 1928 was £3,016,849, and their expenditure was £2,401,936. At the end of the year these societies had 597,857 benefit members enrolled.
I come now to a consideration of the actual imports into Australia during recent years. On the 22nd May I asked the Acting Minister for Trade and Customs, upon notice -
What waa the total value of (a) imports, and (6) exports for each State of the Commonwealth for each of the last three financial years ?
His reply Avas as follows: -
I ako made the following inquiry : -
The replies were as follow : -
The balance of trade between Australia and the United States of America is startling, and calls for urgent consideration. It is one of the causes of our present financial position. The trade position as between the -various dominions of the Empire is, of course, a matter of vital interest to us. In this connexion, I asked the Minister for Trade and Customs some time ago the following question : -
What was the value of trade between (a) Australia and Canada, and (6) Canada and Australia, for the financial years ended 30th June, 1928, and 30th June, 1929?
His reply was as follows: -
The South African position is also of deep concern to us. I asked the Minister for Trade and Customs on the 4th December last -
What was the value of trade between (o) Australia and South Africa, and (6) South Africa and Australia, for the financial years ended 30th June, 1928, and 30th June, 1929?
The honorable gentleman was kind enough in his reply to furnish me with the following figures: -
Although our exports to South Africa dropped in 1928-29, by about £900,000 our trade with her is the one bright spot in our gloomy economic situation to-day. I believe that the decline has been due to the fall in our exportations of flour, and I hope the trade may be regained.
The press has given a great deal of publicity to the financial schemes of the honorable member for Adelaide (Mr. Yates) and the honorable member for Werriwa (Mr. Lazzarini). I have listened carefully to both honorable members on many occasions when they have been expounding their views, and must admit that I have been bewildered by them, as I think most honorable members have been. There is no doubt that the country is passing through a financial crisis; but is it right at such a time to try experiments? Is it not rather the duty pf legislators to adopt only well proved methods of remedying our difficulties? I consider that the Government is tackling our problems from the only angle from which they can be tackled. One of the suggestions of the honorable member for Adelaide is that the credit of the nation should be fully used to assist it. But there is nothing new in that proposal. If the ideas of the honorable members whom I have mentioned were acceptable, past and present Commonwealth and State Governments would have adopted them, and adjusted their finances years ago. It is well known that our national credit has been used, but we have not found it to be adequate to free us from the financial tangle which has been created.
It has also been suggested that we could get out of our difficulties by the issuing of more Commonwealth notes. If that could be done effectively it would, of course, be an easy way out of our troubles; but it cannot safely be done. I know that the Guernsey market was paid for with paper money, but that method of finance would not meet our requirements. It might be safe to issue a certain number of additional notes, but there is a strict limit to what can be done in this direction with safety. The experiences of the older countries of the world, particularly after the late war, is on record. They issued notes in great numbers, and that brought about currency inflation, and general disorganization. We do not want that state of affairs in Australia. Up to the present time, no practicable scheme has been suggested to take the place of the system in vogue. There are two avenues open to the Commonwealth - repudiation, or payment of dur debts. I feel it to be my duty as a representative of the people to say that Australia should “ play the game “ aud pay its way. I prefer to work along known lines, and I believe that that is the desire of the great majority of our people.
Most honorable members are aware of the financial difficulties of South Australia. On the 8th July, 1930, the Honorable L. L. Hill, Premier of South Australia, adjourned the Parliament of that State in order that his Government might have time carefully to investigate the financial position, particularly as regards taxation and revenue bills. The Honorable L. L. Hill, Premier, the Honorable J. J. . Jelley, Chief Secretary, Mr. L. C. Hunkin. Civil Service Commissioner, and Mr. Stuckey, Under Treasurer, are in Canberra at the present time discussing financial matters with the Prime Minister (Mr. Scullin). Mr. Hill claims that the chief causes of the State’s financial difficulties are the disabilities due to federation, the late war, overborrowing, continued deficits in State accounts, unfavorable seasons, and the shrinkage of our national income due to . the falling prices of our exports. This is certainly a gloomy picture. It is pointed out that the war debt is primarily a Commonwealth liability, but South Australian taxpayers cannot escape their share of that responsibility. The State’s indebtedness on account of soldier settlement has been reduced, but it still stands at £8,800.000, and the annual interest bill is over £350,000.
The accumulated deficits of South Australia for the last four years are as follow: -
It is contended that for the year just ended, there will be a further deficit of £2,500,000. I mention these facts because South Australia finds itself in such an unenviable position financially -that she will have to come to the Commonwealth Parliament for further assistance. I am sorry to say that the unfortunate army of unemployed in my State is ever increasing. There are, unfortunately, 20,000 out of work, and 8,000 families are receiving destitute relief. There is general stagnation instead of industrial enterprise, and the prosperity of the people is threatened. The South Australian Government views the State’s financial position with grave concern- The Commonwealth Government finds itself somewhat embarrassed financially, but I hope that some means may be evolved to assist South Australia, and to place it on a sound financial basis once again.
I believe that the budget represents an honest attempt to adjust the finances of Australia. If the Government is given an opportunity to put its policy into effect, I believe that many of the difficulties of this country will be solved. Therefore, I hope a Labour Ministry will retain the treasury bench for a considerable time, so that it may show the people that Labour is capable of extricating Australia from the unhappy position in which it is now placed.
– It is somewhat gratifying to know that the honorable member for Boothby (Mr. Price) recognizes that, although the Government has effected certain economies, there is room for further savings in the expenditure of government departments. The honorable member accuses the late Government of responsibility for the present financial depression; yet he says that the falling off in” the national income, which the Prime Minister estimates at from £50,000,000 to £70,000,000, is one of the chief causes of that depression. It is reasonable, therefore, to suggest that the late Government is not responsible for the present state of affairs. I believe that our troubles are due to worldwide depression, and to a falling off in the value of the primary products that we export, mainly wool, wheat and butter. In addition to that drawback, Australia has experienced a succession of droughts that have seriously contributed to the decline in the national income. I do hot agree with the honorable member for Boothby that the policy of the present Government will win favour from the people, and that it will long remain on the treasury bench. On the contrary, I! have no doubt that, by the extravagance revealed by its first budget, and partisan legislation, it has begun to dig its own political grave.
The press and public of Australia have joined in the universal condemnation of the budget, which has been denounced as devastating, crude, calamitous, extravagant, and a gambler’s budget.’ In almost every capital city the people are so incensed that meetings of protest have been held, at which t*he budget proposals have been strongly condemned. I feel certain, and regret to have to say it, that the imposts placed upon the people by this budget will considerably increase the already tragic increase in unemployment. Both the budget and the tariff proposals are panicky, and as a consequence there is serious anxiety all over Australia as to the prosperity of the country. Labour promised to bring about the millenium, but the position to-day is even worse than ever before. Unemployment was to be done away with, and work was to be provided for all, but the Government Statistician has provided us with figures which show that unemployment, which was unfortunately 12.11 per cent, during September, 1929, and 13.1 per cent, in December is now, after a short period of Labour rule, 18.5 per cent., which is higher than ever before in the history of Australia. It means that one person in every six .is out of work.
– That is mainly due to the tariff.
– The tariff has played a considerable part in bringing about the present unfortunate position. The method in which schedules have been introduced, and the impossibility of giving them proper consideration, have also contributed towards unemployment. Tariff schedules introduced by the present Government have contained many increases for which the manufacturers concerned have made no request. They have certainly not made requests for prohibitions. Many of the increases have never been referred to the Tariff Board, although the Tariff Board Act requires that requests for increases should be so referred. It is impossible for any Minister, a month after he comes into office, to bring down a schedule containing 140 items and expect the country to believe that the requirements of the Tariff Board Act have been complied with. I say advisedly that the material progress of the country has been retarded by the introduction of these ill-considered tariff schedules. Not only was a tariff schedule containing 140 items rushed on within a month of the Government’s coming into office; a few weeks later, in order to rectify many mistakes it contained, and to satisfy the clamouring of manufacturers, another tariff had to be brought down containing SO items. Again in April a third was brought down providing for 50 per cent, surcharge on 50 items and a total prohibition in regard to 78 items. In June another schedule was brought down increasing the duties on 140 items. All these changes have caused uncertainty among business men. Trade is almost paralysed; commerce and industry are seriously disorganized. Many people have been forced out of business and ruined. The practice of the past should have been followed. Before fresh duties were imposed there should have been a reference to the Tariff Board. When tariff schedules are placed before Parliament, honorable members should be able to inform their minds from the reports of the Tariff Board whether the proposed increases of customs duties should be approved or not. Honorable members should be in a position to discuss any item on the information made available by the board to the Minister. But in regard to most of the items included in the various schedules submitted by the present Government no reference has been made to the Tariff Board, and in regard to others honorable members will be asked to agree to increases made on Tariff Board’s reports many years old. I am a supporter of protection. I believe . that industries about to be established in Australia, or in their early stages of development, should be granted tariff protection, but I do not believe that any tariff should be final. It should be subject to review in the light of circumstances brought forward by the Tariff Board. In cases where protection is no longer needed duties should be removed. We can do as much injury by excessive protective duties as we can by excessive importation. “Sir Phillip Snowden, the Chancellor of the Exchequer in Great Britain, has said that nearly all of Australia s financial “troubles ave due not to the late Government, but to the country’s policy of excessive protection. That is a nice condemnation of an Australian Labour Government’s proposals by a British Labour Treasurer!
The Government’s policy of protection has caused serious irritation throughout the world, and is provoking retaliatory steps against Australian goods, by nations which have been trading with us for generations, and with whom our trade balance is favorable. These countries are Belgium, Germany, Ita’;r. France, mtd Japan. Our exports to Belgium are worth £9,320,000 a year. We import from Belgium goods to the value of £936,000. The trade balance in our favour is £8,384,000. We export to France commodities to the value of £15,166,000 and buy from France goods worth £3,877,000, the balance in our favour being £11,2S9,000. Germany buys from us goods to the value of £12,027,000. We buy from Germany commodities worth £41,621,000, the trade balance in our favour being £7,406,000. Italy takes from us goods to the value of £5,138,000 and we import from Italy £1,362,000 worth, the balance in our favour being £3,776,000. To Japan we export goods valued at £12,571,000 and we import from that country goods to the value of £4,282,000, the balance in our favour being £8,289,000. Our annual favorable trade balance with the five countries I have mentioned is £39,144,000. If these countries which are talking of taking retaliatory measures against us, do so, it will certainly mean that no inconsiderable portion of the export trade on which we depend for our income and to bring about a better trade balance between ourselves and other countries will be very seriously affected.
– We seem to be trying to shut down on our trade with those countries.
– The policy which the present Government is adopting is tending to close the trade channels on which we depend to restore our general trade balance, and if it is persisted in we stand a good chance of losing the favorable balance of £39,000,000 we now enjoy with the five countries I have mentioned. Belgium takes from us: butter £10,000, meat and its by-products £500,000. grain £500,000, hides £200.000, wool £6,000,000, ores £600,000. These, with sundries, make a total of close on £9,400,000. France takes from us: foodstuffs of anima1. origin £16,000, vegetable products £480,000, animal substances, including hides, sheep-skins, wool, &c, £14,000,000. These, with other items, make a total of over £15,000,000.
– What do these figures indicate?
– That the trade in primary produce on which we are dependent for balancing the ledger may be lost to us, in which case our position will be much more serious than the honorable member can appreciate. Italy takes from Australia: meat £50,000, wheat £2,000,000, wool £3,500,000, making in all goods to the value of approximately £5,100,000. Japan takes from us: butter £6,000, meat and its by-products £170,000, vegetable products £1.500,000, and animal substances -including wool- £8,800,000. These, with sundries, amount to £12,500,000. Australia should not jeopardize her principal markets by continuing indefinitely a policy of tariff prohibition. I support in the’ main the object which the Government had in mind, namely, the correction of our adverse trade balance; but there are, I believe, other methods of doing it, and I propose to deal more fully with them when the tarin* is being debated. I urge the Government to do everything possible to rectify the posi-tion which has been created by the tariff in regard to our trade with other countries. The trade of Australia should not be interfered with by panic legislation. While it is the policy of the Government to develop secondary industries by granting protection to them - a policy to which I subscribe - it is penalizing the manufacturers by the imposition of a primage duty of 2i per cent, on the raw materials imported for manufacture. It is imposing further hardships by its sales tax of 2$ per cent, on all commodities, on the raw materials for manufacture, and on those necessary to the primary producer, to produce and market his commodity. Such commodities should be entirely exempt from taxation of this kind.
The late Government has been accused of extravagance, but if it were extravagant, the present Government is more so, because it proposes to expend £4,000,000 more, although, on the Prime Minister’s own estimate, the national income has been reduced by £50,000,000 or £70,000,000. If the national income has declined by that amount, we cannot possibly maintain government expenditure at the same rate as in the past. We cannot obtain more revenue by way of income tax or other taxation without seriously affecting the development of the country. Instead of spending more, the Government should exercise economy. This, unfortunately, it refuses to do. Even the last speaker said that there was room for economy. Unless the Government economizes, it will not be possible for us to maintain the present standard of living for the workers. The Prime Minister claims that he has effected a saving of £5,000,000 in departmental expenditure. If that is so, and he has budgeted for an expenditure of £4,000,000 more than the last Government spent, obviously he must propose to spend £9,000,000 more on the remaining services than the late Government spent. I have here a telegram which I received from the Chamber of Commerce and Industry in Ipswich. T have already forwarded this to the Prime Minister. It shows the attitude of this chamber to the amazing budget. It is as follows : - 1 am directed to advise you that in the main this chamber is opposed to the new budget. We therefore beg to submit for your consideration the following: -
That your Government should explore nil avenues for reducing the expenditure on the Public Service to bring its personnel into line with the outside public which has to pay the cost. As a good example ministerial and parliamentary salaries should also be revised. Reductions of income tax exemptions down to £150. Other suggestions are: withdraw proposed sales tax, and raise the required revenue by the following method: Customs duty on every free item in tariff or bylaws, 5 per cent. British and 20 per cent, foreign; Od. per lb. on tea and 3d. per gallon on kerosene. Urge additional duties on timber to encourage Australian cast’ timbers.
The foregoing proposals would realize much more than proposed sales tax. Sales tax would prove a. crushing burden on industry, largely increase unemployment, prove almost unworkable and costly ii> operate for both Government and taxpayer. Increase entertainment tax to it,.former rate with local exemptions for charity and similar institutions not for personal profit or gain.
Mi-. Lacey. - Does the honorable member favour an extra duty of 6d. per lb. on tea?
– I have been reading the considered request of the Ipswich Chamber of Commerce to the Prime Minister. During the six and a half years that the Bruce-Page Government was in office the Commonwealth debt was increased by only £13,000,000, but State debts increased” by £207,000,000. This staggering increase in State debts made it necessary to call a halt. It is appropriate, I think, that I should place on record my appreciation of the services of the late Treasurer, and of the Government with which he was associated, for bringing into existence the Loan Council, which has done so much to stabilize the credit of Australia. The establishment of the National Debt Sinking Fund, and the financial agreement with the States, hav, done a great deal to put the finances of the Commonwealth on a better basis; bin for these things the position of Australia would be much more serious than it ittoday.
Imports have been considerably reduce! because of the restricted purchasing power of the people. The embargo on the importation of some articles, and the 50 per cent, surcharges on others, together with the increased duty on about 400 items of the tariff, will result in substantially reducing the customs revenue. I. support the proposal of the Leader of the Opposition that the expenditure for the present financial year should be reduced by £4,000,000; that is, to the figure at which it stood in the last budget of the Bruce-Page Government. Since this Government came into office industry has been terrified by tariff amendments and increased taxation. These increases are as follow: -
The right honorable member for Cowper aid that the increases in taxation since this Government assumed office amounted to £20,000,000; but even if they amount to no more than £15,835,000 they represent a sufficiently staggering sum, and the consequences have been reflected in the present tremendous increase in unemployment. The Government’s method of dealing with the problem seems to be to maintain, and even to increase, its high rate of expenditure, and to obtain the necessary revenue by excessive taxation.
I approve of the proposal of the Leader of the Opposition that the parliamentary allowances of Ministers and members of Parliament should be reduced. I do not believe that, in ordinary times, Ministers and members are overpaid. Many of us have to travel long distances to attend the sittings of this Parliament. We are under the . obligation of maintaining a home in the town from which we come, and of paying our way in expensive hotels while we are here.
– And of fighting an election every two years.
– As the honorable member for New England reminds me, we have had to fight elections at all too frequent intervals during recent years. Generally speaking members of Parliament have many calls on their parliamentary allowance and in times like the present we feel compelled to meet many more calls, but practically every citizen in Australia has suffered a serious reduction in income as the result of the present depression. Many persons in private employment have been put on part time, and rationing has been adopted in many industries. It is estimated that 18.5 per cent, of the workers of Australia are to-day without employment. Thousands of our farmers and graziers are unhappily in the position of having received very little income for years. Last year they received no income at all. It is not possible, in the circumstances, for Parliament to sanction further taxation proposals, if at the same time members make no sacrifice in the interests of the country. We should set an example by making our contribution towards meeting the huge deficit. I have the highest regard for the members of the Public Service. The more one comes into contact with them the more one must appreciate the high standard of efficiency throughout the Service. They are by no means overpaid. I feel certain, however, that public servants cannot reasonably expect to retain their present emoluments while all sections of people outside are suffering reductions through the general depression.
The Leader of the Opposition (Mr. Latham) has made definite proposals to effect economy in the budget, to the amount of £3,999,000 for this financial year only. ‘ He proposes, in the first place, that Parliament and members of the Public Service shall submit to reductions in income to the amount of £1,000,000: He suggests, also, that the maternity allowance shall be withdrawn from all citizens of the Commonwealth enjoying good incomes. In this way a saving of £200,000 could be effected. Bounties, he suggests, could be reduced by £146,000. Many of us have for some years been advocating the payment of bounties for the encouragement of certain industries. We must, however, realize that in times of financial stringency every effort should be made to reduce expenditure. Special inquiry as to the possible serious consequences to established industries should be conducted by the Tariff Board before any definite action is taken to reduce bounties. He suggests, further, that the roads grant be reduced by £1,500,000. Originally, payments to this . fund were made from surplus revenue, and the expenditure was earmarked for the construction of main and developmental roads. I can hardly agree that the vote should be reduced by such a substantial amount as he suggests; but this vote might very well be reviewed. The Leader of the Opposition urges, also, that the unemployment grant of £1,000,000 to the States should not be paid. I look upon this grant as payment of so much conscience money by members of the Ministry, because during the election campaign candidates representing the Labour party declared that if they were returned to power there would be work for all. Unfortunately, the people have been disillusioned. So far from being able to fulfil its promise, this Government has, by the measures which it has introduced, been responsible for a substantial increase in unemployment. This vote of £1,000,000 may, therefore, be regarded as an attempt to salve the conscience of the Prime Minister (Mr. Scullin) and his colleagues. Let us examine the position in one State only. Time will not permit me to deal with more than one. The Government of New South Wales is making legislative provision to raise a fund of over £3,000,000 for the purpose of dealing with the unemployment problem in that State, and to supplement the efforts of the various State Governments the Commonwealth Government is making £1,000,000 available. This amount should certainly be deducted from the budget.
I come now to the proposed coal subsidy of £150,000. During the election campaign, the Labour party promised that if it were returned to power the coal-mines in New South Wales would be re-opened within fourteen days at prestoppage rates. That, of course, was not possible of accomplishment. .The mines remained closed, and the men continued out of employment for fifteen months. The position had become so serious that with a view to encouraging the men to resume work the Prime Minister, some considerable time ago, pledged- himself to make available a vote of £100,000 to repatriate excess coal-miners. I strongly urged that this vote should be used to repatriate excess coal-miners in all the States, and the Prime Minister agreed to adopt this course. Nevertheless, we find in the budget proposals, this item : - “ Coal - To repatriate miners in the northern fields, and to subsidize the production of coal for export, £150,000.” I wish to know now what the Prime Minister really proposes to do. Unless I can get a clear understanding that it is the intention of the Government to make this fund available for excess coal-miners in all the States, I shall take further action, because I do not intend to allow the coalminers in Queensland or elsewhere to be neglected. Last week-end in Sydney, I attended a conference with the Assistant Minister for Industry (Mr. Beasley) and discussed the situation with the Minister and other honorable members interestd in the coal-mining industry. Mr. Davis, the secretary of the Federated Coal Miners Union in New South Wales, and other mining union officials were also present. I was given to Understand that the fund would be used to repatriate excess coal-miners in all the States, but it now appears to be the intention of the Government to restrict payments from the fund to coal-miners in the northern coalfields of New South Wales… I shall strongly .object to this restriction of the vote, and will insist on the Prime Minister standing by. the promise he made to me. The sum of £3,000, set apart for the maintenance of the industrial peace tribunals, cannot now. be defended, because they have completely failed and the chairman of those tribunals has retired.
I wish now to refer to some of the election promises made by Labour candidates on behalf of the present Ministers. In the first place, the people were told that if Labour were returned there would be work for all. They were given to understand that this problem of unemployment was merely a temporary difficulty ; that if suitable measures were taken it was capable of solution. This, at all events, was the view expressed by the ex-Treasurer (Mr. Theodore). What is the position to-day? Is it not a fact that the percentage of unemployment today in Australia is higher than ever before? One adult person in every six is out of work. Labour candidates also declared that, if returned, they would abolish the amusement tax. As we all know, the former Government’s proposals to tax the moving picture industry were featured during the campaign and I have no doubt that they contributed to its defeat. But the amusement tax stands, and we understand that further taxation is to hu imposed. The people were told, further, that Labour would not impose higher excise duties on liquor or tobacco. What has happened? Customs and excise duties have been increased to the extent of hundreds of thousands of pounds on these items under the various schedules that have been brought down. Another promise made was that Labourwould reduce taxation. I have already shown that taxation #has been increased by nearly £16*,000,000. Still another promise made was that Labour would not impose customs duties for the sole purpose of raising revenue. That promise was not honoured. Everybody knows how seriously the industries of this country have been affected, by the imposition of excessive customs duties for the sole purpose of raising an additional £5,700,000. The Australian Commonwealth Line of Steamers was to be re-established. Foritunately this Government has not had the courage to do that. The promise was made that all disabled soldiers would obtain work in the Public Service. Unfortunately that has not been done. Instead, the Government has brought about wholesale retrenchment which has affected many returned soldiers, and the promise to them before they enlisted and afterwards, that they would be given preference in Commonwealth employment, has been repudiated. Action was taken in this chamber to abolish the principle of preference to returned soldiers, and it was only the expression of intense feeling throughout Australia against that action that caused [he Government to back down and restore the preference. The Labour party, during the election campaign, promised to open the coal-mines at pre-stoppage rates within fourteen days of its return to office. Yet fifteen months elapsed before i he men returned to work. Another promise was made by a supporter of the Government, and also by the ex-Treasurer (Mr. Theodore), of a guaranteed price for wheat of 6s. 6d. a bushel. That promise has been repudiated. I admit that the Government proposed, under the Wheat Marketing Bill, a guarantee of 4s. a bushel, but even that has gone by the board. The budget proposals are far-reaching, and are viewed with consternation throughout Australia and overseas. I urge the Government to accept the suggestions put forward by the Leader of the Opposition (Mr. Latham), or in other ways effect substantial economies, so that Australia may once more be placed in a sound financial position. If the Government persists in carrying out its extravagant proposals there- will be no possibility, owing to the falling-off of the people’s income, of balancing the ledger, developing this country, relieving unemployment and maintaining the high standard of living we have set up in Australia. I commend to the Government the suggestions of the Leader of the Opposition. I trust that it will accept them and any further suggestions that we may be able to make when the various items of the Estimates are under discussion.
.- We have just had the doubtful: pleasure of listening to another effusion from a member of the gloom club. The cry of honorable members opposite is that wages must come down, and their complaint is that this Government will not heed them. The Deputy Leader of the Opposition (Mr. Gullett), says that parliamentary salaries should be reduced, but, almost in the same breath, be. bewailed the fact that it was impossible for him to live on his parliamentary salary. That clearly shows that his attitude towards the Govern.ment’s proposals is insincere.
– I did not say that.
– I am referring to the statement of the Deputy Leader of the Opposition. The honorable member; himself, bewailed the fact that unemployment was rife throughout Australia. Yet he had the audacity to object to the proposal of the ‘ Government to expend £1,000,000 in providing work for the relief of the unemployed. It is hard to follow the arguments of the members of the Opposition in their endeavour to .criticize the budget. [Quorum formed.] The present financial stringency was brought about, not by this Government, but by the party which is now in opposition. I appreciate the seriousness of the position. The responsibility for it lies with the Bruce-Page Government, and, therefore, honorable members opposite should not quibble when we are forced to take extreme measures to place Australia on a sound financial footing. The stoppage, or partial stoppage, of work and development, is not a cure for our ills. Increased production and an increase in the export of our primary produce is the main road to prosperity. It is of no use to centre our energies and attention simply on one phase of production, or on a reduction of wages. We must export more. It is evident that to right our adverse trade balance we must look for new fields to exploit.
I notice that on page 350 of i he Estimates there is a reference to the mining industry of North and Central Australia, a territory which I have the honour to represent. Every honorable member will agree that tho possibilities of mining in North and Central Australia are unlimited, and that the growth of that industry, in the pioneering days, gave an impetus to the development of every State. It is obvious that if the mineral wealth of North and Central Australia is exploited a similar development may take place there. The cost of the administration of the Mines Department of North Australia for the year 1930-1931, is set down in the Estimates at £3,125, which is a decrease compared with last year, of £310. Ob page 353 of the Estimates there appears the item “Development of mining industry, including loans to prospectors and others, £200”. It costs £3,125 to administer the department, yet the Estimates provide the paltry sum of £200 for the development of an industry that has tremendous possibilities. T have repeatedly said in this chamber that that amount would not pay for the sinking of a well in a man’s back yard, let alone develop the possibilities of the mining industry in that great territory. Many prospectors and syndicates are to-day exploiting the raining possibilities of Central Australia, aided by the most modern equipment, including aerial and motor transport. Yet the Government is appropriating only £50 for the development of the mining industry in Central Australia! That is making a farce of the matter. It would be far better if the Estimates contained uo such provision at all, and the Government frankly declared that it did not desire that the mining industry should develop in those areas. I notice that £2,000 is to be set aside for the encouragement of primary production, whereas £2,500 was appropriated for the same purpose last year. The territory is teeming with possibilities, both from an agricultural and pastoral point of view. Even the scholarship vote is being reduced from £450 to £393. Last year, notwithstanding the fact that these are starvation estimates, the Northern Territory underspent its vote by £5,611, and that amount will go back into Consolidated Revenue. I know numerous people in the mining, agricultural and pastoral industries who needed assistance, and could not obtain it because the plea was advanced that no funds were available!
Not only is the territory misunderstood, but for some time past it would appear that its fate has been left in the hands of departmental heads. If any intelligent question regarding the territory’s development is directed to the Government, one receives a stereotyped reply from a departmental head. It would take a lot to convince the people of North and Central Australia that the fate of those territories is not left entirely to departmental control. I do not charge this Government with handing over its powers to public servants ; I merely sound a note of warning.
I desire to impress upon the Minister the hardships that the settlers of those Territories are undergoing; hardships that are grossly aggravated by the exorbitant freight rates charged by the railway department. It is true that the railway system in North and Central Australia is not paying, but that state of affairs is not peculiar to the territories. The Commonwealth railways have lost £45,500,000 during the last ten years. But it must be remembered that our railway systems are instrumental in developing the couuntry, and are not primarily intended to pay during the pioneering stages of the nation. The States do not, because of the failure of their railways to balance the ledger, resort to the practice of bleeding their settlers white in an endeavour to make good the loss. But it would appear that that insane idea has become an obsession with the Commonwealth railway authorities. I doubt whether those lines can be made to pay for a number of years. Owing to the lack of forethought on the part of previous Governments, no provision has been made for the depreciation of rollingstock, so that the community is paying interest on rusty junk that returned to mother earth years ago.
I urge that the development of North and Central Australia should be assisted by the application of scientific research. We have been woefully lacking in that respect.
Cut off and isolated, the people of North and Central Australia deserve sympathetic treatment from the Government. Instead of getting that, everything is done to embarrass and retard their progress. One has to make due allowance for the present Government, because of the state of our finances when it. assumed office. The impression has been created by previous Governments .that nothing would have pleased them .better, than. . to see an alligator or some monster of t;he sea gulp the Territory out of existence. If that happened, it would certainly save governments the shame of demonstrating their lack of colonizing and pioneering instincts. We took the Northern Territory from the blacks and, after the expiration of 100 years, we must admit that the natives did better with it than we have done. At least they did not burden their people with large interest bills and tax them on scrap iron and junk. There is one redeeming feature about the whole sordid business. The people of North and Central Australia have proved that they have inherited the finest pioneering traditions of the race, in spite of the obstructive efforts of successive Governments. In those Territories are the best type of settlers to be found in any part of the world. They go to places remote from civilization, in the hope that governments will assist them in their task of development. It is hope, and hope only, that is keeping them afloat. The north of Australia, from its very isolation, is essentially a country for pioneers and producers, and it should receive every possible assistance from the Government.
One would naturally expect that the Country party, which was in power for a number of years, and repeatedly professed sympathy with the man on the land, would treat the territories considerately. Yet the Bruce-Page Government drew up a fresh schedule of freight rates for the Commonwealth railways in August of last year. It increased the rates ou practically every commodity, some by over 100 per cent. The only lines upon which a reduction was made were beer and spirits. I regret to say those new rates were not put into operation by the last Government; that was left to the present Government.
Before the Commonwealth took over the Northern Territory, that country was producing all kinds of minerals, and the mining industry. .was exceedingly active. The ore was then, freighted on the railways at Id. a ton a mile, or 12s. 6d. for 146 miles. . The charge now is £2 0s. 6d. for 200 miles, an increase of 125 per cent. In January . of this year it cost £13 6s. 4d. to freight 1 ton of explosive from Darwin to Katherine. Now .that the administration has succeeded in discouraging mining, the freight has been reduced to £9 18s. ,5d. Let me. show how settlement has been encouraged. The old and the new freight rates, the latter of which were drawn up with the concurrence of the Country party, are as follow : -
Benzine, £4 17s. 6d. per ton to £5 14s. 6d. - increase per ton, 15s. lid.
Sugar, £3 lis. 8d. per ton to £4 0s. Od. - increase per ton 8s. lOd.
Sundries, £8 6s. 6d. per ton to £9 18s, 5d. - increase per ton £1 Ils. lid.
Vegetables, £1 15s. 4d. per ton to £2 15s. 3d. - increase per ton, 19s. Hd.
Peanuts, £3 lis. 8d. per ton to £4 0s. 6d. - increase per ton, 8s. 10d.
Wire netting, £1 15s. 4d. per ton to £1 168 - increase per ton, 8d.
Motor tyres, £8 0s. Od. per ton to £9 18s. 5d. - increase per ton, £1 lis. lid.
Agricultural machinery, £8 9s. 7d. per ton to £5 14s. 6d. - increase per ton £1 4s. lid.
Mining machinery, £3 lis. 8d. per ton to £4 0s. Od. - increase per ton, 8s. lOd.
Agricultural motors, £6 13s. 2d. per ton to £7 10s. 3d. - increase per ton, 17s. Id.
Wheat, £2 10s. per ton to £4 Ob. 6<L - increase per ton, £1 10s. Od.
Galvanized tanks, £13 6s. 4d. per ton to £19 10s. lOd. - increase per ton, £6 10s. 6d.
These rates are per ton to Katherine, 200 miles. In the same schedule the freight on beer was reduced from £6 13s. 2d. to £4 7s., a reduction of £2 5s lOd. a ton. Spirits freight was reduced from £8 6s. 6d. to £5 14s. 6d., a reduction of £2 12s. a ton. Cattle freights have risen from 10s. to 18s. 2d. a head, an increase of 8s. 2d. per head. Surely the present Minister would not allow these atrocities to continue if he were aware that they exist! The position is the same in Central Australia. Recently I placed before the Minister information showing that new money had come into the country, and that large improvements which were essential to the good working of a property were being put in hand; but, having examined the freight rates on the needed commodities, the owner of the station found that it was possible for him to do only onequarter of the work contemplated.
The cattle industry is an important one in North Australia. This year the value of cattle transported out of the Territory has totalled £250,000. One is entitled to ask, why are the Commonwealth railway freights the highest in Australia ? It is because of the isolation of the Territory, and the lack of personal contact with Ministers charged with its administration. I am on safe ground when I say that the railways of North Australia are absolutely, the worst in the Commonwealth. For many years I have endeavoured to have appointed independent experts to report on the rolling stock, and the state of the permanent way in North Australia. I have walked along chains of permanent way, and put my heel through the sleepers. I have drawn out dog-spikes with my fingers. But whenever I make statements of this kind, the departmental heads say that there is no foundation for them; and there the matter rests. I am satisfied that the Minister would be astounded at the report that he would receive from a competent and independent expert. The manner in which the railways are worked in North Australia would not be tolerated in any other part of the Commonwealth. Money is squandered, and inefficiency is rampant. As I have previously stated, the chief qualification for appointment to any administrative position in either North or Central Australia is ignorance of the work to be performed. If you know your job, you are not wanted; but if you do not, you are sure to be appointed. Lack of supervision of the big contracts on the last section of the railway has been responsible for the waste of thousands of pounds. I am reliably informed that the contractors made huge profits on that section. I have no complaint to make against the contractors receiving large sums, but I think that those who drew up the specifications should at least have drawn them up in such a way that when the work was completed value would have been received for the expenditure. Big prices were paid for ballasting, bridge building, weirs, culverts, &c. Invariably,, after the work had been done by the contractors, it had to be done again by day labour. Let me give an illustration. A new section had thousands of yards of ballast put on by contract. After the work was completed and paid for, thousands of yards more were put on by day labour; and I understand that the road still needs thousands of yards. After the Birdum bridge piers were finished by contractors, and paid for, it was found that they had an insufficient foundation; and again the work had to be gone over by day labour. Great trenches had to be dug round those huge pillars, and feet put on them to keep them from slipping. All this work is debited against day labour. It will not be admitted that either the contract system or inefficiency is responsible. The blame is always placed on the workers. A retaining wall was built at the Birdum to conserve water. It was built by contract. When the first rains came the wall dropped three feet and allowed all the water to escape. Day labour had to come to the rescue after the contractors had been paid. It is the efficiency of administration that is in question. I know that the. departmental heads will contradict my statements. As in the past, their word has invariably been accepted, I challenge the Minister to appoint an independent railway expert to report on the state of affairs which I have disclosed to-night. If he will accept the challenge, and appoint an expert, I predict that he will be astounded with the report that he will receive. In the interests of honest work, economy and efficiency, it is the duty of the Government to appoint an expert, to make an investigation. Is it because of their own inefficiency that the settlers there are being bled white owing to the excessive freight rates on the railways? On the contrary, the settlers are the only persons in the territory who are producing anything. The men who are temporarily in charge of the Commonwealth railways there place on those settlers burdens which would not be tolerated elsewhere in Australia. I hope the Minister will give this matter his per:sonal attention, and replace inefficiency by efficiency. That can only be done if an expert is appointed to investigate the matters which I have raised.
What lias the North Australia Commission done to justify its existence? The Minister will find that question difficult to answer. I realize that that commission was appointed by the late Government, and that the present Government is not to blame for its existence. Under the act which constituted it, the commission was required to assist in the development of the territory. Under the same legislation it was given control of the railways in North Australia, and it was empowered to grant concessional rates to settlers in the interests of the development of the territory. Any loss which might result from the granting of those concessions was to be reimbursed to the Railways Department from the Consolidated Revenue. The commission, which has been in existence for a couple of years, has already squandered about £40,000. So far, it has done nothing to justify its existence; certainly it has not assisted to develop the territory. All that it has done has been to furnish reports. Its members draw their salaries, but they are not permitted to function. Nevertheless they are not without responsibility in this matter; If the commission had been appointed for the purpose of depopulating North Australia, it could scarcely have succeeded better, for, already, it has gone a long way towards achieving that result. The sooner the commission is abolished the sooner will the exodus of settlers from North Australia cease. The money saved could be expended on developmental works.
There is considerable unemployment throughout the Commonwealth. Industry cannot absorb all the men seeking employment. That state of affairs will continue until other avenues of employment are found for them. Two avenues that suggest themselves are land settlement and mining. I -marvel at the hesitancy of the Government about endeavoring to find fresh avenues of production. There are hundreds of thousands of acres of fertile land in North Australia, yet no effort is being made to exploit it scientifically. It is true that some, cattle roam over it - –about one beast to the square mile. After twenty years of Commonwealth control, it requires no argument to prove that the haphazard methods of administration of the past must be jettisoned. More scientific and progressive methods should be adopted. The Government can rest assured that unless it discards the “ go-as-you-please “ policy North Australia will never emerge from the slough of despond. The application of science to the problems of the soil would make it possible to absorb many thousands of unemployed who are now a burden on the States. When one sees the “ better farming trains “ of Victoria, full of experts ready and willing to teach settlers the best methods of production, one cannot but contrast the enterprise of the railways in that State with the indifference of the Commonwealth railway authorities. Up to the present, no expert has ever been appointed to advise settlers in North Australia as to the best means of cultivating their land. Settlers have gone there and done their best. They do not know what the soil is capable of producing, but, fortunately, in spite of government indifference, they are making good. In the lighter rainfall areas of North Australia, I am convinced that we have potential wheat-growing land. Settlers in North Australia are in a better position to capture eastern markets than are farmers in Southern Australia, 3,500 miles further away from those markets. . I know it will be said that because rain falls in the wrong season wheat will not grow in North Australia. It is true that most of the rain falls in what is believed to be the wrong season for wheat-growing; but it is equally true that the climate of
North Australia iu the winter is as suitable for wheat-growing as is the spring weather further south. Tomatoes ripen in North Australia in the winter, and it should be possible to grow wheat also during that season. There has never been any attempt to demonstrate the possibilities of the soil. Millions of acres of potential wheat land are lying idle, lt would cost the Government nothing to place settlers on that land. When I see people trying to grow wheat on land, the capital cost of which makes it economically impossible, I marvel that successive governments have not exploited these vast areas in North Australia. To-day he cry is “ Grow more wheat “. In North Australia there is a vast area of land capable of producing huge quantities of wheat if the Government would only apply the proper methods to its development. If the Government would only tackle the problems of North Australia seriously, that territory, instead of being a burden on the Commonwealth finances, would bc one of Australia’s brightest gems. That result can be achieved only by the application of science to the problems of the soil; by sympathetic assistance from government experts, and by the cessation of the practice of exploiting settlers. “When one thinks of McDouall Stuart who blazed the track from Adelaide to Darwin, tore away the veil from this land of mystery, and opened a pathway to settlement, one asks what has been done to follow np his achievements. Men have been sent into . the wilderness of North Australia, and practically left’ there to perish. Governments have paid no heed to them. The day will come when the Commonwealth will have to answer for its neglect of this area. I appeal to the Government to appoint men who know their jobs to assist the settlers in this portion of our great continent. I urge it to throw open the land so that Australia may demonstrate to the world that that sink for the wealth of the Commonwealth, as it is termed, is capable of producing great riches from agricultural and pastoral pursuits, and from the development of mining. If that is done I am quite satisfied that we shall be able to solve our unemployment problems. I make a final appeal to the Government to do something more for the Northern Territory than provide
£200 for mining purposes, £2,000 for the encouragement of primary production, and a few other small amounts for different purposes. If it will display the same broad outlook in respect to the Northern Territory that it has shown in respect to this budget, I am confident that it will enable this hitherto despised part of Australia to develop into one of the most wealthy parts of the continent.
House adjourned at 12.(1 a.m. (Friday).
Cite as: Australia, House of Representatives, Debates, 24 July 1930, viewed 22 October 2017, <http://historichansard.net/hofreps/1930/19300724_reps_12_126/>.