House of Representatives
25 November 1930

12th Parliament · 1st Session



Mr.Speaker (Hon. Norman Makin) took the chair at 3 p.m., and offered prayers.

page 630

QUESTION

MALTING BARLEY

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– Because of the very low price of other cereals it is reported that there will probably be no market for malting barley. Will the Acting Minister for Markets and Transport communicate with the Minister for Markets (Mr. Parker Moloney), if he is still : in the United Kingdom, and suggest that he should explore every possible market for malting barley, and particularly inquire regarding the possibilities of opening upa trade with the Scottish distillers?

Mr FORDE:
Assistant Minister assisting the Minister for Customs · CAPRICORNIA, QUEENSLAND · ALP

– I shall have an investigation made immediately, and let the honorable member know the result.

page 630

QUESTION

CONVERSION LOAN

Assistance of the Banks.

Dr EARLE PAGE:
COWPER, NEW SOUTH WALES

– In the Labor

Daily of to-day this statement appears -

BANKS HELP FEDERALGOVERNMENT LOAN.

Left Wing Win.

This ready bank co-operation is regarded in Labour circles as the direct fruit of the stand taken by the left wing in the party some weeks ago when Mr. Anstey led an effort to havetheloan deferred for twelve months. . . Thestand takenby the Labour left wing showed them that no funny tricks would be tolerated, and the banks are now rushing to be in first with their subscriptions.

I ask the Acting Treasurer if it is not true that the banks have willingly lent assistance to the Commonwealth Government in connexion with the floatationof every loan since the war began in 1914?

Mr LYONS:
Minister for Works and Railways · WILMOT, TASMANIA · ALP

– So far as I am aware the banks have assisted all Commonwealth loans, but I believe that they are doing a little more than usual to ensure the success of the £28,000,000 conversion loan.

Dr EARLE PAGE:

– With regard to the statement of the Acting Treasurer that the banks are doing more on this occasion than on previous occasions to bring theCommonwealth loan to a successful issue, is it not a fact that the banks, ever since the present conversion loan was mooted, have been ready to help the Government to the fullest extent of their capacity?

Mr SPEAKER:

– It is not in order to base a question on the answer to a previous question.

Dr EARLE PAGE:

-I ask the Acting Treasurer whether it is not a fact that, ever since the present conversionloan was mooted, the banks have been ready to assist the Government to the fullest extent of their capacity?

Mr LYONS:

– Yes.

page 630

QUESTION

PRIMARY CORRESPONDENCE SCHOOLS

Mr BAYLEY:
OXLEY, QUEENSLAND

-In a letter I have received the following passage occurs : -

Iam in receipt of a letter from the Supervisor of the Queensland Government Primary Correspondence School informing me that the comments on the workof the pupils willin future be absent owing to the postal authorities stating that the comments render the whole work liable to ordinary rates of postage. The practice has been permitted since the inception of the school eight years ago.

Will the Postmaster-General give serious consideration to this matter, and ascertain if it is possible to exempt from the postal regulations, the postal matter sent to and from primarycorrespondence schools in Queensland and other States?

Mr LYONS:
ALP

– I have on other occasions stated that the increased rates of postage are being reconsidered. The point raised by the honorable member will be investigated.

page 631

QUESTION

SYDNEY MEAT STRIKE

Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP

– The Assistant Minis*ter for Industry stated, last week that during the week-end he would investigate the meat strike in Sydney. I ask the honorable gentleman whether he negotiated’ with the parties, and if so, with what result ? Having regard to the grave injury that a continuance of the strike would do to thi! meat export trade> will- he make a special effort to protect the primary producers and others?

Mr BEASLEY:
Assistant Minister assisting the Minister for Industry · WEST SYDNEY, NEW SOUTH WALES · ALP

– The dispute in themeat industry in New South Wales, has been referred to a properly constituted authority; namely the Industrial Commission. The commission’s decision apparently does not suit the employers, and they have refused to accept it. There is a strong, suspicion in Sydney that the employers consider the time opportune to- unload upon the public meat that has accumulated in the cool stores for two years.

Mr MACKAY:
LILLEY, QUEENSLAND

– Is the Acting Prime Minister aware of the heavy losses caused to the meat export trade by the continuation of the strike in New South “Wales? Does he know that a large shipment of meat under contract to the British War Office- has- been cancelled in- consequence- of it? Does that fact confirm the statement just made by- the- Assistant Minister for Industry?!

Mr FENTON:
Minister for Trade and Customs · MARIBYRNONG, VICTORIA · ALP

– I shall have, inquiries made,, and furnish the honorable member with full particulars.

page 631

SUGAR INDUSTRY

Mi;. NAIRN- In view of the failure of the committee which is inquiring into the sugar industry to report on the 1st November, and the fact that the sugaragreement will not expire until August next, will the Government seriously consider the advisability of deferring any decision regarding the sugar embargo until this House has had an opportunity to discuss the committee’s report ?

Mi-. FENTON. - That matter is under consideration. Meanwhile the inquiry must proceed. The report will, I understand, be available early next year.

page 631

QUESTION

REPATRIATION QF COAL-MINERS

Shale Oil Deposits

Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP

– Is it correct that the Assistant- Minister for Industry was a member of a deputation which, during; the week end, waited, on the Minister, for Industry in New South Wales, and requested that two members, of theMiners Federation form a special committee to consider the amount that has been, or is likely to be, set aside for the repatriation of miners, and that the. possibilities of the shale oil deposits of Australia will be examined by these two gentlemen ?

Mr BEASLEY:
ALP

– The question of the honorable member is important, as- it is the desire of the Government to assist’ miners who lost their employment as. a result of the coal lockout. There was a meeting, no.t with the Minister, for Industry, but with the Minister for Mines in the Go,vernment of New South Wales, because we are- anxious to obtain the assistance- of that Government in regard to this matter.. It alone has power to deal with leases. We have conferred with the Minister for Mines on two or three occasions. The suggestion was made that, representatives of the State Government, the Commonwealth Government, and the Miners Federation might confer, with a view to arriving at a basis which would permit of the revival of this industry. But while it is true that we entered into negotiations with the Minister for Mines, no conclusion has yet been reached. It will be necessary finally to report to the Commonwealth Government before a definite decision can be reached.

page 631

QUESTION

WIRELESS BROADCASTING

Mr LONG:
LANG, NEW SOUTH WALES

asked the PostmasterGeneral, upon notice -

  1. Is it a fact that the new statutory rules governing broadcasting stations tend to create a dictatorship over broadcasting?
  2. If so, will lie give an assurance that the position will be rectified in the interests of the community?
  3. Is it a fact that under Regulation 59 (‘1 ) and (2), the Government has the power to prohibit the use of any station for broadcasting Labour propaganda?
Mr LYONS:
ALP

– The answers to the honorable member’s questions are as follow: - 1 and 2. The amended wireless regulations detail the manner in which the PostmasterGeneral exercises the powers he has always possessed under the Wireless Telegraphy Act to control the broadcasting services in the interests of the community.

  1. Regulation 59 refers to the censorship which may be exercised by the PostmasterGeneral in connexion with the broadcasting of any matter which may be objectionable or undesirable in the interests of the community. The powers to be exercised under this regulation have been in existence for six years and have not been directed towards the prohibition of any Labour propaganda.

page 632

QUESTION

IMPORTS AND EXPORTS

Mr PRICE:
BOOTHBY, SOUTH AUSTRALIA

asked the Acting Minister for Trade and Customs, upon notice -

What is the value of the imports and exports respectively for the financial year ended 30th June, 1930, to and from - (a) Great Britain, (b) other parts of the British Empire, (c) the United States of America, and (d) other foreign countries?

Mr FORDE:
ALP

– The answers to the honorable member’s questions are as follow : -

page 632

QUESTION

HUME RESERVOIR

Mr JONES:
INDI, VICTORIA

asked the Minister for “Works and Railways, upon notice -

  1. What is the total amount spent on the Hume Reservoir, including cost of works, administration and land resumption?
  2. Is this regarded as a reproductive work?
  3. Is a full complement of men engaged on the work at present?
  4. Has any decision yet been reached as regards the completion of the reservoir to a 2,000,000 acre feet capacity?
Mr LYONS:
ALP

– The answers to the honorable member’s questions are as follow : -

  1. £4,173,000. This includes cost of administration by the constructing authorities but does not include any portion of the administrative expenses of the River Murray Commission which are paid from revenue.
  2. Yes.
  3. Yes, within the limits of the funds available. Approximately 550 men are engaged on the work at present apart from those employed on road and rail deviations under the supervision of the Country Roads Board, Victoria, and the Victorian Railways Commissioners.
  4. No. It is anticipated that the investigations being conducted by the River Murray Commission will be completed this month. On receipt of the commission’s report the matter will be considered by the four contracting Governments.

page 632

QUESTION

TRADE BALANCES

Mr WATKINS:
NEWCASTLE, NEW SOUTH WALES

asked the Acting Prime Minister, upon notice -

With reference to the efforts of the Government to correct the trade balances between Australia and other countries, has the Government kept records showing the result; and, if so, what is the position to-day?

Mr FENTON:
ALP

– The present position in regard to this matter is indicated by the sub-joined comparative statement which shows the total imports and exports for the six monthly periods ending 30th September, 1929, and 30th September, 1930. It will be remembered that the reasons for the Government’s action in this connexion were contained in a statement made to this House by the Prime Minister on the introduction of Customs Tariff (No. 2) to operate on and after the 4th April, 1930. (Hansard, page 820).

page 632

QUESTION

GIPPSLAND OIL BORES

ReportbyAmiralSydenham.

Dr. MALONEY (through Mr. C.

Riley) asked the Minister for Defence, upon notice -

Is it a fact that Admiral Sydenham, of the British Navy, recently inspected the petroleum oil bores near Lakes Entrance, Gippsland?

If so, has he reported thereon to the Minister, and did he express his satisfaction with the prospect of producing petroleum in commercial quantities there?

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

– The answers to the honorable member’s questions are as follow: -

  1. Yes.
  2. The report has not yet been received by me but is expected shortly.

page 633

QUESTION

WHEAT INDUSTRY

Sales Tax on Flour.

Dr EARLE PAGE:

asked the Acting Prime Minister, upon notice -

Whether there is any fundamental difference between the primary products, wine and wheat, that permits wine to be assisted by means of excise taxes to provide bounties, and prevents wheat from being similarly assisted by a sales tax on locally-consumed flour?

Mr FENTON:
ALP

– It is pointed out by Government has been unable to see its way to adopt the recommendation for the imposition of a special sales tax on flour have already been fully explained to the House, and there is nothing that can usefully be added at present.

page 633

QUESTION

GOLD RESERVES

Dr MALONEY:
MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

asked the Acting Treasurer, upon notice -

  1. Has his department any data regarding the gold reserves held against the issue of notes by the banks of England, France, Germany and the Central National Banks of the United States ?
  2. If so, will he give such information to the House?
Mr LYONS:
ALP

– The answers to the honorable member’s questions are as follow : - 1 and 2. England - The Bank of England is permitted to issue bank notes to the amount of its holding of gold coin and gold bullion plus a fiduciary issue of £260,000,000. The Treasury may, on representations from the Bank of England, increase the fiduciary note issue to some specified amount above £260,000,000 for such period as is determined, not exceeding six months. The securities held against the fiduciary note issue may include silver coin to an amount not exceeding £5,500,000.

France - There is no regulation requiring any prescribed’ gold reserve to be held against note issue.

Germany - Reserve of 40 per cent, gold or “ devison “ to be held against note issue of which reserve not less than three-quarters shall bo held in gold. “ Devisen “ are defined as bank notes (of four banks whose rights to issue notes are preserved to them), bills of exchange having not more than fourteen days to run, and cheques and claims due from day to day payable in foreign currency by a bank of known solvency in foreign financial centres.

United States of America - Every Federal Reserve Bank is required to hold against notes in circulation not less than 40 per cent, in gold. The Federal Reserve Board may suspend any reserve requirements for a period not exceeding 30 days, and may renew same for periods not exceeding fifteen days, subject to the establishment of a graduated tax on the deficiency and subject to the following graduated tax in case of the deficiency of the note issue reserve: -

If gold reserve against federal reserve notes falls below 40 per cent., tax not exceeding 1 per cent, per annum if proportion is between 40 per cent, and 324 per cent. A tax of not less than 11/2 per cent, is payable for each 21/2 per cent, or part thereof by which reserve falls below 32-1/2 per cent.

According to the August, 1930, issue of Monthly Bulletin of Statistics (No. 8) of the League of Nations, the position in regard to notes and gold in the respective central banks is: -

page 633

QUESTION

COMMONWEALTH BANKRUPTCY ACT

Mr ELDRIDGE:
MARTIN, NEW SOUTH WALES

asked the Acting Prime Minister, upon notice -

  1. Will he obtain a report from the Acting Solicitor-General as to whether proceedings under the Commonwealth Bankruptcy Act to make a debtor bankrupt would be possible notwithstanding a State Moratorium Act?
  2. If such proceedings would be tenable, will he introduce legislation to deal with the position?
Mr FENTON:
ALP

– It is pointed out by the Commonwealth law authorities that, in the absence of information as to the actual terms of any such State Moratorium Act, it is not possible to express an opinion on the matter raised in this question. I might, however, refer the honorable member to a statement made by me in this House on the 18th November (Hansard, page 398) relating to the Bankruptcy Act.

page 633

QUESTION

WAR SERVICE HOMES

Mr CROUCH:
CORANGAMITE, VICTORIA

asked the Acting Minister for Markets and Transport, upon notice -

  1. Is it a fact that many returned soldiers occupying war service homes have, under the stress of unemployment, been unable to keep up their repayments, which include part principal ?
  2. Will he direct that where it is shown that inability to pay the full amount arises from unemployment, interest only on the balance of principal now due shall be charged until conditions improve?
Mr FORDE:
ALP

– The answers to the- honorable member’s questions are asfollow: -

  1. Yes.. 2’. In cases of genuine unemployment where the purchaser is unable to meet his obligations, both, principal’ and interest due to the War Service Homes Commission are held in abeyance.

page 634

QUESTION

OVERSEAS INVESTMENTS OF AUSTRALIAN COMPANIES

Mr LONG:

asked the Acting Treasurer, upon notice -

  1. Have any steps been taken at any time to ascertain, the amount of funds transferred, out of Australia for investments abroad by insurance- societies, and other interests which depend upon the people of Australia for their business ; if not, will’ he consider the question of inquiring into the matter?
  2. Will he obtain, and supply information as to the method’s adopted by the trading banks in, the marshalling: of their figures forthe sworn, published statements in’ quarterly balance-sheets ?.
Mr LYONS:
ALP

– The answers to the honorable member’s questions are as follow : - 1’. It is impracticable to ascertain the amount of funds so transferred abroad, as transfers may be arranged through many sources and in various ways.

  1. The methods which the banks are required to adopt are set out in section:60ad of, the Commonwealth Bank Act 1911-1927.

page 634

FRENCH’ COMPENSATION CHARGES

Thence; Rents

Mr CROUCH:

asked the Minister for

Defence, upon notice -

  1. Whether any trench rent or charge was paid by the British Government to the French Government or to French land-owners in the 1914-19 war? 2; Did the French land-owners charge compensation’ for damages, known as “ degats,” to land, by war trenches?
  2. Did the British Government in its settlement of war charges with the Australian Government charge for “ accommodation “ of the Australian troops in France?
  3. Did part of this “ accommodation “ consist of the use of trenches?
  4. If not, what “ accommodation “ in France was charged for?
Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

– The answers to the honorable member’s questions are as follow : - 1 and 2. No information is available as to whether the British Government was charged with or paid “trench rent,” compensation for damages to land, &c., to either the French Government or French land-owners.

  1. No,
  2. See reply to No. 3.
  3. No “ accommodation “ whatever used by the Australian Imperial Force in France was charged against the. Commonwealth Government.

page 634

QUESTION

COMMONWEALTH NOTES

Mr FENTON:
ALP

– Oh the 5th November the honorable- member for Newcastle (Mr; Watkins) asked me a- question, without notice, regarding a. newspaper report that Mr. Jacoby, a Perth citizen, had presented Commonwealth notes at the London branch of the Commonwealth Bank and was. unable to get cash or English notes for them. The matter was. taken up with the Commonwealth Bank, which has furnished the following advice : -

In order to meet the requirements of the Governments in London, it was necessary to restrict and ration exchange, An agreement for mobilization of exchange was arranged with the concurrence of the Federal Treasurer. As it became evident that people were taking or sending notes abroad to defeat the exchange restrictions, the facilities for encashment outside of Australia were withdrawn. Notes are, payable at Sydney only, and facilities for encashment abroad were only given at any time as a convenience, not as a right.

page 634

QUESTION

RETURNED SOLDIER COUNSEL

GovernmentBriefs.

Mr FENTON:
ALP

– On the 18th November the Leader of the Opposition (Mr. Latham) asked, the following question, upon notice -

  1. Since the present Government took office, how many briefs have been given on behalf of the Commonwealth in Victoria to - (a), returned soldiers;

    1. of military age at the end of of the war,
    2. under military age at the end of the war?
  2. Will the Government make available the names of counsel briefed in the cases, above referred to?
  3. Is it the case that returned soldier junior barristers who qualified after the war, in some cases after a course of study extending over four or five years, are now placed upon thesame basis with respect to briefs as other junior barristers who qualified after the war: if not, what distinction is made?

I am now in a position to furnish the honorable member with the following answers to his question: -

  1. Since the 22nd October 1929, 83: briefs have been given by the Commonwealth in Victoria to returned soldiers and- 44 (thirteen of which were given to King’s Counsel) to nonreturned soldiers.

    1. The names of counsel briefed are as follows :- Sir B. Mitchell, K.C.; H. I. Cohen, K..C; W. L. Ham, K.C.; X . C. Brennan, K.C.; E. Gorman, K.C.; R. G. Menzies, K.C.; Sir Harrison Moore; Hon. J. H. Keating; D. Hearder; W. Ah Ket; R. H. Gregory; C. G. Duffy; R. Martin; C. H. A. Eager; W. Shelton; E. R. Reynolds; N. O’Bryan; A. Dean; J. H. Moore; J. Tait; A. jj. Read; W. K. Fullagar; E. P. Herring; A. M. Fraser; L. Little; P. D. Phillips; A. D. Ellis; C. Stafford; E. G. Coppel; W. A. Fazio; J. G. Morris; G. L. Mayman; N. F. Mitchell; J. V. Barry; I. Maxwell; W. M. Irvine; H. J. A. Campton; G. L. Dethridge; S. H. Z. Woinarski; N. Burbank; R. M. Warner; and A. j. Rice.
  2. No. As previously pointed out by the Attorney-General, in reply to a question by the honorable member, the only modification in the policy of previous Governments in the allocation of briefs is that, in minor cases, barristers who at the termination of the war were under military age are not excluded from consideration.

page 635

QUESTION

INTEREST ON LOANS

Mr LYONS:
ALP

– On the 25th June the right honorable member for Cowper (Dr. Earle Page) asked the following questions, upon notice -

  1. What was the interest payable on 30th June, 1928, and 30th June, 1929 (a) for the Commonwealth, and (b) for the States?
  2. What was the amount available from revenue-producing assets, in the years 1927-28 and 1928-29?
  3. What were the balances covered by taxation in those years?

The following return sets out the information desired: -

page 635

QUESTION

AERIAL MAIL SERVICES

Darwin to Great Britain

Mr FENTON:
ALP

– On the 19th November the honorable member for Balaclava (Mr. White) ‘asked me a ‘question, without notice, regarding proposals, which it was reported had been submitted to the Prime Minister (Mr. Scullin) -in

London, having in view the extension of an aerial mail service to Australia. The Prime Minister has advised ‘by cablegram that he lias ‘had interviews with Imperial Airways and the Dutch line, but that final consideration of the matter is being deferred pending an examination OI (the proposals on his return to Australia.

page 636

QUESTION

TOBACCO INDUSTRY

Imposts

Mr FORDE:
ALP

– On the 14th November the honorable member for Indi (Mr. Jones) asked the following question, upon notice -

For the years 1928-29 and 1929-30, will the Minister supply the following information: -

The quantity and value of manufactured tobacco imported?

The quantity and value of manufactured cigarettes imported?

The quantity and value of unmannfactured leaf imported?

The quantity of unmanufactured imported leaf manufactured into (a) tobacco, and (6) cigarettes?

I am now able to furnish the honorable member with the following information : -

  1. 1928-29-1,070,251 lb., value £ 159,788; 1929-30-882,008 lb., value £ 139,1 18.
  2. 1928-29-1,019,514 lb.; value £516,006: 1929-30-879,112 lb., value £417,527.
  3. 1928-29-212,137,672 lb., value £1,905,194: 1929-30-20,283,813 lb., value £1,768,686. 4. (a) 1928-29-13,884,513 lb.; 1929-30- 13,673,546 lb. (6) 1928-29-5,191,936 lb.; 1929-30-5,236,720 lb.

The figures relating to imports during the year 1929-30 are advanced, and are subject to revision.

page 636

QUESTION

SYNTHETIC) SILK

Mr FORDE:
ALP

– On the 13th November the honorable member for Barton (Mr. Tully) asked the following questions, upon notice -

  1. Is it a fact that synthetic silk, imported from Germany, is being used by Bonds’ Limited ?
  2. Is it a fact that this silk is imported already wound on cones?
  3. Is it a fact that this silk costs 2id. per lb.?
  4. Is it a fact that there is a flaw in the Customs Act that allows this particular silk to be imported at 2-Jd. per lb.?
  5. Is it a fact that this firm has dismissed a number of girls who were silk-winders?

I am now able to furnish the honorable member with the following information : - 1, 2, 3, and 5. The manager of the company - concerned states that the answer to these questions is emphatically “ No.”

  1. I am not aware of any such flaw; but if the honorable member will furnish me with further particulars I shall have the matter reconsidered.

page 636

PAPERS

The following papers were presented : -

Air Force Act - Regulations amended -

Statutory Rules 1930, No. 135. Vew Guinea Act - Ordinance of 1930 -

No. 21.- Supply (No. 4) 1930-31. Railways Act - Report on Commonwealth

Railways Operations, for year ended 30th lune, 1930.

page 636

REPRESENTATION BILL

Motion (by Mr. Blakeley) agreed to-

That he have leave to bring in a bill lor an act relating to the appointment of an enumeration day for the purposes of the Representation Act 1905.

page 636

SOUTH AUSTRALIA GRANT BILL

Second Reading

Mr LYONS:
Acting Treasurer · Wilmot · ALP

– I move -

That the bill be now read a second time.

During the last three years particularly, the State of South Australia has been in a very difficult financial position. In common with some of the other States it has suffered from-

Mr GREGORY:
SWAN, WESTERN AUSTRALIA

– Federation.

Mr LYONS:

– Bad seasons and low prices. From those causes she has suffered probably to a greater extent than any of the other States. I believe, also, that while all the States are suffering fro’m over-borrowing in the past, the greatest sufferer is South Australia. In addition, it is claimed that she has suffered certain disabilities under federation. Following upon that claim, a royal commission investigated the situation of the State, and recommended that the Commonwealth should grant her assistance to the extent of £1,000,000 over a period of two years. The last Government adopted that recommendation, with the variation that the grant should be over a period of three years, and that it should include an amount of £60,000 by way of relief on account of the handing over to the Commonwealth of the Red Hill to Salisbury railway. Soon after the present Government came into office, it carried out, generally, the undertaking of thi; previous Government, by making provision for the granting of £1,000.000 in throe years, as follows: -

Notwithstanding that special assistance, the position in South Australia, since it was given, has become Infinitely worse. Honorable members will have some indication of the situation when I say that the deficits of that State have been’ £275,000 in 1927-28; £931,000 in 1928-29; and £1,625,000 in 1929-30. The increasing difficulty of the situation impelled the Premier of South Australia, Mr. Hill, recently to request, further assistance fi-om the Commonwealth.

As honorable members are aware, a resolution was carried at the August conference of Commonwealth and State Ministers held in Melbourne, under which the Commonwealth -and each State with the exception of South Australia, undertook to do everything possible to balance their budgets for this particular year. Mr. Hill gave convincing evidence of his determination to make every effort to do so, but proved that the task was utterly beyond the capacity of his State. The Commonwealth could do no more directly than it had already done; but the States agreed to forgo, and thus make available to South Australia, certain grants that the Commonwealth had proposed to pay this year chiefly to assist in relieving unemployment. The total amount involved was £850,000. The balance of £150,000 that Mr. Hill said he would require to balance his budget, has not yet been provided. This bill seeks to give effect to the resolution carried by the representatives of the States. It will be of interest to honorable members to hear the terms of that resolution -

That the claims of South Australia for further financial assistance from the Commonwealth be inquired into by the Federal Parliamentary Public Accounts Committee.

That pending the result of such inquiry, the Governments of the respective States have agreed to forgo certain grants which the Commonwealth proposed to make to them during the present financial year; and the Commonwealth has agreed to pay to the State of South Australia the moneys which the

States have so agreed to forgo, referred to are: -

The grants

That the Government of the Commonwealth and South Australia shall confer as to the balance of £150,000 which shall be made good., if possible, by South Australia or, alternatively, by South Australia and the Com- monwealth acting conjointly.

The bill before the House gives effect to the resolution. The representatives of the States recognized that, if South Australia was to balance its budget, or even to do it approximately, it would be necessary for the rest of Australia to help it over its difficulties. Having considered the matter amongst themselves, the conference agreed to the granting by the Commonwealth of special assistance to South Australia, and undertook to give effect to the resolution. Regarding the balance of £150,000 required to complete the £1,000,000 needed by South Australia, it was agreed that the Commonwealth and South Australia should confer. Of course, it was intended that, if possible, South Australia should raise that money, but, failing that, the matter was to be one of arrangement between that State and the Commonwealth. It has not been practicable for the Government to go definitely into South Australia’s proposals to see if it is possible for that State to provide the balance of £150,000, and, therefore, that matter is still in abeyance. Apart from that, as honorable members know, the Commonwealth is not in a position this year to balance its own budget. A real effort to do so has been made; but we should scarcely be justified in increasing our own deficit merely to balance the budget of South Australia. A further recommendation made bv the conference between representatives of the States and the Commonwealth was that the claims of South Australia should be referred to the Public Accounts Committee, for inquiry as to the amount of assistance necessary to enable that State to carry on in future. To that recommendation, as honorable members are aware, effect has been given.

Without entering into the merits of the claims of South Australia upon the Commonwealth for financial assistance - honorable members have discussed that matter on previous occasions - I think that it is well to consider, to some extent, at any rate, what the Premier and Treasurer of South Australia is himself doing in order to overcome his difficulties. Honorable members will recognize that he is doing all that possibly can be done in the circumstances, and I submit, therefore, that this Parliament should help him over his immediate troubles. The first review of the South Australian budget showed a deficit of approximately £3,000,000. The Premier, Mr. Hill, and the members of his Cabinet, took certain action to meet that situation. The following are among the measures adopted by South Australia for the purpose of helping itself: -

I have pointed out that while Mr. Hill has budgeted for a Commonwealth grant of £1,000,000, the grant now proposed is £850,000. The Commonwealth Government, as I have already indicated, is to confer . with him regarding the balance. The following reductions, of salaries and allowances have been inside in South Australia: -

Ministers - 15 per cent. Members of Parliament - 5 per cent. Sundry salaries under special acts - Various reductions up to 20 per cent.

Public Service - Approximately 10 per cent. up to £1,000, rising to 16 per cent, on £1,250 and over.

Teachers - 10 per cent., and certain bonuses struck off.

Those reductions, of course, only operate for part of this financial year.

Mr Thompson:

– Next year, too.

Mr LYONS:

–That remains to be seen. The representatives of the various States having considered their own difficulties, made ‘ up their minds’ to overcome them as far as they could with their own resource-‘, and they recognized the strong case presented by the Premier of South Australia for further assistance for that State. Realizing that South Australia was suffering greater disabilities than the other States, they arrived at the conclusions which I have mentioned, and made it possible for the Commonwealth to give this grant to South Australia. I feel . sure that this Parliament will recognize the disabilities of that State, and the necessity to help it over its immediate trouble by passing the present bill which gives authority for the payment to be made.

Debate (on motion by Dr. Earle Page) adjourned.

page 638

INCOME TAX (SALARIES) ASSESSMENT BILL

Debate resumed from the 6th November (vide page 96) on motion by Mr. Lyons -

That the bill be now read a second time.

Mr LATHAM:
Kooyong

.- This is one of the most remarkable pieces of legislation ever introduced into this or any other Parliament.

Mr Lacey:

– The honorable member has said that frequently of late.

Mr LATHAM:

– The last occasion on which I made a similar observation was when I was discussing the financial statement in pursuance of which this bill has been introduced. Some remarkable legislation is being placed before us at present. This is a bill to provide for a reduction of the allowances and salaries of Ministers, members of Parliament, and certain, officers of the Commonwealth Public Service. But as this Government has so often said, and so many of its supporters have so often asservated, that they would “ never, never reduce salaries,” the HH is described as an Income Tax Salaries Assessment Bill, and it is pretended that it is not in effect a . bill for the reduction of salaries. The bill, in its title, and in the whole: of its drafting, is a piece of hypocrisy.

Mr SPEAKER (Hon Norman Makin:
HINDMARSH, SOUTH AUSTRALIA

– The honorable member is not in order in using that expression.

Mr LATHAM:

– I withdraw the expression as my own opinion, and will say that if the bill were described outside this House by persons who were not bound by the rules of parliamentary procedure, it would not be at all surprising if such a term were used in respect to it. The bill is covered by a thinly veiled pretence that deceives no one. lt is an. attempt to hide realities behind a screen of words, but it obviously fails to do so. It is called a taxation measure, but it is really a measure for the reduction of salaries and allowances. It pretends to observe what I understand is the policy of the Labour party when it suits it, but not in other cases, that there shall not be any reduction in the emolument paid to any person. This policy is of course, subject to convenient exemptions. Such exemptions are carefully made so as to avoid, as far as possible, doing anything that may incur unpopularity, or involve the responsibility of looking directly at the financial situation, not only of the Commonwealth as a whole, but of its individual citizens. The Labour party during the last election campaign, said that wages would be maintained, and that there would be no reductions at all. The party has been unable to carry out that promise in any particular. Wages are coming down. Award rates are being reduced all over the Commonwealth, and the Government has done, is doing, and can do nothing to stop it. Labour candidates at the last election, who were sufficiently well informed, knew quite well that the Government could do nothing to stop this, because they knew that this Parliament has no power to legislate in respect to wages. For this reason, these promises,’ which were made by so many Labour candidates, were false promises, and many candidates who made them knew that this was so. What are the miners and shearers saying to-day about the value of the promises made to them by the Labour candidates at the last election? At the time of the making of these promises, it was obvious that they could not be fulfilled; but, like many other promises made during that campaign by Labour candidates, they were made in order to win the election which the party is so proud of having won. The promises were made to win’ votes, and they won them; but now that the party is being called upon to honour its promissory notes it cannot do so, nor is it going to try to do it. How is it meeting the existing situation ? ‘With a cynical indifference and contempt. It is perfectly satisfied at having won the election. These promises were made with the object of achieving this end, and they achieved it. According to many honorable members opposite the end has entirely justified the means.

During a debate in this House as recently as last July - long after the election - it was proposed that the salaries of Ministers and members of Parliament should be reduced; but it was declared from the other side of the chamber that, as a matter of principle, this would never be done.

Mr Curtin:

– We are quite prepared to vote this bill out, if you oppose it.

Mr LATHAM:

– Within four months of the time when it was declared by the Government that the salaries of Ministers and members would not be reduced, a bill has been introduced for the purpose of reducing them. From time to time the Government turns its back upon its own policy - if it knows what its policy is - with the utmost indifference. Of course, reductions have already been made in wages and salaries in the Public Service, but those who- have been affected have been very carefully selected, just as a very small number of additional public servants have been selected in this bill. The sailors and soldiers of the Defence Department have been obliged to accept reductions, but not its civil staff. Why is this? It is because the civil staff are members of unions, the officers of which at least are strong supporters of the Government. The salaries of these civil officers have not been reduced, but the salaries of the men to whom the Commonwealth looks to do its fighting, have been reduced. These men joined no union, and cannot do so, because, consistently with their duty to the people of the Commonwealth, they can recognize only one obligation. Consequently, their work has been rationed up to two months in twelve. This Government will not reduce salaries where it knows that to do so may injure it politically.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– That is common sense, is it not?

Mr LATHAM:

– The interjection of the honorable member for South Sydney (Mr. E. Riley) is an exact index to the mind of so many honorable members opposite. So long as they can avoid alienating votes they will go ahead with salary reductions. That is their principle. They have reduced salaries and allowances in the Public Service in the case of officers who have not become members of unions, many of which are extravagantly political. The salaries of the non-unionists - those whom it is thought may possibly not be supporters of the Labour party - have been reduced by this Government, though they will be doing the same work after the reduction as they did before. There is no consideration of justice, nor any attempt to deal with this matter upon the basis of fair play or equity. The only concern of honorable members opposite is the probable result that will he achieved in regard to votes. This Government will not run the risk of alienating the support of officers of certain of those unions who, day in and day out, are more concerned with the fortunes of the Labour party than with the well-being of the members of the Public Service, whose interests they are really appointed to maintain. These reductions have been made. Not only that, but the Government is dismissing men wholesale - throwing thousands out of work, while pretending that it is still animated by the humanitarian ideals of which it claims a monopoly. Men have been ruthlessly dismissed ; in the post office retrenchment is the order of the day. Men are simply thrown on the scrap-heap, many of them being returned soldiers, for whom this Government has no particular affection.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– What does the honorable member suggest?

Mr LATHAM:

– The honorable member for South Sydney (Mr. E. Riley) reminds me of his friends who have occupied rear seats at political meetings I have addressed. They have no ideas of their own; probably would not recognize an idea if they encountered it, but they have been told by someone to interrupt speeches by shouting, “ Give us your policy Honorable members of this House have never found me backward in suggesting alternative courses of action to those I condemn. While employees have been dismissed wholesale from the post office, no attempt has been made to introduce the rationing system which the Government adopted some time ago in the Defence Department, nor has any consideration been given to proposals for reduction of wages which would make it possible to avoid dismissals. It would be better to keep the men at work, even at reduced rates of pay - and it is not suggested that there is no useful work for them to do - than to throw them out to live on a dole. However, the Government is not concerned with these alternatives, sp long as it is able to pretend that it is maintaining rates of wages. The people are not interested in rates of wages which they cannot get; they want to work, and the Government is depriving them of the opportunity. The Council of Trade Unions has propounded a policy with respect to wages in Australia. It matters nothing to them that the national income is reduced, and that hundreds of thousands of men are out of work. Their remedy is to raise wages and shorten working hours. They ask intelligent people to believe that the unemployment problem can be solved in that way. It is very difficult to determine what is the governing authority of the Labour party to-day. The Ministry is at loggerheads, the party is falling to pieces, and there are various outside organizations - the Australasian Council of Trade Unions and the Sydney Trades and Labour Council among others - which, in “a pontifical manner, issue directions to the Labour Cabinet.

The Council of Trade Unions, as I have pointed out, has instructed the Government that wages must be increased and hours shortened. Is that to be the policy of the Labour Government? Is the Government prepared to face the problem of unemployment amongst its post office staff by raising wages and reducing working hours? That is the test of this bright idea. Everybody knows that it cannot be done; but is the Government prepared to disown these instructors? We see that it is not. It will not obey them, but it does not wish to break with them. The members of the Government know, now that they are faced with real responsibility, that when it has no money it cannot pay money away. Private employers have, of course, known that all along. I know many employers who are straining every nerve to keep their men in work. The money coming in is only just about enough to pay the men’s wages, leaving nothing for rent, salaries, &c. Yet the Government’s Labour advisers say that the remedy is to raise wages and shorten hours. Thousands of employees throughout the Commonwealth are being rationed to-day, but it is proposed in New South Wales, I understand, to make rationing illegal. I do not know whether the present Premier of New South Wales (Mr. Lang) will be sufficiently foolish to carry out such a proposal. I know of one company in Sydney which employs 1,900 persons who, unfortunately, have to be rationed one week in three. If rationing were made illegal, nearly 500 of those employees would be thrown out of work altogether.

This bill pretends to be a taxation measure, but it is really a bill to reduce salaries, wages and allowances, seeking to hide itself under another name. It provides for the reduction of salaries paid by the Commonwealth which exceed £725. The tax on salaries between £725 and £1,000 is to be at the rate of 10 per cent., with increasing rates up to 15 per cent, on salaries above that amount. The effect of this measure is that a man on £725 a year will continue to receive £725, while everybody receiving between £725 and £800 will be reduced to £725. The system itself is unjust. A mau receiving £1,000 a year loses £100, while a man on £1,200 a year comes down to £1,050. The reductions should be made according to a gradually increasing scale, instead of following the present abrupt method. Altogether the measure will affect - leaving out Ministers and members of Parliament - a total of only 441 persons. The number of employees of the Commonwealth in and outside the Public Service, as stated by. the Acting Prime Minister (Mr. Fenton) to me in answer to a question on the 12th November last, is no less than . 44,452, and of this number a grand total of 441 persons are to be subjected to this taxation ! I know many public servants who feel ashamed of the proposals of the Government. If the Government were to consult them privately - not by appealing to officials of organizations, some of whom are Labour supporters rather than secretaries of Public Service bodies - they would say that they are quite prepared to share with the rest of the community in the general sacrifice. The Acting Treasurer told us this afternoon that the Labour Premier of South Australia, Mr. Hill, is reducing all State Public Service salaries up to £1,000 by 10 per cent., and salaries up to £1,250 by 16 per cent. The salaries of all teachers are being reduced 10 per cent.

Mr Curtin:

– Even the junior teachers.

Mr LATHAM:

– -I admit that the reduction presses hardly on some of them. In some States the conditions of the teachers have markedly improved in recent years; but even at the present time many of these officials are still illpaid.

Mr Curtin:

– A 10 per cent, reduction of the salaries of some teachers is a disgrace.

Mr LATHAM:

– Public Service salaries are being reduced throughout Australia, with the possible exception of New South Wales, and it will be interesting to see what happens there under the Lang Administration. In every other State the Commonwealth public servants receiving not more than £725 a year will be a privileged class - the only protected section of the community. All other persons, whether in public or private employment, have had, unfortunately, to accept a reduction of income. 1 am informed that in warehouses 20 per cent, reductions of salary have been very general, and a similar curtailment of income is being suffered throughout the community. Yet on a total bill for wages, salaries and allowances of over £11,000,000, taking into account not merely the Public Service, but all persons paid by the Commonwealth, the Government proposes to save £60,000! Meanwhile the State governments are incurring the risk of grave political unpopularity by reducing the salaries of their servants in order to bring them into a fair relation with the community as a whole, and by easing the burden, of taxation to assist industry. At the Melbourne conference held on the 18th to the 21st August, the financial position of the Commonwealth and the States was considered by the heads of all Australian governments. Two alternative courses were open to them. The first involved economy and the reduction of expenditure; the second was the maintenance of the rate of public expenditure along the lines defended by the Prime Minister in July last, when he refused to reduce a budget which provided for expenditure £4,000,000 in excess of that provided for in the budget of 1928-29. The latter course involved a measure of political manipulation of the currency, and was rejected by the conference, which determined that all budgets should be balanced, primarily by economy and the reduction of expenditure. That was the deliberate and definite choice of the leaders of all the Australian governments. Soon, but not too soon, on the 3rd October, the Acting Prime Minister announced that Cabinet had decided to reduce Commonwealth expenditure at the rate of £4,000,000 per _ annum. The State governments, acting on the assumption that the Commonwealth Government would honour the Melbourne agreement, have incurred unpopularity and alienated supporters by reducing expenditure. The reduction of salaries and expenditure is a difficult and unpleasant course, which often causes serious suffering and possibly distress. It is an unpopular thing, which no government willingly does, and no member of Parliament willingly urges, but the State governments are doing this, relying on the good faith of the Commonwealth. The smaller States, by reducing the salaries of their public servants, are saving more than the Commonwealth proposes to save by this means, although its salaries bill is infinitely greater. Yet the Commonwealth Government professes to be applying the principle of economy and reduction of expenditure, to which it committed itself at the Melbourne conference, by proposing a reduction of £60,000 in an annual salaries and wages bill of over £11,000,000. I say emphatically that that is not a performance of the agreement; it amounts to a breach of faith with the State governments, and I am sure that some ministerial supporters are ashamed of the action of their leaders, although they may be unable to express their feelings.

Instead of reducing expenditure the Government proposes to increase taxation. I do not forget that the Acting Treasurer’s speech included a list of savings to be effected in administration. Amongst them was an amount of £3,75,000 in respect of “miscellaneous savings.” How is that saving to be effected? In July last, when the members of the Opposition urged that the budget should be reduced, every line of it was defended by the Prime Minister. What reductions does the Government now propose to make? ITo particulars have been given, and I doubt if they Call be given. All that is clear is that on a salaries and wages bill of £11,000,000 the Government proposes at this critical time, to effect a reduction of £60,000. Everybody outside the Public Service is already suffering a diminution of income, no . matter from what source that income is derived. The Government proposes to set up a small privileged, class, including many who are not subject to the State income tax to which fellow public servants of the Commonwealth residing out of the Federal Capital Territory, and State servants, are subjected. It is an open question whether the members of this Parliament and Commonwealth public servants residing in the States are bound to pay the unemployment tax. Years ago this Parliament legislated to- permit the States to collect income tax from Commonwealth public servants and members of this Parliament, but it is possible that they are not bound to pay the unemployment tax. Certainly all those living at Canberra are immune from both the income and unemployment taxes levied by the States. How can the Government justify such discrimination between individuals in the Commonwealth Public Service, and between the members of that body and the general community.

Mr Archdale Parkhill:

– It . does not justify it.

Mr LATHAM:

– That is characteristic of the Government and its supporters in this Parliament. After a Minister has explained a bill, criticism is offered from this side of. the House. Sometimes a ministerial member supports a government proposal in its entirety, but such a one is a vara avis. I cannot remember, off-hand, any ministerial member wholeheartedly endorsing a bill introduced by this Government. The Labour party does not know where it is. Being devoid of principles it relies entirely on opportunism, and the conditions prevailing in Australia to-day are such that opportunism will not serve very long.

The new taxation which the Government is proposing will place further burdens upon industry and increase unemployment. Generally, the effect of taxation its to collect money from the people who have earned it, or have otherwise become entitled to it, and the expenditure incurred in collection leaves a smaller sum for disbursement by the’ Government. Taxation can never be a remedy for unemployment.

Mr Curtin:

– Does the honorable member suggest that wage reductions would solve unemployment ?

Mr LATHAM:

– Unemployment has already reached the alarming extent of 20 per cent. Will the Labour party wait until it is 30 per cent, or 40 per cent, and still pretend that it is adopting a sensible policy ? A stage must come when it is better to have a reduction of wages with an almost corresponding reduction of the cost of living, so increasing the value of money and giving employment to a large number of citizens, than to stand idly, hopelessly, and, in some instances’, cynically and callously by while the existing staggering figures of unemployment still further increase.

Mr Long:

– Does the honorable member favour the reduction of legal fees?

Mr LATHAM:

– The fees of barristers, doctors and dentists, in fact all professional fees, have decreased. Dentists have told me that the extraction of fees has become much more difficult than the extraction of teeth. How far is unemployment to extend before the Government will reconsider its attitude? If unemployment becomes 35 per cent, or 40 per cent, what will the Government do? Is it not better that men should be at work at lower rates of wages, and that the cost of living should fall, than that a large number of our citizens should continue without employment.

Mr Keane:

– That was not what the honorable member’s party said at. the general elections.

Mr LATHAM:

– That is quite consistent with what was said during the general elections, and because the last Government took a stand on this principle, it was sacrificed to the opportunism and false promises of the Labour party. The inevitable result of these related measures - the Income Tax Assessment Bill and the Income Tax Salaries Assessment Bill - will be increased unemployment. If we brought about a real reduction of salaries, in accordance with the undertaking given by the Commonwealth Government itself to the Premiers’ Conference in Melbourne, there would be no increase of unemployment in the general community as a result of special taxation, and there would be a chance of avoiding some of the dismissals which are at present being made from the Commonwealth Service. It would be out of order for any private member to move that taxation should begin to be imposed on a lower figure than £725, and it is, therefore, impossible for the Opposition to propose, as an amendment, an alternative scale of reductions which would spread the burden more evenly and fairly in the Public Service itself, as between the members of the Public Service, and as between the Public Service and the community. We are unable to move an amendment of that kind’ to a taxing measure, because to do so would increase taxation upon the persons to be charged. Therefore, all that can be done is to submit to the Government arguments - some of which I have used, and others will be used by other honorable members - seeking to persuade it that the reduction of salaries should be spread over a wider area, should be graded more fairly, and should be greater in total; that the Government would be acting wisely in following these suggestions and reducing the taxation which it proposes to impose upon incomes, which will inevitably have the effect of increasing unemployment. To indicate definitely the views of the Opposition, I move the following amendment to the motion for the second reading of the bill: -

That all the words after “ That “ be omitted with a view to insert in lieu thereof the following words: - “in the opinion of this House the amount of over £11.000,000 now paid as salaries, wages and allowances by the Commonwealth to Ministers, members of Parliament, public servants and others should be reduced by an amount greater than that proposed by the Government in order to make it possible to reduce the further taxation proposed by the Government.”

Mr NAIRN:
Perth

.- I second the amendment. I shall confine my remarks entirely to the principle which has been attacked by the Leader of the Opposition (Mr. Latham) - the drawing of a line in relation to taxation at the sum of £725 in the case of members of the Commonwealth Public Service. It has been stated over and over again, both inside and outside this House, that in these times of stress sacrifices are necessary on the part of all sections of the community, and it is agreed that those sacrifices should be shared according to the ability to pay. In these circumstances the drawing of the line at £725, thus applying this special taxation to one section of the people,, is utterly indefensible. There is no ground whatever for contending that persons who receive salaries of from £400 to £725 should be entirely exempt from the special taxation which is necessary in order to balance the accounts of the Commonwealth. Let us compare the position of the members of the Commonwealth Public Service with that of persons in corresponding positions outside, because, after all, we should endeavour to apply the tax equitably, quite irrespective of any class or its vote.

The average salary paid to adult members of the Commonwealth Public- Service is £297; but a better comparison can be obtained by taking the basic wage paid in the Public Service and in the six chief capital cities. The Public Service report, issued this month, shows that the basic wage in the Public Service is £216, plus Child endowment. The nominal basic wage outside the Public Service, even including child endowment, is slightly lower than that; but the actual wage is much less. The basic wage for the six capital cities, assessed on the Harvester award of 42s. in 1907, and varied in proportion to the increase or decrease in the cost of living from time to time, is as follows: -

The weighted average for the six capital cities is £4 a week, or £208 per annum. If we add to that Mr. Justice Powers’ award of 3s., the basic wage is brought to £215 16s. per annum, including child allowance. The basic wage for Commonwealth employees is £216 per annum, plus child allowance. At the end of the financial period ending 30th June, 1930/ the advantage to the Public Service, in respect of child allowance, was £263,043. In addition, the Public Service enjoys the great advantage of permanency of occupation. The latest figures of unemployment among the trade unions show that the percentage has reached 20.5, but. it is probable that actually it is greater. Those figures do not take rationing into consideration. The actual figure of unemployment is believed to be between 20 and 30 per cent. Therefore, to strike a fair average on the ability to pay, we must take into consideration, not merely the nominal basic wage, but also the actual earnings of the people. Commonwealth employees who are on the basic wage receive £216 per annum, plus child allowance. Outside employees receive about £156 per annum.

Mr Keane:

– That is wrong.

Mr NAIRN:

– That is an estimate only. I am taking into consideration the fact that outside the Public Service 25 per cent, of the workers are unemployed.

Therefore, taking the average weekly wage at £4 a week, the actual wage among the community, generally, would be only about £3 a week. That is the position taking into consideration the ability to pay. In mentioning those facts, I am making no attack on the Commonwealth or any other Public Service. The members of the Commonwealth Public Service, like any other members of the community, should be prepared to accept what is fair.

Mr MORGAN:
DARLING DOWNS, QUEENSLAND · NAT

– They are ashamed of the position into which this Government has forced them.

Mr NAIRN:

– They are in a specially favored position, not only in regard to the amount they receive, but also in regard to the permanency of their employment.

Mr Keane:

– “We said, “ No wage reduction “, and we are carrying out that policy.

Mr Latham:

– Particularly in respect of the Defence Department and of the Public Service generally.

Mr Keane:

– We are examining that position.

Mr NAIRN:

– From the point of view of the basic wage, the public servants are enjoying an. advantage, but those who receive salaries ranging from £400 to £725 have been given an additional advantage which is entirely unjustified. The Government’s .object is quite palpable. It has no special love or affection for Commonwealth employees, but it knows that they have votes, and it hopes to consolidate those votes, and by that means retain office. It is deplorable that this palpable attempt to bribe a section of the community should be tolerated by the community in general.

Mr C RILEY:
COOK, NEW SOUTH WALES · ALP; FLP from 1931

– A suggestion of bribery should not be tolerated by this House.

Mr NAIRN:

– I do not think that I have used too harsh a word. I can see no other motive underlying the special discrimination that has been shown by the Government in respect of the Public Service. No other motive has been suggested by honorable members on either side of the House. In fact, no real reason has been given for specially favoring a section of the Public Service. Therefore, I am entitled to draw the deduction that the Government is attempting to attract the vote of public servants in order to maintain office. If public opinion tolerates such a thing, we have, indeed, drifted into a deplorable position.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– I am not surprised at the attitude that has been adopted by the Leader of the Opposition (Mr. Latham). He has consistently advocated the reduction of wages, and upon that consistency I congratulate him. I have yet to learn, however, that such a policy would increase the opportunities for the employment of our people. On the contrary, the purchasing power of the wage-earners would be lessened, and thus fewer people could be employed. Therefore, it is wrong to advocate the reduction of wages as a cure for our unemployment problem.

This is a question that affects, not only this Parliament and the Parliaments of the States, but the whole of the civilized world. We are living to-day in a mechanical age. With each succeeding year newer machinery is introduced for the more rapid production pf goods.’ Any man who understands social and economic questions realizes that there has been built up a machine which is crushing the workers and putting them out of employment. The facts stare us in the face. Wherever machinery has been introduced it has displaced human labour, and as, concurrently, the population has increased, the number of unemployed has steadily become larger. The problem cannot be solved by methods that have previously been adopted.

Mr Archdale Parkhill:

– Does the honorable member believe that we should be better off without the steam engine?

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– We believe in taking . advantage of machinery that will lighten manual labour ; but, at the same time, we should adapt ourselves to the different circumstances. I am proud to belong to a race that has sufficient inventive faculty to produce mechanical appliances. But while science has been responsible for development in that direction, we have not made nearly so much progress in advancing the welfare of the human race. If the use of machinery makes possible the production of goods in one-half the time formerly occupied, the hours of labour should be so adjusted that the altered conditions would not add to the ranks of the unemployed. Our existing system will break down unless we tackle the problem from a scientific stand-point. No nation can afford to have large armies of unemployed. Men will not submit quietly to being underfed and underclothed. The reduction of wages would merely intensify our difficulties. Neither will the problem be solved by increasing production. “We should look at this matter, not through the eyes of party, but from the stand-point of what is best for the nation. The problem has not arisen since the present Government came into power; it caused considerable uneasiness to the last Government, yet that Government, took no steps to solve it. Now, because the Labour party happens to be in control of the affairs of this country, every opportunity is taken by our opponents to stress the seriousness of the position, and to allege that no action is being taken to deal with it. When it was suggested that there should be an extension of our currency for the provision of funds to give employment to our people, it was characterized as repudiation.

Mr Archdale Parkhill:

– You cannot give employment to people by issuing paper that is not worth anything.

Mr DEPUTY SPEAKER (Mr McGrath:
BALLAARAT, VICTORIA

– I ask the honorable member for Warringah to cease interjecting.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– At the last federal elections the Labour party gave a definite pledge that it would not stand for a reduction of wages. Do honorable members opposite wish us to go back on that pledge ? I shall not do so.

Mr MORGAN:
DARLING DOWNS, QUEENSLAND · NAT

– Labour members also said at the last election that work would be found for the unemployed.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– Before long the Government will bring down proposals that will help to solve the problem; but I suppose that they will be opposed by honorable members opposite. We shall do our utmost to fulfil our promises to give employment fo the people. Those honorable members who advocate more production should study with greater exactotude the conditions that now obtain. During the last State election campaign in New South Wales I travelled over a considerable area of country, and on every hand I saw an abundance of food. Australia, this year, has grown sufficient wheat to feed 30,000,000 people, and enough wool to cover, probably, 100,000,000 people. Everywhere, stock are fat; only man is starving. That is the problem that we have to face; shall we do so by reducing the standard of living in the Public Service?

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– Is the Government doing it by increasing taxation?

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– I do not believe in taxation, and would, if I could, reduce it. Unfortunately, however, old-age, invalid and soldiers’ pensions have to be paid, and, rather than default in that respect, I am prepared to support additional taxation to enable the Government to discharge its liability. If honorable members opposite had the courage, they would move an amendment that the salaries of public servants be reduced to, say, £4 a week all round. The amende ment that has been moved side-steps the issue; they are afraid to say what they are prepared to do. Do they realize that 82 per cent, of the public servants of this Commonwealth are postal employees who are almost on the basic wage, and that many of these are returned soldiers? Do they want to reduce their wages?

Mr Bayley:

– No such suggestion was made; the honorable member for Perth (Mr. Nairn) said that nothing below £400 should be touched.

Mr Morgan:

– Why is the Government sacking returned soldiers? It has sacked a greater number than any other government.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– Because the previous Government left it a legacy of debt that it cannot meet. The cancellation of 20,000 telephone installations has caused a tremendous loss of revenue. There is not now the demand that formerly existed for telephonic extensions; therefore, those who were engaged on that work cannot be given employment. Is it the desire of honorable members opposite that the Government should continue in employment men for whom there is no work? We on this side do not stand for such a policy. The late Government adopted that practice; instead of facing the position that it knew existed, it secured overdrafts and issued short-dated loans to obtain funds to pay the salary bill. Largeamounts were spent on all sorts . ofschemes. To-day, we . are feeling ‘the effects of its bad administration. I am confident that this Government twill bring down practical proposals to deal with the unemployment problem.

Dr Earle Page:

– When?

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– The ‘right honorable member for Cowper (Dr. . Page) entered this Parliament fired with the ambition to establish new States, yet not one was established during the time that be was in power. This Government will actmuch more quickly than that. A bounty should be paid on the production of gold and oil.

Mr DEPUTY:

-SPEAKER. - I remind the honorable member that the bill makes no reference to gold.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– This Government will endeavour , to solve the unemployment problem, not by decreasing wages or increasing hours, but by enlarging the currency of this country and thus providing facilities for both private and public operations to be carried on.

Mr PROWSE:
Forrest

– I am surprised that, at a time like the present, the Government should limit this tax to those who are receiving over £725 a year. There could have been an all round reduction of 10 per cent, without affecting the purchasing power of the salaries that public servants receive. According to the Commonwealth Statistician, the cost of living has decreased by 11 per cent. How has that reduction been made possible? lit has been brought about at the expense of the primary producer, who has had to supply his product at an unprofitable rate. It is the primary producer who establishes the financial credit of this country, and who finds the money for the payment of salaries. This year he is short to the extent of £80,000,000; yet there are . those who claim that existing salaries in the Public Service should be continued, just as though there was no depression ! If there were a 10 per cent, reduction, public servants would still be 1 per cent,better off than they were beforethe cost of living fell. I do not believe in this diiferentiation . between sections of the people. I defy any man to find in the ranks of the wheat-growers one person who this year will have a taxable income of£725. Approximately 75 per cent, . of them have practically been . made bankrupt; yet they are to be called upon ; to : findthe money -to maintain and pay the salaries at rates that their servants received in the. past. It is not sporting.; it is not . cricket; it is ‘not business. Have not all -citizens of the Commonwealth equal rights? Yet we are “told that there must be no reduction ‘of the wages . of public servants in receipt of £7.25 per annum or less. What of the men in the back country, who are earning nothing? What of the 400,000, who are unemployed? Are public servants to remain intheir sheltered positions and receive : the same wages as were awarded to them at a time of buoyant revenues’? The honorable member for South Sydney (Mr. E. Riley) reminds us that there is an abundance of food in this country. I point out to him that I see an abundance of labour, even 400,000unemployed. He seemed to imply that, because food was plentiful, it should be obtainable at a low price. Since there is an ample supply of labour, should not that also be cheap? Would not cheap food involve the further sweating of the farmers? Would the honorable member have his constituents live cheaply at the expense of the primary producers ? If I never enter this Parliament again, I say emphatically that at a time of depression like this, every citizen should put his shoulder to the wheel. No honorable member should be a party to sheltering one section of the community at the expense of another. The general desire of honorable members opposite seems to be to put special taxation on particular sections of the community. Taxation, to be equitable, should be imposed in accordance with the ability of the people to pay it. Discrimination has been shown by the Government between property taxation and the taxation of income derived from personal exertion. On that subject I shall have something to say in connexion with another measure.

The reduction in the cost of living has been made possible by the sacrifices of the primary producers, and the present Government will not be taking a broad view if it does not reduce, toy at least a flat rate of 10 per cent., the salariesof all members of the Public Service. As I have already pointed out, this reduction would inflict no hardship upon the members of the Service, because a corresponding reduction of the cost of living has already occurred. The Government needs additional money to carry on the business of the country, and the Public Service could make a contribution to the national funds by accepting an all-round salary reduction. By continuing to shelter a large section of the Public Service, and at the same time imposing a primage duty on wheat sacks and embargoes on the importation of agricultural machinery, the Government is taking a one-eyed view of the situation. I fear that conditions in Australia will become worse than they now are if statesmanlike action is not taken immediately.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

.- If this bill had been introduced twelve months ago, soon after the present Government came into office, one could have understood its action. It had made a distinct promise not to reduce wages, but to find employment for all. Regarding the latter part of the promise, the Ministry has completely failed. When honorable members opposite were on this side of the House, they contended that it was the first duty of the Government of the day to find employment for those in need of it ; but when they got into power, those who had most strongly advocated the provision of work for all, sat silent; they no longer stressed the need for a solution of the problem of unemployment. Over 20 per cent, of the trade unionists of this country are now out of work, and, therefore, the total percentage who are unemployed may be taken to be much greater than that. It is unfortunate that reductions of the salaries of public servants are necessary, but the Government and its supporters must surely realize that present conditions are entirely different from those of, say, ten years ago.

Mr Prowse:

– Or when the salaries were fixed.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– Precisely. Members supporting the Government evidently are not prepared to accept the facts as I feel sure they recognize them. I believe that the Government would be prepared to face the position frankly if the Labour caucus would allow it to do so, but, unfortunately, the caucus must take its instructions from outside organizations, and the Ministry has to obey the caucus. The Leader of the Opposition (Mr. Latham) has pointed out that, under this measure, it is proposed merely to make a reduction of £60,000 in a bill amounting to £11,000,000. The country, at least, will agree that that is not the way in which this Government can carry out its promise to find work for the unemployed. While I admit that the Public Service is a fine body, its members enjoy a much more sheltered position than the average outside employee on a similar wage. They are assured of receiving their salaries fortnightly, and, upon their retirement, there is a superannuation fund by which provision is made for their old age.

Consider the position of the farmer, the small storekeeper, the agent or the bootmaker. There is no superannuation scheme for them. They must look to their own efforts, if provision is to be made for their years of retirement. At the present time they are practically without incomes. Every pound taken from the pockets of the people in taxes to enable the Government to make up the £11,000,000 with which to pay the salaries of the Public Service means so much less work for the huge army now unemployed. The Government should face the position fearlessly. A Labour member could do infinitely more good than a Nationalist in clearing up the position, if he would say to his supporters that the position has altered and that the present standard of wages cannot be maintained. The first thing necessary is that we should return to the conditions that obtained prior to the extraordinary increase in wages that occurred about the period of the late war. The honorable member for South Sydney (Mr. E. Riley) exclaimed that, although wheat and wool were abundant, large numbers of people were ou the verge of starvation. That is quite true, but the wheat and wool grown in Australia is not being produced at a cost that will leave the farmers anything for themselves after contributing the taxes that go to keep up the present standard of wages. We must realize that in Australia we cannot live to ourselves; we are part of the civilization of the world, and we must have regard to world conditions. Until such time as we recognize, collectively, that if we arts to pay our way, despite what certain members of the Labour caucus may think about currency inflation-

Mr SPEAKER (Hon Norman Makin:

– The honorable member must confine himself to the subject-matter of the bill.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– I was endeavouring to show that this measure will have a detrimental effect upon the Commonwealth, and that a reduction of the costs of production would be beneficial to the people.

Mr SPEAKER:

– The. bill contains no reference to inflation.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– I bow to your ruling, Mr. Speaker, but caucus has received such extraordinary press publicity of late, and the effect on the good name of Australia has been so detrimental

Mr SPEAKER:

– The honorable member is now aggravating the offence.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– I again apologize. I regret that the Government has not been sufficiently firm with its supporters in caucus. It should have insisted upon the fulfilment of the distinct promise made by the Prime Minister to the Premiers of the States in August last, that the Commonwealth Government would balance its budget. The States have made ft definite attempt to fulfil their promise in this respect. The Labour Premier of South Australia, Mr. Hill, has done his utmost to carry out his promise.

Mr Keane:

– With the help of £850,Q00 from the Commonwealth.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– That is so. The co-operation of the State Premiers with the Commonwealth Government in making possible this assistance to a necessitous State was one of the most statesmanlike acts that we have seen for a long time. South Australia is carrying out, to the fullest extent within her power, the promises made on her behalf at the August Premiers’ Conference. A section- of the Civil Service of South Australia has set an example which could be well followed by the Commonwealth Public Service. Before the South Australian Government even suggested a reduction of salary, the public school teachers voluntarily undertook to sacrifice 10 per cent, of their salaries to assist the State out of its difficulties. What the South Australian public servants did, I believe that the Commonwealth public servants, with few exceptions, would also do, if given the opportunity. I know that during the last federal election campaign a certain section of the Commonwealth Public Service stood solidly behind the Labour party; but I am quite sure that if the Government were to make an appeal to these officers to submit to a sacrifice in the interests of the- whole community, they would do it. The proceeds of such a sacrifice would considerably help the Government to balance its budget. By adopting the present policy the Government has been blind to its own interests. I do not think that the genuine labour supporters of Australia will endorse the sectional attitude shown in this bill. No unbiased person could say that this is other than an attempt to shelter a particular section of the people. I hope that even now the Government will take its courage in both hands and, as the Leader of the Opposition (Mr. Latham) has suggested, withdraw this bill and bring down another which will involve equality of sacrifice from all sections of the Service. As the Acting Treasurer knows that the Leader of the Opposition cannot move an amendment to’ this bill that could be effective, I hope that he will accept the advice that has been tendered to him by the honorable gentleman.

Mr KEANE:
Bendigo

.- To my mind a political party which is returned to power because of definite promises made to the people on the hustings should do its utmost to see that its promises are fulfilled. In 1929, the Labour party, on the hustings, opposed the abolition of the Federal Arbitration Court because it believed that such a move would result in the reduction of wages. It also undertook, during that campaign, to take all possible steps to see that wages were not reduced, and to do everything possible to provide work for the unemployed; but it did not undertake to find work and employment for every man who was out of work.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– It gave the people to understand that it would do so.

Mr Paterson:

– The New South Wales campaign director had no scruples about making such a promise.

Mr KEANE:

– Every honorable mem, ber, if he speaks honestly, will admit that we shall have unemployed in our midst as long as we have the poor with ais. The Labour party did not promise to find work for every man.

Mr Latham:

– Oh, yes it did; I refer the honorable member to the election pamphlets issued by his party.

Mr KEANE:

– Under the provisions of this bill a tax will be imposed upon persons in receipt of more than £725 per annum; but if the suggestion of the Leader of the Opposition were accepted about £1,000,000 would be taken from the public servants, as a contribution towards our national debt of £1,100,000,000, in respect of which we have to meet an interest bill of more than £1,000,000 per week. It has been argued by honorable members opposite that the Government undertook to balance its budget. I have spoken on this subject recently. All I wish to say now in connexion with it is that no such undertaking was given by either the Commonwealth or the States. In any case the financial situation which has been revealed since the holding of that conference shows that it would be quite impossible to balance the budgets this year. Notwithstanding what the honorable member for Barker (Mr. M. Cameron) has said about the efforts of the States to balance their budgets, they are slipping back to the extent of millions of pounds a month. Some States are making an honest attempt to balance their budgets by dismissing work. men. In my opinion, budgets can be balanced by employing men but not by dismissing them. The reduction of wage’s was one of the big issues in the recent New South Wales election; but the advocates of reduction were, so to speak, “cleaned off the wheels”. The people said by their votes on that occasion, exactly what they said in October of last year. They showed clearly that they did not stand for -the reduction of wages. They indicated that they regarded that policy as a method of deflation which could not result in the employment of men.

Mr Latham:

– Nor will this bill result in the employment of men.

Mr Archdale Parkhill:

– The sum of £60,000 is being taken from a few more than 400 men.

Mr Jones:

– We are dealing with ‘the “ tall poppies “ for a start.

Mr KEANE:

– Honorable members are losing £100 of their own salaries.

Mr Archdale Parkhill:

– And honorable members opposite are agreeing to it with very bad grace.

Mr KEANE:

– It has been said that the costs of everybody have been reduced, but there has been no reduction in the fees of legal and medical practitioners.

Mr Latham:

– I happen to know that there has been a reduction in regard to legal practitioners.

Mr KEANE:

– The Law Institute and the British Medical Association each has a. scale of charges, and any professional man who accepts less than these is called by a name which honorable members on this side of the chamber regard as ugly.

Mr Latham:

– The honorable member has very poor information on the subject.

Mr KEANE:

– I have no information whatever that there has been any reduction of legal or medical fees.

Br. Earle Page. - The honorable member should visit Macquarie-street.

Mr KEANE:

– I notice that honorable members opposite are not saying, in plain English, that they want the wages of the Public Service reduced; on the other hand, we are saying quite, plainly that we do not want them reduced.

Mr Latham:

– But this Government is reducing them, in part.

Mr KEANE:

– When we go before the people again we shall be able to say that we did our best to resist the reduction of wages.’ Honorable gentlemen opposite, however, have the supreme satisfaction of knowing that, despite the decision of the electors in October of last year that wages should not be reduced, three judges of the Federal Arbitration Court are reducing them in an atrocious fashion.

Mr SPEAKER:

– Order ! .

Mr Latham:

– I rise to a point of order. I submit that the honorable member is out of order in suggesting that it is the duty of judges to decide oases in accordance with .the result of an election:

Mr SPEAKER:

-I point out to the Leader of the Opposition (Mr. Latham) that I had called the honorable member to order before he rose. The honorable member for Bendigo is not in order in making such remarks about the judiciary.

Mr KEANE:

– I was merely saying, quite frankly, what I thought of the actions of a certain ‘section of this community. I will content myself with observing that, despite the fact that the electors of Australia said definitely that wages were not to be reduced, reductions are being effected through certain channels. The Labour party is not responsible for ‘this.

Apparently, the Leader of the Opposition and his supporters desire to assist the Commonwealth to the extent of £1,000,000, at the expense of a section of the community whose average rate of wages is only £5 per week. They would reduce these wages by an average of lis. per week, to £4 9s. per week. Every honorable member of this Parliament knows What his salary is, and what his living costs are. He also knows that the Public Service is not extravagantly paid. I admit that the members of the Public Service enjoy some advantages over other sections of the people. They have, for, instance, continuity of work ; but they also have to spend long years in the Service before receiving much promotion, and ate denied the right to engage in other occupations. As an ex-member of the Public Service, I say quite frankly that these men, whose fates of wages are fixed by arbitration, should be left in the enjoyment of their meagre pay. To rob them of a part of their spending power would result in additional deflation, and this would have a further depressing effect upon the community.

Mr GREGORY:
Swan

,- I do not think that honorable members opposite will feel very proud of the crude effort of the honorable member for Bendigo (Mr. Keane) to justify their attitude on this subject. The honorable member, while ‘apparently anxious to see the election promises of his party carried out, does not mind departing from them to some extent. I should like to see certain post-election premises of the Government Carried out faithfully. There is no doubt that the Government undertook at the Premiers Conference in August that it would balance its budget. This bill is a farcical effort in that direction. No one knows better than the Acting Treasurer that Australia is passing through a ‘critical period at present, and that it is difficult to obtain money.

The honorable member for Bendigo would be ‘quite prepared to find employment f or every one. But how is that to be done Unless wealth is being produced in the country? New taxation measures are being brought before the House, and it is only reasonable that we should demand economy in the Public Service. In answer to that demand, all we get is this petty bill which will save a few thousand pounds. Nothing could be more preposterous. Had the Government taken the advice tendered by the Leader of the Opposition (Mr. Latham) when we met early this session, it could have saved anything from £2,500,000 to £3,000,000 this year, and there would, probably, have been no need for ‘extreme taxation. When the people are taxed too heavily,, new works Cannot be undertaken, and the avenues of employment are closed. Of the revenue collected by the Government, anything from 20 to 40 per cent, is frequently wasted. Much better work would ‘be done with that money if it were left in the hands of private persons. Only the other day the Government announced that the primage duty was to be increased to 4 per cent,, which is a heavy burden ‘to place upon industry, t want to see the Government practising economy instead tff piling on ‘additional taxation, Which has the effect of ‘destroying industry and increasing unemployment.

Mr SPEAKER:

– I cannot permit the honorable member to launch out on a general financial ‘discussion.

Mr GREGORY:

– The new taxes which ‘the Government is imposing are bound to have the effect of increasing production costs and creating unemployment. The honorable member for South Sydney (Mr. E. Riley) said that members of the Opposition showed a want of courage because no one moved an amendmend designed to bring about such changes in the bill as we desire. The honorable member has been long enough in the House to be acquainted with it’s rules . and practice. He should know that it is impossible for such a motion to emanate from this side of the chamber; it could only come from the Government side. It has been suggested by some honorable members that the, bill should he amended so as to tax salaries above £400. I do not see why we should s’top at £400. The. tax should be made to apply right through the whole service on a graduated scale. The public servants resident in Canberra pay no State taxation, and in that matter are better off than State public servants.

Mr Blakeley:

– The cost of living is higher here than in the State capitals.

Mr GREGORY:

– In addition, the State public servants have to pay an unemployment tax.

Mr Blakeley:

– The public servants here are making a voluntary contribution to unemployment relief funds.

Mr GREGORY:

– I do not care what they are doing voluntarily. This bill should be amended so that equal sacrifice should be exacted right throughout the service. I have nothing against the public servants; 1 respect them as a body. I believe that the majority of them would be willing to make a sacrifice of this kind. If the matter were put to them not 40 per cent, would object to a reduction. I have been protesting for years against the growing cost of the Commonwealth Public Service. We are always adding to the cost of government, and this means ever increased taxation. We had been led to believe that almost drastic economies had been effected in the Defence Department, but according to the last report of the Public Service Board. 34 new positions were created during the year in the central office of the Defence Department, and only seven positions were abolished. Nearly every other department -was able to reduce the number of its staff.

Mr C RILEY:
COOK, NEW SOUTH WALES · ALP; FLP from 1931

– The honorable member should read the explanation given by the board.

Mr GREGORY:

– I have read the explanation. It is stated that the persons occupying the new positions had been employed in a temporary capacity for some years. I know also that many employees who fought for their country were turned adrift, but those who belonged to the associations of employees were kept on. There is a good deal about that, also, in the report. The situation of the country to-day demands that sacrifices shall be made. I, personally, am quite willing, as I am sure other honorable members are, to make what sacrifices are necessary. I hope that the amendment of the Leader of the Opposition will receive some consideration. I know that it has no chance unless the moderate section of the party opposite can induce the Government to take some action along the lines proposed. According to press reports, influence has been brought to bear upon the > Acting Treasurer (Mr. Lyons) to change his policy. I believe that the Acting Treasurer would have done all in his power to carry out the promise of his chief. He would not, of course, have been able to carry it out ; I do not believe that the Prime Minister himself would have done so had he been here. Had the Acting Treasurer (Mr. Lyons) been let alone, however, he would, I believe, have made a genuine attempt to carry it out, and would have succeeded in making a good showing. It is necessary to make a demonstration of our good intentions at this time. Commitments totalling £37,000,000 must be met in London almost immediately. These comprise overdrafts, and shortdated treasury-bills. Every one recognizes now, that we have been living beyond our means, and we must draw in. It is the duty of the Government, even now, to alter this bill, and to legislate in such a way as that right throughout the Public Service equal sacrifice shall be made. I hope that the Government will not cease there, but will try to keep administrative costs as low as possible. Both wool and wheat producers have had a very bad year. It is possible that tens of thousands of them will be forced into the Bankruptcy Courts. It is they who have produced the wealth which has enabled the country to pay its way. It is now the duty of the Government to economize so that no more than is necessary shall be taken from the primary producers in the way of taxation. ‘ When the primary industries have turned the. corner, and wealth is again flowing into the country from our exports, unemployment and our other problems will cure themselves. We must remember, however, that never again can we indulge in such free borrowing as in the past.

Mr CULLEY:
Denison

.- This bill has provided members of the Opposition with an opportunity of disseminating some electioneering propaganda. It is true, as stated by the Leader of the Opposition (Mr. Latham), that certain promises were made during the last election campaign. I should like to learn what assistance the Leader of the Opposition or other members opposite have given the Government in its attempt to rectify the position which obtained when it took office. Ever since Labour grasped the reins of government, every possible obstacle has been placed in its way by honorable members opposite. The party led by the Leader of the Opposition, assisted by the Country party, is, to a very large extent, responsible for Australia’s unfortunate position. That being so, it should, at least, have given what assistance it could to the Government which has been seeking a way out of the financial muddle. Until this term, of office, the Labour party had not been in control of the affairs of the country for :i considerable period of years.

Dr Earle Page:

– Thank God for that.

Mr CULLEY:

– Had the Labour party been in power during the war period, it is probable that some provision would have been made to meet the liabilities which it was necessary to incur in prosecuting the war.

Dr EdIt LE Page:

– The Labour party was in control for the first two years of i lie war.

Mr CULLEY:

– The Nationalist Government did nothing at all. It simply went on wasting money.

Mr Latham:

– I rise to a point of order. The honorable member for Swan (Mr. Gregory) was stopped by yourself, Mr. Speaker, when making reference to general budget matters.

Mr SPEAKER:

– The honorable member for Denison (Mr. Culley) is not receiving any greater latitude than was accorded to other speakers. “When he goes beyond the allowable limits, I shall stop him.

Mr Latham:

– I did not mean to suggest that differential treatment had been accorded to any one. I was quoting your previous decision as an authority for my point of order, and I submit that, it haying been ruled that any general reference to the finances of the Commonwealth was out of order, a discussion by the honorable member for Denison of the means by which the war was financed by whatever government was then in power, is also out of order.

Mr SPEAKER:

– The honorable member must confine himself to the subject before the Chair.

Mr CULLEY:

– The Leader of tha Opposition upbraided the Government for not attacking the position resolutely, and for not making a general reduction in Civil Service salaries. The failure to do this, and other things, he said, was largely responsible for the great volume of unemployment existing to-day. I hold no brief for the Public Service. I do not rely on the votes of its members. I have a good pair of hands, and a stout heart, and I can make my own way, even if I lose the seat I now hold. Honorable members opposite have said that the Government is doing nothing for the 200,000 persons out of work. It is not my fault that they are out of work, nor is it the fault of honorable members on tin’s side of the House. I cannot agree with the Leader of the Opposition that the unemployed will be helped in any way by reducing the salaries of public servants. I cannot admit that the imposition of a class tax will provide work for even one person unemployed at the present time. Any member who advocates the reduction of wages in order to provide more employment and improve the financial position does not understand economics. In my own observation wage reduction has never given employment in industry to one additional man. Almost invariably, the employers have taken advantage of the reduction to increase their own profits. Therefore, the statement that by reducing wages we shall relieve unemployment and get the Commonwealth out of its financial difficulties is deliberately misleading.

Mr SPEAKER:

– Order ! The honorable member may not say that any statement made by an honorable member was deliberately misleading.

Mr CULLEY:

– I withdraw the statement. A reduction of wages involves a contraction of the spending power of the community, and a diminution of income from taxation. The Labour Government is not responsible for the existing state of affairs. Although a promise was given at the Melbourne conference that expenditure would be reduced and the budget balanced, the Prime Minister said in the House in July last that the reduction of Public Service salaries was a form of class taxation, to which he would not be a party. The right honorable gentleman has never favoured the reduction of wages and of the standard of living of any section of the community, and I do not believe that at the conference lie pledged the Government or the Labour party to cut down the salaries of the public servants. Such promises as were given have been found to be impossible of fulfilment. The honorable member for Barker (Mr. M. Cameron) said that the Premier of South Australia has honestly tried to carry out the undertaking he gave at the Melbourne conference. That contract can be carried out only at the expense of the stomachs of the people.

Mr Mackay:

– The Government is applying class taxation to 440 Commonwealth officers.

Mr CULLEY:

– Because the Government considers that the higher paid officers can well afford to make the sacrifice.

Mr Mackay:

– Does the honorable member think that a minimum of £725 is fair?

Mr CULLEY:

– I do; otherwise I would not vote for the proposal. Members of the Opposition nave referred to the public servants as a sheltered class, and have compared their conditions with, those of outside men on the basic wage. My answer to those critics is that Labour representatives, who have appeared before the Arbitration Court or wages boards, have consistently sought to bring all workers into sheltered positions so that they may be assured every week or fortnight of a living wage. Unfortunately, we have not succeeded in achieving- that, but it is the aim of the Labour party that all workers shall be sheltered and enjoy an assured income. I do not regard the public servants as an unduly sheltered section of the community. Some speakers have drawn attention to the fact that public servants receive, not only a basic wage, but a child endowment allowance. The explanation of that is that after the royal commission, of which Mr. Piddington was chairman, reported on the basic wage in 1920, the. Prime Minister of the day decided to pay child endowment to all members of the Commonwealth Public Service. The report of that commission showed that every worker in Australia should have been receiving £1 per week more than the basic wage he was receiving. Has not the worker helped in that way to bear the burdens of the country? Undoubtedly he has, but, I am afraid, he will continue to be sacrificed whenever the nation is in difficulties. That has been the misfortune of the workers all through the ages; they have been the builders of the nation, and the creators of wealth, but the worst treated section of the community. Honorable members opposite have twitted the Government with not having carried out its promises. This propaganda will do them little good because the people have not forgotten the unfulfilled promises made by the Bruce-Page Government. Another charge made against the present Ministry is that it has established a record in the sacking of men from Commonwealth employment. Prior to the last Government vacating the treasury bench it issued instructions for the dismissal of a large number of postal employees, including returned soldiers.

Dr Earle Page:

– How many of them ? Not more than 200.

Mr CULLEY:

– Whether the number was 200 or 2,000, the principle is the same. Thanks to the advent of a Labour Government work was found for those men during a time when they otherwise would have been out of employment.

Mr ARCHDALE PARKHILL:
Warringah

– The attitude of the Government towards the problems of unemployment and financial adjustment is a long and wearisome record of political inepitude and cowardice.

Mr SPEAKER:

– Order ! The honorable member is not in order in imputing cowardice to members of the House. [Quorum formed.”]

Mr ARCHDALE PARKHILL:

– The proposals of the Government betray an obvious lack of courage. The Melbourne conference decided upon definite proposals to which the Commonwealth Government was a party. In order to balance the budget certain things were to be done, which clearly are not being done. A promise was given by the Prime Minister (Mr. Scullin) and another by the Acting Prime Minister (Mr. Fenton) ; neither is being honored. If the public life of Australia is to be maintained at a standard which will command the respect not only of Australians, but also of people overseas, it is essential that the promises of public men shall be carried out. So ministerial supporter has attempted to justify in definite terms the attitude of the Government. Unfortunately it is becoming a familiar practice for Ministers to throw a proposal on the table, make a few general remarks, and then leave the chamber. Criticism is offered by the Opposition, but except for a few desultory remarks by ministerial members, there is no attempt to defend the programme and legislative proposals of the Government. It is the veriest political hypocrisy-

Mr SPEAKER:

– The honorable member is not in order in applying the term hyprocrisy to honorable members.

Mr ARCHDALE PARKHILL:

– It is the most obvious insincerity-

Mr SPEAKER:

– The honorable member must withdraw that word, and I ask him to express himself in language that does not transgress the Standing Orders.

Mr ARCHDALE PARKHILL:

– I withdraw i t. Obviously those members who defend the attitude of the Government in regard to unemployment do not appreciate the virtue of sincerity. The honorable member who has just resumed his seat . says that this Government should not be held, responsible for the existing unemployment, yet, from the moment it took office, unemployment increased by leaps and bounds, until to-day its extent is unparalleled in the history of Australia. Surely the honorable member does not suggest that the Opposition is responsible for that state of affairs? Have we not time without number heard members of the Government declare that their tariff proposals would give work to 50,000 men, and reduce to a great extent unemployment in this country. Latterly we have not heard so much of that kind of talk. Surely the fact is staring us in the face to-day that, although the Government has been in office for more than twelve months, it has failed to stem the rising tide of unemployment; in fact, its legislation and administration have only aggravated the position. Day after day more men are being thrown out of work, yet the

Government sits in this chamber powerless. It is wringing its hands and talking, instead of taking action. Its own supporters are living in the most abject poverty and misery despite the promises that were made to them. Throughout the length and breadth of .this country, on public hoardings, in the daily press of this country, in millions of leaflets, the members of the Labour party promised the people of Australia that if they were placed in office constant .work would be provided for every one. Their cry was, “ Work for all .”

Mr SPEAKER (Hon Norman Makin:

– In what way does the honorable mem- ber propose to connect his remarks with the subject before the Chair?

Mr ARCHDALE PARKHILL:

– I intend to do that.

Mr SPEAKER:

– I have been waiting for -some considerable time to hear the honorable member do so. I should like him now to do it immediately.

Mr. ARCHDALE PARKHILL.The question at issue involves employment within the Public Service, and surely I am entitled to discuss -the subject in all its aspects.

Mr SPEAKER:

– I want from the honorable member a clear indication of the connexion of his remarks with either the bill or the amendment.

Mr ARCHDALE PARKHILL:

– 1 shall have no difficulty whatever in connecting my remarks with the subject under discussion. If the proposals of the Government were more general in their application; if, instead of amounting to class taxation upon a section of the Public Service, they applied justly and equally throughout the Public Service, falling like the rain upon the just and unjust, there would be more money to spend on giving employment. There has never been a more thorough exhibition of political and economical incapacity than the actions of this Government since it has been in office in dealing with unemployment. . Its administration has been the rankest failure in that respect. Why does this measure provide that only public servants in receipt of salaries exceeding £725, shall be taxed? This afternoon we have heard Government supporters saying that they were returned to this Parliament on their promise not to reduce wages. Are they not now reducing the wages of public servants iu receipt of over £725?

Mr Beasley:

– The Government proposes to reduce the honorable member’s salary.

Mr. ARCHDALE PARKHILL.The proposal to reduce the allowance of members of Parliament was made very grudgingly, with the utmost dissatisfaction and with the worst grace that I have seen on the part of any government that has been forced to take similar action. Honorable members talk of the principles of honour actuating them in respect of the maintenance of wages, but where are those principles so far as the brains of the Public Service are concerned? “Were not their promises - if they made such promises - not to reduce wages just as applicable to the man with brains as to the man with brawn? Is the brawn of this country to be exempt, while the brains of this country - men carrying upon their shoulders the greatest responsibility in the Public Service - are to suffer the most severe and crushing taxation? There can be no justification for such action. The honorable member for Bendigo (Mr. Keane) has said that this Government was returned with a mandate to maintain arbitration, and that it would carry out its pledge. Yet, to-day there is no Public Service arbitrator. This Government has made no attempt to appoint one, and, at the moment, could not give to the Public Service the benefit of any system of arbitration. To-day, there is no such thing as arbitration in the Public Service; yet the Government, according to its spokesmen in this House, is pledged to maintain arbitration.

Mr McTiernan:

– The Arbitrator’s awards are still in force. ‘

Mr ARCHDALE PARKHILL:

– Why is it that this Government is denying the Commonwealth Public Service redress for any grievance that it may have? Why is it that it allowed the Public Service Arbitrator’s term to expire, and has made no new appointment?

Mr SPEAKER:

– I have given the honorable member sufficient time to connect his remarks with the subject before the Chair.

Mr ARCHDALE PARKHILL:

– I presume that you, sir, would have ruled the honorable member for Bendigo (Mr. Keane) out of order if he had digressed from the subject before the Chair.

Mr SPEAKER:

– I would have done so.

Mr ARCHDALE PARKHILL:

– I assumed that the honorable member for Bendigo, when referring to arbitration, was in order, and, therefore, I have taken this opportunity to reply to him.

Mr SPEAKER:

– I have given the honorable member as much latitude as I gave to the honorable member for Bendigo. I cannot allow a full discussion of the position of the Public Service Arbitrator.

Mr Latham:

– The effect of the bill is’ to reduce the emoluments of the Public Service. Those emoluments are at present fixed largely by awards of the Public Service Arbitrator. As the bill will prevent certain members of the Public Service from continuing to receive rates awarded to them, I submit that, apart altogether from the general subject of industrial arbitration, a discussion upon this matter is directly in order.

Mr SPEAKER:

– References to Public Service arbitration in regard to matters such as wages or emoluments affected by _ the proposed tax would be in order ; but it will not be in order for an honorable member to launch into a debate as to the appointment or non-appointment of the Public Service Arbitrator. The honorable member for Warringah (Mr. Parkhill) will recognize that that was exactly what he was doing, and I ask him to connect his remarks with the question before the Chair.

Mr ARCHDALE PARKHILL:

– What I intended to say was that the absence of the Public Service Arbitrator put an end to arbitration for the Commonwealth Public Service, and this measure is a direct effort to destroy arbitration, because it reduces salaries prescribed by the awards of the Public Service Arbitrator. The proposal to reduce the salaries of public servants in receipt of more than £725 per annum is an indirect attack upon the Public Service arbitration awards which are now in existence. Many of the public servants who are affected by this taxation a.re members of the Professional Officers Association.

Mr CHIFLEY:
MACQUARIE, NEW SOUTH WALES · ALP

– There are very few professional officers affected by the awards of the Public Service Arbitrator.

Mr ARCHDALE PARKHILL:

– The Railway Officers Association comes under arbitration, and the honorable member, because of his connexion with the railways, should be the last to deny that. The secretary of the Railway Officers Association resides in my electorate,” and he is now before the court. This Government, which came into office to maintain arbitration, has adopted this indirect means of destroying the federal- arbitration system so far as the public servants are concerned. It has been stated by honorable members behind the Government that, if this reduction of incomes were extended to the lower grades, it would bring about a reduction in the purchasing power of the people. But do they not’ realize that this method of taking money out of the pockets of the people is still further reducing the purchasing power of their wages. Do they not realize that, because of high taxation, business people and other employers are to-day unable to employ the number of men that they previously employed, and that men are, in consequence, being thrown out of work and receiving no wages or salaries at all. The purchasing power of the people is being reduced to a minimum. The object of the amendment moved by the Leader of the Opposition is not to put anybody out of work, but to apply the principles of equity and justice by spreading this special taxation throughout the Public Service. If it be correct to say that the purchasing power of the Commonwealth public servants, if we went below a salary of £725, would be reduced to such an extent as to interfere with the rehabilitation of this country, why has the Premier of South Australia, Mr. Hill, reduced all salaries, from £208 a year upwards? Surely his is as good a Labour Government as this ? Why, too, has the Labour Government of Victoria adopted a similar expedient? Do not the principles of the great Labour movement apply to State Labour Governments as well as to a Labour Government in the federal sphere? Apparently, this Government is a law unto itself.

Mr Bayley:

– The Australian Labour party is a law unto this Government.

Mr. ARCHDALE PARKHILL.Probably that is a more accurate description of the position. It would seem that this Government is prepared rather to tax the community unjustly and unfair!/ than to do what would be the fair thin«, by federal public servants. No honorable member can justify a proposal that imposes taxation on only 441 of the 44,000 odd members of the Commonwealth Public Service. It is always claimed that the Labour party favours equality of opportunity and of sacrifice, and the imposition of taxation in such a way that it falls impartially upon every section of the community. Where do those principles find expression in this measure ? No member of the Government has attempted to justify this proposal, for the simple reason that there is no justification for it. It is unpopular to advocate the reduction of any person’s salary, and no one cares to do so; but the honest course, even though it involve unpopularity, must be taken. That course is being taken by State Labour Premiers, but is being avoided by this Government because of the fear that it will lose them votes in the constituencies. Commonwealth public servants realize that they must make some sacrifice. I do not believe that any resentment would be aroused at the reductions if they had general effect. The general body of public servants will not thank the Government for this discrimination. If they do, all that I can say is that public opinion is in a very sorry condition. Realizing, as they must, that their confreres in the State Public Services are bearing their share of the universal burden, surely they cannot advance any reason for their exemption? I honestly believe that if this Government were to introduce a graduated scale of reductions, commencing lightly on the lower grades, it would be accepted without demur or resentment, and a higher opinion would be held of the Government.

I have said that this proposal is un* fair to the responsible officers in our departments. They are the people who bear the heat and burden of the day. Ministries come and go, but they continue to administer the affairs of this country, often under incompetent Ministers, and frequently without ministerial direction. They are entitled to remuneration commensurate with the responsibilities that they shoulder, and it is both unfair and unjust to discriminate against them in this fashion.

It has to be realized that the alternative to a more general reduction of salaries is excessive taxation. If the Government were to put into effect a scheme of salary reduction that would realize £1,000,000, there would be no need for the crushing taxation that the Government proposes to impose. In a country where 80 per cent, of the workers obtain employment from private enterprise, can the Government not see that the constant withdrawal of money from industry, not only prevents the expansion of employment, but has a restrictive effect; that the one is complementary of the other? Apparently this Government is prepared to favour one section of the Public Service and to inflict hardship on the community generally. By this time it ought to know that it is unable to tax people into prosperity. This country will never rehabilitate itself while these heavy exactions continue.

I have no hesitation in expressing the strongest condemnation possible of the Government’s proposal. I do not think I shall be misunderstood in regard to my attitude towards the taxation of public servants. I always express sentiments that I believe to be fair and just. I repeat that, if the Government had taken the clear, definite and courageous course that is being followed by its Labour confreres in Victoria and South Australia, it would have earned the respect, if not the admiration, of its own supporters. At the present time no other government is thought so little of by its supporters.

Mr PRICE:
Boothby

.- During the time that I have been in this House I have not listened to a more irresponsible speech than that just delivered by the honorable member for Warringah (Mr. Parkhill). He did not express one constructive idea. From time to time the appeal is made by honorable members opposite for all honorable members to co-operate in an endeavour to straighten out the finances of this country; yet whenever this Government proposes any action, they avail themselves of every opportunity to belittle it. This bill, has my support.

Dr Earle ‘ Page:

– Does the honorable member intend to support the amendment ?

Mr PRICE:

– I do not; the Opposi-tion are not sincere in bringing it forward.

Mr SPEAKER (Hon Norman Makin:

– Order ! I require the honorable member to withdraw the imputation of insincerity.

Mr PRICE:

– I withdraw it. It appears to me, however, that honorable members opposite are not really genuine in this matter.

Mr SPEAKER:

-Order! The honorable gentleman must realize that he has aggravated his offence. I ask him not to make any imputation of insincerity or of want of genuineness on the part of honorable members.

Mr PRICE:

– I shall respect your wishes, sir. It seems to me, however, that honorable members opposite have been actuated purely by party considerations.

Honorable members of this House would not be justified in asking any section of the Public Service to accept a reduction of salary, if they were not prepared to reduce their own salaries. It has been stated that only 441 officers of the Public Service will be affected by this proposal of the Government. I point out, however, that they are the officers who are best able to afford a reduction. That is the view which honorable members on this side take of the matter. Speaking on the financial statement, I pointed out that 82 per cent, of the Commonwealth public servants are employed in the Postal Department, and receive from £200 to £300 per annum. I do not feel that we should be justified in reducing their salaries by 10 per cent. Sitting suspended from 6.15 to 8 p.m. [ Quorum formed.]

Mr PRICE:

– Honorable members opposite appear to regret that the Government has not done more than is proposed under this measure in the direction of leving a special tax on members of Parliament and of the Public Service. Had the Opposition been on the Treasury bench to-day, I am afraid that the public servants would be having a very lean time. I am anxious to do the right thing in assisting to adjust the finances of the country, but it would be unfair Jo single out for special taxation those who are not in a position to bear it. I do not believe that there is a government in Australia to-day that will be able to balance its budget in the current year. I realize that every ministry should make an earnest attempt to square its finances, and, in this bill, the present Government has taken steps to impose extra taxation on those members of the Public Service who are able to meet it. If the honorable member for Warringah (Mr. Parkhill), who preaches reductions and further reductions of the cost of government, is earnest in his protestations, let him send an amount to the Treasury by way of conscience money. I am afraid that honorable members opposite have been trying to make political capital out of this, measure by charging lie Government with dismissing public servants wholesale. . Nobody regrets more than members on this side that dismissals have been necessary, find we hope that in the near future it will be possible to place the men in employment again. Actions speak louder than words. When this Government came into power, it was found that orders had been given to the postal authorities for. the dismissal of 1,750 employees.

Mr Bayley:

– Can the honorable member give proof of that statement?

Mr PRICE:

– Yes. When an honorable member opposite was speaking, I asked the Postmaster-General a question on that point, and he furnished me with that information. Immediately the Government assumed office it made a strenuous attempt to obtain sufficient money to keep those men in employment for a further six months.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– And that was done.

Mr PRICE:

– Yes.

Mr Francis:

– In reply to a question that I submitted, I was informed that 3,700 returned soldiers alone had been discharged

Mr PRICE:

– Whether they were exsoldiers or not, they were all working for this community, and we regret that the circumstances necessitated their dismissal. I do not consider that this Parliament is responsible for all the ills now suffered by- the country; but since the party opposite was in charge of the Treasury for thirteen years or more, it is adopting an unreasonable attitude in laying . the blame for the present position at the door of this Government. Members opposite rise in their places, one after another, exclaiming, “What ia the present Government’ doing ?” When the Opposition was in office it did absolutely nothing to maintain a sound financial position. It made a huge bungle of the management of the country’s affairs, and the people should have been extremely pleased when the last change of government occurred. Some members of the community imagine that if the allowances of the members of this Parliament are reduced, the financial salvation of the Commonwealth will bc achieved. In the event of this being the position, I hope that, as a result of the sense of security that will follow the passage of this small measure, all in the happy position of being able to do so will be prepared to invest as much money as possible in the present £28,000,000 loan, so that it may be eminently successful. Having been assured by the Government that it is necessary to pass this bill in order that extra revenue may be. raised, I propose to support it.

Dr EARLE PAGE:
Cowper

.- The House must agree that this little bill is the smallest, meanest and most miserable mouse that any mountain has ever laboured to bring forth. It provides for a reduction of the money spent by the Government on the public services of the Commonwealth - roughly £11,000,000 - by some £60,000, or about per cent. Taking the total Commonwealth expenditure, the reduction amounts to less than one-tenth per cent. The presentation of an insignificant measure of this kind at a critical time, when the basic wage has declined by about 11 per cent., owing to the reduction of the cost of certain necessaries of life, when hundreds of thousands of men are out of employment and unable to get work of any kind, and when the income of practically everybody has been considerably reduced, and, in some cases, stopped altogether, is an insult to the intelligence of this Parliament and the community.

Mr SPEAKER:

– Order ! The right honorable gentleman is not justified in offering such comment, which is a reflection upon the House.

Dr EARLE PAGE:

– I bow to your ruling, Mr. Speaker, and will substitute any words you care to suggest for those which are objectionable. This bill is simply another device to camouflage the failure of the Government to fulfil its promises, and to enable it to do what it has been doing ever since it assumed office, namely, reduce the real value of the wages of the workers. The Government was elected on the definite promise that it would increase employment and maintain wages; but it has. actually increased unemployment and ‘reduced wages, especially real wages. I hope that the Acting Treasurer will accept the amendment of the Leader of the Opposition, take the bold course, and fulfil at least some of the promises that he and other members of the Government have made during the last few months. If that is done, the Commonwealth will be able once again to take the lead in. the present critical financial position, and will not be obliged to drag along at the tail of the States.

No one who looks at the general situation to-day can deny that there has been a real decline in the standard of living, although the cost of living has been maintained. In some instances the Government has rationed the work of its employees, as in the Defence Department. Can anybody say that the wages of the employees affected by this rationing have teen maintained? According to the last report of the Public Service Board, 1,700 men were discharged between the 30th June, 1929, and the 30th June, 1930, and more have been discharged since then. Despite all the protestations of honorable members opposite, these employees have had their wages reduced by 100 per cent. In addition, the wages of practically every person in the community have been decreased by the imposition of additional taxation. No one can deny that the tax of 4d. per lb. on tea has adversely affected every household. The remuneration of wage-earners, salaried workers, and all other people has been reduced by this tax. The primage duty of 4 per cent., or lOd. in the £1, on all imports, and the sales tax of 2£ per cent., have also seriously diminished the purchasing power of our people. The primage duty alone has involved our farmers in an additional expenditure of £185,000 in- respect of cornsacks and manures. To that extent their incomes have been definitely reduced. All these imposts have tended to increase the cost of living. Those who are on the same standard of pay as formerly have actually less purchasing power, while those who are on the reduced standard are suffering severe hardship. Even though the prices of some goods are falling, the cost of living is not being reduced because others are piled up by these means. The people, as a matter of fact, are caught like rats in a trap. The cost of living is being maintained because of the extra taxation levied on the people, while their incomes are being reduced. Surely it is time that the Government took its courage in both hands, and acted upon its declarations of July and August of this year. At that time it was said definitely that governmental expenditure would be reduced. Let me remind honorable members of a few things that were said during that period by members of the Government. On the 8th September the Acting Treasurer (Mr. Lyons) said -

The most ruthless course is being taken; the position is almost desperate.

On the 15th September the same honorable gentleman, in defending the Government’s policy at the conference of the Victorian Labour party, said -

We are faced with three things: Firstly, Australia’s good name and credit abroad; secondly, economies and cuts in expenditure; and thirdly, the duty to find employment.

Asked whether this was consistent with the party policy, the honorable gentleman said -

It is consistent with the needs of the day, and it is preferable to develop private enterprise than to carry an overstaffed public service.

On the 15th September the Acting Treasurer spoke about “ an over-staffed public service,” and in November he introduced a measure to provide for a total reduction in the expenditure of the Public Service by only £60,000 out of £11,000,000 expended. Later in September the Acting Prime Minister (Mr. Fenton), following upon Cabinet meetings, said -

Economies have formed the greater part of the investigations of the Cabinet subcommittee. Even with all our reductions, there must be further taxation. We are not going to impose more than we can help. We are not going to put any further burden on industry.

On the Srd October the Acting Prime Minister declared, in an official statement after a Cabinet meeting -

Proposals to balance the budget were approved. It was agreed that the expenditure must be reduced at the rate of approximately £4,000,000 a year. The recent decline in market prices of government stocks shows that nervous holders ure selling securities through fears that are quite unwarranted, and the Government fully recognizes that these fears must he reduced at once. The Government, therefore, takes this opportunity of notifying the public that the proposals will include reductions and economies in expenditure- a.t the rate of £4,000.000 a year.

In spite of these statements, we are now faced with proposals which provide for a net reduction in expenditure of £430,000 instead of £4,000,000. The total gross reduction in expenditure is £1,230,000, but against this there are increases amounting to £800,000. This means that there has been a definite breach of faith, not only with the State Governments, but with all the people of Australia.

All the State Governments, irrespective of their political colour, have given effect to the proposals made at the August conference of Premiers. It was felt that if all acted this could be done without any fear of party recriminations. In New South Wales, public service salaries have been reduced by 8^ per cent., and parliamentary salaries by 15 per cent. In Queensland, public service salaries have been reduced by 10 per cent. The reductions in public service salaries, in Victoria, range from 5 per cent, to 20 per cent.; the Premier’s salary has been reduced by 18 per cent.; Ministers’ salaries by 14£ per cent., and parliamentary salaries by li per cent, in respect to the Legislative Assembly, and 5 per cent, in respect to the Legislative Council. In South Australia, public service salaries have been reduced by 10 per cent.; Ministers’ salaries by 15 per cent., and members’ salaries by 5 per cent. In addition, the school teachers have voluntarily agreed to a 10 per cent, reduction in their salaries. In Tasmania, public service salaries have been reduced by from 2$ to 7^ per cent. It will be seen, therefore, that the States have made a determined effort to give effect to the conference decisions. But the Commonwealth Government’s endeavours to honour its undertakings have been generally condemned throughout Australia, and it is felt that the Government has broken faith with the States. In this connexion, a press report, published on the 20th November, stated -

The proposals of the Government have been greeted throughout the Australian press as a breach nf faith with the Government’s undertakings at the Melbourne conference, and as a breach of faith with the States upon whose income tax field further heavy inroads are being made.

The reductions proposed in this bill will amount to less than a half of- 1 per cent. of the £11,000,000 spent annually on salaries to 44,000 public servants. While every other class in the community has been obliged to suffer total loss of employment, or actual reductions of wages, or the rationing of work, or increases in the cost of living, because of additional taxation, the Government will not do the simple thing that it should do to give effect to its own undertakings. It has merely set another vicious circle revolving by increasing the cost of living.

I urge the Acting Treasurer (Mr. Lyons), even now, to accept the amendment of the Leader of the Opposition (Mr. Latham) and undertake a definite reduction of Commonwealth expenditure immediately. If the Government would remove some of the direct and indirect imposts that are at present reducing the value of the wages of the workers, it would, at once, make more money available for industry, and this would lead to additional employment. The adoption of this policy would instil some hope in the community, and prevent it from sinking deeper and deeper into the bog of despair.

I totally repudiate the suggestion made by some honorable members opposite, that the parties on this side of the chamber desire to reduce the salaries and wages of the lower-paid public servant* by, 10. per cent. That was never in our minds. If honorable members would examine the facts, they would find that considerable expenditure could, be reduced on extraneous payments, without touching salaries. The payments to. which. I refer totalled £870,000 last year. There is no need whatever to make wild and savage cuts in the remuneration of the lower paid public servants. But there could be a very small reduction in salaries beginning at a certain figure, and increasing gradually, say 1 per cent., with every £100 of salary. If the Government would adopt a policy of this; kind it could materially reduce its expenditure, and this would enable the country to get out of its present dangerous position. It would also reduce the cost of living, enable employment to become more general, and stimulate and encourage private enterprise more than anything else that we could do.

It is useless, for honorable members opposite to say that the standard of living of those outside the Public Service has; not fallen. Every one knows that thevalue of our stocks and shares is in many cases only half what it was twelve months ago. Many works have, had to, be closed; many cases of bankruptcy have occurred, and many voluntary liquidations have taken place. These have all involved the dismissal . of thousands of employees.

It is equally futile for honorable members opposite to say that the greatest reduction’ that can be made in payments totalling £11,000,000 to the Public Service is a miserable £60,000. Reductions could be made, as I have said, in many directions without touching salaries. Since 1925. the cost of the service has increased roughly by £1,700,000. lastyear we paid the following amounts in allowances of one kind and another : -

I suggest that economies could be effected in respect of these items without any very great hardship to any one. Most people at the present time are glad enough to- have a permanent job without extras. I urge the Government to reconsider this whole subject. It should, at once revise its revised budget. If it does not voluntarily do so now, it will be. forced to do it within the next two. or three months., If it. does so now, it will enable us to set our face in the right direction, and prevent us from heading further and further into the bog of despair. I trust, therefore,, that the Government will see its way to. adopt the suggestion of the Leader of the Opposition (Mr. Latham) as a first step towards that most desirable end.

Mr MACKAY:
Lilley

.- The. honorable member for Boothby (Mr. Price) said that the bill before the House was an innocent little measure designed to tax the members of this Parliament, and the Public Service. My complaint is that the measure is altogether too innocent to be effective. Several honorable members on that side of the House attempted to distort the real object of the amendment of the Leader of the Opposition. The position taken up by the honorable members on this- side of’ the House is a perfectly logical one. We say that in these times of severe financial depression every section of the people should be prepared to make some sacrifice. My objection to the bill is that it does not go far- enough. The honorable member for Denison (Mr. Culley), in reply to an interjection of myown, admitted that, this special tax amounted to a reduction of salaries. The honorable member for Bendigo (Mr. Keane) disclaimed any such interpretation. It must be admitted by any one who considers the matter fairly, that a special tax on a man’s salary really amounts to the reduction of his salary. It seems extraordinary to me that the Government, having an annual salary bill of £11,000,000, should be content, when the need for economy so patently exists, to bring in a measure designed to save a paltry £60,000. Such action will get us nowhere. I am convinced that something further is. required. There are 44,000 men and women employed in the. Commonwealth Public Serviceand under this bill only 441 of that number will be required to sacrifice anything. Honorable members on the other side of the House are continually talking of their desire to maintain the standard of living. Evidently they were not much concerned, about the standard of living of those aged and infirm persons who draw an income of £100 a year from investments in property. The Acting Treasurer proposes to tax them to the extent of 1 per cent, of their incomes. It was thought when the Acting Prime Minister and his chief attended the Melbourne conference, and put their signatures to the agreement arrived at there, that an honest attempt was to be made to right the financial position. The bill before us represents a sorry attempt to achieve that end. If every one in Australia will do his duty, and make some sacrifice to meet the present crisis, our difficulties can be overcome, but the Government is not facing the position squarely. I am glad to observe that not one member of this House has complained about the proposed reduction of our own salaries, but it is a fact that members of the Public Service, who are exempted from sacrifice, because their salaries are less than £725 a year, will be in a better position than members of thin Parliament. My suggestion to the Acting-Treasurer is that he should revise his proposal. He should start with a tax of 2jj- per cent, on salaries of £250, increase it to 5 per cent, on salaries over £500, and from then on follow the scale adopted by the Acting Treasurer in the bill before the House. Every State Government ha3 demanded some sacrifice of its employees, and the Commonwealth is setting a very bad example. It is not too late for the Government to revise its proposal. The Public Service will not have a great deal to complain of if the measures I have suggested are adopted, and something worth while will be done to meet the huge deficiency which the Government is sure to have in its finances in the present year.

Mr PATERSON:
Gippsland

– I shall support the amendment of the Leader of the Opposition. I am sure that no one in the House, no matter what party he supports, is satisfied with the bill as drawn. I am satisfied also, that the best minds in the Public Service are ashamed of this measure. It will create* anomalies as between the Commonwealth and State Public Services, and within the Commonwealth Public Service itself. State public servants will be suffering a reduction of their incomes, while employees of the Commonwealth, working side by side with them, will escape. Surely no one will deny that it is substantially the same taxpayers who provide the incomes of the civil servants, whether State or Commonwealth. If dire necessity compels a reduction in the case of one, surely the same thing must apply in the case of another. Moreover, can any one say that there is any justice in a system which provides for practically no gradation whatever, but will reduce the income of the men now receiving £805 a year, to that of the man on £725 a year. The public servant receiving £805 a year will suffer a reduction of £S0, and will come down to £725. The man on £725 a ‘ year will suffer no reduction whatever, and the difference between £725 and £805 will disappear with one stroke of the pen. There is no fairness in that.

Mr Archdale Parkhill:

– And no justice.

Mr PATERSON:

– No, nor is there any justice. In view of the fact that our national income is so enormously reduced - and some people do not seem yet to realize the extent of that reduction - - every member of the community should be prepared to make some sacrifice. It should be as small as possible in the case of the lower paid public servants, and heavier in the case of those who are better paid. Some honorable members opposite have said that any reduction of salaries, either in the Public Service or outside it, would intensify the difficulties which Australia is now facing. The honorable member for South Sydney (Mr. E. Riley), and, later on, the honorable member for Denison (Mr. Culley), said that a reduction of .wages and salaries. would reduce the purchasing power of the people, and aggravate our present trouble. It is evident that this argument is employed by men who have not troubled to look below the surface. Surely they must realize that Australia’s former purchasing power is gone now. It cannot be affected by reductions in the Public Service salaries. The position to-day is that 20.5 per cent, of Australia’s wage-earners have no purchasing power whatever, while of the other 79i per cent, a great many retain less than 50 per cent, of their former purchasing power. Only a very few who are fortunate enough to be in sheltered positions have as much to spend as formerly. If, instead of only 79£ per cent., we could get practically all our people usefully employed at the best wages possible within the compass of our greatly reduced national income, there would be more free spending than there is to-day. There would be a greater circulation of money, because money would be spent by a greater number of persons on the necessaries of life. Our external income, which is what we receive for exports, is 50 per cent, lower than it was a few years ago, so great has been the drop in the value of wool, wheat, meat, butter, fruit and metals. While everybody expects that values must recover to some extent, he would be a most optimistic individual who would predict that, within a reasonably short time, they will get back to more than twothirds, or at best, three-quarters, of what they were before. Therefore, it is inevitable that prices for manufactured goods, and services generally throughout Australia, must conform to the new standard of lower values created by the drop in the value of our exports. It is impossible to have one section of the community on one level, and another section on an entirely different level. Australia is confronted with a tremendous drop in the value of its exportable production, and a cessation of borrowing for developmental works, resulting in a diminution of the fund from which wages are drawn of at least £100,000,000 a year. That being so, it is inevitable that each and all of us must be prepared to accept something less in order to allow every one to have some part of the greatly reduced wages fund. Australia cannot carry the load which the Government is attempting to make it carry. It has been truly said by speakers on this side of the House that taxation at any time tends to reduce employment. It makes industry less profitable, and consequently decreases the capacity of those controlling industry to employ labour. By further increasing taxation at this time the Government is doing its best to increase the volume of unemployment. If we can reduce taxation by making reasonable savings in the cost of government, we shall be doing a service to industry and> taking the first step to improve the employment figures. Some honorable members opposite have said that the Government could not make a general reduction in the remuneration of civil servants because of the promises given to the electors by the Labour party. They say there is some kind of principle involved.

Mr Keane:

– Hear, hear!

Mr PATERSON:

– The honorable member for Bendigo says, “ Hear, hear “. Evidently his principles stretch as far as the civil servant receiving £725 a year, but fail to cover those in receipt of a little more. With principles there can be no gradation. They must be consistent. But evidently the principles of the honorable member for Bendigo are so elastic that they need not apply to men receiving upwards of £725. The honorable member for Denison (Mr. Culley) this afternoon seemed to be thinking along different lines; he contended that that there was no difference between the dismissal of 200 men by the last Government and the dismissal of thousands by the present Government. The honorable member for Bendigo, however, sees a very real difference between the big and the small. When the Government is breaking a promise, or departing from what it calls a principle, as it undoubtedly is in relation to Public Service salaries exceeding £725, it might as well do so thoroughly and to some purpose; it will then be neither more nor less guilty than it is now. The proposal to save £60,000 out of a total salaries and wages bill of £11,000,000 is surely the greatest financial burlesque ever perpetrated in this Parliament, and a great many have been perpetrated in the last twelve months. The saving will amount to about $ per cent, of the total, and will apply to about 1 per cent, of the Public Service. The nonsensical statement has been repeatedly made that a reduction of the remuneration of the Public Service would be a class tax. Unfortunately, almost every other section of the community has had to suffer some deprivation during the present depression. The basic wage has been lowered, the award rates for shearers have been greatly reduced, and business men and their employees are suffering a substantial diminution of their incomes and salaries.

I know of many commercial travellers who are gladly accepting a 25 per cent, reduction of salary; they know that their employers cannot afford to pay them more, and they prefer a lower income to the alternative of unemployment. In regard to the primary producers, the wool-growers and wheatfarmers particularly are suffering a reduction infinitely greater. Their purchasing power is at least 50 per cent, lower than it formerly was, and the greater proportion of those growing wool and wheat on land which they do not own entirely would have to walk off their holdings with practically no assets if the banks pressed them to meet their liabilities. The contention that a small and reasonable reduction of Public Service salaries with a view to making expenditure conform more nearly to the reduced national income would amount to a special class tax is almost incredibly foolish. With much more reason the Government’s avoidance of this course may be said to amount to special class shelter. One section of the community is to receive special protection, from the forces and influences which have been adversely affecting almost every other section. Quite recently the Commonwealth Statistician stated that the cost of living has dropped by 11 per cent. In those circumstances, a small reduction of Public Service salaries would not impose any hardship; it would merely bring the Government employees into line with the outside public, and enable them to bear their share of the sacrifices necessary to place their country on a better footing.

The Government makes some extraordinary choices when selecting fields of taxation. I realize that because of its financial difficulties it must raise additional income, but recently it imposed a 4 per cent, primage tax on the essentials of primary production. By this means it expects to collect £185,000 to £200,000 from men who to-day have practically no standard of living. A reduction of Public Service salaries by a trifling 1) per cent, would yield that amount, but the Government prefers further to hurden men who are threatened with having to abandon their holdings. It is scandalous.

Mr SPEAKER:

– Order! It is not permissible for the honorable member to employ that expression in regard to any action in this House.

Mr PATERSON:
GIPPSLAND, VICTORIA · CP from 1922; ST CP from 1937; LCP from 1940

– In deference to your ruling, sir, I withdraw the word “scandalous” and substitute the word “shocking.” The Government pretends to have at heart the interests of all sections of the community, including those engaged in primary production. As a ministerial member remarked a few minutes ago, “ Actions speak louder than words,” and a Government which is prepared to impose this last straw of taxation in the form of 4 per cent, primage dues on the constituents of superphosphate and on cornsacks and wool packs for export - an impost which must inevitably be paid by men whose products have slumped in value by more than 50 per cent. - rather than make a paltry reduction of lj per cent, in the remuneration of the Public Service - an organized body whose votes it fears to lose - is deserving of the strongest condemnation.

Mr BAYLEY:
Oxley

.-The endeavour of members of the Opposition to secure the passage of the amendment moved by their leader is merely a continuation of our earlier efforts to bring about a reduction of government expenditure. We feel that at this juncture that such a reduction is imperative. Nearly every honorable member who has addressed himself to this bill has mentioned that Australia’s national income has decreased very largely. Surely, at such a time there should be an honest endeavour on the part of governments and individuals alike to economize. Yet the Government is proposing to make good the deficit by imposing increased taxation. Hitherto it has consistently resisted our pressure to effect a reduction of expenditure, but this bill is a short step in the right direction. Our only complaint is that it does not go far enough. We say that the tax should apply to all public servants who are receiving not less than the basic wage. The Government proposes, however, that the tax shall be paid only by those receiving a salary exceeding £725. This proposal is a breach of faith with those State Premiers who attended the Melbourne conference. At that gathering certain undertakings were given in regard to balancing the budgets, and State Premiers, believing that the representatives of the Commonwealth had pledged themselves in good faith, induced their respective parliaments to accept drastic economy and taxation proposals; They would not have done so had they not the assurance of the Acting Prime Minister (Mr. Penton) and the Acting Treasurer (Mr. Lyons) that the Federal Parliament would be invited to do likewise. Each one of us is responsible to some extent for that breach of faith. Mr. Hogan, the Labour Premier of Victoria, had no desire to reduce the salaries of the State Public Service, but he introduced a bill for that purpose in the Victorian Parliament because he had pledged his word to do so. If the Commonwealth Government would follow Mr. Hogan’s example, the salaries bill of the Commonwealth would be reduced by approximately £500,000. Mr. Hogan has proposed that no State public servant shall be required to pay the special tax unless he is in receipt of £208 per annum; which is the equivalent of the average basic wage throughout the Commonwealth. A person with that income will pay in taxation about £9 10s. a year, and the. rates of tax are so graduated that those receiving higher salaries will pay approximately the equivalent of the tax proposed in the measure now’ before us. We have no special desire to reduce the salaries of the public servants, but if sacrifices must be made they should be borne equally by all sections. Outside the Commonwealth Public Service, there is no section that is not suffering pecuniary loss. The honorable member for Bendigo (Mr. Keane) said this afternoon that the doctors and barristers have not reduced their fees. Nevertheless, they, in common with artisans, have suffered a reduction of income. The daily wage of the artisan may not have been reduced, but his earnings during the last twelve months have been less than during the previous year because of the diminution of employment. That has been the experience also of all professional men. Why then should the public servants be singled out for special treatment? The only possible explanation is that offered by the honorable member for

Bendigo, namely, that the Labour party pledged itself at the general election not to interfere with salaries.

Mr Riordan:

– Does the honorable member believe in Parliament fixing the basic wage?

Mr BAYLEY:

– No ; so long as arbitration courts and wages boards are in existence they should fix wages. Until the people have decided on the abolition of industrial tribunals, Parliament should not interfere.

Mr RIORDAN:

– The honorable member is asking this Parliament to interfere with the court.

Mr BAYLEY:

– I am following in the footsteps of the Acting Treasurer and his supporters; but I contend that they have not gone far enough. This taxation should be spread throughout the Public Service, including even the man in receipt of the basic wage. The honorable member for South Sydney (Mr. E. Riley) has said that unemployment has been brought about as the result of the introduction and growing use of the machine. We have heard that story for years and years. If it were true, it would stand to reason that those countries which are dependent upon secondary industries would, at the present time, be suffering much more than those dependent upon primary industries. Yet the existing depression is world wide in its effect. Machinery has had little or nothing to do with it. The trouble is that we have produced commodities, both in. factories and in fields, at a price over and above that which the people can afford to pay for them. In Australia we have produced a public service in receipt of salaries which the people cannot .at present afford to pay, and we have to ask ourselves whether it is better to continue the Public Service at reduced pay, or at existing rates, dismissing a certain percentage of the public servants. We in opposition are opposed to dismissals. We think it far better that the salaries of all should be reduced until such time as Australia is once more in a position to restore them.

Mr RIORDAN:
Kennedy

.- I wish to refer briefly to the attack made upon the Government because of its failure to interfere with wage-fixing tribunals. We have already seen the effect of the wage-slashing that has taken place in every direction, outside of the Public Service. This bill deals, not with wage reductions, but with a tax on salaries. Its. object is to impose a tax of 10 per cent, on salaries in excess of £725. When the honorable member for Oxley (Mr., Bayley) was speaking, he said that, he would answer a question tha.t I had. put to hiin, but he. very successfully and scientifically side-stepped it. He said, that he did not advocate that thisNational Parliament should^ fix the hours and wages of workers., Yet he was in full agreement with the Acting, Treasurer (Mr. Lyons), w,ho had consented to, a reduction iu wages- independent altogether of tribunals* That, is: not the function of this Government. The agreement reached, by the Loan Council “and. the Premiers, and Treasurers, .of- th& Commonwealth and, States, to bring . about a. straight-out reduction, in wages was an attempt to interfere with the wage-fixing tribunals of this country. The question, is whether w,e should continue those, tribunals. Twelve months, ago the exmember for Flinders, Mr. Bruce,, said: - “ “We win wipe out federal arbitration.” We all know what happened to. him.. W,e are here tq carry out the, will, of. the people. Twelve months ago the people put the Labour party- in power in this Parlia-ment,, mainly t.q. give, effect, to the wagefixing principles th,a,t have operated in fly’s, country for a quarter qf a, century. Last, month an appeal was made to, the people- of New South Wales, a State with a population, of over 1,0,00,000… What was the result of the attempt of the. Bavin Government to carry out the Melbourne agreement, arrived at as, a result, not of any desire for. decrease^ wages on the part pf the people of the community, but of the dictation of some one from -overseas who represents a section that is, making no sacrifice, whatever ? Has there been any reduction qf interest rates,? Unlike, honorable members opposite, I am not prepared to. ha,ve the wool pulled over my eyes; More than half of the federal public servants have, during the last sixteen years, worked under a low,er scale of wages than that operating in the State Public Services, and the allowances or extra, payments which have) been referred to by Leader of the Co,un,try party have. been given to them by wage-fixing tribunals so as to make up to some extent for- that discrepancy. Honorable members contend that the public servants, are a sheltered class. The position is that today there is no confidence whatever in the. Service because no public servant knows at the moment that his livelihood will not be taken, from him, and he willnot, be forced to join the great army of ‘ unemployed. If we reduce the wages of public servants in receipt of from £200 to £300 a year, how many additional men will we employ?1 Has the reduction in wages; made by Mr. Bavin in New South Wales, stimulated employment in that State? Has Mr-. Moore’s-, policy of reducing wages, by lft per cent: in Queensland provided employment,?: Has the policy of Mr. Hogan or of Mav Hill; provided more employment Three, weeks ago 5,000 unemployed men, who, if given the opportunity, would’ be producers, marched- the streets of Melbourne! In Queensland, the wages of railway men, have,, in some eases-, been.’ reduced by over 20. per cent,

Mr Mackay:

– Will the policy of the Acting Prime Minister (Mr. Fenton)-, when given effect, provide more jobs?

Mr RIORDAN:

– -No. Honorable members opposite who talk about the parties, getting- together, and doing a,way with, party spleen are all the. time’ over-flowing with party, bile. They are hungry to get a,t the throat of the man on a wage pf £4 a week.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– That; is absolute nonsense.

Mr RIORDAN:

– The honorable mem ber- agrees with the Acting Treasurer* He supports the Melbourne agreement. He is anxious to. reduce the salaries of all public servants.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

-The amendment moved by the Leader of the Opposition will’ not affect anybody.

Mr RIORDAN:

– Then why move it. It, will affect aH public servants. The honorable member wants to scrape, them off the wheels. Let me tell him tha,t when the wheat-growers discover his advocacy of the destruction qf the; spending power of the mass of the people, who! otherwise would be large consumers of wheat, they will not hesitate to scrape him off the w,heel.

Mr Morgan:

– Why did the Labour Government suppress the Public Service Arbitrator?

Mr RIORDAN:

– I did not come here to answer conundrums. I have never interviewed the Public Service Arbitrator. I should be surprised to learn that any members of the Government had done so. This Parliament is beating the air. The people have lost confidence; the workers have lost faith.

Mr Paterson:

– In. the Government.

Mr RIORDAN:

– They lost faith in governments twelve months ago, at the time they destroyed the Nationalist, party. The Bruce-Page Government squandered money during prosperous years and left the incoming Government to face an empty and bankrupt treasury. During the last months, the Opposition have made many misleading statements, and I am surprised that there has been no attempt on the part of the occupants of the treasury bench to refute them. Honorable members talk of the Melbourne agreement, but what happened to those who were responsible for it? Mr. Bavin and Mr. Stevens were, only a few months ago, scraped off the wheels, and their party was destroyed, simply because the people were disgusted with the incapacity and mal-administration of their elected representatives who, at the dictation of a person from overseas, asked for sacrifices to be made. That person, himself, made no attempt to lead the way. Let me ask honorable members of the Country party whether it is true that the interest rates charged to primary producers have been increased by 1 per cent. ?

Mr Keane:

– We have not heard one word from them about that.

Mr RIORDAN:

– They have said nothing about the action of the banks. AH that they advocate is an increase of taxation in respect of the workers generally. We cannot tax a country to prosperity. It is a nice thing to be a taxpayer. My experience as such has been this: When I was in receipt of £300 a year in Queensland, I paid no tax. When I received £500 I paid a tax of £5. I was £200 better off, and for that advantage I paid £5. When I received £750, my tax was increased by £10. It was a pretty decent investment. Now I enjoy a salary of £1,000, and even with a reduction of £100 I shall still be better off than when I received £750. The man who is to be taxed under this bill will not be much affected. This Government should immediately introduce a workers’* unemployment insurance scheme, under which every person in the community would contribute so much per week. Those who say that taxes are high in Australia should make a study of lowtaxed countries. Is the position any better in India, in which country a person receives ls. for a working day of twelve hours? Do honorable members believe that by reducing public servants’ salaries by £1,000,000 unemployment will in any way be relieved? The honorable member for Gippsland (Mr. Paterson), when speaking to-night, said that the public servants were ashamed of the position into which they had been forced by this Government. We have seen no evidence of that ; we have not seen any members of the Public Service, for instance, hurrying to contribute a portion of their salaries to the Consolidated Revenue. Yet there is nothing to prevent their doing that. The names of those who, according to the honorable member for Gippsland (Mr. Paterson), are ashamed, do not appear on unemployed appeal lists. I do not admit that the honorable member for Gippsland speaks for the public servants; they do not recognize him as their mouthpiece. He says that principle must apply throughout; so do I; hence this is a taxation instead of a wage reduction proposal. When prosperity returns, this special tax can be removed: but if there were any wage induction the workers would have to fight their way, as they have always been obliged to do, step by step, to regain the lost ground.

During the course of my speech on the financial statement the other night, the honorable member for Darling Downs (Mr. Morgan), by interjection, stated that the unions had killed Mount Morgan. In that mine men worked a couple of thousand feet below ground, in conditions that in a few years developed in them miners’ phthisis, and to-day many of them are in the Diamantina Hospital for Incurables in Brisbane. What was their reward ? When copper was realizing £112 a ton the shareholders in the Mount

Morgan Gold Mining Company Limited received millions of pounds by way of dividends, while thousands of the soldiers of industry walked off the fields and gradually faded away, leaving their widows and children a burden on the taxpayer. Every wage increase that the miners received cost their organization thousands of pounds. “When there was a rising market, did those who always ask the worker to make sacrifices say, “We are reaping big dividends; up go your wages accordingly”? Were the bank clerks more highly remunerated during the prosperous periods of banking? I remember only one occasion when that branch of industry failed, and it was propped up by the very people who to-day are being destroyed by the banks. Honorable members opposite cry “Repudiation “ when there is any mention of bond - holders being asked to accept a lower rate of interest; yet, according to them, it is not repudiation to take 5s. a week from the man who is receiving £4 or £4 53., or to starve the women and children of this nation. They brag about their advocacy of such a proposal in this House, and when they go home they probably say, “ Thank God, we have done our duty by the nation “. Their conception of doing their duty by the nation is to starve those receiving low wages, and to allow those who have reaped profits out of these individuals during prosperous times to “get away with it”. The business of Ministers is to do the job they were sent here to do; if they do not, they will find themselves the victims of the wheel-scraping industry when next they appear before the people.

Mr BELL:
Darwin

.- Those who sit on this side can afford to pass over the speech of the honorable member for Kennedy “(Mr. Riordan), because it would appear to be a denunciation of the Government. He has his own reason no doubt for denouncing the occupants of the treasury bench, and though I do not wish to stand shoulder to shoulder with him in condemning any proposal brought forward, I am bound to say that I differ widely from the Government with respect to the measure we are now discussing, because of the inequity of its incidence and the unjustness of its effect.

The honorable member for Gippsland said that this’ proposal has not the support of any honorable member. It is evident that the honorable member for Kennedy does not support it; and I noticed particularly that the Acting Treasurer, when introducing it, did not advance any argument in support of it. Those who know that honorable gentleman well, and have either heard or read his utterances upon the introduction of proposals that have emanated from his own mind, are aware that he does not lack argument to justify them. In this case, however, he knows, as does every honorable member, that this is not the considered opinion of any party, and that it is not supported by any section of the people of this country. I consider that it places the Public Service itself in ii false position; because the public generally are asking why those who occupy these sheltered positions should be be exempt from taxation while others who do the hard work of the nation for a wage of £3 a week are taxed by every State. The Acting Treasurer knows only too well that in Tasmania every wageearner, including girls and boys who work for 10s. a week, is taxed at the rate of 3d. in the £1. Why? Because that Government in common with all other State Governments, wishes to honour the agreement entered into with the Commonwealth Government to balance its budget, in the interest of the credit of this country. The Commonwealth Government alone has failed to honour the agreement entered into that all Governments should balance their respective budgets this year. The Acting Treasurer, in his introduction of another measure, commended the Premiers of the States for the efforts they had made to balance their budgets, and quoted the reductions that had taken place in the salaries of State public servants. Surely not one honorable member of this House will say that there is any justice in a proposal to exempt from taxation members of the Commonwealth Public Service who are receiving less than £725, while the salaries of all State public servants are being reduced, although in many of the States they are not receiving nearly as much as Commonwealth public servants. It is not necessary to use any further argument in condemnation of this proposal. The plea of honorable members opposite, that the raising of wages increases the purchasing power of the community, furnishes proof tha,1j they are destitute of argument to support this, measure. It is merely humbug to style this a taxation measure; in reality its object, is to reduce salaries. Labour members went to the country pledged to resist any, reduction of wages or salaries,; but because, it has been found, necessary to obtain more. revenue, and as. every other, channel has been exhausted, some- of the higher salaried; public servants, as well a3: Ministers and members of; Parliament^, are to have their salaries reduced. But w,hy not call? the bill, by its right name? It is: essential, to-day to reduce, substantially the cost? o£ government and) of parliament. The. w,hole.’ community, as has been, pointed out over and over again, during this and other debates, is suffering from a loss, of income, and it is- absolute folly to. suggest that the maintenance of wages at their present figure will increase the purchasing power of the community. It is, perfectly obvious that there is- a wagefund, and that’ from that alone can wagesbe. paid; Over- 20 per cent, of formerwageearners are now unemployed; what purchasing power* have they? It is foolish to suggest the taxation of wages as>an alternative to- the lowering of wages; that’ would not assist- industry to provide employment for one person. Every one. knows that- the reason for the existence of ‘unemployment to-day is that men- cannot be employed profitably. If wageswere to be- reduced all round by 10 per cent., there- would- be every prospect- of ‘‘a large- number of1 those who are out of work being profitably employed-.

The objection to this measure is. that it does not deal fairly and equitably with, different sections of, the taxpayers’. We on this side claim,, as we did throughout the debate upon the, budget proposals, that there, must be a further reduction of ‘costs, if vol.k is. to be found for the unemployed.’ If we do- not reduce, the cos.t of parlia-ment and of government, we must raise additional revenue, and. that can b.e done only by increasing the. taxation imposed’ upon, individuals and’ industries. If” we tax industry we reduce its capacity toprovide employment; that is a simple truth’ which no one can. dispute. Every intelligent person regrets the necessity for reducing wages J. but it is obvious that they must be earned or they cannot be paid. Surely it is not the wish of any person that 20 per cent, or 25 per cent, of the, community should be without any means of livelihood, and be compelled to exist upon a dole, because of the desire of a political party to maintain wages at a high rate. It would- appear that many honorable members opposite do not understand what, is the real position of theworker in this country., Honorable members, opposite say that the. public servant has never, been well paid, and that a mam cannot, maintain ai wife and’ family on less than the basic wage-. As I have already pointed out; the man on the basic wage has, been taxed heavily by theStates. There’ is a- tremendous number of workers- in all. *he, States,, certainly mk those, that. I know a-, good deal, about, who, have, never- had, the basic wage-; menwho have done the- hard work of the nation for not more- than 10s. a day. They have reared families’ on- that, wage;and they arc being taxed, at the rate of 3d-, in the £1 in order to keep in. good jobs these sheltered individuals! who. receive- up. to . £725- a-, year.;. That is the. position, in- a nutshell! The wages off Commonwealth- public- servants. have> increased; progressively since 1925.-26’.. The seventh, annual report of the PublicService Board- states that the average: wage of ( all officers - which, includes boys and! girls in the post offices,’ and other) occupations who. receive a very low wage- - -has been as follows since that year -

Since the 30th March, of this year,, the average wage has been £297.. 35* The majority of those officers* will! beexempt from the taxation to be, imposed under this bill, while the man. who is-, thrown out of his job, because’ an industry cannot afford Ito employ him, is called, upon to bear great, hardship. . What., isthe use of ‘the basic .wage to the man who-, suffers all’ the privations of , life in the - hills, and .forests? in. fossicking, for. a* few pounds of ‘tin. a. week, rather than - live on » the dole?

This hill does not satisfy any individual; we know that it does not satisfy the Treasurer, and it does not satisfy the community at large. It is unjust to the great body of public servants, because by it they are placed in a false position in the eyes of the community. I support the amendment submitted by the Leader of the Opposition. There is great scope still for a reduction of parliamentary and governmental costs in every direction, and surely we should exhaust every possibility of reducing expenditure in a time of stress before we tax hard-working individuals, who have struggled all their lives to maintain themselves and their families in decency, and have thus’ assisted to preserve the solvency of this country. This proposal is unjust. I repeat that the overwhelming majority of the public servants themselves will not wish to be placed in a position in which they will be specially selected for exemption from a burden which, according to the Prime Minister (Mr. Scullin) himself, should be spread over the whole community.

Mr MORGAN:
Darling Downs

– We have not heard one responsible member on the other side of the House attempt to defend this bill. Those honorable members who have dared to support it are entirely irresponsible. The honorable member for Kennedy (Mr. Riordan) took me to task for having had the temerity last week to refer to the reason for the cessation of work at the Mount Morgan mine. In a sort of ad misericordiam appeal to the chamber and to the galleries, he talked of the men employed there suffering from miners’ phthisis. I have every sympathy for men afflicted with that terrible complaint, but I should like the honorable member for Kennedy to state the number of miners working on the big open cut at Mount Morgan, who suffered from that disease. I submit that the proportion was absolutely infinitesimal. Last week I pointed out that the mining industry at Mount Morgan had been brought to nought by a series of Arbitration Court awards that made mining unprofitable at a time when metal prices were on the down grade, and when, ore to the value of £12,000,000 awaited development. The Arbitration Court, by fixing wages at a level that made it unprofitable to work that field, brought, disaster to the industry, ruin to the town, and drove thousands of miners from the district.

Mr SPEAKER (Hon Norman Makin:

– Will the honorable member connect his remarks with the bill?

Mr MORGAN:

– To be quite frank. Mr. Speaker, I cannot do so.

Mr SPEAKER:

– Then, the honorable gentleman will not be in order in pursuing that matter further.

Mr MORGAN:

– I should like to say, in extenuation, that the honorable member for Kennedy pursued this subject to a considerable extent less than half an hour ago.

The honorable member for Bendigo (Mr. Keane), one of the irresponsible members to whom I have already alluded, in attempting to defend the bill, urged with a good deal of unctuous righteousness, that he would not reduce the salaries of public servants, because his party had given an election pledge not to do so. A very short time previously the same honorable member talked of the compact entered into at the Melbourne conference, and tried to justify the smashing of that contract on the ground that it was expedient to do it. In fact, he said that it was impossible to balance the budget. Is there any consistency at all in the attitude of an honorable member who supports the breaking of an agreement and yet contends that a pledge said to have been given in an election contest should be honoured?

What 1 particularly object to in this bill is the utterly vicious principle that it sets up of differentiation between sections of the Public Service. Not only does it differentiate within the Commonwealth Public Service itself, by taxing a body of persons who are drawing £725 per annum and upwards, while utterly excluding from taxation those who draw less than that sum; but it also differentiates between persons employed in the Commonwealth Public Service and those engaged in the State Public Services. That is a most invidious, disturbing, and disastrous differentiation, which is calculated to produce in the various Public Services of the Commonwealth something of that disturbing element that we see operating to-day in the overlapping and conflict of awards in the arbitration sphere. That, in itself, constitutes a defect in this measure for which no government, with any sense of what is right and just towards its employees and to the people, would be responsible for a moment. That, I think, is one of the reasons why responsible members on the Government side have refused to attempt to justify this shocking and damaging piece of legislation.

Mr Bayley:

– Not one Minister has supported it.

Mr MORGAN:

– Only the Minister who introduced the measure, and he did it in a shamefaced manner that did him credit. No other member of the Cabinet has dared to defend this shocking piece of class legislation.

What is there to be said in defence of a hill that singles out 400 men from 44,000 to pay a special tax at this time of acute national crisis? What can be claimed for a piece of legislation that will raise a miserable £60,000 of revenue to help meet an expenditure on the Public Service of £11,000,000? Is there one thing that can be said in excuse for, or in extenuation of such class legislation? We know by the silence of members opposite just what they think of it. The Government is ashamed of this bill, and I believe that the right-thinking majority of public servants of this Commonwealth are equally ashamed of the invidious position in which this measure places them in the eyes of the people. Again I say that the majority of rightthinking public servants will regard this measure as contemptuously as does the Government that introduced it. I do not intend to pursue the matter further; I merely wished to place on record what I consider to be the opinion of the thinking section of the community. I protest most deliberately and emphatically against the creation of a privileged and sheltered class in the community at a time when a common crisis demands a common sacrifice.

Mr CURTIN:
Fremantle

.- I should not have participated in the debate on this bill but for the extraordinary attitude the Opposition has adopted towards it. This bill, as I understand it, is primarily a measure to reduce the net income of members of this Parliament, whose salary is fixed at £1,000 per annum. It is a matter of common knowledge that it costs between £250 and £300 per annum to earn that £1,000. If, in a time of crisis, members of Parliament are to be taxed upon a salary the net value of which is about £725, there is no vicious principle in taxing all salaries drawn from the Consolidated Revenue of the Commonwealth in excess of that amount. That appears to me to be inherently fair. Members of Parliament do not occupy a sheltered position, and are the servants of the nation. Surely the 433 public servants in receipt of permanent salaries of £725 or more should not be better treated than members of Parliament ! ‘ There is no discrimination in this bill. The measure simply provides that all persons who draw emoluments from the nation in excess of £725 net shall be subject to this taxation. I could understand the opposition to the bill if we were dealing with a general income taxation proposal; but this is a special proposal applicable primarily to Ministers of State, members of Parliament, the President and Chairman of Committees of the Senate, and the Speaker and Chairman of Committees of thi3 House.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– The principle of it is a reduction of salary.

Mr CURTIN:

– Only in respect to those in receipt of more than £725 per annum from the revenues of the country will it have the effect of a reduction of salary.

Mr Paterson:

– We have no fault to find with that part of it.

Mr CURTIN:

– Then we may take it that honorable members have no fault to find with the positive proposals of the measure, in spite of their having occupied the whole afternoon in adversely criticizing it. It has been said that the Ministry, in introducing the bill, has been guilty of political hypocrisy; but I am at a loss to explain the failure of the Opposition to draw the logical distinction between a special tax applicable primarily to members of Parliament, as a gesture to the nation that they are willing to participate in the general sacrifice which is demanded-

Mr Archdale Parkhill:

– This is not a legitimate reduction.

Mr CURTIN:

– It is a definite acceptance of less remuneration by members of Parliament with the object of alleviating the position of the country. It would be unfair to ask members of Parliament to make this special sacrifice, and to relieve members of the Public Service in receipt of equal or greater emoluments of the necessity of making it. There is nothing wrong with the bill in principle.

Mr Paterson:

– “We have not said that there is.

Mr CURTIN:

– Then why not agree to the second reading of it without further delay?

Mr Francis:

– We say it does not go far enough. It does not honour the undertakings given at the Melbourne conference.

Mr CURTIN:

– The honorable member for Moreton (Mr. Francis) desires the Government to introduce a bill to bring about a general reduction of wages.

Mr Francis:

– That is not so.

Mr CURTIN:

– If the honorable member does not desire to reduce wages why is he dissatisfied with the principle of this bill? This is not an ordinary income tax measure. The provisions of such a bill should apply to all sections of the community. This is a special taxation measure, designed to impose a super tax upon certain specified incomes, and I subscribe entirely to the logic of it. If there is to be wage reduction it should be accomplished in some other way than by a measure of this kind. Everybody knows that the great majority of the 433 public servants who will be affected by this bill do not come within the jurisdiction of the Public Service Arbitrator; yet honorable members opposite have been complaining all the afternoon that this particular position is at present vacant. There is no violation of the principle of Public Service arbitration in this measure. Honorable members opposite appear to desire that a new Public Service Arbitrator should be appointed so that he could get to work speedily to reduce Public Service salaries.

Mr Archdale Parkhill:

– Not at all.

Mr CURTIN:

– The honorable member would be amazed if Public Service salaries were increased.

Mr Archdale Parkhill:

– I certainly should be.

Mr CURTIN:

– Indignation would also be expressed if an arbitrator allowed the salaries to stay where they are. “Why humbug about the position? The real complaint of the Opposition is that the Public Service Arbitrator is not busily engaged in reducing salaries.

Mr Archdale Parkhill:

– Nothing of the kind.

Mr CURTIN:

– Then, on the honorable member’s own admissions, there is no purpose to be served in appointing an arbitrator at present. In my opinion this is one of the simplest, clearest and most logical bills ever presented to honorable members.

Mr Archdale Parkhill:

– It is the most contemptible !

Mr CURTIN:

– Why is it contemptible ?

Mr Archdale Parkhill:

– Because it does not go as far as Mr. Hill and Mr. Hogan have gone in honouring the undertakings given at the Premiers Conference.

Mr CURTIN:

– Messrs. Hill and Hogan have definitely, by act of Parliament, reduced the salaries of the Government employees in their States.

Mr Archdale Parkhill:

– Why does not this Government do the same thing?

Mr CURTIN:

– In one breath the honorable member says that he does not want salaries reduced, and in the next he asks why they are not being reduced.

Mr Archdale Parkhill:

– I expect this Government to keep its promises; that is all I . am asking it to do.

Mr CURTIN:

– During the last speech that I made in this House the honorable member for Warringah (Mr. Parkhill) repeatedly interrupted me. I inform him now that I am not a sparrow to be intimidated by his scarecrows. The object of this bill is not to reduce Public Service salaries as such, but to impose upon members of Parliament and certain other persons in receipt of more than £725 per annum from public funds, a super tax as a contribution to lessen the financial difficulty of the country. If this were a general income tax assessment bill it would be equitable that all persons in tho community should be brought within its scope, but it is not a measure of that kind.

Mr Archdale Parkhill:

– Why are not Commonwealth public servants being treated like the public servants of all the States?

Mr CURTIN:

– Honorable members opposite must stand either for the application of additional general taxation to all persons in the community, or for the introduction of the vicious principle of wage reduction by act of Parliament. The Premiers of South Australia and Victoria have, without doubt, been instrumental in reducing salaries in their States by act of Parliament; but the Labour party does not believe that Public Service salaries should be the catspaw of a political majority, whether it be Conservative or Labour. We believe that Public Service salaries of moderate dimensions should be regulated by arbitration. This bill is fundamentally a measure to impose a special tax on certain specified people and, as such, it is equitable. It would not be equitable to subject members of Parliament to this taxation and to exempt from it persons in the Public Service who receive a salary equal to or greater than that enjoyed by members of Parliament. I believe that the general public will agree with the principles of this measure and will adjudge honorable members who oppose it guilty of political hypocrisy.

Mr SPEAKER (Hon Norman Makin:

– Order! That expression must be withdrawn.

Mr CURTIN:

– I used the expression because it was used earlier in the debate, but, having done so, I have pleasure in withdrawing it. Honorable members opposite are simply seeking to make political capital out of a misrepresentation of the purpose of this bill.

Mr GARDNER:
Robertson

.- I had no intention of taking part in this debate until the honorable member for Fremantle (Mr. Curtin) spoke. I was not impressed by the logic of the honorable member’s remarks, although that quality is not generally foreign to his speeches. The honorable gentleman cast aspersions upon the honesty of honorable members on this side of the chamber in criticizing this bill ; but I am quite satisfied that the general public will place their true value upon the motives which have led to the introduction of the measure. The honorable member’s remarks would probably have been more effective had he not overlooked certain outstanding facts in the present situation. In the first place, the public is aware that the Prime Minister, prior to leaving Australia, and the Acting Prime Minister and Acting Treasurer, at the Premiers Conference in August, promised that the Commonwealth would balance its budget. The public are also aware that the Government postponed all action in order that Jack Lang might get a chance in the New South Wales elections. The people knew that . the Acting Prime Minister and the Acting Treasurer were themselves desirous of making a cut in government expenditure to the tune of £4,000,000, as suggested by the Leader of the Opposition, and that they proposed to reduce the salaries, not of one section only of the Public Service, but of all sections. Therefore, it was simply political moonshine for the honorable member for Fremantle (Mr. Curtin) to say that it was necessary to deal with certain sections of the Service because the salaries of members of Parliament were being reduced. The Acting Prime Minister and the Acting Treasurer would have carried out their original intention but for the unfortunate stand taken by the Labour caucus. Had they had their way, £500,000 would have been saved on civil service salaries, instead of a paltry £60,000. Unfortunately, the class to which Australia must look for a solution of its troubles, namely, the primary producers, has not been exempt from sacrifice. These are not in receipt of £725 a year. In many instances their incomes have disappeared altogether. As the honorable member for Gippsland (Mr. Paterson) pointed out, many primary producers would simply have to walk out of their homes if the banks to which they owe money exercised their right to demand it. The only income they would then have would be God’s free, fresh air. The honorable member for Fremantle did not impress me very much to-night. He is evidently more successful in caucus than in the House, where at least a little logic is demanded. If a reasonable sacrifice had been required of every one, the Acting Treasurer’s original proposal could have been given effect, and we should have had a chance of solving our problems instead of merely tinkering with them.

Question - That the words proposed to be omitted (Mr. Latham’s amendment) stand part of the question - put. The House divided. (Mr. Speaker - Hon. Norman Makin.)

AYES: 32

NOES: 0

AYES

NOES

Foes . . . . . . 17

Majority….. 15

Question resolved in the affirmative.

Amendment negatived.

Original question resolved in the affirmative.

Bill read a second time.

In committee:

Clause 1 agreed to.

Clause 2 -

In this act, unless the contrary intention appears - “Salary,” in respect of an officer or employee of the Commonwealth or of an authority under the Commonwealth, means the annual remuneration, paid to the officer or employee in respect of the office occupied by him and includes any annual allowance paid in respect of any duties performed in addition to those of that office. “ Taxpayer “ means a person who is -

a senator or member of the House of Representatives, whether or not he holds any of the following offices, namely, Minister of State for the Commonwealth, or Presiding Officer, Chairman of Committees or Leader of the Opposition in either “House of the Parliament; or

a person employed by the Commonwealth or the North Australia Commission whose annual salary as defined in the Income Tax (Salaries) Act 1930 exceeds Seven hundred and twenty-five pounds and is paid from the Commonwealth Public Account or the North Australia Commission Fund but does not include a person employed by the Commonwealth in any Territory not being part of the Commonwealth.

Mr LATHAM:
Kooyong

.- There are several points in this clause to which I invite the attention of the Government. In the first place, I would ask what is the meaning of the phrase “ an authority under the Commonwealth “ ? Does it include the Commonwealth Bank, which, under our law, is “ an authority under the Commonwealth” for some purposes, as for instance, under the Commonwealth Housing Act. Is it intended that the phrase shall cover the bank or not? If not, why not? In any event, what is the meaning of the phrase as used in this bill? So far as I am aware, there is not a statutory definition of the term “ an authority under the Commonwealth “, and, as any ambiguity may lead to misunderstanding, it is desirable that the position should be made clear. There are certain authorities which plainly would be “ authorities under the Commonwealth” although they are not strictly Commonwealth departments. I instance the Federal Capital Commission and the Development and Migration Commission when they existed. The Council for Scientific and Industrial Research, which has been saved from destruction only because it is called a council rather than a commission, is, apparently, an “authority under the Commonwealth”, and there are various other bodies to which reference can be made. I ask the Acting Treasurer to define the position in respect of employees of various bodies which are associated with the Commonwealth.

Then the definition of “salary” is confined to the annual remuneration paid to au officer or employee. Take the case of an officer who receives allowances in addition to an annual remuneration. Allowances paid to officers of the Public Service have averaged about £500,000 per annum. A mau is paid extra for working overtime, or on Sundays or holidays, or in some other manner receives an addition to his annual remuneration. He works longer or harder for that addition, but it means that he is receiving more salary. Should not taxation be imposed upon allowances, other than those for mere out-of-pocket expenses? There will be acute differentiation between individuals unless that is clone. If two men are each earning ,£850 per annum from the Commonwealth, and one receives an allowance of £100 in addition to his annual remuneration, he will be in an entirely different position from that of his colleague. It is only necessary to apply the provisions of this bill to such cases to realize the remarkable differentiation that will be brought about, which it will be difficult to justify.

A further point is that “ annual remuneration “ is defined to include “ any annual allowance paid in respect of any duties performed in addition to those “ of the office occupied by the employee. In such cases, the annual allowance is taxable. To avoid taxation, it will merely be necessary to grant a monthly allowance and the recipient would not be taxed on it, though he might receive it for. say, eleven months of the year.

Mr Lyons:

– The recipient of such an allowance would be taxed on it, on an annual basis.

Mr LATHAM:

– It all depends on the terminology applied to the allowance. If an officer worked for six months on special duty, his extra earnings could hardly fall within the phrase “ annual allowance “. Accordingly, all kinds of differentiations will arise between officers in respect of allowances.

The fourth point is the position of teachers in the Federal Capital Territory. They are employed by the Government of New South Wales. I do not known whether any of them is paid more than £725 per annum, but they have already been reduced in pay by the Government of New South Wales. The Commonwealth Government is saving from its own pocket the reduction imposed upon those teachers, and is taking advantage of them to that extent. At the same time, . it professes never to reduce anybody’s wages or salary. Yet when the Government of New South Wales does so, the Commonwealth Government is prepared to take advantage of it. I understandthat these teachers are subject to the New South Wales unemployment tax and have had their salaries reduced. What is to be their position in comparison with officers of similar rank, if there are such in the Commonwealth Public Service?

Another matter to which I direct attention is the position of the AuditorGeneral. The tenure of this high office is designed to make the occupant independent of the Government of the day. He can be removed only for misbehaviour or incapacity and upon an address adopted by both Houses of this Parliament. His tenure is substantially the same as that of a judge. But the protection this Parliament conferred upon him will become a mockery if the Government proposes to reduce his salary during his term of office. The Commonwealth Auditor-General is paid substantially less than the AuditorGeneral of New South Wales, but my argument is based upon the principle involved and not the amount of the salary.

Mr CROUCH:

Mr. Cerutty receives more than the last Auditor-General did.

Mr LATHAM:

– That may be so; I am concerned merely with the principle of his independence of the Government of the day.

Mr C RILEY:
COOK, NEW SOUTH WALES · ALP; FLP from 1931

– Does the honorable member think that the Auditor-General should pay this tax ?

Mr LATHAM:

– Parliament should recognize that the salary of the AuditorGeneral should not be decreased, or, generally speaking, increased, during his tenure of office. If a government can ask Parliament in the ordinary course to decrease the salary of the AuditorGeneral, undoubtedly he will be dependent upon the Government of the day in a way not contemplated by the Audit Act, which makes his salary a direct charge upon the Consolidated “Revenue. The conditions of the tenure of judges and of the Auditor-General are designed solely to secure their independence, and if Parliament can reduce their salaries, these protective provisions are nullified. I therefore ask the Acting Treasurer whether he will agree to adopt the principle that the salary of the Auditor-General should not he reduced during his tenure of office.

Mr CROUCH:
Corangamite

– I had intended to raise some of the points that have been mentioned by the Leader of the Opposition. I have in mind officers who are under agreement. Last year Parliament reduced the salaries of the members of the Development and Migration Commission. Mr. Gepp’s contract was terminated, but his services were retained in a consultative capacity, and Messrs. Gunn and Mulvaney were reappointed at lower salaries. Are these to be covered by this bill ?

M:r. Archdale Parkhill. - Decidedly.

Mr CROUCH:

– I think they should be. The clause refers to annual allowances. Naval regulations prescribe daily rates, which, however, continue throughout the year, and in some cases aggregate much more than £725 per annum. I suggest that consideration should be given to the meaning of the word “ annual “ in order to ensure that it does not give immunity to men whose allowances are on a daily basis but exceed in the year the minimum mentioned in the bill.

Dr EARLE PAGE:
Cowper

– I associate myself with the remarks of the Leader of the Opposition in regard to the Auditor-General. We should provide beyond doubt that he has the same protection as the judges against any interference with his salary to secure his independence of the Government of the day. Will the Treasurer explain to the committee what is meant by the word “paid to the officer or employee in respect of the office occupied by him “ ? The teachers at the various schools in Canberra, although paid with Commonwealth money, are the employees of the New South Wales Education Department. Will a teacher who receives £725 a year be subject to this ,tax, if there is any such? The House decided by a vote on the amendment submitted by the Leader of the Opposition, that the tax shall not apply to salaries below £725. Although the teachers are servants of the Commonwealth, except in actual name, they are subject to a State reduction of 3d. in the £1 for unemployment relief, in addition to the S-J per cent, reduction of salary. Surely we should not make fish of one and flesh of another. These men and women are to all intents and purposes Commonwealth servants, and live in Canberra, under the same conditions as other Commonwealth employees, and I hope that Government supporters who voted against any interference with the salaries of the lowerpaid servants will see that these teachers also are given a fair deal. The Commonwealth is the only government that can benefit from these various taxes on the teachers stationed in Canberra. I understand that representations have already been made to the Treasurer, but, so far, no action has been taken. I hope that honorable members supporting the Ministry will see the justice of my contention, and will support my request that there shall be no discrimination.

Mr GREGORY:
Swan

.- I wish to emphasize my objection to the bill ; but since the second reading has been carried I should like to see an amendment inserted to abolish all exemptions of public servants. Every person who is in receipt of a salary from the Commonwealth should bc called upon to make some contribution.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– The honorable member is consistent.

Mr GREGORY:

– I recognize that, in the case of members of the judiciary, it is not. possible to reduce their emoluments ; but at a time like this they would exhibit good taste if they agreed to come within the scheme. Only the other day the Government introduced a bill providing for increased primage dues of 4 per cent. This tax will fall heavily upon primary producers requiring superphosphate, wheat sacks, and wool packs, and will increase the cost of these articles this year by over £200,000. These people will be expected to make heavy contributions to the Treasury, and yet in a measure ostensibly designed to provide for an increase of revenue to -meet a difficult financial situation, the Government does not contemplate a reduction in the salaries of public servants below a certain .level. I have no doubt that in the near future another effort will have to be made to secure increased revenue, and possibly we shall have further income tax proposals. The people of Australia are taxed more highly than the people of any other country. What is needed is economy in administration. It is idle for the honorable member for Fremantle (Mr. Curtin) to suggest tha’t-the action of honorable members on this side is a political dodge. The fact is that for political purposes, and for fear of offending Government supporters, the caucus refused to allow the Government, to do its duty and carry out its obligations. We realize fully that we %hal have a great many public servants against us, because we are urging that, for the time being, they should be called upon to suffer a reduction in salary. But we believe that, if they were appealed to in a proper manner, they would be quite prepared to bear their share of the burden that is pressing so heavily on the people of Australia. What justification is there for exempting salaries under £725?

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– Why not submit an amendment ?

Mr GREGORY:

– The honorable member knows very well that it is not competent for a private member to move to increase taxation. But I am satisfied that, if the Government had not consulted its supporters prior to the introduction of the bill, it would have acted more in keeping with the pledge given by the Prime Minister (Mr. Scullin) that the Government would balance its budget. Only by the production of wealth is it possible to provide for more employment. The Government’s taxation proposals are having the opposite effect. I believe that the Treasurer realizes the danger we are in, and he has my fullest sympathy in his present difficult position. We know that it is not possible now to balance the budget this year, but we should like to “see a genuine effort made in that direction. We shall have to find £37,000,000 in London before March next. The position would not be so serious if the Government gave evidence of a genuine desire to make ends meet. I fear, however, that if we Continue along our present path we shall be in grave trouble. The Treasurer’s statement discloses the “unpleasant fact that the finances of the Commonwealth and the States have gone to the bad to the extent of £16,000,000 in the first four months of the financial year. This shows the urgent need for economy in administration. I hope that honorable members supporting the Government will realize the position, and make a genuine effort to ensure economy.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– Would I be in order, Mr. Chairman, in moving an amendment to bring the exemption below £725 ?

Mr Latham:

– It would be useless for the honorable member to do so unless the rates bill-

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– I am putting my question, not to the Leader of the Opposition, but to the Chairman.

The CHAIRMAN” (Mr. McGrath).As this is an assessment bill, the honorable member would be in order.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– There you are.

Mr LATHAM:
Kooyong

.- The honorable member for East Sydney (Mr. E. Riley) has evidently misunderstood the effect of your ruling, Mr. Chairman. The House cannot, on the motion of a private member, or without a message from the Governor-General, increase the charges upon the public. This bill will be ineffective until the rates bill is brought down, and any increase can only be proposed after a message from the Governor-General. The words, “ Seven hundred and twenty-five “ can therefore, only be altered effectively in the rates bill. An amendment to this bill tq lower the exemption would not be effective unless there was a corresponding reduction in the rates bill.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– Is the honorable member challenging the Chairman’s ruling?

Mr LATHAM:

– No; I am explaining it to the honorable member. Before the Acting Treasurer replies I should like to direct his attention to a provision relating to periodical payments. The bill appears to assume that all salaries are paid periodically. I am not sure that they are. Some payments such as, for example, the allowances to the chairmen of the special coal tribunals, which are being maintained by the Government at an estimated cost of £3,000 a year, although the tribunals in question are not doing any work, are made, not periodically, but now and again. I suggest, therefore, that the Minister should inquire whether all payments are made periodically, so that deductions may be made as contemplated by the bill.

Mr GREGORY:
Swan

.- Did I understand you to rule, Mr. Chairman, that i.t would be competent for an honorable member to move an amendment to reduce the salary limit fixed in paragraph b, under the definition of “ Taxpayer “ ?

The CHAIRMAN:

– Yes.

Mr GREGORY:

– Then I move-

That the words, “ Seven hundred and twentyfive,” paragraph (b) of the definition of “ Taxpayer “ be omitted with a view to insert in lieu thereof the words “Two hundred nnd fifty.”

It is not necessary for me to repeat what I have already said. There should be sacrifices in all sections of the Public Service, and a special effort should be made to economize in public expenditure.

Mr Francis:

– There should be a sliding scale in respect of reductions of salari.es.

Mr GREGORY:

– There should be a graduated scale, starting at, say,21/2 per cent., then 5 per cent,. 71/2 per cent, and 10 per cent, if so desired. The percentage should be at the discretion of the Treasurer. No one would suggest that a man receiving £250 a year should be taxed the same as a man on £1,000 a year ; or that a man on £1,000 should be taxed the same as a man on £2,000 a year. I contend that I am more than justified in suggesting that, in view of the existing depression, every member of the Public Service should make some small sacrifice.

Mr LATHAM:
Kooyong

– I support the amendment, although I know that it is impossible to give effect to it unless a rates bill is brought down dealing with salaries from £250 upwards. It was for that reason that I referred to the uselessness of the Opposition moving amendments of this character. At the same time I agree with the principle embodied in the amendment - a principle which I defended in my speech on the second reading.

Mr PROWSE:
Forrest

.- I support the amendment moved by the honorable member for Swan. I believe that if every public servant were to see the position of the people on the farming areas of Australia he would say “ Amen “ to the amendment. Every Australian citizen who is worthy of the name should readily accept a reduction of salary in view of the depression existing throughout the country. I have already mentioned that the cost of living has decreased by 11 per cent. If the salaries of public servants remain unaltered they will be in an infinitely better position in this time of depression than they were in the days of prosperity. That would not be at all fair in view of the sufferings of the community generally.

Mr LYONS:
Acting Treasurer · Wilmot · ALP

– What the honorable member for Swan proposes was really included in the more comprehensive amendment of the Leader of the Opposition (Mr. Latham), and that having been defeated, it seems to me that, we are only wasting time by proceeding with this amendment. In regard to the points that have been raised, mainly by the Leader of the Opposition, I think that on further consideration he will probably agree that there are not so many difficulties in respect of the operation of this measure as was anticipated. The honorable member raised the question of “ an authority under the Commonwealth.” He suggested that a member of the Commonwealth Bank might be intended. It is more than likely that such a person would be an authority, but the honorable member will see that sub-clause b, under “ Definitions “, includes as a taxpayer “ A person employed by the Commonwealth or the North Australia Commission whose annual salary as defined in the Income Tax Salaries Act 1930, exceeds £725 and is paid from the Commonwealth public account.” That, of course, definitely excludes the Commonwealth Bank. I think that the Leader of the Opposition will admit that that subclause is sufficiently clear to show the different authorities or sections that would be subject, to the tax. The two provisions have to be read together. The Leader of the Opposition also suggested that there might be some anomalies, because, although the tax would be imposed upon annual allowances made to officers in addition to their ordinary salary, there might be payments of overtime which would not be taxed because they were not annual allowances. I would point out to him that no overtime is allowed to officers in receipt of £725 or over.

Mr Latham:

– There are other allowances of various kinds.

Mr LYONS:

– It would be difficult to find allowances that are not based upon an annual amount. Frequently an officer is called upon to carry out extra duties. He may have to take a higher position temporarily, and, if so employed for three months, he would receive payment on the basis of an annual allowance. There would be few cases of excluded allowances. In some cases it is necessary, of course, to pay extra allowances. Take, as an illustration, the Secretary to the Treasury. That officer receives a definite salary for that position, but at the same time, as a member of the Commonwealth Bank Board, he receives an allowance. It would not be right that he should be taxed only upon his ordinary salary.

Dr Earle Page:

– His allowance as a member of the Commonwealth Bank Board would not be paid from the Commonwealth public account.

Mr Latham:

– And therefore would be excluded.

Mr LYONS:

– Possibly I may be wrong in that case. If the allowance were paid by the Commonwealth it would have to be included for taxation purposes. We are not in a position 9o tax outside allowances.

Mr Latham:

– The Commonwealth is in a* position to tax everything.

Mr LYONS:

– In the particular instance that I have given the amount would be excluded. Payment by fees is also excluded. For instance, the fees paid to persons who are appointed for a special purpose and for a particular period outside the ordinary service will not be taxed.

Mr Latham:

– Why not? -Why should not the chairman of the coal tribunal be taxed as a matter of principle?

Mr LYONS:

– There is no reason why it should not be done so that there may be no anomalies in the bill, and I have no objection to offer to that proposal. The teachers who are carrying out their work in Canberra are officers of the New South Wales Education Department, and are paid by that department. We, in turn, re-imburse the Government of New South Wales. They are not paid from the public account of the Commonwealth, and are, therefore, not affected by this bill.

Dr Earle Page:

– Why should they be penalized as they are?

Mr LYONS:

– As officers of the State of New South Wales they are subject to whatever the State does, and we cannot interfere. We should be only emphasizing the injustice, if there be any, by including them in the provisions of this bill.

Dr Earle Page:

– Who benefits by the 8-j per cent, reduction in their salaries? Surely the Commonwealth gains by it.

Mr LYONS:

– That may be so, but we cannot avoid that. They are officers of the New South Wales Government, and any deduction from their salaries is made by that Government, and not by the Commonwealth.

Dr Earle Page:

– That is surely a quibble.

Mr LYONS:

– It is not. The Commonwealth is quite prepared to pay these officers the 8–,- per cent, if it would be’ passed on to them by the Government of New South Wales. It would be no satisfaction to these teachers for the Government of New South Wales to receive the 8-J- per cent, from the Commonwealth and not pass it on. Of . course, if it could be passed on an anomaly would be created between the New South Wales teachers located in the Commonwealth Territory, and all the other teachers in the State.

Dr Earle Page:

– Do these teachers receive the Canberra allowance?

Mr LYONS:

– I do not know what set of conditions attaches to the teaching profession in Canberra, but that is not affected by this bill. If they do not receive the Canberra allowance now, they did not receive it when the right honorable gentleman was Treasurer. We cannot help what is done with the 8-j per cent. - we cannot deal with it - but the teachers are excluded from the tax imposed by the bill - the main point so far as they are concerned. There is a very clear distinction between the AuditorGeneral and the judges, who are protected by the Constitution, whereas the AuditorGeneral is not, although his salary is fixed by appropriation. I feel that none should be excluded, and I hope that the judges will follow the example set by the members of the Tariff Board who, because they were excluded, voluntarily offered to make the deduction themselves. The officer:? still with the Development and Migration Department will be subject to this bill. I think it will be found that there is a distinction between the daily allowances made in the Navy, and an annual allowance. The daily allowances are not for extra service rendered, but are really expenditures that are met specially. Therefore, they would be excluded by and not taxed under this bill.

Mr THOMPSON:
New England

– On the general proposal presented by the Leader of the Opposition (Mr. Latham) I did not think it necessary to say anything, because it was merely a proposal to leave to the Government practically a re-adjustment of the whole scheme for reducing the salaries of members and the civil servants. But the honorable member for Swan (Mr. Gregory) has come forward with something which is very much more definite. 1 think he has made his minimum a little too low, and I suggest to the Government, if it contemplates accepting the suggestion, that it would meet out evenhanded justice to all sections of the lowerpaid members of the civil service by making the minimum £300 instead of £250. The majority of men on £6 a week in the civil service are mostly married men with families, and they are, I think, entitled, for the present at all events, to whatever consideration this Parliament can extend to them. A salary of £6 a week is not excessive for a married man in the Civil Service. We have heard a good deal about an alleged reduction in the cost of living. It is largely mythical, I think, up to the present. I have no doubt it will come, but those who are putting it forward as an argument for a reduction of salaries are really counting their chickens before they are hatched; I want to see some of it. I have been looking very anxiously, and, I think, intelligently, for some sign of any reduction in the cost of living, but I must confess it has not been very conspicuous up to the present, except in. a few slight instances. I do not think that we can take it into serious consideration at this moment without acting harshly towards the lower-paid members of the civil service.

I have changed my views about the salary question since it came before this chamber last July. I then made it clear that I thought it was the duty of the Government and not of the Opposition to deal with the matter, and I indicated that, if the Government took action on the lines suggested, I would support it. The Government has now, in view of the changed circumstances, come to Parliament saying that it has decided to take the responsibility of reducing the salaries of members and Ministers practically to the extent suggested by members of the Opposition last July, and I support that proposal. In fact, if it had said that it would reduce salaries of members and Ministers to a greater extent I should have been one of those to cheerfully accept it, because I realize that the responsibility rests with the Government. It is not for honorable members to dictate what allowances shall be paid to members, because the Government has the responsibility of finding the money. When, however, we come to a proposal to tax salaries paid in the civil service, we open up a very big question indeed. I sympathize with the civil servants, and I totally disagree with that section of the public which is very fond of kicking them. My experience of civil servants, particularly the higher paid, is that they are very valuable assets to the country. The more highly paid they are the more valuable and the more responsible they become. I am grieved indeed that the Government has adopted a policy totally at variance with justice so far as the higher-paid civil servants are concerned. Many of these men have given their lives to training for the particular service they are performing. They are now being sacrificed on the altar of class consciousness. I do not think that that is desirable, and I am sorry indeed that the Government is making what is really a very cruel gesture so far as these higher-paid civil servants are concerned. That is plainly indicated by the monstrous proposal that the exemption mark shall be £725 per annum. I do not think that such clearcut evidence of class consciousness has ever been shown before in a British Parliament. I sympathize with all the members of the Public Service; they are doing their job well. But I particularly sympathize with the higher-paid men, who are really carrying on their shoulders the government of this country, as Ministers and members well know. They cannot very well be done without.

Mr Riordan:

– When a public servant dies his position is filled.

Mr THOMPSON:

– There is always another officer in training to fill a vacancy; but men cannot be taken from the street and placed in the positions that are filled by these higher-paid officers. Therefore, I do not think that any of them, not even the much maligned director of Posts and Telegraphs, Mr. H. P. Brown, is over-paid. That gentleman is administering one of the biggest businesses, probably, in the world, certainly in Australia. The latterday objection of members of the Labour party to the payment of high salaries is strange, in view of their former advocacy of proper remuneration for those who give their services to this country. As a matter of fact, Australia is not a high-wage country if we except the lower paid workers, because the remuneration of our highly skilled public servants and captains of industry is insignificant compared with that of persons occupying similar positions in Great Britain, the United States of America, and on the Continent of Europe.

I sincerely trust that, before the Government pushes this matter to an issue, it will give further consideration to it. It is preposterous that men who are receiving £10 or £12 a week should be exempt from this salary cut. I can hardly realize that the Government and its supporters should wish to push the proposal in its present form. I appeal to them, even at this late stage, to reconsider the whole matter.

Amendment negatived.

Mr C RILEY:
COOK, NEW SOUTH WALES · ALP; FLP from 1931

– I should like the Acting Treasurer (Mr. Lyons) to inform me whether Common wealth officials who are employed at Australia House, such as the official secretary and the financial adviser, will be subject to the provisions of this clause. If it is not intended that they shall be the clause ought to be amended to make them liable to the tax.

Mr LYONS:
Acting Treasurer · Wilmot · ALP

– There appears to be a slight doubt as to whether the officials mentioned by the honorable member for Cook (Mr. C. Riley) will be affected by the measure, although the intention is to include them.

Mr Latham:

– It will be a completely new principle of taxation.

Mr LYONS:

– The whole principle is new, Surely it is not desired that one section of the Public Service should be excluded because they happen to be filling positions elsewhere than in Australia

Mr Latham:

– Do they not pay taxes in the country where they live?

Mr LYONS:

– The intention is to include them. The matter will be reconsidered, and if there should be any serious doubt, the clause can be recommitted and amended accordingly.

Clause agreed to.

Clause 3 -

Subject to, and in accordance with, the previsions of this act, the income tax imposed by the Income Tax (Salaries) Act 1930 shall be levied and paid in respect of each payment of salary to every taxpayer on or after the first day of November, One thousand nine hundred, and thirty.

Mr C RILEY:
COOK, NEW SOUTH WALES · ALP; FLP from 1931

.- I regret that, owing to the manner in which the Opposition unduly prolonged the discussion on the financial proposals of the Govern ment-

Mr Latham:

– On a point of order, I submit that the Government Whip is imputing improper motives to the Opposition, and that the Chair should rule that he is not in order- in doing so. We are all anxious to adjourn; but if the imputation of the honorable member be not withdrawn the debate may be prolonged.

The CHAIRMAN (Mr McGrath:
BALLAARAT, VICTORIA

– 1 ask the honorable member for Cook (Mr. C. Riley) to withdraw the imputation.

Mr C RILEY:
COOK, NEW SOUTH WALES · ALP; FLP from 1931

– I withdraw it. I did not think that any honorable member could take exception to the statement that the Opposition unduly prolonged the discussion on the Government’s financial proposals, thereby necessitating the consideration of this measure three or more weeks later than the date on which it should have been considered. This clause provides for the deduction of the salary tax as from the 1st November last. Some time must elapse before the measure is finally disposed of. Therefore, the next pay-day of the public servants will have passed before the Treasury will have statutory authority to deduct the tax, and the first deduction will be made on a pay-day in the middle of December. To my mind that will inflict a great deal of hardship upon our public servants, because three deductions will then be made from the one pay. As only a small amour.t is involved - probably £5,000, or less, I suggest that, rather than be a party to retrospective taxation, the committee should alter the date of the commencement of the tax from the 1st November to the 1st December. A few years ago, when the present Opposition was in power, I opposed a taxation proposal which it was intended should operate retrospectively, and I am still opposed to making taxation of any kind or its remission retrospective. Our public servants are a fine, public-spirited body of men, and have subscribed hundreds of pounds monthly in Canberra for the relief of the unemployed. The amount involved is very small, but if an amendment is not made in the direction I have suggested, members of the Public Service will have to submit to a deduction covering three pay periods On a pay day falling within a short time before Christmas. In order to test the feeling of the committee, I move -

That the word “ November “ be omitted with a view to insert in lieu thereof the word “ December “.

Mr LYONS:
Acting Treasurer · Wilmot · ALP

– When this measure was drafted it was anticipated that it would be passed earlier. .From inquiries made I find,’ as the honorable member for Cook (Mr. G. Riley) states, that by the time the bill, has passed another place it will be necessary to make deductions covering three pay days. As the amount involved will not be large, I accept the amendment.

Mr GREGORY:
Swan

.- I oppose the amendment. It is most extraordinary to find the honorable member for Cook objecting to retrospective legislation when the Government of which he is a supporter has introduced numerous tariff schedules imposing rates of duty which become operative from the date on which they were tabled, and which the representatives of the people have not yet had an opportunity to discuss. Taxation in the form of additional customs duties has been in operation for many months.

The CHAIRMAN (Mr. McGrath).I ask the honorable member to confine his remarks to the clause.

Mr GREGORY:

– The taxation to be collected under this measure should amount to much more’ than the amount proposed, and in view of the necessity to reduce the cost of government in this country, particularly that of the Commonwealth Government, such an amendment should not be accepted. Parliament was not summoned early enough to discuss this and other important proposals. Delay occurred because the New South Wales elections were pending, and because of the dissension in caucus. The honorable member for Cook now objects to the discussion on this measure being unduly prolonged. I oppose the amendment.

Mr PROWSE:
Forrest

.-If the honorable member for Cook realized the position which will be confronting many of our primary producers during the approaching festive season, he would not put in a plea for public servants in receipt of regular incomes. In view of the necessity to raise all the revenue possible, the request is unreasonable. It is the duty of this committee to dispose of the bill as quickly as possible and to send it on to another place. The difficulty confronting a large section of the people is that they have not any money with which to pay their taxes, and in many cases are faced with bankruptcy. This is due to an absence of political vision and true statesmanship. I oppose the amendment.

Mr CROUCH:
Corangamite

– It is unreasonable to suggest that persons in receipt of over £60 a month cannot pay a tax of £9. Parliament should have been summoned earlier so that revenue from this source would now be coming in. Surely the honorable member for Cook does not suggest that persons in receipt of the salary I mentioned are not sufficiently thrifty to enable them to make payment of the amount due.

Dr EARLE PAGE:
Cowper

– If this amendment is carried honorable members will be regarded with contempt by the people of Australia. We should give a lead to the people of Australia, instead of standing shivering on the brink, afraid to put our feet into the cold water of reduction of our own salaries It is easy to say that this amendment has boon submitted in the interests of the public servants; but honorable members should remember that, if adopted, it will also benefit them.

Question - That the amendment (Mr. C. Riley’s) be agreed to - put. The committee divided. (Chairman - Mr. McGrath . )

AYES: 26

NOES: 19

Majority . . 7

AYES

NOES

Question so resolved in the affirmative.

Amendment agreed to.

Clause, as amended, agreed to.

Clause 4 -

This . Act shall not apply to -

b ) the salary, in any financial year com mencing on or after the first day of July, One thousand nine hundred and thirty, of any person who, in pursuance of an arrangement made for the purposes of economy, is, in that year, required to take leave without pay.

Clause consequentially amended.

Mr CROUCH:
Corangamite

– I wish to know the meaning of paragraph b of this clause. If a person were required to take leave without pay fora week, or for any short period, he might, be exempt from the provisions of the act. This clause might thus lead to great abuse. I presume that it is intended to apply it to officers in the Defence Department.

Mr Lyons:

– To the officers who are rationed.

Mr CUSACK:
EDEN-MONARO, NEW SOUTH WALES · ALP

– What is the present, rate of rationing of those officers?

Mr Lyons:

– In every case the rationing involves a greater sacrifice than would be required under this bill.

Mr CROUCH:

– What percentage of salary does it represent?

Mr Lyons:

– It varies.

Mr CROUCH:

– I have no desire to see an officer who is already rationed pay a double tax; but, under this clause, an anomaly could, and probably would, be created, resulting in the necessity for amending legislation. The minimum period of leave should be stated, so that the tax imposed by the rationing of these officers may not be less than that borne by other members of the Service.

Mr LATHAM:
Kooyong

.- I rise most unwillingly at this late hour to continue the discussion of this important bill. It is most desirable that all the clauses should be clear and unambiguous. Surely this Parliament has had sufficient experience of income tax legislation to appreciate the necessity for clothing it in unambiguous language. I draw attention to the words, “in pursuance of an arrangement made for the purposes of economy.” Those are vague words, and lack that precision which we are entitled to expect in a taxation measure. When an employeehas tostand down fora month it becomes disputable whether he is taking leave because of the need for economy, or because work is not available for him. The Postmaster-General (Mr. Lyons) has participated in a discussion regarding dismissals from his department. Have these been made in pursuance of an arrangement arrived at for the purposes of economy, or because there is no work for those employees to do? In a taxation measure, in which the language used should be definite and precise, it is dangerous to determine the liability of the taxpayer by reference to the motives of the Government. Therefore, some other phrase ought to be found to express the idea which we all recognize is intended fo be conveyed by the words to which’ I have referred. I do not desire to delay the committee at this late hour; but I ask the Acting Treasurer to reconsider the phrase with the object of eliminating all reference to purposes and motives, and. to deal with the matter in another place.

Progress reported.

page 685

ADJOURNMENT

order of Business. - Postal Rates on School Exercises. - Queensland Sheep Entering New South Wales.

Motion (by Mr. Fenton) proposed -

That the House do now adjourn.

Mr LATHAM:
Kooyong

– I rise to inquire what business the Government proposes to transact to-morrow. We have been anticipating a discussion on the Income Tax Assessment Bill. On Friday last we had the announcement that either that the bill or the Income Tax Rates Bill is to be materially amended. The speech made by the Acting Treasurer (Mr. Lyons), in introducing the assessment bill, dealt rather with the rates than with the bill which he was introducing. There was, indeed, little in the Acting Treasurer’s speech which related to the bill before the House. If the Government proposes to introduce amendments, I ask that they be circulated well in advance of the discussion. At best, an income tax bill is difficult to understand. I also suggest that the Acting Treasurer should introduce the rates resolution at once, in order that we may have it before us when the hill is under discussion. The proposal to increase property rates by 71/2 per cent, already outlined by the Acting Treasurer, does not find a place in the bill we have before us. I suggest that the House should have before it the whole of the material prior to being asked to embark on a discussion involving an alteration of income taxation. 1 hope that the Acting Prime Minister (Mr. Fenton) will indicate the nature of the business to be transacted to-morrow.

Mr RIORDAN:
Kennedy

.- I wish to bring before the House a matter of great importance to the people of Queensland - I refer to the increased postage rates on the tuition of children belonging to correspondence classes. In reply to a question to-day in regard to this subject, the Acting Treasurer said he would have inquiries made. It is not a matter which should occasion much delay in arriving at a decision. I should like to know who was responsible for imposing increased rates of postage on these lessons. I remind the House that the children affected are the children of parents who cannot afford to send them to centres where schools exist, or to engage tutors for them. The system of correspondence lessons, which was inaugurated in Queensland in 1922, enables children in the remotest parts of the Gulf and western, north-western, and central districts of Queensland to receive an education which otherwise they could not obtain. The classes started with an enrolment of 129 children; to-day more than 4,500 children are enrolled. The exercises are worked out by the children at home and sent to the department in Brisbane, where the examiners correct them, afterwards returning them with comments and advice. Because these comments are made, the Postal Department has recently decided to charge full letter rates on the exercises. Dealing with this matter the Brisbane Courier of the 20th November stated -

For the past seven or eight years the Correspondence School of the Department of Education, when returning corrected exercises to the children of the distant part of the State where schools are not available, have written useful remarks for the guidance of scholars. About a fortnight ago the Postal Department notified the Correspondence School authorities that such remarks must be paid for under the letter rate, as the department was losing revenue under the present arrangement. Since the notification was received the exercise has been returned corrected, but not annotated, pending a reconsideration of the matter by the Postal Department.

Surely there are other ways of effecting economies and balancing the budget than by placing additional handicaps on the education of these outback children. Already country residents suffer considerable inconvenience because of their distance from the centres of population. For instance, they are the people who will suffer most from the new additional duties on tea. They are unable to follow the advice to eat more fruit, or to drink more lemon squash; their only beverage is tea. It is time that there was a reorganization of the Postal Department. All its reforms appear to be directed against the outback dwellers. In many instances their mails have been cut down from a weekly to a fortnightly service. The correspondence classes to which I refer include children in the following districts : -

The system has been in operation for eight years, and has proved most successful. Many children who have not seen, the inside of a school have qualified through this correspondence course for entrance to secondary schools. This legislation was placed on the statutes of Queensland by a Labour government. It remained for the Commonwealth Labour Government to increase the postage rates on the mail matter despatched in connexion with the scheme. A large. number of teachers is employed in dealing with this correspondence. I wish to know who was responsible for increasing these rates, and why the matter was decided without reference to Parliament. The number of children affected by this decision exceeds 4,500, but the additional revenue received from this increase would be an inconsiderable factor in the finances of the department, and ^ should not be collected. The parents of many of these children could not possibly afford to send them to school. According to the latest report of the Queensland Department of Public Instruction, the children who receive this instruction are those of selectors, stockmen, boundary riders, grooms, fencers, carriers, timber-getters, fossickers, and, in fact, of all people who go out into the far outback away from even wireless communication, and certainly far from telegraphic and telephonic facilities. The Queensland Government is endeavouring to provide medical as well as educational facilities for these people, and I deeply resent the action of the Postal Department in increasing these postage rates. I feel so strongly on the matter that I intend to raise it every night on the motion for the adjournment of the House until the complaint has been remedied. To-day I received a telegram from the Winton Chamber of Commerce requesting me to ask the Government to remove the disability under which these children have been placed. I hope the Postmaster-General will be able to say to-morrow morning, at the latest, that the rates which ruled a fortnight ago will be restored.

Dr EARLE PAGE:
Cowper

– I associate myself with the protest made this afternoon by the honorable member for Oxley (Mr. Bayley), and repeated to-night by the honorable member for Kennedy (Mr. Riordan) against the increase in the postal rates on mail matter in connexion with the correspondence schools of Queensland. In view of the fact that every effort is being made by the State authorities to enable these children to obtain, at least, some education, it ill becomes the Commonwealth Government to place this obstacle in the way of the achievement of that laudable object. The policy of Australia is free and compulsory education, and the Commonwealth Parliament should not cause any departure from it. Enough money will be obtained, I might even say, robbed, from the teachers in Canberra, under the provisions of the bill we have been discussing this evening, to more than make up the difference in revenue between the old and new rates on’ this mail matter. I trust that the Postmaster-General will take immediate steps to remedy this complaint.

I understand that the Income Tax Assessment Bill is to be discussed tomorrow. I urge the Acting Treasurer to introduce the taxation rates motion immediately the House meets, and then allow the debate to be adjourned for at least 24 hours so that we may have an opportunity to understand the Government’s proposal. If such an adjournment is granted it might enable us to deal with this whole subject in one debate, whereas, if the introduction of the rates motion is delayed, it will, undoubtedly, cause two debates, and so occupy a great deal more of the time of Parliament than would otherwise be the case. The subject is difficult enough to deal with in any circumstances, and I, therefore, trust that the Government will give my suggestion favorable consideration.

Mr MARTENS:
Herbert

.- 1 associate myself with the protest of other honorable members against the increase in the postage rates on correspondence school mail matter. The children of the people who live on some of the islands on the Queensland coast are members of the correspondence school and they, in common with the children of the people far outback, will be seriously handicapped if the new rates remain in force. ‘ It is possible for some parents in these remote places to send their older children to a boarding school ; but unless children have already had the rudiments’ of education, they must be greatly handicapped. The itinerant system - of teaching in Queensland has done a great deal of good, but some places are so far removed from the centres of population that an itinerant teacher cannot visit them even twice a year. In such cases the correspondence school is of immense benefit to the children. As the honorable member for Kennedy (Mr. Riordan) has stated, the parents of most of the children affected are far from wealthy, and if it were not for this correspondence school their education would be limited to what their mothers could teach them, and there would be a great deal more illiteracy than at present. The Queensland Government has taken commendable steps to fit these children for the duties of life, and I hope that the Postmaster-General will not allow Mr. H. P. Brown, or any other postal official, to rob them of the meagre advantages that they may at present enjoy.

Mr MORGAN:
Darling Downs

– I also hope that the Government will remove the injustice that has been inflicted upon the children who live in the distant parts of a far-flung State like Queensland, by the increase in postal rates on correspondence school mail matter. This grievance should be remedied immediately.

I wish to bring another important matter under the notice of the Government. On the 18th November I asked the Minister for Health the following question : -

To what extent is the action of the New South Wales authorities, in imposing restrictions upon the entry of Queensland sheep into Kew South Wales, via Kyogle, for consumption in the northern river districts, an infringement of interstate free-trade and in violation of section 92 of the Constitution.

His reply was as follows : -

As sheep are recognized carriers of cattle tick, the movement into New South Wales of sheep from Queensland likely to carry red water tick is fraught with danger. The movement of such sheep has been subject to restrictions for many years. lt has been held by the Full Court that a State has the power to restrict the movement of stock likely to carry disease from another State. The restrictions in question are, therefore, not’ in contravention of the Constitution.

That was the official reply to my question. I do not think that the matter ought to be allowed to remain there. While the answer of the Minister was substantially correct, I desire to point out that sheep grown in Queensland rarely carry cattle tick, because they are born and bred far outside the tick infested areas of the State. Furthermore, the ticks carried are not pathogenic, and the eggs usually are infertile. Sheep could be procured from Queensland sale yards, or from the runs, without any risk. Having come from clean western stations to clean sheep yards, they could be accepted for immediate slaughter, or, as an alternative, dipping could be carried out, so that there would be no need to impose this restiction on trade. It seems to me that an attempt is being made to hold up this valuable interstate trade by means of what I can only describe as a wretched subterfuge. On the case as presented by the Minister it would appear that the quarantine laws are being used to defeat section 92 of the Constitution, which specifically provides for free and unrestricted trade between the States. I ask the Acting Prime Minister to see that the quarantine laws are not used to defeat this section.

M:r. BAYLEY (Oxley) [11.53]. - I am glad that I raised this matter of postage rates on school correspondence lessons, and I hope that, now that other members have spoken, the Minister will realize the seriousness of the position. These postal lessons mean a great deal to the children in outback districts. In the letter from which I quoted this morning the writer, referring to the comments which the teacher attached to lessons, said that he could not make such comments himself, as he had not had sufficient education, yet without them the lessons would be of little use. I realize that the increased charges have been imposed without the knowledge of the Postmaster-General, and I ask him to leave no stone .unturned - to see that the children of the far northern and western districts of Queensland are not denied the boon which has been enjoyed by the children of those districts for the last seven or eight years.

Mr LYONS:
Acting Treasurer · Wilmot · ALP

– The amendments to the Income Tax Salaries Bill have been circulated, as requested by the Leader of the Opposition (Mr. La than). I have also promised the right honorable member for Cowper (Dr.. Page) that copies of the resolutions will be made available to honorable members opposite. I cannot bring them forward formally in the House, because they cannot be presented until the bills have been dealt with. It has also been arranged that the extra time asked for to consider these bills will be granted, and to enable this to be done the South Australian Bank Sill will be taken before the second taxation bill. la regard to the postal charges on correspondence lessons, it is not clear whether the difficulty has arisen through a wrong interpretation of regulations and the law, or whether the regulations and the law compel the increased charges. I have every sympathy with the representations of honorable members, and I know the good work, which is being done by the correspondence schools. As Minister for Education in Tasmania, I was associated with their work, and I would be the last one to hamper it in any way. If the trouble is due to misinterpretation of the regulations by some official it will be corrected, and if it is due to something inherent in the regulations, that also will be corrected as soon as it can be done. I think, however, that some honorable members who have been very vehement on this subject, might have given me a little time to make the necessary inquiries. I gave an assurance this morning that inquiries would be made, and I am in the habit of honoring the assurances I give. They might have extended me a little more consideration, especially as they must realize the amount of work which a Minister has to do.

Mr FENTON:
Acting Prime Minister · Maribyrnong · ALP

– The representations of the honorable member for Darling Downs (Mr. Morgan), regarding quarantine restrictions as they apply to sheep, will be brought under the notice of the Minister for Health, who will make inquiries.

Mr Latham:

– Will the Acting Prime Minister inform honorable members what the Government’s programme is for to-morrow i Are we to go on with the South Australian Grant Bill?

Mr FENTON:

– Yes.

Question resolved in the affirmative.

House adjourned nt U.SS p.m.

Cite as: Australia, House of Representatives, Debates, 25 November 1930, viewed 6 July 2017, <http://historichansard.net/hofreps/1930/19301125_reps_12_127/>.