House of Representatives
17 April 1931

12th Parliament · 1st Session



Mr. Speaker (Hon. Norman Makin) took the chair at 11 a.m., and offered prayers.

page 990

QUESTION

FINANCIAL POLICY

Correspondence withcommonwealth Bank.

Mr THEODORE:
Treasurer · Dalley · ALP

by leave - An important letter was received by me recently from the Commonwealth Bank Board. As it related to matters of very grave national concern, and as my reply indicated the attitude of the Government to the demand of the bank, and dealt with financial policy, I think it desirable that I should place the correspondence before the House. The letter from the chairman of the Commonwealth Bank Board was as follows : -

Commonwealth Bank,

Melbourne, C.I., 2nd April, 1931.

The Hon. E. G. Theodore, M.P.,

Chairman of the Loan Council,

Canberra, F.C.T.

Dear Sir, -

The Bank Board has given serious consideration to the question of financial assistance, present and future, required by the various Governments, as submitted to the meeting of the board this week. The increasing demands which are falling on the bank, arising from the continuous drift of Government finances, which have become accentuated through this action of the New South Wales Government and the inability of the Victorian Government to obtain further assistance from the Associated Banks, has made it necessary for the board to give consideration to the ultimate capacity of the bank to continue to finance the Governments of Australia.

It would appear from the information in possession of the board, and any forecast which can be indulged in based upon such information, that not only is there at present no prospect of the Governments of Australia reducing their obligations to the bank, in the aggregate, but there is every evidence that the continuous drift in Government finance generally must lend to progressive and increasing calls upon the bank for financial assistance for the Governments.

It now becomes the unpleasant duty of the hoard to advise the Loan Council that a point is being reached beyond which it wouldbe impossible for the bank to provide further financial assistance for the Governments in the future.

Theboard have carefully reviewed the position of the bank as of the present, and the position which can be anticipated in the light of existing and future conditions, and having regard to these, it has arrived at a forecast of the probable limits to which the bank can go in providing Governments financial assistance, unless there is a definite change for the bettor in the financial position in the future, a possibility which there is no justification for anticipating at present. 1 am, therefore, to advise yon that, in the light of all existing circumstances and future forecasts, the bank will not be able to exceed a total of £25,000,000 represented by Treasury bills or overdrafts within Australia, and the present total advanced in London upon Treasury bills and debentures, amounting to £25,125,000.

For the information of the Loan Council, I attach hereto figures representing the progressive development of the bank’s assistance to the Governments of Australia at various dates up to, and including the situation as at this date.

I am further to advise you that as this bank is the banker for the following Govern ments, and as the board feel under obligations as their bankers to inform them of the position, I am forwarding a copy of this communication to the Treasurer of each of the Governments concerned for their information and such action as they may deem it advisable to take : -

Government of Victoria.

Government of South Australia.

Government of Queensland.

Government of Western Australia.

Government of Tasmania.

I shall be obliged if you, as Treasurer of the Commonwealth of Australia, will also accept this communication as applying in the same way.

Yours faithfully,

Chairman of the Board of Directors.

2nd April, 1931.

To that communication I, as Commonwealth Treasurer, sent the following reply:-

Commonwealth Treasury,

Canberra, 15th April, 1931

Sir Robert Gibson, K.B.E., Chairman of the Board of Directors, Commonwealth Bank of Australia, Melbourne, Victoria.

Dear Sir,

In Februarylast I submitted to the Commonwealth Bank Board comprehensive proposals which had been adopted by the Governmentas a means to ease the financial stringency and assist the nation towards budgetary stability. The co-operation of the bank in giving effect to these proposals was sought by the Government, but was refused by the bank.

The board now intimates to the Government that it will not provide financial accommodation to the Commonwealth or the State Governments beyond a point which will be reached in a week or two.

The attitude of the board throughout the recent negotiations, and as disclosed in the letter now referred to, can only be regarded by the Commonwealth Government as an attempt on the part of the bank to arrogate to itself a supremacy over the Government in the determination of the financial policy of the Commonwealth, a supremacy which, I am sure, was never contemplated by the framers of the Australian Constitution, and has never been sanctioned by the Australian people.

In financial matters, as in all other aspects of public policy, the Government is responsible to the electorate, and not to the banks, and this responsibility cannot be renounced by the Government except at the risk of grave danger to the democratic principles of the nation.

The control of the public purse has heretofore always been regarded as an essential prerogative of the people - a prerogative which is exercised, not by the banking institutions, but by the people’s representatives in Parliament. The Government will not be a party to any attempt by the bank board or any other authority to subvert this principle.

Reverting to your letter relating to the overdraft position, I must warn you that if the bank carries out its intention as expressed in the letter it must, within a few weeks, refuse to pay cheques drawn on the Public Account in the discharge of payments authorized by Parliament and covered by parliamentary appropriation. A persistence by the bank in this action will force the Governments, both State and Commonwealth, to dishonour their contractual and other obligations. There is no escape from these consequences, because no possible action that can be taken by the Commonwealth or State Governments in the near future, except by failing to pay just obligations, will have the effect of keeping the combined overdraft requirements down to the maximum which has been arbitrarily fixed by the board.

The Government does not question the right of the bank board to call attention to the increasing burden of the Government overdrafts, or to offer such comment or criticism as the board thinks proper; but the Government does seriously challenge the right of the bank to cut off money supplies to the Commonwealth Government, and to do this without consultation or prior discussion.

In order to clear up certain misconceptions which may exist in the minds of the members of the bank board, I take this opportunity to review the position as I see it.

The increased difficulty in balancing their accounts which is being experienced by the State and Commonwealth Governments is the outcome of the serious diminution of public revenues combined with an inability at the present time to raise loans on the local or overseas markets.

Both these difficulties arise from circumstances over which the present Commonwealth Government has had no control.

Customs revenue suffered a severe set-back owing to the tremendous decline in imports. Direct taxation diminished owing to the lesser volume of internal trade and the decreased earning power of industry due to lower prices and values.

Depressed prices and diminished trade have wrought havoc with the national finances of this and many other countries. Those who are responsible forgeneral monetary policy, especially for the disastrous contraction of credit, areanswerable for the present unhappy state of things.

The productive capacity/of the country has not been impaired. In Australia nature has not failed, but is as generous and bountiful as ever. What we are suffering from is a complete break-down of the man-controlled mechanism of exchange. Catastrophe has come upon us from a failure of the monetary system to meet the credit and exchange needs of the community.

The Australian banks, more particularly the Commonwealth Bank, cannot escape their share of responsibility in this matter so far as it affects Australia, for they blindly followed the overseas banks in pursuing a policy which forced Australian prices down in consonance with the slumped prices in overseas countries. The rapid deflation of credit which has taken place in Australia during the last eighteen months has brought in its train a collapse of trade, loss of commercial profits, thousands of business bankruptcies, and the creation of unemployment on a scale wholly unprecedented in the history of the country.

These calamities could have been mitigated, if not wholly avoided, if the Commonwealth Bank, with the co-operation of the private banks, had adopted a more liberal policy. If, instead of starving the community of credit during this period of crisis, they had pursued a policy of sustaining industry until it could adjust itself gradually to the altered economic conditions, Australia could easily have weathered the storm.

That this was within the power of the banks cannot seriously be denied. The banks themselves have given a clear indication of their ability in this respect in their communications to the Commonwealth Government. In a communication from the Commonwealth Bank Board in February, the undertaking was given that, conditional upon wages, salaries, pensions and social services being adequately reduced, the banks would provide funds to sustain industry and restore employment.

The Government is well aware that a more liberal bank policy, if such had been adopted, with its concomitant stimulation of trade, would have led to increased demands on the currency, and that this policy may have necessitated legislation to authorize an extension beyond the existing limits of the Australian note issue. It is the recognition of this necessity that has induced the Government to introduce the bill for a fiduciary currency, which is now before the Parliament of the Commonwealth.

The Government has not assumed that a mere change in monetary policy by the banks is all that is necessary to restore economic prosperity. It is fully aware that the loss of national income due to external causes must, in the main, be met by reduced costs in industry and reductions in governmental expenditure. The Government is earnestly endeavouring to do its part in bringing about the necessary adjustments, but declines to lend itself to proposals which place the burden almost wholly upon the shoulders of the wage-earners and certain sections of the primary producers. In this respect it is worthy of note that during the last twelve months the wages of the workers in Australia have been reduced through the variation or abolition of Arbitration awards by an amount which exceeds £40,000,000 per annum. On the other hand, those people who own fixed money claims against the Governments or against industry, amounting to about £70,000,000 a year, continue to enjoy their full income and have made no sacrifice.

The Commonwealth Government has not ignored the necessity for reductions in governmental expenditure as might be inferred from criticisms by the banks. Since the present Government assumed office departmental expenditure has been examined with diligent care, and economies have been effected which saved over a million pounds in the Government’s first eight months of office, and a further £1,230,000 during the present financial year. Moreover, the Prime Minister recently announced the action that is being taken to make adjustments in the salaries and emoluments of the public servants. These adjustments are expected to benefit the exchequer still further to the amount of £1,000,000 a year.

A campaign of economy alone, no matter how drastic, would be inadequate to bring about budget equilibrium. There can be no hope of a balanced budget nor a return to commercial prosperity while more than 20 per cent, of our employable citizens are out of work. Even the most drastic reductions in the governmental expenditure that have been advocated, at any rate by persons with any sense of responsibility, would result in savings in the Commonwealth expenditure amounting to not more than £2,000,000 or £3,000,000 in excess of the savings already effected. And no sensible person will say that £2,000,000 or £3,000,000 saved at the expense of old-age and war pensioners is all that stands between salvation and disaster for this nation.

In addition to economies in industry and in the governmental services, it is again emphasized that a radical change is required in monetary policy which will restore internal prices and enable industry and trade to resume their normal activity.

In formulating its financial proposals the Government have kept those fundamental axioms constantly in mind. On the other hand, the banks’ policy and attitude have done a great deal to create the widespread apprehension and fear which exist in the community to-day. In their attempts to force upon the Government a policy of wage and pension reductions the banks have allied themselves with a party political agitation which was calculated to engender controversial bitterness and- not create an atmosphere of general public confidence. The banks’ frequent declarations on the subject of reductions have become the chief weapon of a certain class of critic who believes economic troubles can be cured only by attacking the standard of living of the workers and by reducing oldage and war pensions.

The banks have frequently criticized the Governments in Australia lor over-expenditure of capital funds and for general extravagance.

While the present Government does not deny that Governments in the past have contributed to the financial difficulties by spending lavishly in the height of prosperity and by making drastic reductions at the time of depression, that responsibility can scarcely be laid at the door of the present Government. Nor can the banks in this matter be regarded as above reproach. Since the war years the banks themselves have drained vast sums of money from the Australian public, and from industry, by the high charges for their services. The increased charges have enabled the banks to double their declared annual profits in recent years, and, in addition, to build up colossal inner reserves at the expense of the community. From these gains the banks have expended millions of pounds in building palatial premises in ‘ every large city. In the principal streets in one city alone certain of the banks have, during the last two or three years, erected five magnificent and costly structures.

With respect to the difficulty which the Governments are experiencing in raising longterra credit, I remind you that the overseas money market for Australian loans became exhausted during the regime of the BrucePage Government. During that regime, in the three years to 30th June, 1929, Australian loans were issued in London at the rate of about £8,000,000 every two months. The market was bled white. During the last nine months of the Nationalist Government no longterm loans could be obtained. That Government left the credit of Australia in a thoroughly unstable condition, and, in addition, bequeathed to the present Government heavy debit balances in the cash accounts, an excessive drain on London funds, large arrears of long-term borrowing to meet expenditure already incurred, colossal maturing loans unprovided for, and a collapsing revenue. It is not on record that the Commonwealth Bank ever passed strictures upon the Nationalist Government for its reckless finance or threatened arbitrarily to stop that Government’s credit unless it agreed to a financial policy approved by the bank.

Might I also remind you that of the £130,000,000 of financial accommodation under all heads which has been provided by the Commonwealth Bank for tho Governments and governmental institutions of Australia, to which attention is called in your letter, more than £75,000,000 of that amount was provided by the bank before the present Government came into office, and that of the £25,300,000 direct and contingent liability due in Australia by the Governments to the bank, half was provided for Governments other than the Commonwealth Government.

Although the Commonwealth Bank Board appears in its recent actions to adopt a firm and resolute attitude in its dealings with the Governments, it has signally failed to distinguish itself by a display of similar attributes when dealing with the private trading banks. It has lately become painfully obvious that the leadership in banking policy has been indisputably assumed by the private banks.

It is known that the trading banks have been the final arbiters in determining interest and exchange rates from time to time, and that by their action in increasing such rates they have levied a heavy toll upon the whole community. In these matters it is regretted that the Commonwealth Bani; Board has allowed itself to be openly ignored and, in fact, has actually followed the lead of the private banks.

In concluding this statement of the Government attitude on the critical matters raised by the bank’s action, I have to express regret at the definitive tone adopted by the Board in the letter conveying its decisions. It seems to the Government that you have deliberately chosen ‘a course which, if persisted in, would close the door to further consultation or discussion.

In these circumstances, the Commonwealth Government for its part feels that you should be informed that the Government cannot be deflected from its definite policy by the unwarranted action of the Bank Board.

The Government intends to proceed with its parliamentary programme and can only hope that the Bank Board will consider its ultimatum and refrain from precipitating a crisis until Parliament lias had an opportunity of dealing with the finance bills.

Yours faithfully,

Edward G. THEODORE

Treasurer of the Commonwealth.

Mr LATHAM:
Kooyong

- by leave. - I rise to ask whether the Treasurer will move that the letters which he has read be printed, in order that the House may have an opportunity to debate them, and whether the Government will provide for such a debate on an early occasion. If the Government is prepared to do that, I shall say no more at the present stage than this: The House has been in the habit of giving leave to Ministers to make statements upon important matters affecting the public affairs of the Commonwealth. It has been the general practice that these statements shall merely contain information for the benefit of the House and of the public. The matter in the Treasurer’s letter to which we have listened this morning is, however, such as should find a place only in an argumentative and propagandist speech. There are proper occasions for the making of such speeches. They are a raison d’etre of Parliament, and nobody objects to argumentative and propagandist speeches being made here; but if the willingness of the House to give leave to Ministers to make important statements is utilized, as it was just now, the inevitable result will be that leave to make statements without notice will be refused. The result will be that debate must follow every ministerial statement. I do not think that members, as a whole, would regard that as desirable. There are many occasions when the making of ministerial statements for the purpose of conveying information to the House should be permitted. I inquire of the Prime Minister or the Treasurer if the Government is prepared to move that this document be printed, and to afford an early opportunity of a real debate on the matter ?

Mr Scullin:

– Yes.

Mr LATHAM:

– Then I shall only add one observation. I regard this correspondence between the Commonwealth Bank and the Treasurer as one of the most profoundly important things that has happened in the history of the Commonwealth. The questions raised, whatever our views upon them may be, are fundamental. They go to the very root of the problems of Australia to-day, and ought to be our first concern. . I am, therefore, glad that the Government is prepared to afford an opportunity of discussing them.

Mr ELDRIDGE:
MARTIN, NEW SOUTH WALES

– Can the Treasurer inform the House whether Mr. Duffy, as a member of the Commonwealth Bank Board, is associated with the letter addressed to the Government?

Mr THEODORE:
ALP

– The Board has communicated to the Government certain decisions at which it has arrived, but its letter contains no indication of the attitude of any individual of the board, nor am I informed whether the decision was arrived at byvote.

Mr MACKAY:
LILLEY, QUEENSLAND

– Can the Treasurer say whether the communication from the Commonwealth Bank Board was addressed to him as Chairman of the Loan Council ? If so, should it not have been presented to, and discussed by, that body before being mentioned in the House ?

Mr THEODORE:

– It was addressed to me as Chairman of the Loan Council, but a copy was sent to each State Treasurer and to me as Commonwealth Treasurer, with the suggestion that it should be considered as a communication from the Bank Board to each individual Treasurer as well as to the Chairman of the Loan Council. The Prime Minister has indicated that an early opportunity will be afforded to Parliament to discuss the matters raised in them, and therefore,

I move -

That the paperbe printed.

Debate (on motion by Mr. Latham) adjourned.

page 994

QUESTION

INTERNATIONAL LABOUR CONFERENCE

Mr BAYLEY:
OXLEY, QUEENSLAND

– When will the report of the Australian delegation to the International Labour Conference be laid on the table, and will the House be given an opportunity to discuss it?

Mr SCULLIN:
ALP

– I hope to be able to lay the report on the table next week, and an opportunity to discuss it will be given a little later.

page 994

QUESTION

SALES TAX

Mr LATHAM:

– Have representations been made to the Treasurer with reference to the operation of the Sales Tas Acts in the case of goods manufactured and taken into retail stock before the 1st August? I remind the honorable gentleman that when these measures were before the House it was, I think, incontestibly the view of the House that sales tax should not be paid in relation to the transaction of the sale of those goods. I understand now that the tax is being collected. Is the Treasurer prepared to consider making the law clear ?

Mr THEODORE:
ALP

– Large retail firms that engage also in manufacture directed my attention, when I was in Sydney a week ago, to what they regard as the injustice of the present practice. I have undertaken to go into the matter to see if any real injustice is being done, and, if so, how it may be rectified.

page 994

QUESTION

AUSTRALIAN WHEAT

Sale in Great Britain.

Mr HAWKER:
WAKEFIELD, SOUTH AUSTRALIA

– Will the Minister for Markets inform the House whether he made a considered statement on Tuesday in remarking that while he and the Prime Minister were in England protests were made against the British Labour Government admitting Russian slavegrown wheat into the British market in a way which affected adversely the selling capacity of Australian wheat? If so, can the Minister give any indication of the nature and vigour of those protests, and whether he has any hope that the action of the present British. Government may be different in future?

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– On the first day of the meeting of the Imperial Economic Conference, I submitted a motion for the appointment of a committee to go into the whole wheat position. The committee was formed, and I was made a member of it.We finally came to a decision in regard to a wheat quota for the Dominions, and it was unanimously decided that if the quota were given effect it would be highly beneficial. We passed that resolution on to the full conference, an.d it was eventually forwarded to the British Government, which undertook to give the matter careful consideration. Since our return to Australia I have noticed that the British authorities propose to introduce legislation to give effect to it.

Mr HAWKER:

– Can the Minister say whether the quota to which he refers prevents Russian slave-grown wheat from competing with grain grown under white-l abour conditions in the British Dominions; also whether he has any information concerning the details of the proposed legislation in Great Britain?

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– I have already informed the honorable member that the quota system was agreed to by a committee of the Imperial Conference, and that, if the recommendations of the Conference are adopted, a larger percentage of Australian wheat will be taken by Great Britain. This matter, I remind him, is one for the British Government to determine. All I can say is that the Australian delegation made strong representations and that the quota system was viewed favorably by the Conference.

Mr WHITE:
BALACLAVA, VICTORIA

– In the course of my speech during the committee stage of the Wheat Bill last night the Minister by way of interjection gave us to understand that he had made some protest to the British Government against the dumping of Russian wheat in Great Britain. Can he tell the House exactly what he did say?

Mr SPEAKER:

– It is not in order in directing a question without notice to ask a Minister for an expression of his opinions.

page 995

QUESTION

SURPLUS MILITARY STORES

Mr CUNNINGHAM:
GWYDIR, NEW SOUTH WALES

– Yesterday I received a reply from the Minister for Defence to a question I asked regarding the distribution to unemployed persons of surplus stocks of military clothing from the Defence Department. The Minister replied that the New South Wales Government could not see its way to pay for dyeing the clothing, and, in the case of that State, other arrangements have had to be made. He added that it. had been decided that distribution would be made to each Federal electorate in New South Wales, and the member representing each electorate would assume the responsibility of finding out what organization in the division was prepared to defray the cost of dyeing. Will the Minister take the matter up again with the New South Wales Government and urge them to bear this cost so that it will not be necessary for the cost to be borne by the organizations formed for relief purposes in the various electorates?

Mr CHIFLEY:
MACQUARIE, NEW SOUTH WALES · ALP

– This matter has already been taken up with the New South Wales Government on several occasions, and to the last communication forwarded to that Government no reply has been received. Regarding the second portion of the honorable member’s question, I shall give the matter consideration.

page 995

QUESTION

LAND TAX VALUATIONS

Mr KILLEN:
RIVERINA, NEW SOUTH WALES

– On the motion for the adjournment of the House some weeks ago, I drew attention to the fact that, notwithstanding the great decrease in the value of land, the valuations for land tax purposes are being increased throughout New South Wales. I then asked the Prime Minister whether he would make inquiries with a view to directing the valuers to take into consideration the decreased value of land, and reduce their valuations accordingly. Has the Prime. Minister yet investigated that matter?

Mr SCULLIN:
ALP

– I took that subject

Up with the Treasurer immediately it was raised by the honorable member, and the Treasurer has discussed it with the Commissioner of Taxation, who is at present investigating the whole position.

page 996

QUESTION

TASMANIAN MAIL SERVICE

Mr BELL:
DARWIN, TASMANIA

– As the steamship Oonah has replaced the Loongana for the winter season on the run between Melbourne and the north-western ports of Tasmania will an arrangement similar to that of last year he made whereby the time for the departure of that vessel will be delayed to allow the interstate mail arriving in Melbourne by the Sydney express at noon to be placed on board the vessel?

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

– I looked into that subject immediately the Oonah was placed on the Tasmanian run, and the practice adopted last year of delaying the steamer fifteen minutes after the scheduled time of departure is to be adopted, if possible, in order to catch the Sydney mail.

page 996

QUESTION

IRON AND STEEL PRICES

Mr GREGORY:
SWAN, WESTERN AUSTRALIA

– Can the Minister for Trade and Customs inform the House whether the Tariff Board has yet made an investigation into and reported upon certain allegations of restraint of trade and the fixation of prices, both wholesale and retail, by certain manufacturers, principally manufacturers of iron and steel products?

Mr FORDE:
Minister for Trade and Customs · CAPRICORNIA, QUEENSLAND · ALP

– An investigation is being made, not by the Tariff Board, but by departmental officers. The Tariff Board, I understand, inquired into the distribution of galvanized iron throughout Australia, and reported that the arrangements were entirely satisfactory. With regard to the other matter mentioned hy the honorable member, I shall make inquiries and let him know.

page 996

QUESTION

INTERSTATE TRADE

Mr WATKINS:
NEWCASTLE, NEW SOUTH WALES

– Has the attention of the Minister for Trade and Customs been directed to a statement reported to have been made by the Premier of Western Australia advising the people in that State not to have any dealings with the eastern States? If so, does not he consider such a statement an interference with interstate trade ?

Mr FORDE:
ALP

– I have not seen the report to which the honorahle member refers, but I shall make inquiries concerning it. It is inconceivable that the Premier of a State should offer such antiAustralian advice to the people.

page 996

QUESTION

CANADIAN TRADE

Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP

– Is the Minister for Markets in a position to inform the House of the position with regard to the trade treaty which, it is alleged, has been entered into between Australia and Canada? If the negotiations are being held up because of the illness of the Canadian Minister for Commerce, will the Minister, in view of the urgency of the matter, approach the Canadian Government with the request that the negotiations be taken up by some other Minister of the dominion?

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– Last week I informed the honorable member that, owing to the illness of the Minister for Commerce, the Prime Minister of Canada was conducting the negotiations; but in the absence of the Minister for Commerce, who is recuperating in another country, certain difficulties are arising, and it is difficult, in the circumstances, to overcome them. Negotiations are still proceeding.

page 996

QUESTION

DUTY ON BEESWAX

Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP

– Can the Minister for Trade and Customs state if the inquiry by the Tariff Board into the proposal to impose a duty on beeswax has been completed? If so, when will the report be laid on the table of the House ?

Mr FORDE:
ALP

– I shall have inquiries made. If a report has been received, I shall furnish a copy of it to the honorable member.

page 996

QUESTION

SUBMAKINES OTWAY AND OXLEY

Mr MARKS:
WENTWORTH, NEW SOUTH WALES

asked the Minister for Defence, upon notice -

What were the conditions, if any, financial or otherwise, arranged with the British Government for the taking over of the two Australian submarines, Otway and Oxley, and is such transfer permanent or temporary?

Mr CHIFLEY:
MACQUARIE, NEW SOUTH WALES · ALP

– These two submarines form part of the Empire quota under the London Naval Treaty, and it is important that they should be maintained in the highest state of efficiency. The Naval Board reported that this was very difficult in Australia, where they were a small specialized unit. The British Government was consulted, and agreed to take oyer the submarines as a free gift, and maintain them at their expense. The transfer is permanent.

page 997

QUESTION

MOVEMENTS OFROYAL AUSTRALIAN NAVY

Mr WARD:
through Mr. Lazzarini

asked the Minister for Defence, upon notice -

Whether any unit of the Royal Australian Navy has recently been despatched to Chinese waters; if so, for what purpose?

Mr CHIFLEY:
MACQUARIE, NEW SOUTH WALES · ALP

– No unit of the Royal Australian Navy has recently been despatched to Chinese waters.

page 997

QUESTION

NEW SOUTH WALES DEBTS

Mr LONG:
through Mr. Coleman

asked the Treasurer, upon notice -

Can he supply the following information : -

  1. What is the amount of annual interest payable to Great Britain by the New South Wales Government on loans raised for public works and general Governmental requirements ?
  2. What amount of interest commitments has the same Government incurred from war debts ?
  3. Is it a fact that no State Government, as such, has any responsibility in respect of war debts ?
Mr THEODORE:
ALP

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

  1. No interest is payable to the Government of the United Kingdom in respect of loans raised for public works and general Government requirements, but interest amounting to approximately £8,000,000 per annum is payable to bondholders resident in Great Britain in respect of loans raised in London by and on behalf of New South Wales.
  2. New South Wales has no interest commitments in respect of war debts.
  3. Yes.

page 997

QUESTION

GALVANIZED IRON

Mr GREGORY:

asked the Minister for Trade and Customs, upon notice -

  1. Is it a fact that in the Western Australian newspapers of the 4th instant, the following prices, wholesale, of galvanized corrugated iron are quoted: - 26 gauge galvanized corrugated iron,6 feet to 8 feet, £30 12s. per ton; 9 feet, £31 2s.6d; 10 feet, £31 12s.6d.; Perth rates, 15s. extra?
  2. Is it a fact that iron of British “Orb” brand can be imported into Australia at £16 per ton, less duty and exchange?
  3. What action is he taking to carry out the promise that there would be no increase in price if the duty were increased?
  4. What action has been taken in regard to the charge made that manufacturers of these goods were making special rebates to those within certain associations.
Mr FORDE:
ALP

– Information is being obtained.

page 997

QUESTION

NEW COMMONWEALTH APPOINTMENTS

Mr GULLETT:
HENTY, VICTORIA

asked the Prime Minister, upon notice -

What are the names, official positions, and salaries of any appointments or promotions by the present Government to positions carrying a salary of £500 per annum or over?

Mr SCULLIN:
ALP

– I am obtaining the particulars desired by the honorable member, and will make them available at an early date.

page 997

QUESTION

NORTHERN IRELAND DEBTS

Mr LEWIS:
through Mr. Crouch

asked the Treasurer, upon notice -

  1. Is it a fact that the payment of the sum of £7,000,000 per annum to the British Government is one of the contractual obligations of the Parliament of Northern Ireland?
  2. Is it a fact that last year only £150,000 of the £7,000,000 due was paid?
  3. Has he knowledge of any action contemplated or taken by the British Government with respect to the default of the Government of Northern Ireland?
Mr THEODORE:
ALP

– The information is being obtained and will be furnished as soon as possible.

page 997

QUESTION

BRIEFS OF NON-RETURNED SOLDIER COUNSEL

Mr WHITE:

asked the AttorneyGeneral, upon notice -

  1. Did the Melbourne barrister, Mr. A. M. Fraser, serve his articles under Mr. Frank Brennan or any member or employee of the firm of Frank Brennan and Company, or of any firm of which the present Attorney-General was a member? 2.is he the same Mr. A. M. Fraser who has been paid or is entitled to receive fees amounting to £445 or thereabouts in connexion with the intervention by the Commonwealth in the recent basic wage cases?
  2. What other fees have been paid or become payable to Mr. A. M. Fraser by the Commonwealth since the present Government assumed office ?
  3. What fees have been paid or are payable to non-returned soldier counsel briefed in Victoria by the Commonwealth since the present Government assumed office?
  4. What fees have been paid or are payable to returned soldier counsel briefed in Victoria by the Commonwealth since the present Government assumed office?
  5. What alteration was made by the present Government in the preference principle in respect of the allocation of Crown briefs ?
  6. Did the Federal Congress of the Returned Sailors and Soldiers Imperial League of Australia pass the following resolution: - “That this congress regards as unsatisfactory the explanation of the Minister in regard to the Modification of the preference principle in respect of the allocation of Crown briefs and seeks an assurance that full preference will be restored.”?
  7. Has any action been taken to restore the preference policy as administered by the last Government with respect to the briefing of counsel 1
Mr BRENNAN:
Attorney-General · BATMAN, VICTORIA · ALP

– Tlie information will be supplied.

page 998

QUESTION

FEDERAL CAPITAL TERRITORY ADVISORY COUNCIL

Mr LEWIS:
through Mr. Crouch

asked the Minister for Home Affairs, upon notice -

  1. Are members of the Federal Capital Territory Advisory Committee entitled to be addressed as “ councillors “ ?
  2. Did. the two successful candidates, who were members of the Commonwealth Public Service, obtain permission’ to be candidates from the Public Service Board?
  3. How many hours leave of absence have these members obtained to attend the meetings of the Advisory Council, and was such leave granted with pay?
  4. If such leave with pay was granted, did they receive an allowance for attending council meetings ?
Mr BLAKELEY:
DARLING, NEW SOUTH WALES

– The information is being obtained and will be conveyed to the honorable member as soon as possible.

page 998

QUESTION

FINANCING OF EAST-WEST RAILWAY

Mr THEODORE:
ALP

– On the 26th March, the honorable member for Angas (Mr. Gabb) asked the following questions, upon notice -

  1. Whether the east-west railway line was financed from the Commonwealth note issue?
  2. If so, to what extent, in terms of money ?
  3. What amounts, if. any, have been repaid to the Note Issue Department as repayment of principal and payment of interest?

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

The capital cost of the east-west railway is £7,800,000, of which £1,200,000 was provided from revenue, and £6,000,000 from works loan fund.

Up to 1920, the works loan fund was financed from investments of the notes fund and other Commonwealth trust funds, and the moneys so borrowed were used for other works as well as the east-west railway.

When the notes issue was handed over to the Commonwealth Bank, in 1920, the total investments in Commonwealth securities were £.10,858,000, of which £7,780,000 represented the investment of profits. The securities representing the investment of profits were retained by the Treasury and cancelled, and £3,078,000 of securities were transferred to the Commonwealth Bank as portion of the assets of the notes fund.

So far as the east-west railway is concerned it is estimated that approximately £5,300,000 was financed from investments of the notes fund in Commonwealth securities, of which £3,428,000 may be regarded as representing profits and having been cancelled in 1920, and the balance of £1,872,000 may be regarded as still current and bearing interest at 3) per cent.

page 998

QUESTION

NORTHERN TERRITORY

Tantalite Deposits

Mr BLAKELEY:

– On 15th April, the honorable member for the Northern Territory (Mr. Nelson) asked me the following questions, upon notice -

With reference to the press statements in connexion with the exhibition of mineral resources at the Imperial Institute, South Kensington, England, at which extensive exhibits of metals were made by all States of the Commonwealth, and in view of the special stress laid on the importance of a metal known as “ Tantalum “, and the statement that samples of only mica and copper came from Central Australia, will the Minister state -

Is it a fact that in the Northern Territory there are known deposits of Tantalite containing “ Tantalum “, which are capable of supplying the world’s present demand?

What is being done by the Government to find markets for this rare metal?

Who was responsible for the paltry exhibits of the mineral wealth of the territory at the exhibition mentioned?

Is it a fact that the Northern Territory contains almost every mineral known?

Why were samples of the various metals not sent to the exhibition, with a view to attracting attention to the mineral wealth of the territory?

I am now in a position to advise him as f follows : - 1 and 2. Tantalite is found in certain localities in North Australia, viz., Bynoe Harbour; on the Finnis River, fifteen miles north-west of Rum Jungle; and in the West Arm district.

The world’s present requirements of Tantalum are very small, being estimated at between ten and twenty tons per annum. Advices from the Imperial Institute last year indicated that the demand was increasing, “and practically the whole of the present demand was being met from Western Australia. Up to the present, it is reported that only two firms have produced Tantalum commercially, i.e. Siemens and Halske A.C., of Charlottemburg, Berlin, and the Fansteel Products Company Incorporated, of North Chicago, Illinois, United States of America, each company having its own process of production.

In 1927 and 1928, H and 26 cwts. of tantalite, respectively, were recovered, and were sent to the United States from the Mount

Finnis Mine in the territory. In 1028, the owners made a contract to supply twenty tons to the Fanstoel Products Company of North Chicago. The owners of this mine have been granted assistance from time to time by the Government for the purpose of working the deposit, and marketing the product. 3 and 5. The Department of Markets advises that the exhibits were supplied by the State Governments at the request of the Commonwealth, and that it is regretted that arrangements were not made for a special exhibit from North Australia.

  1. A wide range of minerals has been identified in the Territories of North and Central Australia.

page 999

QUESTION

SENATE VACANCY

Mr BRENNAN:
ALP

– Recently the honorable member for Corangamite (Mr. Crouch) addressed a question to me relating to the Senate vacancy caused by the lamented death of Senator H. E. Elliott. I am now in a position to inform him that section 21 of the Constitution provides that whenever a vacancy happens in the Senate the President shall notify, the same to the Governor of the State in the representation of which the vacancy has happened. I have ascertained that a notification to the Governor of the State of Victoria in relation to the vacancy occasioned by the death of Senator H. E. Elliott was despatched by the President on the 2nd April, 1931.’ The method of filling casual vacancies is laid down by section 15 of the Constitution. The vacant seat is filled by the Houses of Parliament of the State sitting and voting together, and choosing a person to hold the place until the expiration of the term of the last holder, and if the Parliament of the State is not in session, by an appointment by the Governor-in-Council of that State. Such action required of the Commonwealth in connexion with this matter has been taken, and the further proceedings to fill the vacancy are for the Parliament or the Governor-in-Council of the State of Victoria.

page 999

HIGH COMMISSIONER’S OFFICE

Report by Mr. Coleman, M.P.

Mr SCULLIN:
ALP

– I lay on the table the following paper : -

Organization of the High Commissioner’s office, London, and the activities associated therewith - report, with appendices, by Mr. P. E. Coleman, M.P., chairman, Commonwealth Parliamentary Joint Committee of Public Accounts - London, 14th August, 1930.

Mr COLEMAN:
Reid

.-! move -

That the report be printed.

In submitting the motion I wish to express my appreciation of the action of the Government in entrusting this investigation to me during my absence abroad last year. I undertook it £.s a matter of public duty. The task was by no means a pleasant one, seeing that it involved the retrenchment of certain officers and the abolition of certain positions. I endeavoured to go into the matter as exhaustively as time permitted. I tried to be impartial and just in my conclusions, and the report now tendered represents my careful and considered judgment. I do not propose to review it in detail, but 1 shall endeavour to explain its principal features.

The report will no doubt be circulated among honorable members. I made the investigation with a recognition of the need for urgent and imperative economy, more especially as overseas expenditure was involved. My recommendations, particularly in regard to staff changes, were influenced by my belief that every £1 spent outside Australia under the existing economic circumstances was draining this country of so much of its life blood. Certain changes necessitating the return to Australia of a number of public officials effected an economy in London expenditure besides reducing overseas payments, although some critics claim that ‘no economy was involved in those changes. The inquiry extended over six weeks, during which period I was engaged for some time from early morn until midnight. I mention that in answer to those critics who say that the inquiry was unduly prolonged.

The exhaustive character of the report, with its accompanying appendices, will satisfy any one who peruses them that the task given me was treated with the seriousness and importance that it warranted, and, in respect of the recommendations, no attempt was made to try to seek party capital. The justification for the inquiry, if any is needed, is to be found in the report itself, which recommended savings in the cost of Australia House of over £30,000 per annum, and in other directions economies are suggested of £151,399, making a total of £182,307. While the Government may not have found it practicable on the ground of policy^ or because of contractual agreements of which I have no knowledge; or because of disagreement with certain of my views, to give effect to all my recommendations, I understand that considerable savings have already been made, and these will no doubt be referred to by the Government. The report lays down a basis for further economies without a reduction of efficiency. It checks further extravagances, and gives the necessary impetus to reform in the Australia House administration.

The cost of this inquiry to the Commonwealth was £160. An overhaul of the London organization was long overdue. Australia House has been subjected to repeated and continuous criticism by members of Parliament, by returning travellers, and by the press of Australia. While much of this criticism may have been unfair and exaggerated, nevertheless it indicated a deep-seated dissatisfaction which warranted an investigation by the present Government. As a result of this criticism, which has continued now for many years, a number of examinations of Australia House have been conducted by Ministers, but the last comprehensive inquiry was made by General Ramaciotti on behalf of a royal commission which was appointed in 1920 to investigate economies in the Public Service. That inquiry was spread over a much longer period than mine, and the report of General Ramaciotti was brief. I am surprised to find that, although he made many valuable recommendations, few of them were acted upon. In my report I found occasion to refer to the fact that if certain recommendations in the 1920 report had been adopted many economies and better efficiency would have resulted. Senator Sir Hal Colebatch, one of the more recent parliamentary critics of Australia House, said in the Senate on the 13th March of last year that it would be easy to reduce expenditure at Australia House by £50,000 per annum. The Prime Minister and many members on both’ sides of the House have from time to time found it necessary to criticize our London organization. I mention that to justify, if necessary, the action of the Government in instituting this inquiry. A few weeks before I left Australia, Mr. E. C. Knowles, a former mayor of Williamstown, told the Melbourne Herald, on. the 29th January, 1930, that Australia House was a white elephant, and might just as well be scrapped. Two former Agents-General of South Australia, Mr. Homburg and Sir Edward Lucas, and Mr. Hudd, M.P., of that State, all criticized Australia House last year. The associated chambers of manufactures at a conference held in Sydney, in October, 1929, carried a resolution unanimously asking the Federal Government to institute an independent inquiry, so that Australia House might be placed on an efficient footing. At that conference Mr. Sevier, the president of the Sydney Chamber of Manufactures, indulged in severe criticism, and Mr. Joshua, of the Victorian Chamber of Manufactures, suggested that England would laugh at our London organization had it not so many other things to laugh at. The Melbourne Age, in a series of leading articles at the beginning of 1930, urged that an exhaustive inquiry should be made. On the 1st January, 1930, that newspaper in a leading article said -

What is unquestionable from even a superficial examination of this gigantic and expensive department is that it requires a thorough overhaul. Ministers have gone to London to investigate and reform, and have fallen down on their job. The cost of the department ought to be visible in the estimates, and the estimates ought to be prepared in a form that will enable any person of average intelligence to learn quickly what his country is paying for this service . . . . It is a commonplace that a representative of the Government, entering this building in London with the best intentions is soon captured by the forces that meet him. From being their master ho becomes their servant. They set out to prove as an indispensable necessity that they should be left alone.

I recognize that it is not possible for a Minister, because of his manifold public duties, to go abroad to carry out a thorough inquiry. I have no wish to criticize the former Government in that respect. It was impossible for the present Prime Minister to examine personally the London organization, and the Government saw fit to ask me in my capacity of chairman of the Public Accounts Committee to carry out the inquiry. I believe that during my absence abroad the action of the Government, and my qualifications for the task, were strongly criticized. Let me say that I have had actual experience of the London office, having been engaged there for some months after the Armistice. I was materially assisted during the inquiry by Mr. J. B. Collins, the financial adviser, who investigated various branches relating to public accounts, and also .by Mr. Farrands, the assistant secretary, who was formerly the secretary of the Development and Migration Commission. He performed a useful service in examining the migration staff. While in London I interviewed various High Commissioners, and Agents-General, and investigated the London agencies of the Export Control Boards. It has been stated in the British-Australian and New Zealander, which circulates in London, and is obtainable in this building, that I slighted the High Commissioner and the Official Secretary. I wish to give that statement an emphatic denial. My relations with the High Commissioner and the Official Secretary were quite amicable. I extended to them courtesy and consideration, and gave instructions that all documents and information obtained by me from the staff should pass through the Official Secretary, I invited them to express their views and to make suggestions for economies. The Official Secretary made a number of suggestions, with some of which I agreed. In some cases I took an opposite view after consultation with Mr. J. B. Collins and Mr. Farrands. For instance, it was suggested that £1,000 might be saved by reducing expenditure on cleaning Australia House. I considered that such a saving would not be conducive to efficiency, to health, or to the prestige of the Government, and I disagreed with that suggestion.

It has been said, that I did not discuss my report with the officials of Australia House. My report was presented to the Prime Minister, and it was a matter for him to determine when and how it should be made available. I did not discuss the proposed economies with the High Commissioner, Sir Gran- ville Ryrie. He did not evidence any desire to make suggestions. I have no wish to criticize him behind his back, as has been done in my own case, other than to say that the High Commissioner was not in a position to make suggestions concerning the organization of the office in London. Under existing conditions the position of High Commissioner in London does not carry that measure of direct responsibility in executive control that it would do if the original terms of the High Commissioner Act were given effect. If honorable members opposite disagree with the view which I am endeavouring to couch in the mildest language, I suggest that they discuss the Australia House organization, and the qualifications of the High Commissioner, with certain members of their own party in another chamber who were recently in England. The High Commissioner Act contemplated the appointment of ah official who would take direct control of the London organization. But since the creation of the office, that principle has not been followed. It is certainly not followed at present. A wrong principle has been pursued throughout by appointing men. who have arrived at the climax of their political careers, and in that sense they have not had any vision for the future, nor have they given that close attention to the administration of the London office that is required. In passing I make this contrast : In the case of South Africa a comparatively young man is the High Commissioner, and he exercises personal and direct control over his office. In the case of Canada, the Premier of one of the biggest provinces in that country was recently appointed High Commissioner in London. In the case of India, Sir Atul Chatterjee, a brilliant full-blooded Indian, is the High Commissioner. We cannot expect . to obtain the best results from our London representation unless we select the best man available to carry out this important and onerous diplomatic and trade function. If it were practicable, I would suggest that it would be preferable to have a resident Minister in London, in constant touch with the policy and views of the Government that happened to be in power; but there are insuperable difficulties in the way. What Canada can do we cannot. That nation is within ten days’ sail of London, and it takes six weeks to travel by boat from Australia to England.

I realize that the ideal cannot be realized in that respect. I believe that the appointment of the Canadian High Commissioner is purely political, and there is no specific term of appointment. Sir George Perley, whom I met in Ottawa, acted as High Commissioner for Canada for an indeterminate period - while the Government to which he owed allegiance remained in power - and his appointment terminated with the defeat of that Government. I do not know whether Canada is still following that principle, but the contention at Ottawa was that the High Commissioner should represent the views of the Government. I realize that there are difficulties to overcome. It is futile to expect a man to accept responsibilities unless he has a definite contract. It seems to me that issues such as this should be raised and discussed so that honorable members mayrealize that our system in respect of the London organization is not an ideal one. A perusal of my report will indicate that the High Commissioner’s position is the most lucrative government post of its kind. The remuneration is considerably higher than that of any of the other dominion. High Commissioners, and I say advisedly, and without any desire to be uncharitable or personal, that we .do not get as much for the money we are spending as do some of the other dominions. If we had no High Commissioner in London we might suffer certain inconveniences, ‘but business would go on just the same. Iti Australia House there is an army of experts discharging various functions which, iti the case of certain other Of the dominions, are discharged by the High Commissioner himself. Without a High Commissioner the only loss we should suffer Would be the lack of a figure-head to represent Australia on public occasions, and a mouthpiece to express our policy through the press. We pay the High Commissioner a salary of £8,000 a year, together with £2,000 for expenses. He is paid that amount regardless of the actual expenses incurred, and in addition a residence is provided at a cost of £1,300 a year, which includes rates and taxes, maintenance of residence, furnishing and maintenance of certain servants. A car is provided with a chauffeur, together with petrol, oil and other expenses, which coat in all £520 a year, while emoluments and expenses received for attending conferences each year amount to £500. Therefore, the total payments to the High Commissioner amount to £7,325, which was until recently free of Australian income tax, and is certainly free of British income tax. In contrast with this, the Canadian High Commissioner receives- £5,000 a year, and has to provide his own residence and car. The South African Commissioner, who holds office on the same terms, receives £4,000 a year, while the High. Commissioner for New Zealand is paid £3,000 a year. The cost of the High Commissioner in London to-day is nearly as much as the whole office cost in 1910. In that year our London representation cost £7,592. There are two aspects of Australia’s overseas representation to which I wish to draw attention - the diplomatic and the trade aspects. It is difficult for one man satisfactorily to discharge both functions. Some officer, not necessarily on a high salary, or with any high-sounding title, should be vested with the responsibility of controlling the various trade activities at Australia House. At present there is no coordination, no central authority controlling these activities, and obviously it is necessary that somebody should be there to do this work. Whoever acts as trade commissioner should undoubtedly be subordinate to the High Commissioner. There should be but one official iri. London charged with the responsibility of speaking for Australia.

Australia House is the most pretentious of all the dominion offices in London, It was a costly mistake. The use of Australian materials added, greatly to the cost, with the result that the capital cost of the building is £1,000,000. Then it is in the wrong position. It is too big for our needs, and, in consequence, private tenants have been taken into the building, and their accommodation adjoins the various official departments conducted there. What is the result? While I was in London it was found necessary to ask a tenant to stop advertising in the press directing clients to apply to the “ Managing Director “, Australia House, lest the public might be induced to believe that th«

Australian Government guaranteed the bona fides of this trader, and that the person referred to was a government official. Honorable members will recall the trouble which occurred over the selling of blocks of land allegedly situated in Canberra. One reason for this trouble was that the office from which the sales were ‘being conducted was situated in Australia House, and it was believed that the public were influenced in favour of the company’s proposition because of that fact. I consider that the private tenants in Australia House should be separated from the departments. Much of the surplus accommodation would be used, officially if all the Agents-General could be induced to move their offices to Australia House. I put the matter to them when I was in London. Both Queensland and Western Australia have their offices in better positions than Australia House; there is a larger flow of traffic past them, and they occupy them on advantageous terms of tenancy. It would be almost impossible, I believe, to induce these State Governments ‘ to remove the offices of their Agents-General to Australia House. Honorable members do not, perhaps, realize the magnitude of Australia House. If the whole of the office space were let, the amount received in rent would not pay interest amounting to 2£ per cent, on the cost of construction, after paying rates and other expenses. Interest charges amount to £50,000 a year; rents received amount to £26,000, while maintenance rates, taxation, &c, come to £19,000, which makes the net return from rents only £7,000. Much of the space in the building is wasted, and the building itself is in the wrong position, being on an ‘ island site. Although it constitutes an excellent monument, and provides a conspicuous landmark for tourists in London, the fact that it is on the wrong side of the road, and situated on an island site, diverts the stream of traffic to the opposite side of the Strand. People will not risk injury in the traffic by crossing the street to the building. That is the considered opinion of every one I have been able to consult on the matter in London.

2ST

Mr Maxwell:

– Would it be practicable to move our .offices ?

Mr COLEMAN:

– Thousands of people are continually passing along the opposite side of the street at night, but Australia House is left in almost complete darkness. There is nothing to show that it is Australia House. If one goes down the Strand, one sees the offices of the South African High Commissioner brilliantly flood-lighted, although they are only temporary premises. This challenges the attention of every one to the London office of the Union, of South Africa. The honorable member for Fawkner (Mr. Maxwell) asks whether it would be practicable to abandon Australia House. I did not make that suggestion in my report, because I thought it would be, perhaps, a little too advanced. I realized the difficulty of getting rid of the building; but if it were possible to alter the site I should certainly advise that and the alteration of the whole structure. In that building of ten floors there is half a mile of corridors.

Owing to the need for economy, 29 appendices to the report have been prepared, but not printed. They contain a great deal of information regarding the financial administration of Australia House, and would well repay honorable members the trouble of reading them.

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

– Have any of the other dominions represented in London a central office, and Agents-General as well?

Mr COLEMAN:

– I shall deal with that presently. The figures accompanying my report have been compiled at my direction by the accounts branch of Australia House, and are certified to as correct. I myself, did not obtain any figures from the offices of the AgentsGeneral, but I asked the accounts branch to obtain them for me. This they did by consulting the budget-papers of the various States, the same course being followed in order to obtain information in regard to the London offices of the other dominions. As I have said, the figures quoted have been certified as correct, and if any mistake has occurred k is not mine. In 1910 the cost of the Australia House organization was £7,592

Mr Gullett:

– Australia House was not in existence in 1910.

Mr COLEMAN:

– I thank the honorable gentleman for his correction. What I meant wasthat the cost of Australia’s representation in Loudon in 1910 was £7,592. The peak cost of this organization was reached in 1921, when it amounted to £76,514. In 1924 the cost had receded to £54,008, but it increased to £66,133 in 1929; while since the war there has been a remarkable expansion of other activities,such as boards, commissions, &c., not covered by, or included in, the High Commissioner’s vote. The total cost in 1929 of our London organization was £135,800, while in 1930 the cost was £124,841. If the cost of trade publicity is added, the total expenditure on our London organization exceeds £200,000 per year, and interest on the cost of building brings the amount up to £250,000 a year. If we add the cost of the offices of the Agent-General, which is a charge on the taxpayers of Australia, the cost revealed by budget papers certified as true by the accounts branch of Australia House is increased by a further £69,000. Then there is the cost of naval, military and air training in Great Britain. I have not had an opportunity of examining this expenditure closely, or of forming an opinion as to how far it is justified. I could not do everything in six weeks. The cost to Australia of naval, military and air training in Great Britain exceeded £61,000 last year.

Mr White:

– That is offset by reciprocal arrangements entered into with the British Government.

Mr COLEMAN:

– That may be so; I have not had an opportunity of going fully into the matter. It remains true, however, that it comprises part of the cost of our overseas representation, and under the existing rate of exchange it becomes an onerous burden. The cost of export control boards amounts to £14,000 a year, so that the total cost of Australian representation in London by the Commonwealth and States, including defence training, exceeds £401,000 a year. We can deduct from this gross amount the cost of export control boards, because the producers pay for those organizations although the taxpayers contribute through the increased cost of commodities. We could also deduct half the cost of trade publicity, which is borne by the interests subscribing to the scheme. After making these deductions, the total net cost of Australia’s London representation amounts to £312,682.

These figures speak for themselves; but in case anyone may think that Australia’s oversea representation is cheaply controlled, I ask him to compare its costs with that of the other dominion offices as set forth in an appendix to my report. The total expenditure for Canadian representation in Great Britain in just in excess of £143,000 a year.

Mr Gullett:

– Does that include the cost of propaganda ?

Mr COLEMAN:

– I am coming to that. Of the amount I have mentioned, £68,000 was expended on migration, leaving a net balance of £75,000 to cover the cost of representation. The Canadian building is smaller than ours, and the staff carried is also smaller. Moreover the Canadian Government does work in London which is done on behalf of Australia by the State Agents-General. Canada spent £68,000 last year on migration, as compared with £5,000 spent by Australia.

Mr Hughes:

– Does the figure which the honorable member has quoted in respect of Canada cover the cost of all activities ?

Mr COLEMAN:

– It does not cover the cost of Canadian provincial representation. South African representation in. London, excluding non-recurring charges, amounts to £65,000 a year, and the cost for New Zealand, with its unitary government, is £52,000.

Mr Hughes:

– New Zealand has only one-sixth of the population of Australia.

Mr COLEMAN:

– That is so, but the £52,769 covers all the responsibilities now discharged by Australia House, and the Agencies-General. The Australia House staff - 121 males and 126 females - is considerably greater than that of’ any other dominion, and the salaries are very much higher. It was not my business to recommend reductions of salaries, but I direct attention to the large number of high salaries. Of the staff, 43 are Australian born, and 20 are ex-members of the Aus- tralian Imperial Force who are not Australian born. I am not a believer in creating Public Service positions in London. Australia House should be run as a business organization. A few of the higher executive positions should be filled from Australia, but such appointments should be strictly limited in number because of the cost involved in the periodical transport of officers to and from London, amounting approximately to £1,000 for each officer. When vacancies occur in the general staff at Australia House preference should be given to Australians who are in London, but officers should not be sent from the Commonwealth to fill them. Of the staff at Australia House three are paid salaries of £2,000 and over; three, £1,500 and over ; five, £1,000 and over ; five, £900 and over ; four £800 and over; eleven, £700 and over; and 39, £300 and over. Those 70 officers, almost without exception, are men. One single woman receives £372 a year for supervising typists. The cost of living in London is less than in Australia. In seeking avenues of economy I decided to devote my attention to the higher positions - to lop some of the forest giants rather than clear the undergrowth.

The honorable member for Henty (Mr. Gullett) asked whether the provinces of other dominions have representatives in London. I remind the House that this statement is a recital of facts, ascertained by careful inquiry, rather than a presentation of arguments. If honorable members think that they can detect errors in it, their obvious duty is to submit controverting facts, instead of making unsupported contradictions. It is true that four of the nine provinces of Canada are separately represented. The net expenditure of British Columbia is £3,000 per annum; of Ontario, £15,000; of Novia Scotia, £4,732; and of Quebec £12,000, making a total of £35,000. The Australian Agencies-General cost £69,000.

In my opinion, the cost of London representation is too great for the services rendered. There is a limited field of activity for the Commonwealth in London, and little harm would be done if Australia House were closed and its activities were transferred to the Agencies-General. I do not think it is desirable that Australia House should be closed; I merely say that, judged by the actual results achieved, little material harm would follow such a step. The clear intention of the High Commissioner Act was that the Agencies-General of the States should be absorbed in Australia House, and that the Commonwealth should be represented in London by one central authority. That was the underlying purpose of the creation of the High Commissionership. Unfortunately the Agencies-General have grown and consolidated their positions, and there is ceaseless conflict to a minor extent between Commonwealth and State representatives. A few years ago, the friction was very pronounced; I give Sir GranvilleRyrie credit for having minimized this evil, but there is still a good deal of unnecessary duplication of effort. There are two essentials for the overseas representation of the Commonwealth. If we regard diplomatic representation as costly and unnecessary during a time of financial stress, we must limit our representation to finance and customs.

Mr White:

– What about defence?

Mr COLEMAN:

– Defence representation is unnecessary. The trade activities are duplicated by the Commonwealth and the States. Each State has a trade commissioner or an officer discharging the duties of a trade commissioner, though he may not bear that title. The Commonwealth should inform the States that if they intend to maintain their costly organizations the federal activities will be reduced and the onus will be thrown on the States to do all the things which the Commonwealth has been trying to do for them and which could be most efficiently done by one authority. Either the States must reduce their organizations and transfer the duties to Australia House, or else the Commonwealth must transfer the whole responsibility to the States. It is not necessary for the two organizations to continue in the same sphere.

If the Commonwealth were to shut the commercial offices, the intelligence bureau, the publicity bureau, the migration branch, the office of the Council for Scientific and Industrial Eesearch and the trade publicity office, it would save in respect of trade publicity £36,000 a year, and approximately £10,000 in respect of the maintenance of other trade activities. I would not like that course to be followed. The strongest efforts should be put forth to induce the States to help to reduce their costs and services. I have read that the States claim that their special interests must be protected. That could be done by attaching to Australia House a special ‘ officer whose function would be to safeguard the interests of the State he represented. But only occasionally does the need for special representation arise, and then the State would be better sensed by sending a mission to London or New York to present its case. There is no justification for continuous expensive representation. In connexion with the ordering of supplies there is a supplies branch at Australia House and one under each Agent-General. One buying authority could do the work for both States and Commonwealth. The continuance of seven separate buying agencies is a wanton waste of public funds. No question of policy is involved in the ordering of locomotives or a piece of machinery, and one expert officer could do all the buying for the Australian Governments.

Much of the other expenditure in London is beyond the control of the Commonwealth. Included in. the expenditure beyond the control of the Commonwealth is £76,426 for trade publicity, of which the Commonwealth contributes £36,000, I have only to say that that money appeared tome to be well spent in advertising Australian goods. The export control boards cost £14,000 a year, but I do not intend to deal with them. I visited the offices of the boards and interviewed those in charge, but I had no authority to investigate their organizations in detail. I was impressed, however, with the fact that the Dried Fruits Export Control B&ard has done, and is doing, an immense service for Australian fruit-growers. At the risk of starting a controversy I express my opinion that the operations of the Dairy Export Control Board have not been quite so satisfactory. If it were remodelled on the lines of the Dried Fruits Export Control Board and played a larger part in the actual marketing of products it would serve a ‘more useful purpose. The

Dried Fruits Export Control Board costs £6,800 and the Dairy Export Control Board £5,900, without doing nearly such useful work. The Canned Fruits Export Control Board costs £1,230 a year. The organization consists of one officer and a typist, and having regard to the limited expenditure, very useful work is being done. I shall say no more regarding these activities, as no doubt the Minister for Markets and Transport will deal with them more fully in due course.

Mr PATERSON:
GIPPSLAND, VICTORIA

– The honorable member should make it clear that the expenditure of the export control boards is provided by the industries concerned.

Mr COLEMAN:

-I have already pointed that out. Nevertheless, the expenditure is an indirect charge on the taxpayers as it increases the prices of the commodities. It constitutes a public charge that warrants consideration by the Government.

Divorcing this matter entirely from party considerations, honorable members will agree that expenditure of such magnitude in London calls for drastic action to bring about economy, and, of course, we cannot have omelettes without breaking eggs. The duty entrusted to me was not a pleasant one. Somebody was bound to get hurt, and incidentally I have had to submit to unfair and malicious criticism. I did not dismiss any one from Australia House; I merely recommended the abolition of certain positions and provided, as against savings, £2,000 for staff re-adjustments. My attention has been directed by members of this Parliament to a paragraph appearing in the BritishAustralian and New Zealander, of the 8th J January last. Its criticism is prefaced by this statement -

The economies at Australia House proceed, and though most of them were justifiable, if regrettable, and some were imperative, they include others that are petty and do Australia’s reputation harm. Such, for instance, as the dismissal of the High Commissioner’s private secretary and his chauffeur.

I had nothing whatever to do with the dismissal of these men. One chauffeur had to go, and an Australian-born member of the Australian Imperial Force was retained. The preference accorded him met with my hearty approval. The private secretary was paid £554 a year and his position was abolished because, in the opinion of the official secretary and others, it was unnecessary. I believe that this officer has since been re-employed at a lower salary in a subordinate position.

To summarize my recommendations, I urged that the powers and duties of the High Commissioner should be defined as prescribed by the act. That has never been done. The High Commissioner goes abroad without knowing where his authority begins and ends, or what are his duties. The States should be invited to abolish the Agencies-General. The High Commissioner should be carefully selected, and should be required personally to supervise and control Australia House, and do the work that is now done by an army of advisers. I have recommended that the High- Commissioner’s residence at Ennismore Gardens should be sold or, alternatively, that the remuneration be reduced. The latter course has been followed indirectly by the imposition of income tax on the High Commissioner, and by requiring him to pay the wages of his servants. Previously the Commonwealth had to pay for a butler and other household staff. Overlapping of the activities of Australia House and the AgenciesGeneral should be eliminated. One of the expensive superfluities was the hospitality branch. We had a big staff there, and it cost about 7s. 7d. for supervising the social activities of each visitor to London. I suggest that this service should be transferred to the Agents-General for the States, who know the visitors from their own States, and are better able to look after them.

There is duplication, also, in the inspection of fruit shipments. In some cases fruit has been inspected simultaneously by an officer of Australia House and by officers of certain State Agents-General. This means an unwarrantable waste of public funds. I have recommended that the motor car of the official secretary at Australia House should be sold. Two motor cars were kept in commission at a cost of £1,080 per annum, and running 25,000 miles a year. In my opinion the taxpayers of the Commonwealth should not be called upon to provide more than one car for the High Commissioner’s office. I have recommended that preference to Australians should be given when they are available for appointment to vacancies.

Attention is directed to the fact that, in the past six years, five new positions were created, with staffs involving an expenditure of nearly £13,000 per annum ; I refer to the positions of financial adviser and liaison officer, and those held by Messrs. Fuhrman, McDougall, and Hyland. I have recommended that the positions of official secretary and financial adviser be amalgamated, because a royal commission, in 1920, in recommending improvement in the status of the official secretary, and urging that his remuneration be increased, made these pertinent observations -

The administration of the office of the High Commissioner devolves upon the Official Secretary, the importance and responsibility of whose duties cannot be overestimated. He is not only a permanent Under-Secretary, but from the financial and trade point of view may be compared with the general manager of a large banking institution or business concern.

This officer must be a good administrator, necessarily competent to deal with financial, trade and other problems of vital interest to the Commonwealth, and to meet the highest government and financial representatives on an equal footing, both as to competence and standing. He is effectually a Deputy High Commissioner, and is required to deal with issues, the magnitude of which is not realized in Australia outside ministerial circles.

On the recommendation of that commission the salary was increased. The function of advising the Commonwealth on financial matters in London is of supreme importance. Under the Commonwealth Bank Act 1924, there must be a London Board of Advice, and this function is now discharged by Mr. J. R. Collins. We require an official secretary with a knowledge of finance to control the accounts and the pensions branches. In the last few years we have had in London many eminent public servants of undisputed ability, high character, energy and initiative, but not in one instance in recent years has any regard been paid to the importance of having a man with a wide knowledge of finance as official secretary. Men associated with the Defence Department have been sent to London. Take the case of Mr. Trumble, for whom I have the highest respect. He had been secretary of the Defence Department, and his assistant, Mr. Duffy, had been secretary of the Commonwealth Military Board. The late Government found it essential to appoint a financial adviser, and my view is that the two posts should be amalgamated. In future, an officer with treasury training should be chosen as official secretary, and Mr. Collins Convinced me that one man could undertake the work. I believe that Mr. Collins is giving every satisfaction at the present time.

Mr Archdale Parkhill:

– Why should not the Commonwealth Bank do in London what Mr. Collins is now doing as financial adviser?

Mr COLEMAN:

– That would necessitate an amendment of the Commonwealth Bank Act of 1924 ; the matter would have to be carefully investigated. Whoever represents Australia in London must be responsible to the Government, and not to the Commonwealth Bank.

I now come to a controversial subject. Major Casey, Liaison Officer at the Foreign Office in London, recently resigned. There is also a League of Nations Officer at Australia House, who was under Major. Casey. The latter did very valuable work of a confidential character, the details of which I did not seek to ascertain. In my report, I urged that these two positions should be amalgamated, and I qualified my recommendation by saying that I did not know the exact extent of Major Casey’s confidential duties. I pointed out that other dominions had no liaison officers in London, and in not one instance had they a League of Nations Officer. The other High Commissioners have diplomatic private secretaries, who keep an eye on the League of Nations business. South Africa, Canada, and the Irish Free State all have permanent accredited representatives with offices at Geneva.

Mr Gullett:

– Would not those offices cost more than we spend under the present arrangement ?

Mr COLEMAN:

– No; I shall come to that point. My view is that the position of liaison officer should be abolished, and the League of Nations Officer should carry out the work of both positions. I direct attention to the cost of sending delegations to Geneva. In my considered judgment it would be better to appoint a permanent representative there. This would lead to greater efficiency. The officer appointed would, no doubt, have a good knowledge of the French language.

Mr Maxwell:

– There would also be continuity of representation.

Mr COLEMAN:

– Yes. At the present time we send delegates of the highest ability, but full contact with the other delegates is lacking; there are obvious disadvantages through insufficient knowledge of the French language.

Mr Marr:

– A good deal of time is spent in becoming accustomed to the atmosphere at’ Geneva.

Mr COLEMAN:

– Of course, the other countries have all appointed permanent representatives. Canada has less international responsibility than Australia, which is charged with the administration of the Mandated Territories of New Guinea and Nauru. We are, therefore, vitally interested in the orientation of international policy at Geneva, and we have’ suffered in international prestige because of the absence of permanent representation. Canada had a seat on the League of Nations Council, and is represented on the governing body of the International Labour Office. The human element is of importance in these matters. A permanent delegate would be able to canvass the prospects of the Government’s nominee, and canvassing goes on at Geneva on a very large scale.

An honorable member has asked whether it would be cheaper to have a permanent delegate to the League of Nations at Geneva than to continue the present method of representation. I may mention that, in three years, Sir Granville Ryrie was abroad for 233 days. This cost the Commonwealth £1,502 in hotel expenses and allowances, at the rate of £3 3s. a day. To that expenditure was added £1,394 in allowances and expenses for Mr. Fuhrman and £1,123 for a typist, who were abroad for 379 and 365 days- respectively. The salary of the High Commissioner at the rate of £14 a day amounted to about £3,400, and that of Mr. Fuhrman to £800. A rough, but reasonably accurate, estimate of the cost of sending the High Commissioner, Mr. Fuhrman, and a typist to Geneva is £3,000 per annum. The total cost of delegations to Geneva in 1929 was £6,162.

Mr. MacDougall was appointed by the former Government to act as a kind of economic officer to represent the Com- monwealth on the Empire Marketing Board and on the League of Nations Economic Committee, and to perform various other functions. He was, apart from Mr. J. R. Collins, the most highly-paid officer at Australia House, receiving £2,500 per annum, distributed as follows: - £500 from the Dried Fruits Board, £500 from the Council of Scientific and Industrial Research, £500 from the Development and Migration Commission, and £1,000 from the Commonwealth Government as a direct remuneration. I recommended that his total salary be reduced by £1,000, that the position of the technical assistant employed in that office should be abolished, and that this work should be done by Mr. McDougall, while the development and migration and scientific activities should be vested in the control of the High Commissioner and carried out by Mr. Farrands, the assistant secretary, with the assistance of a capable clerk. I recommended these changes because I considered that economy was possible and necessary in this regard. Mr. McDougall is apparently a very capable officer, and is carrying out much valuable propaganda work for Australia. But I say, advisedly, that much of the work that he has done should have been carried out by the High Commissioner in person.

Mr SPEAKER (Hon Norman Makin:
HINDMARSH, SOUTH AUSTRALIA

– The usual hour for the luncheon adjournment has arrived, but the debate on this motion may be continued until 1 p.m. The honorable member’s time expires at ten minutes to one o’clock.

Mr Scullin:

– It is the desire of the Government to have the motion for the printing of the paper further debated.

Mr SPEAKER:

– Two hours after the commencement of the sitting of tho House, orders of the day must be called upon. At 1 p.m. this debate will have to be adjourned to a later hour this day, or to another day. If there is no objection at this stage, the honorable member may continue his remarks.

Motion (by Mr. Scullin) - by leave - agreed to -

That tho Standing Orders be suspended to enable the honorable member to continue his speech after the termination of the time allowed by Standing Order No. 2.17a, and to enable the debate to be continued after the termination of the time allowed by Standing Order No. 119.

Sitting suspended from 12.47 to 2.16 p.m.

Mr COLEMAN:

– My investigations led me to the conclusion that many appointments have been made, the designations and duties of which should rightly devolve upon the High Commissioner; but I discovered that there had grown up the practice of relieving the High Commissioner of all direct responsibility. However, I shall say nothing more about that at this stage. To demonstrate how the number of even subordinate positions has been increased at Australia House I may state that, a few years ago, it was the established principle to require the assistant secretaries to have a knowledge of accountancy. But assistant secretaries without this knowledge have been appointed to positions, with the result that expenditure has been duplicated by the appointment of an accountant. Had some foresight been exercised in appointing assistant secretaries, much of this expenditure would have been avoided. Among my recommendations was one that the Public Service position of accountant should be abolished, and that a member of the High Commissioner’s staff . should discharge the responsibility under the ‘supervision and control of the assistant secretary. I await with interest the Government’s decision in this matter. Of course, all these things are dependent upon the appointment to the position of official secretary of an officer having the necessary financial training and experience. Mr. Farrands, who was appointed assistant secretary to the High Commissioner, had no accountancy experience; but, fortunately, he had been secretary to the Development and Migration Commission. Consequently, he has been able to take over the duties formerly discharged by Mr. MacDougall. I recommended also that the position of chief clerk should be abolished. I believe the occupant of that position recently returned to Australia, so I shall say no more about the matter now, other than that the official secretary and senior officials endorsed the recommendation. I also suggested that the position of private secretary to the High Commissioner should be abolished. That also had the endorsement of senior officers at Australia House. Another recommendation was that the position of supervisor of typists, held by a female officer drawing a salary of £372 per annum, should be abolished, and responsibility for the supervision of typists placed upon the official secretary and assistant secretary.

As a result of my activities at Australia House I came to the conclusion that the supply branch, which deals with the purchase of all orders requisitioned from Australia, is costly. Mr. Collins, who has wide administrative experience, at my request made an exhaustive examination, and suggested a saving of £400 per annum. He also pointed out that the department needs careful supervision and examination.I understand that that matter is now being attended to. I consider that there is urgent need for a substantial curtailment in the purchase of goods in London for use in Australia. I am not in a position to say whether or not the goods requisitioned and ordered are necessary, but I feel that I should direct attention to the fact that the expenditure on this account in London last year amounted to £427,000.

Mr Maxwell:

– What was the nature of the orders?

Mr COLEMAN:

– They represented government requisitions, and included such items as stationery, books, military text-books and materials. The cost of publications has increased from £3,777 in 1923 to over £10,000 last year.

Mr McGrath:

– What departments asked for them?

Mr COLEMAN:

– They were requisitioned by a number of departments. There has been a substantial increase in the cost of publications. I cannot say whether or not the whole of the expenditure is justified, but I recommended that the controller of stores in the PostmasterGeneral’s Branch in Australia should scrutinize all requisitions before they are sent to the Supply Branch in London.

Mr Archdale Parkhill:

– What, roughly, was the expenditure on military text-books last year?

Mr COLEMAN:

– In 1929 the expenditure by the Defence Department was £6,122. This amount covered books and stationery for the Australia, the

Canberra, the Otway, and Oxley. There were also similar orders for the Air Force, munitions supply, civil aviation, and various other departments. I am unable, in this brief summary, to give further details, so I content myself by directing attention to the magnitude of the expenditure incurred through the channels of the Supply Branch in London. I have recommended that there should be in Australia an officer whose duty it should be to scrutinize carefully all these requisitions, whether for books or other stores, and report to the Government whether the goods in question can be obtained in Australia ofAustralian manufacture, and also whether the orders are necessary.

I believe that it is possible to curtail substantially the purchase of orders overseas. Let me illustrate what I mean. In the case of two departments in juxtaposition one text book or standard work should meet the needs of both. Under the existing system two are ordered. I was informed by officers at Australia House, men who had been in departments in Australia, that frequently half a dozen books would be ordered when actually one would have sufficed for the departmental needs. These, standing by themselves, may be small economies, but aggregated as they must be in the requisitions forwarded to the Supply Branch in London, they must represent a substantial expenditure yearly. All I suggest is that these requisitions shall be scrutinized more carefully in Australia. If this is done a considerable saving should be possible.

Another recommendation which I made was that the repatriation officer in London should he returned toAustralia. Mr. Forrest, the officer in question, made this suggestion himself a year or two ago. Although the Repatriation Department disagrees with my recommendation, I still consider that the retention of the repatriation officer in London is not necessary. But I shall not discuss this point further. I refer honorable members to my report.

One honorable member mentioned, by way of interjection earlier in my speech, that he would be glad of information regarding the hospitality branch at Australia House. It may interest honorable members to know that there is a large staff in London whose business, appar- ently, it is to look after the entertainment of Australian visitors.

Mr Gullett:

– A large staff ?

Mr COLEMAN:

– At Australia Blouse there are five officers directly or indirectly engaged in attending to the requirements of Australian visitors, and the annual charge in respect of their services is £1,523.

Mr Hughes:

– Who is in charge of them ?

Mr COLEMAN:

- Mr. Ellison, a gentleman with whom the right honorable member was acquainted some years ago. He has since retired from the department. I suggest that the practice of giving Australians going abroad letters of introduction to the High Commissioner in London should be curtailed and discouraged, because much unfair criticism of Australia House comes from Australian visitors who, armed with letters of introduction, expect the High Commissioner and his staff to be waiting on the doorstep to welcome them, and to make available to them the freedom of the city of London. Australian visitors to London should be told that the High Commissioner’s office is not primarily a tourist bureau, but is a business organization, maintained in the interests of Australian trade and for the furtherance of Australian diplomatic relationships. It would be just as reasonable to expect the Commonwealth to provide facilities for the entertainment of tourists at Berlin, Rome, Paris or New York. Accordingly I have recommended that, in the interests of efficiency, and to preserve the prestige and good name of Australia, visitors to London should be given clearly to understand that Australia House is not intended primarily for their personal benefit. They have no more right to expect entertainment from the High Commissioner in London than they have from any government department in Canberra, Sydney or Melbourne.

I have recommended further that the whole of the records at Australia House should be centralized. In making this suggestion I have endeavoured to give effect to the Government’s policy to coordinate the activities of the various departments which, at present, in some instances are watertight. If effect is given to this recommendation the departments will function as one united organization.

I found that the Migration Department had been drastically reduced. I recommended certain reductions, and I believe that still further economies have been effected. In this matter I acted on the advice of Mr. Farrands, who was secretary to the Development and Migration Department in Australia. I recommended the retention of the chief medical officer in London, not because I considered that the appointment should be continued, but because the Royal Commission on Health reported to the Bruce-Page Government that it was desirable to have a medical liaison officer in London. In my opinion the volume of ordinary departmental work does not justify the continuance of this appointment at an expenditure cost of approximately £1,500 per annum, but in view of the request from the royal commission, I hesitated to recommend that the position should be abolished. I suggested also that the audit branch in London should be closed, but pointed out that this was a matter for the Auditor-General in Australia to determine.

The honorable member for Balaclava (Mr. White), has asked for information concerning the cost of defence representation in London. The expenditure is £12,000 per annum. I have recommended the abolition of the naval and military branches, but in view of the important development and constant changes in aerial navagation I have urged the maintenance of an air liaison officer. I have suggested that the other two branches should be abolished and that the necessary routine work should be discharged by a subordinate staff of officers who have had defence training in the naval and military branches. I base that recommendation on the fact that no other dominion maintains in London a naval’ or military liaison; Australia is the only dominion that does. Admittedly, wre carry a heavier burden of defence than the other dominions, but I question whether, under existing circumstances, in a time of national stringency, we should require a major-general, a major and a staff in the military branch ; a naval captain, an engineer-captain, a - paymasterlieutenant and a number of clerks in the naval branch; two air liaison officers and a staff in the air branch. That represents a total expenditure of £12,d00 a year. I have pointed out in my report that the cost has greatly increased. In 1920 we had a military adviser to the High Commissioner at a salary of £1,100 per annum. In recent years the office has been altered. Now we have a military representative entirely independent of the High Commissioner, and the cost has increased to £2,950 per annum. I urge in my report that one air liaison officer is sufficient. I met the late Squadron Leader Palstra, who was killed in the tragic disaster to the R101 and his subordinates, and from conversations with them I came to the conclusion that the maintenance of an air liaison branch is uecessary, one officer being ample, and that it should be housed with the British Air Ministry. At one time our air liaison branch was housed Avith the British Ministry, together with other dominion liaison officers. We had the use of that accommodation, and also communication free of charge. The British Air Ministry is glad to have the air liaison branches of the dominions housed under one roof, but the High Commissioner’s office decided that the Australian air liaison department should be in Australia House. I have urged that that is wrong, that the branch is occupying accommodation that could be let. It interferes with the efficiency of the branch and, in the interests of economy and efficiency, it should be housed with the British Air Ministry. I understand that the Government has found it necessary to appoint Mr. Trumble as defence liaison officer. No doubt, the Prime Minister will, in due course, explain the reason for that appointment, but I still think that, in existing circumstances, apart from the air liaison branch, the military and naval departments are of little consequence. The principal function of the military and naval liaison branches is in connexion with accounts, and I have urged that all accounts in London should be consolidated and brought under the control of the accounts branch ofthe High Commissioner’s office, and, if possible, the British authorities should be asked to relieve us of some of the heavy expense of maintaining our defence liaison.

I referred earlier in my remarks to training. Approximately £61,000 a year is being expended by

Australia in Great Britain in respect of naval, military and air training. The supplies last year, tenders for which T have already referred to, cost £427,000. The total amount expended on naval, military and air training and supplies was £488,000. I have suggested, arbitrarily, without examining the details, that the Government should endeavour to reduce that sum by £150,000 a year. Whether that can be done, I do not know, but it should be the objective of the Government. Supplies should certainly be cut down by 25 per cent. or more.

I have already referred to Australia House building and the waste of space, including corridors half a mile long. I urge the Government to make available for letting ten rooms that are permanently kept vacant for occupancy by visiting Ministers in London. It is an absolute waste to keep those furnished rooms idle, particularly when a Minister goes abroad only once a year on the average.

Fruit is sold at Australia House under an arrangement with Burnside and Company. This firm pays no rent, yet it is allowed to charge more for Australian apples than is charged by the retail shops. I asked why that was so and the officials at Australia House replied that it was much better if visitors could buy apples cheaper elsewhere because it gave them the impression that they were on a good thing. Personally, I cannot follow that process of reasoning. In addition to charging more for apples and getting premises rent free, Burnside and Company is paid a sum equivalent to 10 per cent. for depreciation of fruit exhibited.

Mr Maxwell:

– Are the visitors prepared to pay the higher price for apples?

Mr COLEMAN:

– They buy the apples and then complain. The purchasers are mostly visitors from Australia, and they buy the apples to take to their friends. That is one source of complaint.

Mr McGrath:

– That firm is on a good wicket.

Mr COLEMAN:

– That seems to be evident. Then we have an arrangement with the Australian Travel Agency, which seeks tourists in competition with Thomas Cook and Sons, and others. That company has the use of a stall at the entrance hall of Australia House at a rental of 7s. 6d. a week.

Mr Gullett:

– That is good socialism.

Mr COLEMAN:

– Yes, but tenders are not invited for the use of the stall. I also recommended that the cinema should be closed because it is a needless expense, particularly in view of the fact that migration was restricted and is now suspended. The cinema is frequented mainly by children and stray visitors. I directed attention in my report to the manner in which the staff of Australia House is scattered all over the building. In 1920 the royal commission that inquired into the Public Service stated that there were too many de luxe suites, and that the offices were scattered all over the building. No action has been taken to remedy that. The offices are still scattered, and that is certainly not conducive to economy. In addition, the staff is removed from supervision and control. Is it any wonder that visitors complain when they have to wander all over the building seeking a particular officer? I recommend that the exhibition hall should be abandoned and converted into offices. There is a vivid contrast in the Canadian House, which has an atmosphere of bustling activity. When one enters Australia House one walks through the entrance hall, past the exhibits and the stalls, and then extreme difficulty is experienced in finding a particular officer. The assessed rental value of the main exhibition hall is £8,000 per annum. I have urged the discontinuance of the cinema and the letting of the rooms reserved for Ministers. The cost of the maintenance and upkeep of Australia House is £19,000 a year, but the most difficult and complex problem confronting this Parliament and this Government is in connexion with the publicity, trade, commercial and intelligence activities of the London organization. The Government asked me to review those branches to see if they could not be co-ordinated. At present there is no central authority in control. There is the commercial branch, the trade publicity branch, the export control boards, a dairy officer, and a veterinary officer. All these activities are working independently of one another, under the control of the High Commissioner’s office in certain cases and entirely independent of it in other cases. No individual or authority is exercising any supervision or Control. Obviously, the system is unsound, and there should be an authority in control. I suggest that Mr. MacDougall or some other officer should be appointed as supervisor of trade activities. I have already referred to the need to economize in connexion with the export control boards, but rather than restrict their operations I recommend the expansion of the principle, because when the primary producer participates in the selling of his commodity he takes care to ensure that his interests are adequately safeguarded. I have suggested that trade and publicity should be grouped under one heading. In Australia House there are at present Mr. Hyland, of the trade publicity organization, and Mr. Smart in control of other publicity. I have urged that the two departments should be combined and Mr. Smart’s branch abolished. There is another weakness in the organization. Take the matter of publicity of a diplomatic character such as replies to attacks in the London press on various phases of Australian policy. There is no one authority in Australia House dealing with that subject. Mr. Collins deals with finance and loans. Mr. MacDougall deals with economic questions and Mr. Hyland with the sale of dried fruits. I have therefore urged that in the interests of efficiency there should be one authority in control. When in London, I received complaints about members of the High Commissioner’s staff writing to the press even after the High Commissioner had decided that as a matter of policy it was undesirable to do so. I directed attention in London to that practice, and I have urged this Government to ensure that the High Commissioner should alone speak on behalf of Australia and that all publicity activity should be co-ordinated and controlled. I have also referred to the excessive travelling expenses both on the Continent and in England. -The provision of telephones at officers’ residences is on an extravagant scale compared with Australia. The cost of cabling runs into thousands of pounds every year, and I was informed that much of that expenditure was caused because of the need to cable reminders when information was not readily forthcoming. I have urged that an officer of the Prime Minister’s Department in Australia should supervise the accounts of Australia House so as to prevent unnecessary expenditure. What is everybody’s business is nobody’s business, and if one officer is given the responsibility of checking London requisitions, staff changes, and variations in expenditure, it would tend to reduce the costs and enable this Parliament to exercise a more effective supervision of Australia House.

One of the most important aspects that the Prime Minister (Mr. Scullin) asked me to examine was the necessity for proper presentation of information in the Estimates. In the past the Estimates have not properly disclosed the cost of Australia House. One might almost say that Parliament has been deceived in this matter. In 1920 a royal commission on the Public Service put it on record that “ the Estimates do not display the cost of Australian representation in England in a manner which enables members of Parliament to know what this is really costing.” I directed the attention of the official secretary to that, and he pointed out that the Estimates still did not disclose the real cost. I referred to division 1326 - “ advertising the resources of the Commonwealth, £1,691.” Of this sum £967 was spent on salaries, and £131 on travelling expenses. When I pointed this out to the official secretary, his somewhat naive reply was that it was impossible to set the position out as desired, because enough money was not made available, and he had to utilize the advertising grant to pay salaries. These were his words -

The salaries of Mr. Smart and the cinema operator have always been shown underthe heading of Advertising and Publicity other than Trade Publicity. I have at times endeavoured to correct this by including the provisions under the heading of Salaries, but in each instance the salary provision has been reduced to such an extent that I have been forced to charge the salaries against Item 7 as indicated above.

I have urged in my report that this defect be remedied. I recommended that salaries of 93 clerks, typists, storemen, messengers, telephonists and assistants, shown in the Estimates as amounting to £20,000, should be dealt with as follows : -

  1. That estimates be prepared so as to show in detail all salaries under the Commonwealth Public Service Act, and under the High Commissioner’s Act, and any other acts, under the head of Salaries in the Estimates, and that all salaries above £300 per annum be shown in detail;
  2. ) That total of the expenditure, other than salaries, should be shown in the Estimates in detail, uniform with that which is used for other departments.

I have urged also that interest on the cost of construction of Australia House be included, and that the necessary deductions in other respects be made. My object is that Parliament may see for itself the real cost of our London representation. The present Prime Minister, the royal commission which inquired into the Public Service, as well as other critics, have repeatedly sought this information.

The Paris office was created in 1919 by the then Prime Minister, the right honorable member for North Sydney (Mr. Hughes). He appointed as our agent in Paris a Mr. Voss, at a salary of £850 a year, the total cost of the office being £1,500 a year. I went over to Paris and spent two days there inquiring into the work of this office. During those two days I saw Mr. Voss, examined his office and records, visited the British Embassy, the British Consular Service, the British Chamber of Commerce, and the Canadian Trade Commissioner in Paris, so that honorable members will recognize that I did not waste much time. Mr. Voss performs a useful service of . a general nature, but his duties have never been defined. He was appointed on probation, and . his position has been periodically reviewed and held in suspense. No attempt has been made to develop it or to define his duties. Mr. Voss is an Australianborn citizen who was with the army in France at the conclusion of hostilities. Because of his wide knowledge of French, he was brought into contact with the Australian Delegation at Versailles, and that was the genesis of his appointment. In regard to overseas trade representation generally, it is well to remember that the success or failure of trade commissioners depends upon the fundamental principle of trade treaties. There is no hope of developing trade with France unless we have a trade treaty with that .country. Germany is our best potential customer on the mainland of Europe. France is the most selfcontained nation .on the Continent. She buys from Australia only such necessaries as wool, and wheat when there is a scarcity, as well as a quantity of the muchdiscussed sheepskins. Beyond that, France requires little from Australia, and, in the absence of a trade treaty, it is impossible for us to sell her any of our fruit, butter or other commodities. The work of Mr. Voss has been hampered by the absence of a trade treaty with France. His appointment no doubt arose out of a hope entertained by the Tight honorable member for North Sydney (Mr. Hughes), that during the post-war reconstruction of France feelings of sentiment and gratitude to Australia would induce her to trade with us to a larger extent than has proved to be the case. Unfortunately, Mr. Hughes’s reasonable expectations have not been realized. There is no supervision over the Paris office by Australia House. Mr. Voss sends an annual report to the High Commissioner, and he is relieved every year for his three weeks’ holiday by an officer from the London office. When Mr. Duffy, the former Assistant Secretary was going over to Paris to relieve Mr. Voss, I asked him to keep a record of the business transacted at the office, including inquiries, correspondence, telephone calls, &c, with a view to learning whether the office was really necessary. Both Mr. Duffy and Mr. Brown, the accountant who had relieved Mr. Voss the previous year, told me that, in the existing conditions of Australia’s finance, the continuance of the Paris office on the present basis was unjustifiable, and it ought to be closed. It has achieved no spectacular results up to date. Of course, it might be argued that Mr. Voss performs a useful duty as a liaison officer. He speaks French fluently, and is useful to visiting Ministers passing through Paris on their way to and from Geneva, and to Australian visitors generally. I was extremely reluctant to recommend the closing of the office, but I believe that it ought to be done. Mr. Voss’s proudest achievement since his occupancy of the office was to induce the Longchamps racecourse authorities to instal a Julius totalizator at a cost of £30,000, which, he declared, would pay the cost of his office for many years.

Mr Hughes:

– By the same reasoning, lt would be possible to condemn this Parliament as performing no useful function.

Mr COLEMAN:

– I was asked to express my opinion in regard to the Paris office, and I have done so. Most of the inquiries received at the office are from French merchants anxious to establish Australian agencies. So far as that is concerned, the British consular service makes it a principle of policy that it will not facilitate imports into Great Britain. It encourages exports to other countries, and facilitates the importation of raw materials to Great Britain or goods that Britain cannot manufacture, but not imports generally. In the case of the Paris office, of course, no discrimination has -been exercised. I deem that the Paris office is not needed. The absence of a trade treaty makes it difficult to expect results, but for the £1,500 a year perhaps we are not doing badly. In . eight months’ 150 visitors signed the book in the Paris office. There is very little correspondence done, there are no activities of importance. The continuance of the office is dependent on government policy in regard to trade representation overseas. The qualifications of Mr. Voss, his classification and remuneration, and the whole basis of the office would have to be reviewed if such representation were to be desired in Paris. Canada and South Africa are both represented on the Continent, but largely for political reasons For instance, Canada, which has a big staff in Paris, has a large French population, and South Africa, which has an office in Holland, has a big Dutch population. Australia has no large foreign element which makes it necessary for us ‘to extend our overseas representation, and the broad view of those who have studied the situation is that the British market offers the best potential outlet for our surplus produets. During the Imperial Conference in 1923 the various dominions were offered every facility of the British consular service. The dominion delegates were told : “ Use our consular service to the fullest possible extent.” Availing myself of that previous offer, I went to the British consular trade service, and was assured that they were only too willing and anxious to do all they could to help Australia in Paris and elsewhere.

That in effect closes my report on Australia House; but I should like to refer to the New York office. I returned to Australia, through America, at my own expense, and was invited by the staff to look at that office. Some of the officials unburdened their souls to me on the value of the office, and I say, emphatically, that the work done is not of much value to Australia. Of our commissioners in New York, only two have remained in their positions for their full term. All of them have deprecated the limited sphere of activity a commissioner in New York has. In my opinion, if it is worth doing things at all, it is worth doing them well. It might pay us for the time being to suspend the appointment of a Commissioner-General and, when times are better, appoint a Resident Minister at Washington. I visited Washington and made inquiries. I knew the feeling in this Parliament, and in this country, that the appointment of Resident Ministers, apart from the expense involved, was likely to be regarded as an antiImperial gesture, and, accordingly, I asked the British Ambassador in Washington if he found that Great Britain was embarrassed by the presence in. Washington of Ministers representing the Irish Free State and Canada. He said in effect - “ Not at all. On the other hand Imperial unity has been strengthened because Ave work in perfect harmony. Whereas in the past it might have been said by American critics that there was a division of opinion on an important question of Imperial policy, owing to the absence of dominion representation, now the fact that we are working in a spirit of unison strengthens our prestige in the American community”. Apart from the question of cost, that is the most serious objection to the appointment of a Minister to represent Australia at Washington. However; this is not the time to discuss such an appointment, although, ultimately, the question may be revived, because our prestige and importance as a nation are ever increasing. We are playing a more important part in world affairs, and our . mandatory responsibilities and trade relations warrant us having at least equal status to that of Canada or South Africa. After all, viewing the matter from the trade stand-point alone, our volume of trade with America has not increased as a result of having an office in New York. If anything, our trade is decreasing, and there are no possibilities of expanding it in the absence of a trade treaty with America which, under existing circumstances, appears to be outside the bounds of practical politics.

Mr Killen:

– What is the cost of the New York office?

Mr COLEMAN:

– Speaking from memory, it is in the neighbourhood of £6,000 a year.

Mr Fenton:

– It was up to £12,000.

Mr COLEMAN:

– I did not investigate the New York office, I was not asked to do so, but as a matter of public duty, having inquired into the position in London, for my own satisfaction, I had a look at the New York office. At Toronto, I found a refreshing contrast. Our trade with Canada is growing, we have a trade treaty with that dominion. I found among the Canadians a spirit of complete friendliness and co-operation, and a desire to build up trade with us. If anything, there is a prejudice on the part of Canadians against their American cousins which helps in the development of our trade with the dominion. TheToronto office is small, but the staff is efficient and enthusiastic, and is doing splendid work for Australia.

I thank honorable members for the courtesy they have extended to me. I hope that it will be generally appreciated that my inquiry was not approached as a political party matter, but was rendered necessary in view of the volume of outside criticism of Australia House. I hope that it will be felt that the expenditure involved in making the investigation has been more than justified.

Mr SCULLIN:
Prime Minister · Yarra · ALP

– I feel it incumbent on me to say a few words in order that honorable members may have an opportunity to know what the Government has done in respect to the report submitted by the honorable member for Reid (Mr. Coleman). I congratulate the honorable member on the comprehensive statement he has made to the House,, and particularly upon the very excellent report he has prepared. I have read it with great interest, and I recommend a perusal of it to honorable members who are interested in the subject. The honorable member applied himself most energetically to his investigations. Without his report, it would have been impossible for the Government to make the decisions arrived at. On my way to London, I carried the honorable member’s report with me, andI took the opportunity, when I was in London, to confer with the officials in Australia House, and particularly with Mr. Collins, who was of great assistance to me. We have already done a good deal along the lines recommended by the honorable member. We have not carried out all his recommendations, some are still being investigated, and some we do not propose to adopt, mostly because of certain contracts which have yet to terminate, and certain commitments already entered into. When the terms of those contracts have expired, further recommendations of the honorable member will be carried out. The savings effected on the recommendations up to date are £18,359. There were other reductions amounting to £12,335 in the first six months of the calendar year prior to the submission of the honorable member’s report. The total savings effected at Australia House since the present Government took office amount to £30,694. The honorable member has recommended that the High Commissioner’s residence should be sold. The Government went into that matter. As honorable members are aware, the High Commissioner is allowed £2,000 a year. to provide himself with a residence, but when the last appointment was made, the lease of a residence was purchased, and the annual cost is borne by the Commonwealth Government in addition to the £2,000 a year.

Mr Fenton:

– How many years has the lease to run?

Mr SCULLIN:

– About seventeen years. The lease, however, can be sold if necessary. The rental is very low, but a large sum of money was paid for the purchase of the lease. When I went into the matter in London I found that the present High Commissioner was appointed on condition that a residence should be provided for him. I did not doubt his word, but he produced evidence to convince me that his appointment was at £5,000 a year with free residence.

Mr Stewart:

– What is the annual cost of the lease?

Mr SCULLIN:

– About £1,300, representing the interest on the purchase cost, plus the rental. I was satisfied that the present High Commissioner had definite promises from the previous Government, and it is not part of our policy to break a contract; therefore, Sir Granville Ryrie will have the use of the residence for the remainder of his term of office. But after that date the residence should be provided by the High Commissioner out of the allowance specially provided for that purpose.

An important recommendation of the honorable member for Reid, which the Government has adopted, was the amalgamation of the positions of financial adviser and official secretary. The appointment of a financial adviser was necessitated in the first place by the lack of financial knowledge and experience on the part of former official secretaries. During the speech of the honorable member for Reid to-day an honorable member of the Opposition interjected that the Commonwealth Bank should be asked to act as financial adviser to the Commonwealth Government in London. That is not the function of the London branch of the bank. The Government must have its own financial adviser there; but there is no reason why he should not also be the official secretary at Australia House. The two positions have been amalgamated, and Mr. J. R. Collins has been appointed to them. This has enabled a saving to be made in the High Commissioner’s Department of the salary of Mr. Trumble, who has been transferred to the Defence Department, to which his salary will be charged. He, too, made a contract with the previous Government, and his term of office will not expire for eighteen months. On the completion of it he will be due to retire from the Service. His letters and engagements constitute a contract which the Government was unwilling to break, and he now occupies a position for which his experience in the Defence Department has thoroughly qualified him, and in which he is doing very useful work. The defence representation in London has been considerably reduced, and we have effected a saving of £3,856 per annum after allowing for the salary of Mr. Trumble, who is. doing the work of defence liaison officer. I believe, however, that other economies could be effected in the defence representation in London. Mr. Duffy, who previously was assistant secretary in the High Commissioner’s Office, has succeeded Major Casey as liaison officer at the Foreign Office. The latter has resigned from the Service and returned to Australia. Those who were in close touch with him in London speak very highly of his work. It was intended that Mr. Duffy should spend a year at the Imperial Defence College at a cost of £1,435. By this re-arrangement the Government will save £1,300 over the twelve months. Further reductions of staff have been effected in the migration branch, resulting in a saving of £2,433 during the present financial year. In the last financial year economies in salaries to the amount of £12,335 were effected by the Government, which “since assuming office has reduced the staff by 58 persons. Thus the total saving in the migration branch in London has been nearly £15,000. The following table shows the reduction of expenditure at

Australia House from the 1st July, 1930, as a result of the re-organization: -

This figure will not be fully realized in the expenditure of 1930-31. In 1931-32 the full effect should be realized.

In addition to above, further savings are contemplated -

In conclusion I compliment the honorable member for Reid (Mr. Coleman) on the good work he did in London and on the very excellent presentation of his report to-day.

Debate (on motion by Mr. Gullett) adjourned.

page 1019

WHEAT BILL

In committee (Consideration resumed from 16th April, vide page 972).

Clause 6. (To whom bounty payable).

Progress reported.

page 1019

PAPER

The following paper was presented -

Commonwealth Bank Act - Treasurer’s statement of combined accounts of the Commonwealth Bank and Commonwealth Savings Bank at 31st December, 1930; together with the certificate of the Audi tor-G eneral .

page 1019

ADJOURNMENT

Wheat Bill - Fiduciary Notes Bill - Moonta Prospecting Syndicate

Mr SCULLIN:
Prime Minister · Yarra · ALP

– I move -

That the House do now adjourn.

Because of the defeat of the Fiduciary Notes Bill in another place the Government does not propose to proceedat present with the Wheat Bill.

Mr Stewart:

– That is dud No. 3.

Mr SCULLIN:

– We shall see who is responsible for this development, and we shall test this matter to the hitter end.

Mr Gullett:

– When?

Mr SCULLIN:

– I shall tell the honorable member now.

Mr Gabb:

– That will suit me.

Mr SCULLIN:

-The Government will not proceed with the Wheat Bill because the financing of it depended on the passing of the Fiduciary Notes Bill.

Mr Gregory:

– That was not stated in the Wheat Bill.

Mr SCULLIN:

– If honorable members will read the two measures together with intelligence they will come to the same conclusion as the Leader of the Opposition. Not only was the relationship of the two measures clearly stated by the Minister for Markets, but it was definitely emphasized by the Treasurer when heintroduced the Fiduciary Notes Bill; moreover, that bill specifically includes provision to finance the wheat industry. The borrowing clause in the wheat bill was inserted so that when the Fiduciary Notes Bill was passed and in operation authority would exist for getting advances from the Commonwealth Bank to finance the wheat scheme - advances which the bank could make only if the Fiduciary Notes Bill were passed. That was made very clear to us by the Commonwealth Bank authorities. There was no make-believe about this on the part of the Government, and the official opposition understood the position thoroughly.

Mr Stewart:

– Would the Commonwealth Bank have given effect to the Fiduciary Notes Bill if it had been passed ?

Mr SCULLIN:

-The Chairman of the Commonwealth Bank Board told us definitely that the bank would operate the bill if Parliament passed it.

Mr Gullett:

– It would have to do so, for it would be the law of the land.

Mr SCULLIN:

– That is not correct, because the bill provided for an optional course. If the bank had refused to issue the notes the Treasury could have done so ; but the Government was satisfied that the bank would issue them. The Chairman of Directors and the Governor of the bank told me that the bank could not take the responsibility of making further advances under existing legislation, which limited the currency in accordance with the gold reserve in hand. The Treasurer made it quite clear that the object of the Fiduciary Notes Bill was to obtainfurther advances for the relief of unemployment and for the assistance of the farmers; and I also emphasized that when I spoke during the second-reading debate on that bill. Our remarks are recorded in Hansard, and honorable members opposite cannot plead ignorance of them. The Leader of the Opposition (Mr. Latham), was perfectly right yesterday when he said that the Wheat Bill and the Fiduciary Notes Bill were linked together. The other place has thrown out the Fiduciary Notes Bill, and has treated in a most contemptuous fashion the policy of the Government. Honorable members opposite who say “hear, hear,” and who pose as sympathisers of the farmers, and of the unemployed in this country, have not made a single proposal for giving them immediate relief. I challenge the honorable member for Maribyrnong (Mr. Fenton), and his present leader to state their policy for doing these things.

Mr Fenton:

– The Prime Minister had a policy last August, but he did not follow it out.

Mr SCULLIN:

– Honorable members opposite have no policy for giving immediate relief to the farmers and the unemployed.

Mr Fenton:

– We could give them relief faster than the Government will do it.

Mr SCULLIN:

– The honorable member says that the Government had a policy in August last. That is true, and that policy has not been changed. I certainly have not changed my policy of August last. I have not deserted that policy, but others have done so. No honorable member of this House can truthfully say today that the budget can be balanced this year.

Mr Fenton:

– No one says it.

Mr SCULLIN:

– But that was part of the policy of August last, so the honorable member has run away from that policy.

Mr Fenton:

– The Prime Minister has run away from it.

Mr SPEAKER:

– It is impossible for the debate to proceed along these lines. I ask the honorable member for Maribyrnong and other honorable members to restrain themselves.

Mr SCULLIN:

– One of the most lamentable features of the public life of Australia to-day is-

Mr Gabb:

– The way some honorable members twist.

Mr SCULLIN:

– That interjection has particular reference to the honorable member for Angas.

Mr Gabb:

– If the Prime Minister will go on to show how that is so, I will follow him, and say what he thought about the honorable member for Dalley (Mr. Theodore)-

Mr SPEAKER:

– If the honorable member for Angas continues to interrupt the debate, I shall name him.

Honorable members interrupting,

Mr SPEAKER:

-I name the honorable member for Maribyrnong, and ask the Prime Minister to take the necessary action.

Mr SCULLIN:

– I ask the honorable member for Maribyrnong to withdraw his remark, and apologize to the Chair.

Mr Fenton:

– What have I to withdraw?

Mr SPEAKER:

– The honorable member must apologize for disobeying the Chair.

Mr Fenton:

– I apologize to you, Mr. Speaker, but honorable members should keep their heads.

Mr SPEAKER:

– The honorable member will be required to apologize again if he does not behave himself.

Mr SCULLIN:

– We have many problems to face in Australia, and no doubt we all have our shortcomings, and these show themselves at such a time as this. But one of the most unfair things that I know of is the attempt that has been made to shoulder on to this Government the responsibility for the economic and financial position of the country. It has been suggested that if a different government were in office unemployment would not have occurred, the fall in the price of our commodities would have been avoided, and the depression which is in evidence all over the world would not have affected Australia.

Mr Stewart:

– Surely no one suggests that.

Mr SCULLIN:

– The honorable member for Wimmera has not done so, but. other honorable members have not hesitated to say that all that Australia needs to-day to overcome the evils which afflict her is a change of government. It would have been much more manly and more patriotic, and of more service to the country, if those who talk in this way had stuck to their post, and helped the Government to overcome our difficulties.

There can be not doubt whatever that the only effective means which has been proposed of helping the farmers is that suggested by the Government.

Mr Paterson:

– We have suggested the imposition of a sales tax on flour.

Mr SCULLIN:

– That is, in effect, a tax on bread. I ask the honorable member for Gippsland whether, as the responsible member of a government, he would say that it is a fair proposition to put a tax on bread for the purpose of relieving the wheat-growers, and to leave it to tho unemployed to pay the tax ? We have endeavoured to assist both the unemployed and the wheat-growers, and have shown a broader sympathy than honorable members opposite, who can see only the wheat-growers. We can see both. That is the difference between us. The two sections of the community which need immediate relief are the wheat-growers and the unemployed, and we made provision in the Fiduciary Notes Bill and this bill, which is complementary to it, to help them, but the other place has rejected the Fiduciary Notes Bill. I notice that the Leader of the Opposition in the other place (Senator Pearce) has thrown out a challenge to the Government to take its courage in both hands, and go to the country in July on a single dissolulution. I am filled with admiration at the courage the right honorable gentleman himself shows. He knows perfectly well that the honorable senators who would face the electors in July under those conditions would have to face them before very long in any case. But even if they were defeated in July they would still retain their seats until the end of the following June. The right honorable gentleman must know that if an election were held within the next month or two on a single dissolution, the position might be left exactly as it is, yet he talks about the Government taking its courage in its hands.

The Labour party is the only party with a policy for giving immediate relief to the wheat-growers and the unemployed; but that policy has been ignominiously rejected by the other place. I say definitely that the bill which the Senate has rejected will be sent back to it at the earliest possible moment that it can be sent under the Constitution, and if it is then rejected we shall go to the country, not on a single dissolution the result of which could prove nothing, for it would leave the representation in another place practically as it is. There is only one straightforward course to adopt, and that is for both House of Parliament to go to the people.

Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP

– Why does not the Government ask for a double dissolution?

Mr SCULLIN:

– If the honorable member is such a good constitutional authority that he can show me how to obtain a double dissolution immediately, I will shake hands with him.

Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP

– It could be easily done.

Mr SCULLIN:

– I have invited the honorable member to show me how it could be done. We shall send this bill back to another place at the earliest possible date. It may be again rejected, and then not half the Senate, but the whole of its members will have to go to the country, and all of them will not return to this Parliament. That is the policy which this Government will pursue; but the gentlemen who sit in party meetings with the Opposition, members in the . other chamber will have to take their responsibility for the suffering that will be caused in the meantime. The Government cannot perform miracles. It can but submit its legislative proposals as earnestly and forcefully as its limited powers permit. It can pass those measures in this House, and send them to the other branch of the legislature, but the responsibility for the suffering of the wheat-growers and the unemployed in the meantime lies at the door of the friends of honorable senators in all the parties opposite. I regret that this position has arisen. The attitude which has been taken up in another place is utterly abject.

Mr Fenton:

– The Prime Minister knew what would happen before he set out to put his policy into effect.

Mr SCULLIN:

– No; I believed that at least the majority of the senators had bowels of compassion.

Mr Francis:

– What is required is not compassion but common sense.

Mr SCULLIN:

– I expected to find common sense in the majority, but I was disappointed. The responsibility assumed by members in another place is great, and surely they ought to offer some alternative measure to relieve the unemployed and the wheat-growers. In our whole political history I have never known such a policy of negation in a critical situation. The Government has submitted a policy that would give relief immediately, but members in another place have rejected it and offered nothing in its place. History will record that they have been guilty of a crime against humanity.

Mr LATHAM:
Kooyong

.- The Prime Minister has made the position quite clear with reference to the Government’s policy to relieve the farmers and the unemployed. He has said that the Wheat Bill and the Unemployed Relief Bill which it was intended to introduce subsequently depended entirely upon the adoption of the proposals of the Government for a fiduciary currency, and he has shown that that is so by announcing that the Government does not now propose to proceed further with those measures. He has told usthat there is no alternative policy for the relief of the farmers; but I contend that, with a government in office that had a sound financial policy - something very different, indeed, from that of the present Government - there would be no difficulty in raising a loan to give all the relief that this Government proposed to provide.

Mr.Fenton. - And it could be done at once.

Mr LATHAM:

– Yes. That, however, depends upon a government being in office which commands the confidence of the people in Australia and abroad ; this Government does not even possess the confidence of a number of the honorable members who are voting to keep it in office. Under a sound financial policy we should avoid the results of the inflation that would be caused by a fiduciary issue, which the Prime Minister himself declared a few months ago to be a desperate and unsound remedy.

Mr Scullin:

– I did not.

Mr LATHAM:

– I deeply regret the position that has been created for the farmers and the unemployed by the action and the inaction of this Government. It is unable to produce any remedy at all at the present time. The remedy that was proposed has been rejected in another place, and so the Government can do nothing.

I have never said, and have never suggested, that this or any other Government is responsible for the whole of the financial and economic difficulties which now confront the Commonwealth. Any government in office at the present time would have very difficult problems, indeed, to handle. As we know, many of them are due to world conditions, for which no government in Australia is even remotely responsible, but the difficulties have been greatly aggravated in Australia by the present Government. Its financial policy depends entirely upon the adoption of its proposal for a fiduciary currency. Any doubt about that would have been removed by the action of the Prime Minister in announcing that the Government would not proceed with the Wheat Bill. If there had still been any lingering uncertainty, the letter which the Treasurer has addressed to the Chairman of the Commonwealth Bank Board, which was read in the House this morning, would have removed the last lingering remnants of doubt.

The policy of the Government has been rejected in another place, and it must be remembered that effect is given to policies not merely by governments, but by Parliaments. The Commonwealth Bank Board, and everybody else, is under an obligation to respect, not necessarily the will of the Government, but the will of the Parliament as duly declared by Parliament. The Government cannot carry on under its policy. It has not a majority of the members in this House supporting it in that policy. The country cannot wait for a double dissolution, as suggested by the Prime Minister. What is to happen in the intervening months? Are the farmers and the unemployed to receive no relief in the meantime?

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

– The honorable member should ask his friends.

Mr LATHAM:

– This Government, admittedly, can do nothing in the way of giving relief. The best thing that it can do is to resign and to have an election as soon as eighteen senators in another place can go to the people. I am not disputing the accuracy of the statement of the Prime Minister (Mr. Scullin) as to the legal and constitutional position. It is true that if an election were held next July, eighteen senators who, incidentally, with the exception of one, are opposed to the Government, would face the electors, and, if not re-elected, would still retain their seats until the 30th of June of next year.

This Commonwealth of ours should not be regarded as a geographical area, but as a community of men, women and children. The position is so critical that the only way to deal with it adequately is by an appeal to the people themselves. If the people gave a definite verdict upon the issues that would be submitted to them at an early election, a solution would be found, notwithstanding the difficulty to which the Prime Minister referred, and irrespective of the composition of the Senate. Something would have to be done. As an alternative, because of the preliminaries necessary to a double dissolution, there must necessarily be a delay of some four to five months.

Mr Scullin:

– If we had a single dissolution, and this Government were returned on its policy, would the Senate then turn upon its vote and carry the Fiduciary Notes Bill ?

Mr LATHAM:

– I am not in a position to give guarantees on behalf of individual senators-

Mr Cusack:

– The honorable member is not head of the Opposition.

Mr SPEAKER:

– Order!

Mr Cusack:

– The honorable member cannot speak for the Opposition.

Mr SPEAKER:

– Order! I shall name the honorable member for EdenMonaro if he does not obey the Chair.

Mr LATHAM:

-We are faced with a national crisis of a most extreme character, which demands our serious consideration. If there were an election and the will of the people were unmistakably declared, the members of another chamber would have to pay very real deference to that verdict. The position of the nation is more acute and critical than it has ever been before, and while I do not suggest for a moment that the Senate would accept uncritically any proposals that a victorious government, fresh from an election, might choose to put forward, I contend that there would be every inclination to deal in the fairest possible manner with those proposals, and to recognize that something would have to be done.

Mr Keane:

– Why has the Senate not taken action on this occasion?

Mr LATHAM:

– Does the honorable member suggest that the people have at any time had submitted to them proposals for a fiduciary note issue, except on one occasion, the Parkes by-election? The honorable member may remember that on that occasion a Labour majority of about 10,000 was changed into a Nationalist majority of approximately 10,000. No mention of a controlled inflation of currency and credits was made in the policy speech of the present Prime Minister at the last election, nor was it ventilated by any other honorable member on a single platform. The Labour party had not then discovered that along the lines of inflation all our difficulties could be made to disappear.

I put it to the Prime Minister that the country cannot wait for the long delay indicated by him, and that the best course to adopt is to have an election early in July. I do not couple with that any statement that the Senate in its surviving condition until the following July would uncritically accept every proposal that the new Government might advance, but I do say that, if the people unmistakably declared their will at that election, Parliament would be in a much better position to deal with the financial and other problems that confront the nation than it is at present.

Mr THEODORE:
Treasurer · Dalley · ALP

– This afternoon the Leader of the Opposition (Mr. Latham) was definitely invited by the Prime Minister to indicate clearly what are his proposals to deal with the undoubtedly critical situation that has arisen through the rejection in anotherplace of the Fiduciary Notes Bill. What is the honorable gentleman’s solution?

Mr Morgan:

– To get rid of the Government.

Mr THEODORE:

– That is, indeed, the whole policy of the Leader of the Opposition, and of those who sit behind him. He has acknowledged that the con- dition of Australia is most critical. Not only are some 60,000 wheat-growers and 300,000 workers, with their many dependants, immediately affected; the prevailing distress extends over a still wider area, and how doe3 the Nationalist party propose to deal with the problem with which we are confronted? In another place the pivotal measure of the legislative programme constituting the policy of the Government has been rejected. What do honorable members opposite offer as a substitute for what we have proposed ?

It is conceivable that a policy better than that formulated by the Governmentmight emanate from the parties on the other side of the chamber, but at least the Government and the people have the right to expect that the Opposition shall enunciate their programme, so that all may understand what is involved in it. The Leader of the Opposition said that the Government has an alternative to a double dissolution, that it should send this House to the country in July. He claims that if that were done one-half of the members of another place would also have to face their constituents, that if a verdict were given in favour of the Government, our policy could be implemented in the following session. But is that so? How can the honorable gentleman, or any one else in this House, give such an assurance? If, as a consequence of such an appeal to the country, the policy of the Labour party were emphatically endorsed, we should have no change in the personnel of another place - with the exception of one representative - until twelve months from the 1st July next. That is what the Leader of the Opposition is apparently ignoring. The honorable gentleman say3 that the members of another place would have to recognize and give effect to the verdict of the people. But can any one deny that this Government obtained an emphatic verdict from the people in October, 1929?

Mr Latham:

– Not on this issue.

Mr THEODORE:

– The Leader of the Opposition (Mr. Latham) suggests that the Fiduciary Notes Bill was not then part of the Labour party’s programme. Of course, it was not. But arbitration was part of its policy.

How did another place treat the amending Arbitration Bill sent up to it from this House ? Did it not so mangle it that it was almost unrecognizable when it was returned to us? How, also, did another place treat the Central Reserve Bank Bill, which certainly was part of the declared policy of this party during the 1929 election campaign? In their treatment of legislation introduced by this Government, and passed by this House, the members of another place have ignored entirely the definite mandate which we received from the people. In connexion with the Central Reserve Bank Bill, the Senate flagrantly flouted this House, and to this day it has not returned the bill to this chamber. In the light of this experience, are we justified in assuming that, if there were another appeal to the people in the near future, the members of another place would take any notice of the verdict given at the polls? They have so clearly demonstrated their prejudice and bias with regard to measures submitted by this Government, that even if our policy obtained almost the unanimous approval of the people, they would not heed it. No solution, therefore, lies in that direction.

Mr Archdale Parkhill:

– This Government has lost its majority even in this House.

Mr THEODORE:

– Honorable members opposite have challenged the Govern, ment’s authority on a number of occasions.

Mr Archdale Parkhill:

– The Government has to depend for its support on men who say that they have only the choice of “duds”.

Mr SPEAKER:

– Order ! For some considerable time there has been a running fire of interjections, which I have sought in vain to restrain by frequent calls to order. I warn the honorable member for Warringah (Mr. Parkhill), and other honorable members, that if they continue to disobey the Chair I shall name them.

Mr THEODORE:

– Honorable members have been living on false hopes during the last few weeks. They have been hoping that the Government had lost its majority, and on a number of occasions have challenged it, but in every case they have experienced gross and humiliating defeat. As recently as Tuesday last, only an hour after the meeting of the House, the Leader of the Opposition, in quite a dramatic manner, formally moved the adjournment ostensibly to direct attention to the state of the public finances, but intended, I suggest, to re-assert his claims, slender as they may be, to the leadership of a great party, or to bring about a division upon which the Government would be defeated. Well, the division took place, and what a sorry spectacle we had! Honorable members “ gagged “ themselves, with the unanimous approval of the House, the members of which were only too glad that the tide of their oratory should be stemmed, and insisted on a division upon what, in other circumstances, would have been a purely formal motion.

The Leader of the Oppositon has told us that one thing that can lift this country out of its present difficulties is a sound policy of finance. If measures which have been submitted by the Government are to be rejected summarily in another place, where can we look for that sound policy?

Mr Francis:

– Over here.

Mr THEODORE:

– By whom has such a policy been declared? What honorable member has enunciated it? All that honorable members opposite have done is to denounce the Government’s legislative programme. The various elements which constitute the opposition to this Government have been carrying on a campaign of denunciation. We have been criticized by the Leader of the Nationalist party (Mr. Latham), the Leader of the Country party (Dr. Earle Page), the newly arisen Leader of another section (Mr. Lyons), and the leaders of various new organizations, and factions in the country. But what does all this outcry amount to? If we examine all these declarations of policy we shall fail to find in them one constructive proposal. Not one of our critics has put forward such a proposal. The proposals of the right honorable member for Cowper for bringing Australia out of the economic morass in which it is floundering, resolve themselves into an attack upon wages and pensions. Is such a policy likely to save Australia ? Let us suppose that there came a change of government next week, and that honorable members opposite applied their economy schemes to the solution of our troubles. What would be the net result? Even if they succeeded in reducing wages and pensions by 20 per cent., and made further retrenchments in the Public Service salaries, would that put any money in the pockets of our wheat-growers, or ensure the employment of any considerable number of those 300,000 men, who are out of work in Australia? And this, I remind the House, is the immediate problem that should engage the attention of this Parliament. Honorable members opposite speak glibly about what would happen upon a change of Government. Even if we could ensure budget equilibrium within the next three years, is it reasonable to expect people who to-day are in such dire distress, to wait until the plans of the Opposition are brought to fruition? Assistance for our wheatfarmers and employment for our people should be provided immediately. Do honorable members suggest that a mere change of Government would restore confidence ?

Mr Francis:

– Of course it would.

Mr THEODORE:

– Would it ensure the freer flow of money for the assistance of industry ?

Mr Francis:

– Yes.

Mr THEODORE:

– Let us examine that statement. Do honorable members opposite seriously contend that all that is necessary to persuade the banks to adopt a more liberal attitude is to put a Labour Government out of office and a Nationalist Government into office?

Mr White:

– It would help.

Mr THEODORE:

– Then the suggestion apparently is that the banks, which decline to co-operate with a Labour Government, would come to the assistance of a Nationalist Government. In the meantime, pending this change, the suffering wheat-farmers are to be squeezed, and the problem of unemployment, is to be neglected. I have never denied that there reposes in the private trading banks of this country tremendous power to create or restrict credit.

The honorable member for Wilmot (Mr. Lyons), in speeches in Adelaide and elsewhere, has been rediculing the policy of this Government, concerning which he appears to he ill-informed. He has been going round the country indulging in humorous speeches, and making strange statements about the alleged magic of changing a £10 note into a £5 note, or vice versa, and leading the people to believe that real money cannot be made available by the means of the fiduciary issue, or the adoption, by the banks, of the policy put forward by this Government. He implies that a fiduciary £1 note would not be real money, whereas an ordinary £1 note is real money. Possibly we may understand the honorable member’s difficulty in this matter if we take cognizance of his frequent assertions that he knows nothing about finance. And yet, by certain sections he is put forward as the saviour of the country, largely because of his financial policy! He declares himself to be innocent of all knowledge of finance, and yet ridicules this Government’s attempt, by means of its financial policy, to solve Australia’s problems.

The Leader of the Opposition. (Mr. Latham), a couple of weeks ago, advanced a proposal that he claimed would furnish a means of providing immediate assistance for the wheat-growers. With a great flourish of trumpets, and with announcements in the press throughout Australia, the “ Latham private loan “ was launched. Since then, no one has heard anything about it.

Mr Latham:

– It is going along very well indeed.

Mr THEODORE:

– There is no possibility of raising a loan of such dimensions as would be of real assistance to the wheat-growers, except it be handled and backed by the Government. A loan issued by private individuals, unsupported by the credit of the Commonwealth or of governments, has no hope’ of success, because the farmers cannot give any security to cover’ such advances.

Mr Stewart:

– Not those farmers who need it most.

Mr THEODORE:

– The farmers who need financial assistance most cannot give any security to cover such advances. That was fully recognized at the Premiers’ Conference held in February last, when it was decided to make available to the wheat-growers the sum of £6,000,000- £3,500,000 through the Commonwealth by way of a bounty, and £2,500,000 through the States by way of advances to individual farmers. It was realized that those advances would have to be made to the farmers without any security, because whatever security they may have is already pledged up to the hilt. The suggestion that a proposal of that nature can be set aside, and yet that a private loan can be placed on the market to raise a sufficient amount to render the same measure of assistance, is preposterous. Such a proposal was doomed to failure from the outset. Yet that is the only concrete proposal that has emanated from the Nationalist party.

We have to depend upon the resources of the Commonwealth, whatever those resources may be, to assist farmers and others who are in distressed circumstances. The inference to be drawn from the remarks that have been made by the honorable member for Wilmot (Mr. Lyons) is that there are no resources in Australia. He argues that, if resources are created, or if the potential credit of the country is utilized by means of a fiduciary currency, or some similar government measure, this must be denounced as fictitious money; that it is not real money. Apparently, the honorable member does not realize that what gives a value to the Australian pound note in circulation to-day is, not any intrinsic worth that it possesses, but the fact that it must be recognized and accepted as legal tender.

An Opposition Member. - Its issue is limited.

Mr THEODORE:

– I agree that it is limited. But so also was the fiduciary currency to be limited to £18,000,000. Even if those notes were issued to the full extent of the authority given under the Fiduciary Notes Bill, every one of them would have the same backing as an Australian note, and each would be legal tender for the payment of any kind of debt or monetary obligation in the Commonwealth. I invite the honorable member for Wilmot to explain what he means when he describes that class of money as unreal money, and to show in what way that which he can magically produce is real money.

We are faced with a very critical situation that cannot be met merely by adopting the suggestion of the Leader of the Opposition to make this matter the test of an election, at “which the whole of the members of this House, but only onehalf of the members of another place would confront the constituencies, all members of another place still retaining the right to sit until July, 1932. That is not the way to test this question, and to provide a solution of the grave problems that so urgently need solving.

The efforts of the Government have been frustrated in another place. The Nationalists are now, and have been for some time, in an exceedingly happy position. From 1922 to 1929 they had a majority in both houses of the Commonwealth Parliament, and in addition had their appointees in the best strategical places in the administrative field. They were defeated overwhermingly in this House in 1929, the aggregate number of votes cast for this Government being 1,750,000, while those secured by all the parties that sit opposite totalled only 1,200,000. Yet the Nationalists have continued to rule in another place. They still control the legislation of this parliament, and their policies are still being administered by their adherents in certain administrative and strategical positions in the Public Service of the Commonwealth.

Mr Gullett:

– Shame !

Mr THEODORE:

– It is a shame that it should be so. The honorable member for Henty (Mr. Gullett), and the honorable member for Warringah (Mr. Parkhill), when particularly provocative, have challenged the Government to show what it has been able to do since it was entrusted with the control of the affairs of this country. Their argument has been “ You have been eighteen months in office; what have you done?” They have deliberately ignored the fact that another place has rejected our legislation; that this Government is in office, hut not in power. The legislature is still under the control of the Nationalists or of those who have prejudices in that direction. If any parliamentary body is responsible for the economic difficulties, the distress and the starvation that are being experienced in Australia to-day, it is not the Labour party, but the Nationalists, who have the dominance of Parliament, still enjoying a majority in another place.

The Leader of the Government ‘ (Mr. Scullin) has put the case cogently and forcibly, and in a way that cannot be ignored. While Ministers have the support of the 40 members who sit on this side -it cannot be expected, weakly and meekly, to hand over the government to the 35 members of the multifarious and heterogeneous parties that occupy the benches opposite.

Mr Fenton:

– You have the repudiationists to support you.

Mr THEODORE:

– The Government cannot be expected to surrender simply because of a clamour raised by the Opposition, or because of the attitude of the reactionary interests that are entrenched in another place. It will not surrender its position in that way. The members of the Opposition, the Nationalist forces in another place, and their Nationalist friends among the banking institutions, must be made to accept their share of whatever responsibility arises out of the present position.

Dr EARLE PAGE:
Cowper

.- The Prime Minister (Mr. Scullin) and the Treasurer (Mr. Theodore), by their fervid speeches, have evidently tried to hide the fact that they have cold feet on the question of an appeal to the people. During the last hour we have heard from them all sorts of excuses for not making an immediate appeal to the people We have been told that we should wait for three, four or five months, yet the members of the Government know that they have been absolutely discredited throughout the country. This Labour Government has completely failed in its administration. It is despised in this House. It holds office only at the whim of five honorable members, who every time they speak put humiliation and shame into the hearts of Government supporters. The Government has to bow on bended knee, and to grovel on the floor of this House, to enable it to carry on at all. It is subservient to a small party whose policy it absolutely hates and abhors, although that policy is really a full brother to the policy of inflation adopted by the Government, and certainly more honest and open than the Government’s policy, which is the meanest form of taxation that can be devised. It would place a tax, not only on the bread of the people, which the Prime Minister refused to do to help the distressed farmers, but also on the water, homes, and everything in use by the people of this country. The Prime Minister is now prepared to withdraw the Wheat Bill, and to throw the farmers to the wolves simply because another chamber has rejected the Fiduciary Bill. The Wheat Bill contains no word about the fiduciary issue. There are 100 different ways in which the wheat legislation could be financed. The Government said a year ago that it could finance the wheatfarmers to the extent of 4s. a bushel by a system which would allow the farmers themselves to raise the price of bread in this country. Why does not the Government adopt that system now? The Government’s policy, although it has been long camouflaged, is now patent. Its scheme is to smash the Commonwealth Bank, an institution which a former Labour government established, and to destroy the monetary system of this country. I am glad indeed, that another place has taken a definite stand against that. The Government is trying to terrorize the Commonwealth Bank Board to adopt a policy, which that body knows to be inherently unsound, and, if adopted, must bring ruin to Australia. Every country that has tried that policy has encountered disaster. The Government’s policy is to abandon the gold standard, although the Treasurer has denied that.

Mr YATES:
ADELAIDE, SOUTH AUSTRALIA

– That is a deliberate lie.

Mr SPEAKER (Hon Norman Makin:

– I ask the honorable member for Adelaide to withdraw the statement that the right honorable member for Cowper is telling a lie.

Mr Yates:

– I withdraw it.

Dr EARLE PAGE:

– This Government has been in office for eighteen months. When the Labour party was in opposition, it attacked the Bruce-Pam Government for not taking immediate action to relieve unemployment. Yet, at the present time, the figures in respect of unemployment are rapidly growing. One out of every four unionists in this country is out of work. The Government’s policy has failed. The Treasurer says that it has not been able to do anything because of the holding up of the

Central Reserve Bank Bill ; but what difference would that make, if all the protestations that he has made on the floor of this House were honest and sincere?

Mr SPEAKER:

– The honorable member is not in order in saying that anything that has taken place in this House is not honest and sincere. I ask him to withdraw those words.

Dr EARLE PAGE:

– I withdraw them. A year ago the Treasurer said that the passage of the Central Reserve Bank Bill would not be followed by an inflation of the currency of this country. Since then the Commonwealth Bank Bill, the Fiduciary Notes Bill and other measures have been introduced. The policy of the Government is now revealed, because all these measures are based upon naked inflation, and everything that the Treasurer stated last year to illustrate the soundness of his policy has gone by the board. This Government has lost its credit at home and abroad. It must be removed from office to enable confidence to be restored, not only to the people of this country, but also to people outside who wish us well. The only way to meet this national crisis is to obtain financial assistance from outside, and while this Government remains in office there is not the slightest chance of obtaining that assistance. That is obvious from every financial statement that appears in the London newspapers. The people will not stand for the policy of the Government, and they should be given an opportunity to express their will. Why should this Government allow the unemployed to starve for another four or five months until it can do something to bring about a double dissolution? Its policy has failed, so why not go to the country and let us know exactly where we stand? Since we re-assembled at the beginning of March, every speech from the Government side has been of a purely electioneering character, and absolutely without substance. An instance of that is the long letter that was read by the Treasurer this morning. The reading of that letter was certainly one of the grossest abuses of privilege ever committed in this House. The letter was read with the deliberate purpose of fooling the people.

Mr SPEAKER:

– Order ! The right honorable member’s observation is unparliamentary, and I ask him to withdraw it.

Dr EARLE PAGE:

– I withdraw it. The Treasurer’s intention was to delude the people into believing that the Government had some definite proposition for the salvation of Australia. I have no wish to labour this subject.We have thrown out a challenge, and the battle is now on. We are prepared to fight this issue in the constituencies at the earliest moment. The people have had no opportunity to consider the present proposals of theGovernment, and if a general election takes place immediately I have no doubt of the result.

Mr PARKER MOLONEY:
Minister for Markets and Transport · HUME, NEW SOUTH WALES · ALP

– The right honorable member for Cowper (Dr. Earle Page) has made one of his characteristic utterances. It is without substance, and without any suggestion for the solution of our difficulties. He is the one honorable member above all others noted for his abuse. He has vilified this Government from one end of this country to the other in the columns of a peculiar publication called. The Weekly Bulletin, in an effort to bolster up the Country party, which has long since ceased to have any significance in the minds of the primary producers or of any other section of the community. I doubt whether 20 per cent. of the farmers have any confidence in the Leader of the Country party or his associates. His outstanding feature is his helplessness and inability to suggest anything concrete for the relief of the primary producers of this country. To-day he has uttered his usual diatribe against this Government, which, he says, is unable to obtain assistance either at home or abroad. His own record brands the Government with which he was associated for six years as the most inept and incompetent in the history of federation. During the last nine months in which that Government was in office it endeavoured to obtain financial assistance in London, but received a blank refusal because investors had lost confidence in the administration of which the right honorable gentleman was a member.For nine months that Government was beg ging for financial assistance, which was definitely refused owing to its maladministration. The ex-Treasurer, who inherited a surplus of £7,000,000, was in office for six years and left a deficit of £5,000,000, or, in effect, went to the bad to the extent of £12,000,000,notwithstanding the prosperous conditions prevailing. The right honorable member, whose sorry record of hopeless and reckless administration I have briefly outlined, has the temerity to criticize this Government’s policy. The honorable member for Henty (Mr. Gullett) aptly described the right honorable member as the most tragic Treasurer the country had ever seen. The right honorable member for Cowper intimated that the Government did not make it clear that the Wheat Bill under discussion this week was complementary to theFiduciary Notes Bill.

Mr Gregory:

– The Minister paraded the country and made no mention of that fact.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– The honorable member is quite wrong. Last night the honorable member for Fawkner (Mr. Maxwell) put a direct question to me on that point, which I did not shirk. In effect, he asked me if the Wheat Bill was contingent upon the Fiduciary Notes Bill. I definitely stated that it was, and that the Government admitted that the method proposed was the only way in which the Government could obtain money to assist necessitous farmers. Honorable members opposite failed to offer any effective criticism of the Fiduciary Notes Bill, or to suggest any remedy to overcome the present critical situation.

Mr Maxwell:

– The Minister admitted that the Government is powerless to help the farmers other than by printing additional notes,

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– I admitted that a fiduciary note issue was the most effective way of rendering immediate assistance, and I challenged honorable members opposite, including the honorable member for Fawkner, to submit an alternative proposal; but that challenge was not accepted. It is true that some honorable members opposite suggested the imposition of a sales tax on flour; but when

I pointed out that the Government proposed to re-introduce the Wheat Marketing Bill and to include a provision giving the State Governments the right to fix the price for local consumption-1-

Mr Paterson:

-. - That would be of no lise for this year.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– The proposal of the honorable member was fbr five years.

Mr Paterson:

– I suggested one year.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– The leader of the Country party proposed a period of five years, but when I pointed out that such a provision would seriously interfere with the passage of the bill not one honorable member contradicted my assertion. Apparently they concurred in the view I then expressed, but now the honorable member for Gippsland (Mr. Paterson) says that the five-year period should be reduced to one year.

Mr Paterson:

– I said so yesterday.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– Why was a five-year period suggested in the first place? The honorable member said that it would be a sufficient guarantee to the bank, but at the outset he did not suggest that what would be collected in one year would be a sufficient guarantee to enable the banks to make an advance. The honorable member agreed to the period being altered to one year when he found that his original suggestion was unworkable, and no doubt he would later alter his alteration. The only .alternative to the Government’s proposal is a sales tax on flour, and when challenged on that point honorable members opposite ran away. The Prime Minister (Mr. Scullin), and the Treasurer (Mr. Theodore), have clearly stated the position. It would be interesting to know why such a large number of honorable members opposite supported the second reading of the Wheat Bill yesterday if they believed that its operation was dependent upon the passage of the Fiduciary Notes Bill .by both branches of the legislature. Instead of honorable members opposite condemning those individuals in another place who, if they had. appeared before the electors at the last election, would have been decimated, and who today have the temerity to thwart the will of the popular chamber, they are condemning the Government for its honest attempt to relieve the suffering wheatgrowers and thousands of unemployed. They regard themselves as members of the Country party, but are supporting the action of those individuals in another place who have prevented the farmers from receiving any help. That was the attitude that one would expect the leader of the so-called Country party to adopt. He is merely attempting to score politically off honorable members on this side, and entirely overlooking the claims of those whom he is supposed to represent. He forgets the people he claims to represent, but when he follows that up by turning his back on the farmers, and blaming this Government for not being able to get credit either here or abroad, it goes beyond the power of understanding. He must think the people have short memories when he charges the present Government with not being able to do the very thing which he himself so abjectly failed to do. Whatever he can say must go for nothing, either with the primary producers or any other section of the people. His record stands against him, and nothing he can do now can alter it. I could not describe him and his record better than by quoting the opinion of one of the leading newspapers of this country after he had concluded his tragic occupancy of the office of Treasurer-

Mr Gabb:

– The Minister for Markets (Mr. Parker Moloney) should not be worrying about the ex-Treasurer; he should keep his eye on Mr. Hardy, junior.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– The honorable member will have to be very hardy if he can live down his awful record since the last election. He speaks about repudiation, but the archrepudiator is a man who repudiates his pledge to the. people who sent him here. If he had any sense of honour he would submit himself to the judgment of the people who elected him.

Mr SPEAKER (Hon Norman Makin:

– The honorable member is out of order.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– The honorable member for Angas (Mr. Gabb) saw fit to interject, and he must expect to get something in return. I propose to quote from a newspaper which is at present attempting to take a detached, view of public affairs; which so far has not been carried away by mushroom en- thusiasms that arise in a night and are gone the next day - a newspaper which is not concerned with the strivings of those who hope, by means of a suddenly achieved unity of partiesin Opposition, to place back in power a government which was responsible so largely for the troubles under which Australia labours to-day. Dealing with the record of the right honorable member for Cowper (Dr. Earle Page), the Melbourne Age, of the 28th of May, 1930, said-

The Leader of the Federal Country party has taken it upon himself to diagnose Australia’s illsand prescribe remedies. Few people are better qualified to speak of the nation’s financial troubles, for none will deny Mr. Page the distinction of having made a notable contribution to their creation. But, to the surprise of the community, the erstwhile Treasurer does not apologize for the appalling muddle he left tohis successor; he does not lament his countless neglected opportunities of avoiding some of the stressful difficulties with which others must grapple. At his inglorious going Mr. Page left the national finances in a condition so chaotic that the incoming Government was obliged to take unprecedented action in a desperate attempt to avert disaster. The limit of extravagance and ineptitude had been reached.

The ex-Treasurer, with a record of that kind, described in terms which fit him perfectly, has the temerity to try to place on this Government the responsibility for conditions for which he himself is so largely responsible. Ninety per cent. of the troubles from which Australia is suffering to-day have their origin in the mal-administration of the Government with which the right honorable member for Cowper was associated, and no chain of platitudes can shift the responsibility from him, and those associated with him.

Mr STEWART:
Wimmera

.- I do not wish to prolong this post-mortem on the Wheat Bill, but I feel compelled to say that, whatever may be the cause of its defeat, or whoever may be responsible, the fact emerges that the wheatfarmers of Australia are to obtain no relief, and must carry on as best they can. The Prime Minister (Mr. Scullin), and the Minister for Markets (Mr. Parker Moloney), referring to the attitude of members of the Country party to the Fiduciary Notes Bill, stated that no alternative to that measure had been advanced by them. They would be more correct had they said that an alterna tive was put forward, but was not acceptable to the Government.Whether it was wise or unwise, an alternative certainly was advanced. An amendment was proposed that money for financing the wheat scheme be raised by imposing a sales tax on flour. It is true that the Minister, in answering that proposal, outlined contemplated legislation for the creation of a compulsory wheat pool. That was . previously unknown to this party, and raised a complication. Most of the difficulties, however, could probably have been overcome had the Government taken advantage of the opportunity of appointing a committee of honorable members representing wheat-growing areas, under the presidency either of the Treasurer (Mr. Theodore), or the Minister for Markets (Mr. Parker Moloney), to see whether it was not possible to devise ways and means of helping the farmers. Perhaps it is not too late yet for the Government to adopt this suggestion.

Mr Gullett:

– The Government was not sincere ; it was merely electioneering.

Mr Scullin:

– Is that in order, Mr. Speaker ?

Mr SPEAKER:

– It is unparliamentary for the Deputy Leader of the Opposition (Mr. Gullett) to say that the Government was not in earnest.

Mr Gullett:

– I withdraw the remark.

Mr STEWART:

– I did not rise to make party capital out of the deplorable difficulties confronting the country. I believe that we are involved in difficulties which are world-wide in their incidence. I do not think that any government in Australia ever faced greater difficulties than the present Government is facing. It is only fair to say that, and the people, I believe, recognize it. Whatever one may think of the remedies which the Government has tried to apply, the clear fact stands out that the situation confronting it is one of extraordinary difficulty. Situated as we are, with one party in control of one House, and another in control of the other, we have reached a political deadlock. I am not in favour of the present system of cabinet responsibility, but we are workingunder that system, and its main virtue, if it possesses one, is that the Government shall govern; that His Majesty’s

Ministers shall be in control of the legislation of the country. But the fact is that the Ministry admits that it is impotent. At the Eight Hours Day function on Saturday evening of the 21st of March, the Prime Minister (Mr. Scullin) is reported to have said : -

He would remind them, however, that the Government was not in control of the parliamentary machine or of the finances of this country.

Mr Scullin:

– It hopes soon to be.

Mr STEWART:

-What is the Government’s policy? Although absolutely impotent, it hangs on to office. I. admit that under the existing parliamentary system of spoils to the victors it is asking a great deal for men who have spent many long years in opposition to get off the treasury bench now they are there, with the possibility of hot getting back to it again for a very long time, particularly when they are in a majority.

Mr Theodore:

– Surely the honorable member does not suggest that a government elected with a majority should hand over to a minority Opposition?

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– Or to six parties ?

Mr STEWART:

– The six parties, accepting the Minister’s count, have put forward certain claims. First of all they have declared that ‘they can handle the situation, obtain finance, and pull the country out of its present difficulties. If I might appeal to ministerialists on strategic grounds, it might be of advantage to them to get off the treasury bench and let the other parties try to right the finances. The position of the Government is rather humiliating when one remembers that it actually has not a majority in this chamber, and is kept in power to-day by men who daily record in the pages of Hansard their contempt of the Government. If I were a Minister, I would not remain in office for 24 hours under such humilitating conditions.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– Would the honorable member support a Government led by Nationalists?

Mr STEWART:

– What I am concerned with is the position of the wheatgrowers and the unemployed, and of Australia itself, and I do not care very much who is on the treasury bench. I should be quite prepared to support a govern ment led by the Leader of the Opposition (Mr. Latham), or by the honorable member for Wilmot (Mr. Lyons), or by anyone else for that matter, and give him a chance to do something rather than allow the present Government, which admits that it can do nothing, to remain in office.

Mr Scullin:

– If the honorable member would not care who led him, would he care very much who supported him? I ask that question, because the honorable member has said that the present Government ought to get out because of certain supporters it has in the chamber.

Mr STEWART:

– The right honorable gentleman is very astute in giving my words a twist. I did not say that I would allow the Leader of the Nationalist party (Mr. Latham) to lead me. I have never yet said that. What I said was that I should be prepared to give him a chance to do what he claims he can do, although I confess I “ have my doubts “. If the present Government is not in control of the parliamentary machine and has lost control of the finances of the country, yet is determined to hang on to office for a period of at least four months, I think the public are entitled to know whether things are to be allowed to drift during that period.

Mr Scullin:

– The Government intends to secure power over the finances of the country and over the Parliamentary machine, and it thinks that it is better for it to remain in office than to hand over the control of affairs to persons whoseadministration has already nearly ruined Australia.

Mr STEWART:

– Surely the right honorable gentleman does not suggest that things should be allowed to drift for four months while there are hundreds of thousands of unemployed, and the number is increasing daily, and winter coming on ?.

Mr Scullin:

– Does the honorable gentleman suggest that if the Government resigns, the unemployed will get anything?

Mr STEWART:

– If the Government remains in office on its own admission the unemployed will get nothing. When we have a Government which, on its own admission, and not on the claim of its opponents, can do nothing for four months, I am prepared to say “ Let some one else come along.” At least some one else can do no less than nothing and there is a possibility that something may be done.

Mr Theodore:

– Does the honorable member lay down the doctrine that a hostile Senate should have the right to dismiss the Government, for that is what it amounts to.

Mr STEWART:

– No, but I lay down the principle that those who say that they cannot govern, and that they have lost control of the finances of this country, have no right to remain in office.

Mr Scullin:

– We are not going to run away; we are going to fight.

Mr STEWART:

– I am not suggesting a running away. There is such a thing as a dignified withdrawal. I think that it would be in the interests of the Labor movement itself if Ministers said “ We shall not remain on the treasury bench subject to dictation and having our policies thwarted. We will let the other section take possession of the bench and show what they can do.”

But the main thing is, what is to be done during the next four months? Does the right honorable gentleman propose to adjourn the Parliament for that period? I suggest that it would be the best thing to do, because at least such spectacles as we had yesterday and this afternoon in this chamber would be avoided - parties wrangling across the chamber and blaming one another, raking up history, and trotting out all the old- party catch cries. The temper of the farmers - leaving the unemployed out of the question, although they are in an ugly mood - is such that some time ago there was talk of 50,000 of them marching to Canberra. It is a good thing for this Parliament that they did not carry out that intention, because if they had been in th, gallery last night and had listened to what was going on here, with the thrust and parry of party debate, and members, as it were, fiddling while Rome burns, they would have driven us out of the chamber like Christ drove the money-changers out of the Temple.

Mr Theodore:

– If the farmers had marched to Canberra and heard the debate in the Senate, would they have endorsed the attitude of that chamber?

Mr STEWART:

– That brings me back to the issue of the Wheat Bill, in relation to the Fiduciary Notes Bill. When the promise was made by the Government that certain assistance would be given to the wheat-growers, not one word was said to the effect that such assistance would be contingent on the establishment of a fiduciary currency. Progressively, the amount of the offer has declined from 4s. to 4-Jd. a “bushel and the last-named offer was tacked on to a most contentious financial measure. The loss of the Wheat Bill is not due to opposition to the principle of assistance to the farmers. Had the measure reached another place and failed to pass, it would have been only because of objection to the method of finance. That is the objection that was raised by members of the Country party in this chamber. So desperate is the position of the wheatgrowers that the country cannot be rehabilitated until this Parliament tackles the problem of removing the depression in the primary industries. Until that is done men cannot be set to work in the factories, and the implement and superphosphate works. At present many of the wheat-growers are hamstrung; they can do nothing. Consequently, the reduction of the area under cultivation this year will be enormous, and the standard of farming will be lowered by the use of unsuitable implements and the lack of superphosphates. Until the farmers are set to work at production upon normal lines, prosperity will not be restored to Australia.

I am profoundly disappointed with the announcement of the Prime Minister that the Wheat Bill is to be abandoned. I admit the difficulties of the Government, and do not doubt its sincere desire to help the farmers; but it is not yet too late for Ministers to show their sympathy in deeds as well as in words, by accepting the proposal for a round-table conference to discuss the possibility even now of affording relief. If such a conference did no good, at least it could do no harm.

Mr BLAKELEY:
Minister for Home Affairs · Darling

.- On the 14th April the honorable member for the Northern Territory (Mr. Nelson) asked a question during which he directed attention to a paragraphin the Melbourne Age of the 10th April, which stated, inter alia -

Good results continue from the work of the Moonta Prospecting Syndicate at Moonta (South Australia). At the 240-ft. level a 31/2-ft. ore-body, assaying 30 per cent. copper, is being driven upon, the drive being in ore for 100 feet. The same lode has been picked up at the 720-ft. level.

Ore bagged ready for shipment includes 103 tons going from16 to 33 per cent. copper, and 1,000 tons of 6 per cent. ore are stacked at the surface.

The prospecting work is being carried out under the scheme by which the Federal Government made advances.

The honorable member asked me to furnish details of the manner in which the Commonwealth Government was making these advances. Some time ago the Commonwealth Government made available £1,000,000 for the relief of unemployment in the various States. The South Australian Government represented that a portion of the amount allocated to that State should be applied to an investigation to determine the possibility of reviving mining operations at Moonta. After the proposal had been investigated by Mr. Gepp, the Commonwealth agreed that £5,000 should be made available to the syndicate for the development of the Moonta mine, with a view to deciding the prospects of operating it as a payable proposition. Obviously, the amount could not be paid from the Precious Metals Prospecting Fund.

Mr PATERSON:
Gippsland

– The Minister for Markets made a characteristically venomous attack on the right honorable member for Cowper (Dr. Earle Page) and said that no chain of platitudes would be sufficient to defend his financial administration. I shall not indulge in a chain of platitudes, but shall merely bring to the notice of the Minister five concrete facts. By an extraordinary arithmetical process the honorable gentleman added together the £7,000,000 surplus inherited by the right honorable member for Cowper when he became Treasurer, and the deficit of nearly £5,000,000 which he left behind when he vacated office, and said that tha. two represented a deficit of £12,000,000, caused by the Bruce-Page Administration.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– I said that in six years the right honorable member for

Cowper allowed the finances of the Commonwealth to go to the bad to the extent of £12,000,000.

Mr PATERSON:

– Is the Minister so intensely ignorant as to he unaware that the £7,000,000 in the till when the right honorable member for Cowper became Treasurer was used for the reduction of the national debt? The application of the amount to that purpose is saving the present Government, as it will save future governments, £400,000 a year in interest. Therefore, the right honorable member for Cowper, instead of contributing to the national debt, extinguished a substantial portion of it. Other concrete facts I desire to put before the Minister are these: The right honor able member for Cowper played an important part in the establishment of the Loan Council, which to-day can be regarded as the sheet anchor of Australia. In 1924 he was instrumental in inducing this Parliament to amend the Commonwealth Bank Act so as to take out of the hands of the Government control of the note issue. That amendment has made it doubly difficult for the present administration to carry out its policy of inflation.

The next fact to which I shall allude relates to one of the last of the bigger acts of administration of the previous Government. In 1929 that Government, because of the additional constitutional power conferred upon the Commonwealth Parliament by a referendum of the people, was able to obtain the approval of Parliament to the financial agreement with the States, which has been the means of preventing the Premier of the senior State of Australia repudiating our interest obligations, despite the fact that he desired to do so. It has been admitted by those who had little love for the previous Government that if it had done nothing else during its term of office than put upon the statute-book the act embodying the financial agreement, it would deserve to be well remembered by Australia.

One other fact to which I shall refer is that the honorable member for Wilmot (Mr. Lyons), when acting as Treasurer of this Government a few months ago, paid a high tribute to the administration of the right honorable member for Cowper (Dr. Earle Page), although he may not have intended to do so. In submitting to this Blouse a measure which provided for a reduction of £2,000,000 per annum in our sinking fund contributions, the honorable gentleman reminded the House that the previous Government had during the seven years it was in office contributed £2,000,000 annually towards the extinction of the national debt more than it need have done in order to conform to what might be regarded as reasonably good sinking fund provisions.

Those five facts are in no sense platitudes, and they, without anything else, are a sufficient answer to the extraordinary assertions made by the Minister for Markets in regard to the administration of the Treasury by the right honorable member for Cowper, who may justly claim to have been responsible to some considerable extent for these things.

I wish to add my protest against the action of the Government in withdrawing the Wheat Bill. I repeat what I said the night before last, that there is nothing in the bill which connects it with the Fiduciary Notes Bill, notwithstanding that the Prime Minister (Mr. Scullin), the Treasurer (Mr. Theodore), and the Minister for Markets (Mr. Parker Moloney) have said that that measure was the basis upon which the Government intended to finance it. I submit that in this chamber we should take notice, not of what Ministers or honorable members may say about bills submitted to us, but of what the bills themselves actually contain. The Wheat Bill contains no reference to the Fiduciary Notes Bill. Clause 7 of it, which provides the financial machinery for its administration, is in exactly the sameterms as the machinery clause which appears in all loan bills. There is not even the minutest difference. The Prime Minister said last night that the Leader of the Opposition (Mr. Latham) was perfectly correct in stating that this measure could not be disconnected from the Fiduciary Notes Bill. I challenge the accuracy of that statement, and in support of my opinion direct attention to the amendment which the Leader of the Opposition intended to move to this bill, with the object of making it impossible for fiduciary notes to be used to finance this scheme. I submit that the Leader of the Opposition has himself disproved his own contention by giving notice of his intention to move that amendment, which would have had the unanimous support of the party to which 1 belong. The amendment would have entirely divorced the bill from the Fiduciary Notes Bill. How, in the face of this, it can be said that the measure is necessarily dependent upon the Fiduciary Notes Bill I cannot understand, for the honorable gentleman himself has shown that at present the two measures may be entirely disconnected. In further support of my view of the situation I point out that the Deputy Leader of the Opposition (Mr. Gullett) had given notice of his intention to move an amendment exactly opposite to that foreshadowed by the Leader of the Opposition. Had his amendment been carried it would have connected this bill with the Fiduciary Notes Bill. If they were already connected there was no need to move such, an amendment.

Mr Gullett:

– How innocent the honorable member for Gippsland is ! But he cannot get away from his foolish vote of last night.

Mr PATERSON:

– It is extraordinary that the Leader of the Opposition should intimate his intention to move one amendment and the Deputy Leader circulate an amendment designed to have a diametrically opposite effect.

I wish to refer, also, to the statement of the Minister for Markets and Transport (Mr. Parker Moloney) that no definite alternative to the scheme of the Wheat Bill for assisting the farmers has been proposed. I say definitely that a practical alternative was proposed. The Minister for Markets and Transport has challenged my statement, and said that I intended to move an amendment which stipulated that the proposed sales tax on flour should be continued for a period of five years. The fact is that the amendment which I circulated was in the following terms: -

Money borrowed under this aft shall be redeemed within a period of five years by means of the proceeds of a sales tux fin Hour.

I emphasize the words “ within a period of five years.” I realized that a private member might not be permitted to move this amendment; but I intended to appeal to the Minister to move it himself. The amendment left it open for the Minister «o fix any period he desired, up to five years, for the imposition of the proposed tax. It was my intension to concentrate my argument upon the possibility of redeeming within twelve months the necessary loan to provide a bounty of £3,500,000 for the farmers. I know that the Minister has said that it would not be reasonable for the Government to impose a sales tax on flour because of the difficult times through which the country is passing. I admit that it would not be an ideal solution of our problem, but it would be practicable; and I impress upon the Minister that the adoption of my proposal would not place upon the people any greater burden in the shape of a higher price for bread than, will be placed upon them if the State Governments take the course, which the Minister has said he hopes they will take, of fixing the price of wheat for home consumption at 4s. a bushel. The imposition of a sales tax on flour under the conditions which I advocate would not raise the price of flour to any greater extent than it will be raised if the State Governments act as they have intimated they intend to act. Either of these courses will have exactly the same effect upon the consumers of Australia. Therefore, if the Minister for Markets agrees that this is. the sane thing to do - he welcomes such action by State Governments - he cannot logically say that it would be an unreasonable thing for this Parliament to do.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– The action must not be duplicated.

Mr PATERSON:

– There need be no duplication, because the State Governments have this action in mind. The farmers of New South Wales are not receiving a fixed price for wheat as the result of what is being done in that State. Even if this course were to be taken in the future by State Governments, it would have no immediate effect in assisting the farmers.

Mr SPEAKER (Hon, Norman Makin:
HINDMARSH, SOUTH AUSTRALIA

– An honorable member may not anticipate the debate in committee. The bill is still before the House, and, irrespective of what the Prime Minister has said, it is possible for the House to proceed with it.

Mr PATERSON:

– I shall confine myself merely to replying to statements made by the Minister for Markets. He agrees that it would be desirable to have action taken by State Governments with the object of raising the local price of wheat to 4s. a bushel. That would have the effect of raising the price of flour to exactly the same extent as if the maximum sales tax on flour were imposed by this Parliament with the object of wiping off the loan of £3,500,000 within twelve months. That is the best answer to the criticism of the. Minister for Markets. I say that it is a practical proposal, and it would afford immediate relief. It would be possible by this means to assist the wheatgrowers within a month, which could not be done if dependence were placed on a fiduciary issue.

Mr Scullin:

– We could have assisted them in a week, if our fiduciary currency measure had been passed in another place.

Mr PATERSON:

– We must look at the position as we find it, and I appeal to the Prime Minister to use what appears to be the only practicable means of now giving immediate assistance to the farmers. This would involve no greater degree of hardship than would be imposed on the consumers if the State Governments took the action which the Minister for Markets desires them to take. The £3,500,000 which it is proposed under this bill to grant as a bounty could be paid off within twelve months, including 6 per cent, interest for half of that period. I say one-half, because the amount would be steadily reduced, week by week, and it could be paid off in twelve months by a sales tax of £5 lis. per ton.

Mr SPEAKER:

– I have given the honorable member considerable latitude, and I urge him not to take undue advantage of it.

Mr PATERSON:

– I conclude by saying that since the Fiduciary Notes Bill has been defeated in another place, and that means of financing the Wheat Bill has gone, the responsibility of adopting some alternative method of giving immediate relief rests upon the Government. If the Government fails to adopt the practical suggestion that has been made, on it alone will fall the responsibility for failure to give immediate relief to the wheat-growers of this country.

Mr GREGORY:
Swan

.- I do not propose to join in the political discussion that has arisen to-day. Ample opportunity will be afforded later to deal with the statements made by the Prime Minister this afternoon. I endorse all that has been said by the honorable member for Gippsland (Mr. Paterson) in regard to alternative measures, and I am speaking not so much on behalf of the farmers, great as their interests are, as for the people generally. It must be recognized that, owing to the heavy fall in the price of wheat, the position of the farmers is desperate. They are producing the wealth of this country, and if something is not done at once to enable them to continue the production of that wealth, the losses and unemployment that have already occurred must be increased. I suggest that before the Government definitely decides to abandon this measure it should take notice of the request of the honorable member for Wimmera (Mr. Stewart) that an effort be made to finance some other measure of relief that would be acceptable to the Parliament. If we allow the farmer to go down now, the distress next year will be worse than that being experienced at the present time. We must continue to produce wealth, if we are to obtain the outside assistance required to enable us to improve the conditions of our people. If all else fails, wo should try a compulsory loan. I would even go that far, rather than see Australia fall into the slough of despond.

Question resolved in the affirmative.

House adjourned at5.13 p.m.

Cite as: Australia, House of Representatives, Debates, 17 April 1931, viewed 6 July 2017, <http://historichansard.net/hofreps/1931/19310417_reps_12_128/>.