House of Representatives
16 March 1932

13th Parliament · 1st Session



Mr. Speaker (Hon. G. H. Mackay) took the chair at 11 a.m., and read prayers.

page 1158

QUESTION

ARBITRATION LAWS

New Zealand Amendments

Mr HUTCHIN:
DENISON, TASMANIA

– Newspapers report that the Arbitration Act in New Zealand is to be substantially amended to enable the industries of that dominion to adjust themselves to present-day conditions. I ask the Minister representing the Minister for Industry whether the Government’ will arrange to secure full information regarding the proposed changes of the New Zealand law with a view to determining whether they are suitable for adoption in Australia?

Mr BRUCE:
FLINDERS, VICTORIA · NAT; UAP from 1931

– Certainly.

page 1158

QUESTION

CATTLE TICK

Dr EARLE PAGE:
COWPER, NEW SOUTH WALES

– I ask the

Minister for Health whether the Government has yet come to a decision regarding the continuance of Commonwealth assistance in the combating of the cattle tick menace?

Mr MARR:
Minister for Health · Parkes · UAP

.- by leave - The Government is gravely concerned at the reports which have been received from its officers tothe effect that cattle tick has been spreading southward and westward from the north coast districts of New South “Wales. This has happened in spite of the expenditure during the present year by the Tick Commission of £142,000, of which £44,000 has been provided by the Commonwealth Government, and in spite of the employment of more than 300 men in the work of tick control and eradication. This new danger from this pest has led the Government to reconsider the conditions of the contribution it proposed to make during the coming twelve months. In more normal circumstances it might reasonably have expected that the reduced cost level and lower awards in Australia would have enabled the work of tick control and eradication to be continued with equal efficiency, but with lower expenditure by the governments. This would have enabled some economy to have been effected during the coming twelve months to the relief of Commonwealth and State exchequers. The Commonwealth Government, however, views the renewed menace from the spread of tick so seriously that Cabinet has decided that a grant equal to that made during the present year shall be made available next year. This grant will be conditional upon a sufficient proportion of these funds being usedtoerectenoughnewdips before next summer along the southern fringe of, and within, the newly-infected areas, and sufficient staff being made available to supervise the necessary preventive measures, to hold back the further spread southward of the pest, and, if possible, to eradicate it from the areas recently invaded. In the past the Tick Commission has sometimes failed to receive that willing co-operation which might have been expected from the cattleowners in the infected districts. It is hoped that, both in the construction of the new dips and in observation with the object of discovering tick, cattleowners will give the commission the fullest assistance, so that the limited funds available may produce results equal to, if not better than, those obtained in previous years. The commission, which consists of representatives of the Commonwealth and the States of New South Wales and Queensland, will meet next week to consider this matter, and I hope to be able to make a further statement on the matter subsequently.

Mr NELSON:
NORTHERN TERRITORY, NORTHERN TERRITORY · ALP

– Can the Minister say what action, if any, is being taken to prevent the spread of the tick pest throughout an area of approximately 700,000 square miles of clean country in the Northern Territory?

Mr MARR:
PARKES, NEW SOUTH WALES · NAT; UAP from 1931

– The subject has been receiving the attention of the Tick Commission, which comprises representatives of the Commonwealth Government and the Governments of New SouthWales and Queensland, Its jurisdiction does not extend to the Northern Territory, but I shall bring the matter under the notice of the Minister for Home Affairs, and also the Cabinet, with a view to determining what action should be taken in that portion of the Commonwealth.

page 1157

QUESTION

CRUDE OIL

Mr NAIRN:
PERTH, WESTERN AUSTRALIA

– In order to give assurance to the farmers who are about to commence sowing operations, can the Assistant Minister for Trade and Customs announce that there will be no increase of the duty on crude oil: alternatively, if the Government intends to await the report of the Tariff Board, will it ask the board to expedite its inquiry?

Mr PERKINS:
Assistant Minister for Trade and Customs · EDEN-MONARO, NEW SOUTH WALES · UAP

– Crude oil is one of the matters now being investigated by the Tariff Board, whose report will be dealt with by the Government as soon as it is received.

page 1157

QUESTION

COMMUNISM

Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP

– During the general election campaign members of the presentMinistry said that if they were elected to office they would take action against the Communists. More recently both the Attorney-General and the Assistant Attorney-General have said that action would have to be taken by private individuals. I, therefore, ask the Minister representing the Attorney-General whether the Government itself proposes to take action against Communists or to throw the full responsibility upon private citizens?

Mr BRUCE:
FLINDERS, VICTORIA · NAT; UAP from 1931

– Any impression that the Government will leave action against Communists to private individuals is unfounded. The Government is prepared to take any action possible under the existing law, and if the necessity arises to ask Parliament to increase the Government’s powers by an amendment of the law; but the Attorney-General has, from time to time, invited private citizens who are in possession of proveable information regarding Communist activities to supply it to him, on the assurance that immediate action would follow.

page 1157

QUESTION

NEW ZEALAND TRADE AGREEMENT

Mr PRICE:
BOOTHBY, SOUTH AUSTRALIA

– This morning I received a letter from an Adelaide business man who states -

When I was in New Zealand I endeavoured to buy Australian table raisins in Auckland, but could only purchase Californian products or products from Greece. It seems pathetic that this market is not ours.

I ask the Minister for Markets whether the Government will endeavour to improve the existing trade agreement with New Zealand?

Mr HAWKER:
Minister for Markets · WAKEFIELD, SOUTH AUSTRALIA · UAP

– The improvement of trade relations between Australia and New Zealand has been the aim of all Commonwealth Governments during recent years. Although the dominion does not buy Australian dried fruits exclusively, it is our third best market for them. A trade agreement with the Commonwealth is in operation, and the Scullin Ministry, when imposing tariff increases and embargoes, endeavoured to extend consideration to New Zealand and not to prejudice Australia’s trade with it. No doubt at the forthcoming Economic Conference at Ottawa trade relations between the different dominions as well as between the Mother Country and the dominions will be considered.

page 1158

QUESTION

PUBLIC WORKS

Contract System

Mr RILEY:
COOK, NEW SOUTH WALES

– Following the announcement by the Government that in future Commonwealth public works will be carried out by contract, will the Prime Minister make available a report made some years ago by Mr. Root, of the Auditor-General’s Department, regarding certain works constructed by contract in the Federal Capital Territory ?

Mr LYONS:
Prime Minister · WILMOT, TASMANIA · UAP

– I shall investigate the matter and let the honorable member know if the report can be made available.

page 1158

QUESTION

TOBACCO DUTIES

Mr THOMPSON:
NEW ENGLAND, NEW SOUTH WALES

– Is the Prime Minister aware that the tobaccomanufacturers have already reduced the prices of imported brands of tobacco and increased the prices of Australian brands ? Will he represent to them the unfairness of taking such action before Parliament has come to a decision on the new tobacco duties?

Mr LYONS:
UAP

– I shall discuss the matter with the Minister for Trade and Customs with a view to correcting the action of the manufacturers, if that is within the Commonwealth Government’s power.

Mr FORDE:
CAPRICORNIA, QUEENSLAND

– In view of the fact that a fortnight has elapsed since the House was given an opportunity to discuss the Government’s tariff proposals with regard to the tobacco industry, I should like to know whether the Ministry has yet given the duties further consideration, as promised at the request of members of the Country party? It wasbecause of the definite assurance that the whole question would be reconsidered that several members of the Country party voted against their own amendment.

Mr LYONS:

– The Government is taking such action as will enable it to fully reconsider the whole subject. We are investigating the position from the stand-point of the growers particularly. The Minister has secured the services of an officer who was not connected with the previous investigation, in order that the whole position may be reviewed and a report made to the Cabinet. The Government will then give careful consideration to the question. In doing this, the Government is honouring the undertaking it gave to the right honorable the leader of the Country party.

Mr RIORDAN:
KENNEDY, QUEENSLAND

– Has the Minister been advised that, as the result of the lower duties imposed by this Government, the National Tobacco Company in Queensland has closed down, and that a considerable number of employees will be thrown out of work? I should also like to know if it is the intention of the Government to give the House an opportunity to conclude the debate on this subject before the Easter recess.

Mr PERKINS:
UAP

– I regret that I cannot answer the first part of the honorable member’s question; I shall refer it to the Minister for Trade and Customs. As to the second part, I see no opportunity for further discussing the Government’s proposals before the Easter adjournment.

page 1158

QUESTION

OIL FROM COAL

Mr JAMES:
HUNTER, NEW SOUTH WALES

– In view of the Government’s announced intention to hand over the Newnes shale industry to private enterprise, and having regard to the fact that the £100,000 voted by the last Parliament for the repatriation of surplus coal-miners has not been wholly expended, will the Acting Minister for Industry make available from the balance a sum of £20,000 to Lyon Brothers, who have been experimenting in the extraction of oil from coal? Would it not be better to use that money for the development of an industry that would absorb some of the surplus miners, rather than return it to the Consolidated Revenue Fund?

Mr BRUCE:
FLINDERS, VICTORIA · NAT; UAP from 1931

– The Government’s policy aims at providing the maximum of employment, and to that end it is prepared to co-operate with private enterprise. One of the purposes of the conference of Commonwealth and State Premiers to be held on the 12th April is to consider ways and means of co-operation between governments and private enterprise with a view to minimizing unemployment. I cannot give to the honorable member an assurance on the specific subject he has mentioned; but, if examination should disclose that a measure of Commonwealth assistance to or co-operation with any private enterprise in the development of an industry would result in opening up a new avenue of employment, and help to absorb some of the surplus miners, the Government will give to it sympathetic consideration.

page 1159

QUESTION

WIRE WETTING

Mr GREGORY:
SWAN, WESTERN AUSTRALIA

– Yesterday I directed the attention of the Minister for Trade and Customs to the fact that, owing to the operation of the dumping duty on wife netting, British manufacturers are now charging a higher price for their wire netting in Australia than in South Africa or New Zealand. Since then I have received from a resident of a country district in Western Australia a letter telling me of the great destruction that is being caused by rabbits there. Having regard to the bounty that is being paid to Australian manufacturers, will the Prime Minister refer this question to Cabinet with a view to removing importations of wire netting from the anti-dumping provisions of the Customs Act?

Mr LYONS:
UAP

– I shall be glad to bring the matter mentioned by the honorable member before Cabinet for consideration.

page 1159

QUESTION

WINE EXCISE

Mr NOCK:
RIVERINA, NEW SOUTH WALES

– Can the Minister for Markets give any information as to the reasons actuating the Government in shelving the Wine Excise Bill?

Mr HAWKER:
UAP

– The Wine Excise Bill has not been shelved. The bill would have completely altered the method by which excise revenue from wine was collected. In principle, it had the general support of winemakers and grape-growers, but there wa3 considerable difference of opinion as to the actual form which the new proposals should take. Had there been general agreement among wine-makers and grapegrowers it would have been possible to pass the bill through this Parliament practically as an unopposed measure; but representations were made through some of the organizations of grapegrowers and also the Viticultural Council which represents wine-makers, that the bill should be deferred until after the present vintage. In the circumstances there is no chance of passing the bill in time for the Excise Department to be so reorganized as to permit of the collecting of revenue from this year’s vintage. The matter will be considered before the next vintage.

Mr PRICE:

– As the Baume system for testing wine is a contentious one, will the Minister see if it is possible to agree upon a standard test?

Mr HAWKER:

– There has been a standard test in operation for many years, and, as announced by the Minister for Trade and Customs, the Government intends to do everything within its power to see that the test is complied with.

page 1159

QUESTION

LITHGOW SMALL ARMS FACTORY

Mr THOMPSON:

– Is there any truth in the report that the Government proposes to curtail the activities of the Lithgow Small Arms Factory? By way of explanation, I may say that the factory is now manufacturing shearing machine accessories of good quality and at cheap prices, but there is an agitation afoot to induce the Government to require the management to discontinue this class of work. Is the Prime Minister aware of any intention to close down the factory so far as this class of work is concerned ?

Mr LYONS:
UAP

– There is no intention to close the factory, nor is it intended to cease manufacturing shearing machine accessories.

page 1160

QUESTION

CLOTHING FOR UNEMPLOYED

Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP

– This morning I received from Brigadier-General Heritage, Commandant of the Victoria Barracks, Sydney, the following letter with reference to the supply of surplus military clothing to the unemployed: -

As you will have seen from the communication of my Chief Ordnance Officer, who deals with these matters, and who replied to your previous communication during my absence, I have no authority to issue to any organizations outside the metropolitan area at present. The situation is that 1 was instructed to issue to certain charitable organizations nominated by the State Government of New South Wales. That Government has only nominated metropolitan institutions as it considers the clothing, &c, available for issue is not of sufficient quantity to make a State-wide distribution.

Will the Minister take steps to see that country districts, and particularly districts such as Portland, Lithgow, and Wallerawang, where the people are suffering great privations as the result of unemployment, receive their fair share of such military clothing as is available?

Mr FRANCIS:
Minister in charge of War Service Homes · MORETON, QUEENSLAND · UAP

– The distribution of surplus military clothing is at present engaging the attention of the Minister for Defence and myself. Certain action has been taken during the last few days and I hope to be able to make an announcement very shortly. Special attention will be given to all country districts, including those mentioned by the honorable member.

Mr JAMES:

– In view of the discontent prevailing in country districts, because of the changed policy of the Government which now restricts the issue of surplus military clothing to organizations in the metropolitan areas, will the Ministry, by way of an Easter gift, make available to the unemployed sufficient clothing to meet their requirements from the military and naval stores branch of the Defence Department?

Mr LYONS:
UAP

– There has been no change in the policy of the Government, and no distinction is made between metropolitan and country areas. I shall confer with the Minister for Defence and see what can be done; but the honorable member must know that there is not sufficient surplus military clothing on hand to do what he suggests.

page 1160

QUESTION

U NEMPLOYMENT

Release of Credits

Mr FORDE:

– In view of the great importance to the unemployed and the commercial community of the Prime Minister’s statement at Wollongong on Saturday, that the Government would have to consider using the credit of the country to relieve unemployment, and get away from the old system of borrowing, I should like to know whether the Government intends that the credit resources mentioned by him should be made available by the private banks, by the Commonwealth Bank, or by both? Further, by what other method does he expect that credits for the relief of unemployment may be made available, and when?

Mr LYONS:
UAP

– I replied yesterday to a similar question asked by the honorable member.

Mr Forde:

– It was a very vague reply.

Mr LYONS:

– I have nothing to add to that statement, beyond saying that the unemployment problem will be considered by the special committee which has been set Up by the Government, andalso by a conference of representatives of the Commonwealth and State Governments a few days hence.

page 1160

QUESTION

CORNSACKS

Mr COLLINS:
HUME, NEW SOUTH WALES

– Having regard to the complaints that have been made concerning the irregularity in size and the inferior quality of cornsacks, will the Minister for Markets endeavour to ensure uniformity in size and an improvement in quality?

Mr HAWKER:
UAP

– I will give the matter my attention and see if it is practicable to do anything to achieve the desirable object suggested by the honorable member.

page 1160

BROADCASTING BILL AND TOBACCO DUTIES

Mr RIORDAN:

– Since the Government has decided to drop the Broadcasting Bill after consultation with the associated press, I should like to know if the same consideration will be given to the request of the tobacco-growers who have made representations for the reimposition of the duties imposed by the previous Government. I should further like to know if the representative of the associated press who conferred with the Prime Minister yesterday was the gentleman who prevented the Leader of the Country party (Dr. Earle Page) from securing the portfolio of Minister for Trade and Customs ?

Mr LYONS:
UAP

– As the Government has not decided to drop the Broadcasting Bill, there is nothing in any of the suggestions made by the honorable member.

page 1161

QUESTION

BUFFALO FLY

Mr THORBY:
CALARE, NEW SOUTH WALES

– Can the Minister for Health inform the House if any action has been taken to co-operate with the Governments of Queensland and Western Australia in steps to check the spread of the buffalo fly pest, which is such a serious menace to the cattle industry in Australia ?

Mr MARR:
UAP

– I have not had any representations from the Government of Western Australia, but the Minister for Agriculture in Queensland brought the matter under my notice yesterday, and I shall have a further conference with him to-day. Recommendations will be made to Cabinet, and these will receive consideration.

page 1161

QUESTION

COMMONWEALTH MUNITION WORKS

Mr WHITE:
BALACLAVA, VICTORIA

– Is the Assistant Minister for Defence satisfied with the means adopted for the distribution of sheet brass made by the Munitions Department under the arrangement instituted by the last Government i Is it proposed to continue the policy instituted by the last Government of making motor bodies and other motor parts at tlie department’s factories in competition with private enterprise?

Mr FRANCIS:
UAP

– ‘These matters are receiving the consideration of the Minister for Defence and myself, and at a favorable opportunity a statement will be made dealing with the policy of the Government with regard to the Maribyrnong and other munition factories.

page 1161

QUESTION

OLD-AGE PENSIONERS

Mr JAMES:

– In view of the reply given by the Prime Minister to a deputation which I introduced to him in Sydney - that the Government would give consideration to the desirableness of amending the Old-age Pensions Act so that unproductive property, whether houses or land, belonging to pensioners would not be taken into consideration in assessing their pensions - will he now state whether it is the Government’s intention to amend the act, as indicated?

Mr LYONS:
UAP

– I have no recollection of making such a promise. I take it that the last Government gave full consideration to this matter, and must have had good reason for leaving the act as it is. I am prepared, however, to have the matter further considered to see whether anything can be done in the direction desired by the honorable member.

page 1161

QUESTION

COTTON INDUSTRY

Mr FORDE:

– Having regard to the great uncertainty in the minds of those engaged in the cotton-growing industry in Queensland, and the probable unemployment of thousands of persons connected with the industry, will the Prime Minister give an assurance that the tariff protection afforded to the industry will be reconsidered at an early date, and the Government’s decision announced, if possible, this week ?

Mr LYONS:
UAP

– I shall consult with the Minister for Trade and Customs regarding the matter.

page 1161

QUESTION

THE PRIME MINISTER AND MR. ERIC CAMPBELL

Mr JAMES:

– Does the Prime Minister propose to offer a.ny objection to Eric Campbell using him as a doormat?

Mr LYONS:
UAP

– Neither Eric Campbell nor the . honorable member for Hunter (Mr. James) will ever be allowed to use me as a doormat.

page 1162

QUESTION

STATE LOANS RAISED IN AMERICA

Dr MALONEY:
MELBOURNE, VICTORIA

asked the Treasurer upon notice -

  1. What are the totals of loans raised in America on behalf of States of the Commonwealth ?

  1. In each case, what State raised the loan,, on what dato was it raised, and what was the rate of interest?
Mr LYONS:
UAP

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

  1. £31,067,149.

page 1162

QUESTION

PREVENTION OF BUSH FIRES

Dr MALONEY:

asked the Minister for Home Affairs, upon notice -

  1. Has his attention been drawn to an article on “ Bush Fires “ by Sir James Barrett, published in the publication called The Woman on the 1st instant?
  2. If so, will he endeavour to obtain the help of the various States to take conjoined action to prevent bush fires ,with the resultant loss of lives and property?
Mr ARCHDALE PARKHILL:
Minister for Home Affairs · WARRINGAH, NEW SOUTH WALES · UAP

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

  1. Yes.
  2. The Commonwealth Forestry Bureau has made certain recommendations regarding cooperative action in the States, and these are now under consideration.

page 1162

QUESTION

CONTROL OF PEARL FISHING

Mr NELSON:
NORTHERN TERRITORY, NORTHERN TERRITORY

asked the Minister for

Home Affairs, upon notice -

  1. Has his attention been drawn to the. following newspaper extract: - “The motor vessel

Maroubra, under Government charter, with Mr. W. L. Stanley, Chief Pearling Inspector, aboard, has returned from a search for contraband pearl shell. The inspector found that during last pearling season the luggers have taken much more shell than the Government ordinance allows, and the Japanese divers are blamed. Many luggers have come from the Dutch Fast Indies, and have taken shell from hiding places on Bathurst and Melville Islands, defeating the object of the federal quota. The Maroubra brought back six tons of pearl shell, valued at several hundred pounds. It is suggested that a revenue cutter should control the fishing, Or that an aeroplane patrol should be used to prevent mother-of-pearl going to the East.”?

  1. If so. what action is the Government taking to prevent restricted aliens from spending week-ends in Darwin?
Mr ARCHDALE PARKHILL:
UAP

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

  1. The newspaper report has not been seen, but a full report on the subject is being obtained from Darwin.
  2. This ‘matter will be fully investigated.

page 1163

QUESTION

CONTRIBUTION TO IMPERIAL COLLEGE OF AGRICULTURE, TRINIDAD

Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP

asked the Treasurer, upon notice -

  1. Is a subsidy paid by the Commonwealth to the Royal College of Agriculture, Trinidad?
  2. If so, what is the amount and under what conditions is it given?
  3. Are there any scholarships at the college available for Australians, either exclusively or in general ; if so, what are the conditions ?
Mr LYONS:
UAP

– The answers to the honorable member’s questions are as follow : - 1 and 2. A contribution of £250 per annum was paid to the Imperial College of Tropical Agriculture, Trinidad, during the period of 1927-28 to 1929-30. Payment of the contribution was suspended on the grounds of financial Stringency during 1930-31. No special conditions were attached to this payment.

  1. I shall obtain the information desired, and make it available as soon as possible.

page 1163

FINANCIAL AGREEMENTS ENFORCEMENT ACT

Application to the State of New South Wales - Suspension of Standing ORDERS

Motion (by Mr. Lyons) proposed -

That the Standing Orders be suspended to enable the Prime Minister to move a motion, without notice, under section 6 of tlie Financial Agreements Enforcement Act 1932, and also to allow the debate on the motion to bc continued after two hours without interruption under Standing Order 119.

Mr SCULLIN:
Yarra

.- I do not intend to support the motion. This Parliament has rights, and it is one of the duties of the Opposition to preserve those rights when they are threatened by the Government. It is necessary, sometimes, for a government to move the suspension of the Standing Orders to expedite business-

Mr Thompson:

– The right honorable member did it often enough.

Mr SCULLIN:

– I never did anything to equal this. I challenge the honorable member to quote a precedent for the Government’s action to-day. We have here a proposed motion which is probably the most important, and certainly the most drastic, which has ever come before this Parliament, and it is thrown before honorable members for them to pass without their even having had time to read it.

Mr Gabb:

– The matter is urgent.

Mr SCULLIN:

– Why did not the Prime Minister (Mr. Lyons) give notice yesterday of his intention to move the motion? Why did it not appear on the business-sheet to-day? Why was not the motion distributed so that honorable members might have an opportunity to read it?

Mr White:

– The Leader of the Opposition will be able to get the. adjournment, and to study the text of the motion before the matter is proceeded with further.

Mr SCULLIN:

– The Prime Minister has intimated that the motion is to be put through immediately. If he will state now that I can have the adjournment, I shall withdraw my objection.

Mr Lyons:

– It would be impossible to deal this week with the Government business already outlined if that were done.

Mr SCULLIN:

– It is evident that the motion is to be rushed through immediately. I ask honorable members whether any of them have yet had time to read it. An honorable member supporting the Government interjected that there was no need to read it. He surely, is a wonderful representative of the people !

Mr Perkins:

– Who made that interjection? I did not hear it.

Mr SCULLIN:

– It came from the Government side of the House. The interjection shows how seriously he takes his responsibilities, and how blindly he is prepared to follow the lead of the Government. I again ask honorable members how many of them have read the motion ?

MINISTERIAL Members. - All of us.

Mr SCULLIN:

– -Perhaps they read it at 2 o’clock this morning, during the caucus meeting, but honorable members on this side of the House have had no such opportunity. Honorable members opposite may make light of this matter if they choose, but this is not the proper way to treat a national parliament, or any parliament, for that matter. Honorable members who intend to support the motion without even having read it are adopting a most irresponsible attitude, whether they sit behind the Government, with the Country party, or elsewhere. Oh this document, which is now placed before us for the first time, there is, first of all, a copy of the certificate by the Auditor-General, setting out the amount of money owing.

Mr Gabb:

– The Leader of the Opposition will surely not challenge the certificate, and that is the main part of it.

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

– I thought that the honorable member for Angas (Mr. Gabb) was an independent.

Mr Gabb:

– So I am.

Mr SCULLIN:

– The honorable member for Angas has proved by his interjection that he does not understand the motion.

Mr Gabb:

– I have read it since I have been sitting here.

Mr SCULLIN:

– The honorable member may have read it, but it is evident that he does not understand it. He said that the Auditor-General’s certificate was the most important part of the document.

Mr Gabb:

– No; I said that it was the largest part.

Mr SCULLIN:

– The honorable member chooses now to shift his ground. Obviously, the most important part of the motion is comprised of the list or classes of revenue which it is proposed to attach. I should like honorable members to inform me how much revenue is involved in the list before us. Do they know anything about the matter? Have they looked up the figures to see just how much revenue it is proposed to attach? Does any one know anything of this matter except, perhaps, the Government?

Mr E J HARRISON:
WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

– A footnote says that revenue may be attached to the extent of the amount set forth.

Mr SCULLIN:

-Can the honorable member tell me the amount involved in the long list of revenues set forth in the motion? If that is not evident, howcan the House intelligently decide whether the whole of the list of items should be agreed to or not ? There is an amount of less than £1,000,000 to be collected, but what amount of revenue is it proposed to attach?

Mr E J HARRISON:
WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

– What does it matter?

Mr SCULLIN:

– It ought to matter to the honorable member if he is a taxpayer in the State of New South Wales.

Mr Lane:

– Why apologize for the Lang Government?

Mr SCULLIN:

– The honorable member has been throwing across the chamber statements which have no foundation in fact. He is merely insulting, and is rarely anything else. If the honorable member understood my attitude on this matter he would know that I have no sympathy with Mr. Lang, and no support for his methods or his actions, but I have a strong sense of responsibility to this Parliament, and to the people - a sense of responsibility, which, apparently, the honorable member does not share. I do not propose to agree to the suspension of Standing Orders, so that the House may pass a motion of which notice should have been given yesterday, but which hasonly just been placed before honorable members. The amount to be collected is, as I have said, under £1,000,000, but so far as I can judge by studying this motion, the Commonwealth Government asks permission to attach revenue amounting to between £6,000,000 and £7,000,000, or two-thirds of the revenue of the State.

Mr McBride:

– It will collect only the amount due, which is something over £900,000.

Mr SCULLIN:

– Then why attach twothirds of the revenue of the State? . Honorable members have a right to go into these matters fully, instead of which they will have to rely on the explanation of the Prime Minister, which may leave the positionjust as clear as it was when he began. I protest against the proposed action of the Government, and intend to oppose it.

Mr SPEAKER (Hon G H Mackay:
LILLEY, QUEENSLAND

– I remind honorable members that the question before the Chair is a motion for the suspension of the Standing Orders, and the discussion must be strictly limited to that. Honorable members must not deal with the terms of the motion which it is proposed to move later.

Mr BEASLEY:
West Sydney

– I desire to follow the correct procedure. I take it that the proposal is to suspend the Standing Orders for a specific purpose. In challenging the adoption of that course, I feel that I must make some reference to the object intended.

Mr SPEAKER:

– It must be extremely brief.

Mr BEASLEY:

– On several occasions I have drawn attention to the attitude of the Prime Minister (Mr. Lyons) towards the privileges of honorable members. His determination this morning to proceed in the manner that he has indicated is in keeping with the tactics that all along he has attempted to employ to carry out this proposal. The intention of this Government was to endeavour to seize the revenues of the State, held by the private banks and thus to prevent the payment of public service salaries prior to the Easter holidays, but it was frustrated in that move. Honorable members opposite may laugh. It’ is obvious that, in the battle of tactics uptodate, this Government has been the loser, and that it wishes to hide its discomfiture by attempting to laugh the matter off. I assure the House that the longer laugh will be with the Government of New South Wales.

Having been defeated in the direction already referred to the Government is now making this move to achieve its object. The information contained in the document that has Deen placed before us this morning could quite easily have been made available to us yesterday. As a matter of fact, I know that it was prepared yesterday in the office of the Prime Minister, and was ready for presentation to Parliament ; but it was not to be made public, the object of the Government being to swoop down on the State of New South Wales just prior to the holidays an.d procure certain of its revenues.

Mr SPEAKER:

– The honorable member is now discussing the resolution.

Mr BEASLEY:

– I may be. But I am pointing out that the object of the Government in proposing to suspend the Standing Orders is to enable it to swoop down at a given moment upon certain of the revenues of the State of New South Wales. Had the ordinary procedure of the House been followed an opportunity would have been afforded to those concerned to prepare their case.

Mr SPEAKER:

– On the other hand, I remind the. honorable member that when the resolution is debated it 13 possible that its terms may be altered. Therefore, he is not justified in assuming that certain things will happen.

Mr BEASLEY:

– I appreciate that fact. But at the moment all that we have before us is the document that has been distributed. I am not competent to forecast what changes may be made; consequently I cannot express any opinion in that direction. It seems clear that it is the desire of the Government this morning to suspend the Standing Orders so that it may obtain a tactical advantage over those who are affected adversely by the terms of the resolution.

I followed closely the remarks of the right honorable the Leader of the Opposition (Mr. Scullin) when he questioned the likelihood of our friends opposite having read this document or of knowing exactly what it contains. I remind the House that a statement by the Prime Minister, which was published in the press this morning, set out that the amount to be obtained from New South Wales was, in round figures, in the vicinity of £S00,000. As a matter of fact the statement prepared in his department yesterday was for that amount. Since then, however, a change has been made, and the amount has been altered to £924,082 3s. 4d. The statement of the amount involved, which was published in the Canberra Times this morning, apparently was sent also to the different States. Yet honorable members who sit behind the Government claim to have a complete knowledge of the subject! Although the Prime Minister himself apparently has not, they are prepared to follow him blindly. The only course open to the Government of New South Wales ia to play this Government at its own game ; and I am satisfied that it is quite capable of doing so. The resolution may be bludgeoned through this Parliament, and the Government may “go its hardest” to enforce it; but in due season the State Government will give effect to its policy, and I am satisfied that it will obtain the results it desires.

Dr EARLE PAGE:
Cowper

– I have no hesitation in supporting the motion moved by the Prime Minister ; because, if ever there was a time when this Parliament should move swiftly, it is the present, when the greatest State in the Commonwealth is dishonouring itself by refusing to pay its just debts.

Mr Scullin:

– Why could we not have been given notice yesterday?

Dr EARLE PAGE:

– Everybody knows that five minutes before noon last Saturday the Premier of this great State withdrew a large sum of money out of the banks.

Mr SPEAKER:

– Order! The right honorable gentleman must confine himself to the terms of the motion.

Dr EARLE PAGE:

– That was regarded as a matter of urgency ; no notice was given of the intention to withdraw that money.

Mr Beasley:

– One does not give a burglar notice.

Dr EARLE PAGE:

– The burglar in this case is not the Commonwealth Government, which is protecting the other States of Australia and the people of the Commonwealth, but the State of New South Wales, a portion of which I represent. We should move as swiftly as possible. The suggestion that the action taken this morning came as a shock to honorable members is an absolute camouflage of the facts. Within the last three weeks we have discussed the measures that were regarded as necessary to enable this resolution to be put into operation. During those debates consideration was given to the methods that might be used.For weeks everybody has been considering what was the wisest course to pursue. It is the first duty of this Parliament to act swiftly and certainly, and in such a way that a similar thing will never occur again.

Mr FORDE:
Capricornia

.- Honorable members have a just grievance against the Prime Minister (Mr. Lyons) for treating them with the scant courtesy that he has exhibited this morning. Surely he could have given notice last night of his intention to move this motion ! It is understood that a certain measure, which he gave us to understand would be first on the notice-paper to-day, is not to be proceeded with. If the honorable gentleman continues to act in this fashion, he will meet with a good deal of obstruction. We object to being treated in this way.

Motion (by Mr. White) proposed -

That the question be now put.

The House divided.

In division:

AYES: 0

NOES: 0

AYES

NOES

Motion - by leave - withdrawn.

Mr JAMES:
Hunter

.- I oppose the motion for the suspension of the Standing Orders. The Government, in moving it without having given previous notice, is endeavouring to ride rough-shod over all the precedents and customs of this House. Never before has a Prime Minister adopted such a course. No one has had an opportunity to consider these proposals, and to ascertain what revenues the Commonwealth proposes to seize from New South Wales. I doubt whether the proposed action will be taken, because, if it is taken, it will undoubtedly lead to the imprisonment of certain Commonwealth officials inthe gaols of New South Wales. The Government is attempting to hold up the festivities that are to take place in New South

Wales at the opening of the Sydney Harbour bridge, and no doubt its action is in accordance with the promise of some of its supporters on the hustings that, if the United Australia party were returned to power, the Lang Government would be put out of office within three weeks. Mr. Eric Campbell does not intend to allow Mr. Lang to open the bridge.

Mr SPEAKER:

– The honorable member is not now advancing reasons in justification of his opposition to the motion, and I ask him to connect his remarks with it.

Mr JAMES:
HUNTER, NEW SOUTH WALES · ALP; LANG LAB from 1931; ALP from 1936

– I am trying to connect my remarks with the motion. It involves the seizure of the revenues of New South Wales at a time when that State will be visited by many people from the other States and from overseas. This Government proposes to use legislation which it has recently passed for the purpose of raiding, like a thief in the night, the revenues of New South Wales. This Government is putting the interests of foreign bondholders before the interests of the hungry people of New South Wales. As the resolution vitally affects one of the constituent parts of the federation, due notice of its introduction should have been given by the Government. No doubt, this drastic action is being taken to pacify certain heelers of the Government. I intend to oppose tooth and nail every paragraph of the resolution. The group that I represent will force a division at every opportunity, even if that means keeping the Parliament in session until after the opening of the bridge.

Mr Prowse:

– Mr.Lang should pay the debts of. New South Wales.

Mr JAMES:

– He is prepared to pay them, but not in preference to people who are in distressed circumstances, and who require food. There are occasions on which debtors have to ask their creditors for additional time in which to meet their obligations. The State of New South Wales, as a debtor State, is now asking the Commonwealth for an extension of time.

Mr SPEAKER:

– I have previously asked the honorable member to connect his remarks with the motion. He is now discussing a position which might arise if the resolution were carried, and I ask him not to indulge in a general discussion.

Mr JAMES:

– I should not have wandered from the issue before the House had it not been for the interjection of the honorable member forForrest (Mr. Prowse). No honorable member has had an opportunity to give proper consideration to the proposals of the Government, and, therefore, I cannot allow this motion to pass without voicing my protest against it.

Mr GABB:
Angas

– I support the motion for the suspension of the Standing Orders. As an independent member, I recognize that we have to be jealous of the rights and privileges of members of this House; but I feel that we have reached a stage in our history at which the private rights of members and the supersensitiveness of the Opposition must be brushed aside. We are faced with a desperate position, with a desperate man, and with a desperate government. I am prepared to support the Commonwealth Government in any action, however drastic it may be, that it takes to prevent the ship of state from drifting on to the financial rocks.

Mr PROWSE:
Forrest

.- I support the motion, because dread diseases need drastic remedies. The Government is taking the proper course. The honorable member for Hunter (Mr. James) has said that the action of the Government is likely to interfere with the festivities in connexion with the opening of the Sydney Harbour bridge, but this is a time not for festivities but for sackcloth and ashes, particularly so far as New South Wales is concerned. Any honorable member can readily read the resolution within the time at our disposal. I honour the Government for taking this drastic action, because it is in the interests of New South Wales as well as of the other States of the Commonwealth.

Mr BLAKELEY:
Darling

.- I do not know whether the Government, in taking this hasty action, has contemptuously disregarded the rights of honorable members. It may be that be cause of recent happenings in New South Wales the Prime Minister is so obsessed by fear that he is new really emulating a certain person in that State in an endeavour to do something spectacular every day.

Mr Beasley:

– The Prime Minister will need to do something spectacular next Saturday.

Mr BLAKELEY:

– I advise the Prime Minister to look before he leaps. The resolution which the Government intends to introduce is of farreaching importance to the Commonwealth and the various States of Australia. The right honorable member for Cowper (Dr. Earle Page) has said that we knew what was coming. We did know that the actual certificate of the Auditor-General would be an ordinary certificate conveying certain information, but we had no indication whatever from the Government as to the classes of State revenue that would come within the provisions of the act. The latter portion of the resolution is all-embracing and reads -

  1. the certificate to be approved and adopted; and
  2. by reason of urgency it is desirable that the provisions of sections seven to thirteen (inclusive) of Part II. of the said act -

    1. should apply immediately in relation to the State of New South Wales. . . .
Mr SPEAKER:

– The honorable member for Darling (Mr. Blakeley) is now reading portion of the resolution, and that action, of course, cannot be allowed at this stage. I am sure that the honorable member’s mental resources are sufficient to enable him, without reading the resolution, to connect his remarks with the motion before the Chair.

Mr BLAKELEY:

– I bow to your ruling, Mr. Speaker, but, in view of the fact that apparently quite a number of honorable members opposite have not read the resolution, I wished to read it so as to give them some indication of the policy of the Government. The rights of honorable members have been attacked by the Prime Minister, whether intentionally or because of some previous omission on his part, I do not know. We knew that the Auditor-

General’s certificate was in course of preparation, but we do not know when it was made available to the Prime Minister. It is dated the loth March, and, therefore, could have been presented to the House yesterday. There are eight important points embodied in the motion which honorable members have not yet had an opportunity to consider in order to determine the extent to which the revenues of the State concerned may be affected. A sudden withdrawal of revenue under paragraphs v. and viii. of clause 2 may have serious consequences.

Mr SPEAKER (Hon G H Mackay:

– Order! The honorable member must connect his remarks with the motion for the suspension of the Standing Orders. He is not in order in referring in detail to the terms of the motion that is to follow.

Mr BLAKELEY:

– I was merely directing the attention of the House to the possible sudden withdrawal of revenue from taxation upon incomes imposed for the relief of unemployment. The Opposition is entitled to some courtesy from the Prime Minister.

Mr LANE:
Barton

.- I support the motion for the suspension of the Standing Orders. Honorable members opposite who are anxious that certain State revenues shall not be attached possibly desire to get into communication with those in control of such revenues. They appear to be acting in collusion with those who support Mr. Lang’s policy. Surely they are big enough to state definitely where they stand upon such an important issue. If they are not, they should be willing to appeal to the people, who would deal with them as they did at the last general election. Apparently, these honorable gentlemen are endeavouring to obstruct this Government in obtaining redress from a government that is unworthy of recognition by honorable citizens. Hardly one decent citizen in New South Wales would support the policy they advocate.

Mr SPEAKER:

– I ask the honorable member to discuss the motion. He is not in order in making general remarks concerning the political situation in any State.

Mr LANE:

– I am endeavouring to show that the activities of honorable members opposing the suspension of the Standing Orders are actuated by motives unworthy of any honorable member.

Mr Rosevear:

– The honorable member cannot prove that.

Mr LANE:

– It would be impossible to reveal to them the ethics of truth or honesty. They do not understand honesty, truth or anything else of the kind.

Mr Scullin:

– I rise to order. I take strong exception to the remarks of the honorable member.

Mr SPEAKER:

– What is the statement to which objection is taken ?

Mr Scullin:

– That honorable members on this side have no regard for the ethics of truth and honesty.

Mr SPEAKER:

– If the honorable member for Barton reflected upon honorable members of the Opposition in what he said, he was distinctly out of order, and must withdraw his remark.

Mr LANE:

– I was referring more particularly to an honorable member who interjected, and not to the Opposition generally.

Mr Beasley:

– I rise to order. I presume that the honorable member was referring to the honorable member for Dalley (Mr. Rosevear). I contend that the honorable member for Barton was not in order in making personal attacks of that nature.

Mr SPEAKER:

– The honorable member was not in order in referring to any honorable member in that way. The statement must be withdrawn.

Mr LANE:

– In deference to your wishes, sir, I withdraw my reference to any individual member of the Opposition. I trust that a majority of honorable members will support the suspension of the Standing Orders to enable the Government to deal promptly with a situation which is unique in the history of the Commonwealth. It is the responsibility of this Government to prevent the dishonest action of governments which are not paying their way.

Mr Blakeley:

– I rise to order. I submit that the honorable member for Barton is disregarding your ruling. Other honorable members have been compelled to confine their remarks to the motion before the Chair, and this, I submit, the honorable member should do.

Mr SPEAKER:

– I called the honorable member for Barton to order when I considered that he was digressing from the motion before the Chair. As I understand that he has now concluded his speech, the honorable member for Darling (Mr. Blakeley) will have no further cause for complaint.

Mr WARD:
East Sydney

– I emphatically protest against the action of the Government in moving the suspension of the Standing Orders to give an opportunity to the Commonwealth Government to get at the throats of the people of New SouthWales-

Motion (by Mr. Lyons) put -

That the question be now put.

The House divided. (Me. Speaker - Hon. G. H. Mackay).

AYES: 50

NOES: 16

Majority . . 34

AYES

NOES

Question so resolved in the affirmative.

Question - That the Standing Orders be suspended - put. The House divided. (Mb. Speaker - Hon. G. H. Mackay).

AYES: 49

NOES: 16

Majority . . . . 33

AYES

NOES

Question so resolved in the affirmative.

Sitting suspended from 12.37 to 3 p.m.

Certificate of Auditor-General - Motion to Approve and Adopt and to Apply

Sections 7 to 13 of Act

Mr LYONS:
Prime Minister and Treasurer · Wilmot · UAP

– I move -

That, the Auditor-General for the Commonwealth having given to the Treasurer a certificate in pursuance of sub-section (1.) of section five of the *Financial Agreements Enforcement Act* 1932 as follows : -

Commonwealthof Australia

Audit Office,

Canberra

Financial Agreements Enforcement Act 1932

I, Charles John Cerbutty, the Auditor-General for the Commonwealth, do hereby, in pursuance of a request, dated the fourteenth day of March, 1932, made to me by the Treasurer of the Commonwealth under section five of the *Financial Agreements Enforcement Act* 1932, certify - {: type="1" start="1"} 0. that on amount of nine hundred and twenty-four thousand and eighty-two pounds three shillings and fourpence (£924,082 3s. 4d.) is due and payable and unpaid by the State of New South Wales to the Commonwealth under or by virtue of the Agreements contained in the Schedules to the *Financial Agreement Validation Act* 1929, the *Debt Conversion Agreement Act* 1931 and the *Debt Conversion Agreement Act (No.* 2) 1931 ; and Dated this fifteenth day of March, One thousand nine hundred and thirty-two. {: type="A" start="C"} 0. J. CERUTTY, Auditor-General for the Commonwealth. {: type="1" start="1"} 0. the certificate be approved and adopted ; and 1. by reason of urgency it is desirable that the provisions of sections seven to thirteen (inclusive) of Part II. of the said Act - {: type="a" start="a"} 0. should apply immediately in relation to the State of New South Wales (being the State to which the said certificate relates) ; and, 1. in order to protect the interests of the Commonwealth until the question of the liability of the said State has been determined by the High Court pursuant to an application under section six of the said Act, should have effect with respect to the following classes of revenue of the said State, namely : - {: type="i" start="i"} 0. revenue from taxation on or in relation to betting (other than stamp duties on betting tickets) and from taxation imposed on racing clubs and associations and bookmakers ; 1. revenue from taxation upon payments for admission to racecourses ; 2. revenue from taxation imposed on or in relation to totalisators ; 3. revenue from taxation on or in relation to the holding of, or admission to, any entertainment, or of or to anything in the nature of an entertainment ; 4. revenue from taxation upon incomes (but not including revenue from taxation imposed by the *Unemployment Belief Tax Act* 1931 of the State of New South Wales) ; 5. revenue from taxation imposed on or in relation to motor vehicles ; 6. revenue from any lottery conducted by or under the authority of the State but not including any sums required for the payment of prizes ; 7. revenue from taxation imposed upon incomes for the purpose of the relief of unemployment ; to the extent of the amount set forth in the said certificate. As the debate on the motion for the suspension of the Standing Orders was concluded suddenly, I had no opportunity to reply to the complaint of honorable members that their rights had been infringed by the moving of that motion. I had no desire whatever to trespass on the rights of any honorable member, but I remind the House that it was indicated clearly yesterday that the Government desired the Broadcasting Bill, and the resolution which I have just moved, to be passed before the Ea3ter adjournment. I assure honorable members that it was impossible for me to give notice of this motion yesterday, because the information on which it is based was not then all available. In any case, the Parliament having so recently passed the Pinanci.il Agreements Enforcement Act, was aware that the subject with which it dealt would require urgent attention. In view of the continued default by the New South Wales Government, the Commonwealth Government feels compelled to intervene at this stage, and to begin the course of action necessary to enable it to recover from the New South Wales Government the amounts which have been paid on behalf of that State, lt was necessary that the debate on the motion for the suspension of the Standing Orders should be concluded before 1 o'clock, otherwise the orders of the day would have been called on, and our whole procedure dislocated. As honorable members know, the Financial Agreements Enforcement Act, which was passed last week, was assented to on Saturday. On Monday last, as Treasurer of the Commonwealth, I made a request to the Auditor-General for a certificate setting out the amount then due and payable and unpaid by New South Wales, under or by virtue of the Financial Agreements. That request was made in accordance with the provisions of section 5, sub-section 1, of the act. Yesterday the Auditor-General furnished a certificate that an amount of £924,0S2 3s. 4d. is due and payable and unpaid by the State of New South Wales under or by virtue of the Financial Agreements. In accordance with the requirements of sub-section 2 of section 5 of the act, a copy of that certificate was published in the *Gazette* yesterday. The Government is now taking the next step provided for under the act, and is asking both Houses of the Parliament to pass a resolution approving and adopting the certificate of the Auditor-General, and providing that, by reason of urgency, the provisions of sections 7 to 13 inclusive of the act, shall apply immediately in relation to New South Wales, and shall have effect with respect to the particular classes of revenue set out in the motion. The motion has been moved in pursuance of section 6 of the act, which sets out the procedure in a case of urgency. There can be no doubt that a position of urgency has already arisen, in view of the fact that the default of New South Wales i3 now practically £1,000,000. On Monday last I forwarded a copy of the act to the Premier of New South Wales, and invited his attention to its provisions. {: #subdebate-24-5-s0 .speaker-F4O} ##### Mr LYONS:
UAP -- I have no knowledge that it has been attended to. 1 informed the Premier of the amount due and payable and unpaid by New South Wales, and requested payment of it. I also informed him that in the event of a continuance of the failure on the part of New South Wales to meet its financial obligations, it was proposed to invoke the provisions of the act. New South Wales not having since met. those obligations, the Commonwealth Government is forced to proceed under the act. The Premier of New South Wales has informed me that he is advised that the act is *ultra vires* of the Commonwealth Constitution1, and has asked for an undertaking not to put it into operation pending the hearing of the action which the State proposes to bring to test its validity. The Commonwealth Government is prepared to assist in every way to secure an early decision as to the validity of the act, and the New South Wales Government will find that no obstacles will be placed in its way by the Commonwealth Government, but rather that every assistance will be forthcoming to facilitate the action which it proposes to take. But the amount already in default and the amounts becoming due by New South Wales for overseas interest are so large that delay in putting the measure into operation may seriously affect the finances, not only of the Commonwealth Government, but also of the other States. {: .speaker-KX7} ##### Mr Ward: -- Including Tasmania? {: .speaker-F4O} ##### Mr LYONS: -- Yes; of Tasmania and every other State. All the States as well as the Commonwealth must be seriously affected by the failure of the New South Wales Government to meet its commitments, and the obligation thus thrust upon the Commonwealth Government of providing money for this purpose. The amount for which the New South Wales Government is now in default exceeds £900,000. It is, of course, impossible to say what further defaults will be made by the Government of New South Wales. To date there have been several defaults of interest due overseas and two defaults in respect of interest due in Australia to the Commonwealth Bank, but the interest due in Australia to private bondholders has been paid by the State to date. If we assume that the State Government will maintain the same attitude in the future, the amount in default will increase month by month, and will, after allowing credit for amounts withheld by the Commonwealth, amount to £4,500,000 by the 30th June; and if the State does not pay the Australian interest, the amount in default may reach nearly £6,000,000 by the 30th June. {: .speaker-L08} ##### Mr Rosevear: -- There are too many " if s " about this statement; why not get down to facts? {: .speaker-F4O} ##### Mr LYONS: -- I am surely entitled to assume that the New South Wales Government will continue to do in the future what it has done in the past. The Commonwealth Government can deal only with the position as it now exists. Accordingly it proposes to take such action as is necessary to recover the amount now due by the State. At the same time, it cannot neglect consideration of the possibilities of the future, and must safeguard itself against further default by the State Government. Honorable members will recollect that the act provides that both Houses of the Parliament may resolve that particular classes of revenue of a State may, subject to certain procedure, be made payable to the Commonwealth, but it also provides that it is not obligatory that all the classes of revenue specified in the resolution of the Parliament shall be included in one proclamation. Different classes of revenue may be included in different proclamations. All the various classes of revenue that might be attached are included in the resolution; but not necessarily all, or even more than one class, will be included in the proclamation. The different classes may be included in different proclamations. This elasticity is necessary to enable the Commonwealth to recover amounts in default with the least disturbance of existing arrangements. The need for such a provision will be seen on an examination of the position. The amount of the present default is £924,082. The estimated yield of income taxes in New South Wales, apart from unemployment taxes, during the next eight weeks, would be sufficient to provide that amount; so that, if no further default took place, it would be necessary only to proclaim that income taxes due to the State of New South Wales would be payable to the Commonwealth for a period of about two months. {: .speaker-F4Q} ##### Mr Scullin: -- Does this resolution cover future default? {: .speaker-F4O} ##### Mr LYONS: -- It covers the classes of revenue that would be attached if future default occurred; but the Government does not at present intend to deal with revenues other than those that are sufficient to meet the present default. It is necessary that this resolution shall make provision for covering any default that may take place between now and the next meeting of the Parliament, because a further resolution can be obtained only from the Parliament, {: .speaker-KLL} ##### Mr Makin: -- Would not a certificate of the Auditor-General be required in regard to any future default? {: .speaker-F4O} ##### Mr LYONS: -- Undoubtedly ; the act provides for that. But the present resolution covers various classes of revenue that will be sufficient to effect recovery in the event of a further certificate being given by the Auditor-General relating to further default. It must be recognized, however, that if the default increases, the income tax receipts may not suffice to meet the default. I have already stated that there are possibilities of the default increasing to £4,500,000, or, perhaps, £6,000,000, by the 30th June. To protect the interests of the Commonwealth and the other States, the Commonwealth Government must, therefore, ask Parliament to give it power to require payment from time to time to the Federal Treasurer of such revenues as may be necessary to meet the amounts in default. It i3 for this reason that the motion now before the House covers several classes of revenue. The yields of these revenues, up to the 30th June, according to the information available to the Commonwealth, may be estimated as follow : - These classes of taxation, which are those covered by the motion would suffice to meet the interest payments of the State for the balance of the year, even if the overseas defaults were continued, and the default were extended by the State Government to interest payments due to Australian bondholders. The Government considers it desh able to ask Parliament to give such authority now as will enable the Commonwealth to deal with the position as it develops. If the default does not increase, the Government's course will be clear. It will proclaim only such revenues as are necessary to meet the amount of the present default. The revenue from income tax. excluding the unemployment relief tax, for the next eight weeks would be sufficient to cover the existing default, and there would be no necessity to proclaim any class of revenue beyond that of ordinary income tax. But if the default increases, the Government must have power to recover larger sums. Before recommending Parliament to resolve that the several classes of revenue specified in the act may, in certain circumstances, be made payable to the Commonwealth, the Government carefully considered all the sources of revenue of the State. This consideration shows that certain classes of revenue can be made payable to the Commonwealth more readily than others. For instance, some revenues could be attached in the hands of State officers only, and such a procedure might entail difficulties. Other revenues could be intercepted before they reached the State. Then there are certain revenues on the payment of which action by the State is necessary; for instance, probate duties. These facts have been borne in mind in the drafting of the motion now before the House. {: .speaker-DQC} ##### Mr Hughes: -- What proportion do the revenues to be attached bear to the total revenue of the State for the period from now to the end of the financial year? {: .speaker-F4O} ##### Mr LYONS: -- I am afraid that I cannot furnish that precise information. We are dealing now only with the amount of revenue obtainable from ordinary income tax, for a period of eight weeks, which will cover the present default. The desire of the Government is that the more practicable course; shall be adopted, and that the revenues which can be intercepted shall, in the first instance, be drawn upon. So that there may be no misconception of the position by taxpayers, I desire to make quite clear the position which will arise on the adoption of this resolution. The resolution sets out what classes of revenue of the State of New South Wales may be made payable to the Treasurer of the Commonwealth. The obligation of the taxpayer to pay to the Federal Treasurer any particular tax or class of revenue named in the resolution does not, however, arise until a proclamation has been issued by the Commonwealth in -relation to that particular tax or class of revenue. The mere carrying of this resolution does not make the tax due to the State payable to the Commonwealth; it is only when a proclamation is issued specifying a particular tax or class of revenue that that applies. It is not intended at the present stage to issue a proclamation covering all the taxes or classes of revenue named in the resolution. One or two of those taxes or classes of revenue will, however, be proclaimed as soon as possible. When that is done, wide publicity will be given to the matter, so that all persons concerned may clearly understand what obligations are imposed on them under the Financial Agreements Enforcement Act. They will then know that the obligation is to pay to the Commonwealth and not to the State. The mere fact that all these classes of revenue and taxation are included in this resolution does nothing at the present stage to make them payable by the taxpayers to the Commonwealth, and the position will not be altered until the proclamation has been issued, when the widest publicity will be given to it. {: .speaker-KX9} ##### Mr Watkins: -- Suppose the taxpayers paid the State income tax before the proclamation was issued. Would the Commonwealth then demand payment of the tax a second time? {: .speaker-F4O} ##### Mr LYONS: -- Not at all. The urgent need for the action which the. Common wealth Government proposes to take was fully explained during the debates on the Financial Agreements Enforcement Bill. The position is that one State in the Commonwealth has deliberately refused to meet its contractual obligations for interest, and is seeking to place the burden of those obligations on the Commonwealth, and, through the Commonwealth, on the other States. Such a proceeding cannot be tolerated by the Commonwealth or by the other States. The action being taken to-day, and recent federal legislation with respect to this matter, have for their object the promotion of the interests of the Commonwealth and the whole of the States. This is not a matter of party politics; the Government is endeavouring to save the financial reputation of Australia, and of the individual States. It is suggested that the Government has some ridiculous motive affecting the festivities in connexion with the opening of the Sydney Harbour bridge on Saturday; but our sole object is to compel the Government of Nev,' South Wales to meet its obligations. {: .speaker-KJQ} ##### Mr James: -- Thereby starving the people of that State. {: .speaker-F4O} ##### Mr LYONS: -- Nothing of the kind. The Commonwealth Government is merely taking action to recover from New South Wales moneys that we have already paid on its behalf. If this default were allowed to continue, and the Commonwealth Government, accepting as it does, liability for payments due by a defaulting State Government, were asked to meet default upon default, to find million upon million in order to meet the obligations of the State, the finances of not only New South Wales and the Commonwealth, but also of every State in the Commonwealth, would be wrecked, and that at an early stage. Governments, like individuals, must observe the moral code, and must meet the financial obligations into which they have entered with due deliberation. That is all that we are asking of the State Government of New South Wales. Every effort has been made to induce the Premier of that State to meet his commitments.- Even after the Financial Agreements Enforcement Act was passed, and before any attempt was made to put it into operation, the Premier of New South Wales was again reminded of the position, and asked to reimburse the Commonwealth the amounts that it had paid on behalf of the State. However, the Lang Government has evinced no desire to honour its obligations, and it is only just to the other States, and to the citizens of New South Wales, who, as a body, would repudiate the action that has been taken by the Lang Government, that the Commonwealth Government should endeavour by legitimate means to recover the amount that it has paid on behalf of the Government of New South Wales. The reason why various classes of revenue are included in this motion which, in the aggregate, are greater than the amount that is due to the Commonwealth is that this Government must be able to recover all that is due to it in the event of the New South Wales Government again defaulting. If that precaution were not taken, and **Mr. Lang** again defaulted, Parliament would have to be called together specially to pass a further resolution. Under the terms of this motion, it is only necessary for the AuditorGeneral to issue a further certificate ag to the amount due. {: .speaker-KFE} ##### Mr Gregory: -- Can that be done without a further vote of Parliament being taken ? {: .speaker-F4O} ##### Mr LYONS: -- Yes. It will be admitted by those who are seriously concerned about the necessity to maintain the financial position and the honour of the Commonwealth that' the .power sought is entirely reasonable. I hope that the motion will be carried, not only in this House, but in another place. . {: #subdebate-24-5-s1 .speaker-F4Q} ##### Mr SCULLIN:
Yarra .- In his opening remarks, the- Prime Minister **(Mr. Lyons)** referred to the protest that was made by myself and the members of my party against the attempt of the Government to rush this motion through without giving the House an opportunity to examine it properly. The honorable gentleman declared that we knew that the motion was coming before Parliament. That cannot be denied;, but we did not know what it would contain, and our protest was a legitimate one. We made no endeavour to stonewall. Had the Prime Minister agreed to adjourn the debate until 3 o'clock this afternoon, as he eventually did, our objections would have ceased, and Parliament could have proceeded with other business during the morning. Our protest has been effective, and the honorable gentleman has learned that rush tactics are not always the most expeditious. It was suggested that members of the Opposition were obstructing the work of Parliament. The insinuation is both disorderly and untrue. Had we desired to obstruct the business of the House, we should have spoken at greater length, a procedure which would have brought the guillotine into operation in due course. Members of the official Opposition merely voiced a genuine protest against the attempt of the Government to rush through a motion the contents of which were not familiar to them. We desired an opportunity to examine it, and compare its phraseology with sections of the Financial Agreements Enforcement Act. The action of the Prime Minister in getting the sitting suspended until 3 p.m. has given us an opportunity to peruse the motion, and we can now discuss it more intelligently. In my opinion, there are two broad aspects of this motion, the general method that is employed for the recovery of money due to the Commonwealth, and the specifying of certain classes of revenue as liable to be attached. We have already discussed fully the principles that are contained in this class of legislation, and I do not propose to repeat at length what I have previously said on the subject. I agree entirely with the general views that have been expressed by the Prime Minister as to the obligation of a' State t,o meet its commitments. I do not find fault with the statement that the honour of Australia requires that every government shall meet its obligations and eschew repudiation. I say to those who, by these proceedings, would make a martyr of the Premier of New South Wales - and that is one of the things that I fear this legislation is doing - that if that gentleman had shown a genuine desire to meet his obligations and demonstrated his incapacity to do so, the people and the Government of Australia would have been prepared to meet him as far as was possible. There is a vast difference between the declarations, " I cannot pay " and " I will not pay ". My Government believed last year that there was a genuine desire on the part of the Lang Government to meet the situation, and even at this stage I have no reason to believe that that desire did not then exist, for I am not one to impute base motives to men with whose policy I entirely disagree. I resent strongly the insinuation that I and my party are apologists for a person who has repudiated. We have suffered more than any other body associated with the political life of this country because of the stand that we took against repudiation by the Lang Administration. At the same time, I cannot change my opinion that the method which is being employed by the Commonwealth Government to deal with the Lang Government is a wrong one. This Parliament is asked to carry a resolution declaring that a certain sum of money is due and payable by the Government of New South Wales. The resolution does even more than that; it is a garnishee order upon certain revenues of that State. I do not claim to know all that has been done by Parliaments and courts; but for years I have studied constitutional and political history, and I know of no precedent to warrant action of this kind being taken by Parliament against another Government. I may be told that we are facing an unprecedented situation. I certainly hope that it will never recur in the history of this country. At the same time, we must be careful not to create a bad precedent, in striving to deal, with what is regarded as a bad situation. This motion declares that money is due and payable by the Government of New South. Wales, and a proclamation may be issued to attach certain specified revenues. The resolution will be carried by the claimant government, through the Parliament that supports it. Where, in the history of litigation, can we find a parallel case, where the right is given to the claimant to declare what the defendant owes. Where does there exist the right of the claimant to say, " I shall issue an order attaching certain of your revenues, and garnishee them"? {: .speaker-KNP} ##### Mr Maxwell: -- In other cases the other party enters a defence. {: .speaker-F4Q} ##### Mr SCULLIN: -- In this instance a defence will be entered, disputing the amount. I am not going to say that there are strong grounds for that defence, but thousands of defendants advance a case which is no stronger than that of the Lang Government. It matters not how strong may be the opinion of a claimant that money is due to him, he cannot attach it without first applying to the proper tribunal. No one knows that better than the honorable member for Fawkner **(Mr. Maxwell),** who has had such a distinguished career in the law courts of this country. In this case the High Court, the tribunal which interprets our Constitution and decides these problems, is deliberately brushed aside. It is true that a State may make application to the High Court; but that provision was inserted only as a result of criticism that was levelled at the original bill. Originally it was provided that unless the federal Attorney-General made application to the court, the State could not apply to that tribunal for a declaration. This motion proposes that the Commonwealth Government shall seize the revenues of a State without the consent or the declaration of the court. That is a principle to which I will not subscribe, no matter how provocative the circumstances may be. Some may say, " But the State may apply immediately to the Court". But this motion proposes to seize the money without an order of the court. A State may apply for an interim injunction. Surely that would prevent the Commonwealth from obtaining the money pending further action, and delay matters just the same as if action were originally instituted through the ordinary judicial channels. The method proposed may bring the case before the courts a little sooner than otherwise would be possible ; but, in order to save a few weeks or a few months, is it wise to precipitate what may be one of the greatest crises known in the history of Australia? Hasty methods are often dangerous methods. One may run so rapidly as to trip, and thus sustain a heavy and unpleasant fall. I do not want that to happen in this instance. In the clash that may occur between the Commonwealth and State, I want to see the Commonwealth always on the right side, always paramount in what it does. I do not want to see any action taken by the Commonwealth proved wrong. That would cause unnecessary provocation, and possibly give rise to the suspicion that it has behind it political motives, so diverting sympathy to a government that espouses a policy of repudiation. Why has the Government chosen to start in the wrong way? This matter must eventually go to the court; so why not go to the court first, and lift this issue - one of the biggest in the parliamentary history of our country - out of the political atmosphere into the calm, judicial, and non-political atmosphere of the court? The fact that the Government is taking action without any preliminary judicial procedure, is in itself a warrant and excuse for counter action that may be direct and illegal. Even the very course that the Commonwealth Government is proposing may be declared to be illegal. The Premier of New South Wales declares that he has been advised that this legislation is invalid. That advice may be good or bad, but the High Court has before now declared unconstitutional certain legislation of this Parliament. The very fact that the Government of New South Wales starts with the assumption that the Commonwealth is doing something illegal will give it an excuse to counter this legislation with illegality. And what will be the outcome of this conflict between two sovereign parliaments, each' controlling means of supporting its will by force? The right honorable member for Cowper **(Dr. Earle Page)** said that the hurried action now being taken is justified, because on Saturday morning the Government of New South Wales drew over £1.000,000 in cash from the banks, carried it off in suitcases, and deposited it in the treasury vaults. That any government should adopt such a method to dodge the bailiff is pitiable, but it is regarded in many quarters as a smart move to frustrate a political opponent. What happened on Saturday, and the public attitude to it, illustrate the danger of dealing with default in an atmosphere of party politics. Had the withdrawal of cash from the banks followed a judgment of the High Court, a cry of indignation would have been raised throughout the country. But because of the political feeling which has been aroused, this extraordinary action on the part of the Government of New South Wales is regarded by a large section of its people as merely another political move in the game of chess being played by the Prime Minister and the Premier of New South Wales. What a regrettable position Australian governments are getting into when the public display that attitude towards so serious a matter ! Had **Mr. Lang** acted in defiance of an order of the court the opinion of the public would have been vastly different. The Deputy Leader of the Opposition **(Mr. Forde)** referred to the opinion expressed by **Senator Colebatch,** admittedly one of the ablest men in the Nationalist party, whom not even the honorable member for Barton **(Mr. Lane)** would accuse of being a partisan of **Mr. Lang. Senator Colebatch** said in effect, "I have been in Sydney, and have heard sympathy expressed with **Mr. Lang** in quarters which would surprise most people ". And he and others are opposed to this legislation, not because they sympathize with **Mr. Lang,** but because they cannot agree to the method which the Government is adopting. My attitude is similar. I do not attempt to endorse repudiation, but I strongly condemn the procedure which the Commonwealth Government is adopting to recover the money owing to it by New South Wales! Less judicial minds, resenting the methods employed, become sympathetic with the person against whom these proceedings are directed, and there is danger of that sympathy extending to the policy which **Mr. Lang** has adopted. This Parliament is treating the High Court with contempt. If the Commonwealth went to the High Court and obtained judgment, and the defendant did not obey it, he would be treating the court with, contempt. This Government is reversing; the process. This resolution gives to the Government power to attach eight different classes of revenue, totalling approximately £6,000,000. Income tax alone represents £5,000,000, or, deducting that raised specially for the relief of unemployment, approximately £2,500,000. The Prime Minister stated that in eight weeks sufficient money would be obtained from income tax to meet the present claim of the Commonwealth, but the resolution i3 covering a larger amount because of the possibility of further default. The proclamation of attachment need apply only to that amount which is immediately required, and thus, I admit, unnecessary hardship and trouble to the people of New South Wales will be avoided. The issue of proclamations from time to time attaching such sums as are required, will be infinitely better than issuing a proclamation attaching the whole of the £6,000,000, and creating chaos and uncertainty throughout the State. Nevertheless this resolution will create a certain amount of uncertainty and difficulty, and for the life of me I cannot see why the Government is attaching the income tax raised specially for unemployment. Tactical considerations alone should have restrained the Government from adopting a course that will provoke sympathy for default which otherwise would be abhorrent to the majority of people. {: .speaker-JOM} ##### Mr Beasley: -- Let it go. {: .speaker-F4Q} ##### Mr SCULLIN: -- Of course, the honorable member for West Sydney **(Mr. Beasley)** and the Premier of New South Wales **(Mr. Lang)** are glad that the Government is proposing to lay hands upon the unemployment relief funds. That will create sympathy upon which anybody with the least gift of oratory will be able to play effectively. {: .speaker-KZR} ##### Mr White: -- It is income tax, i.3 it not? {: .speaker-F4Q} ##### Mr SCULLIN: -- Yes, and raised specifically for the relief of unemployment. {: .speaker-KXY} ##### Mr Perkins: -- Is the money applied to that purpose? {: .speaker-F4Q} ##### Mr SCULLIN: -- I understand that the Government of New South Wales spends for the relief of unemployment in that State, a good deal more than the proceeds of this special income tax. I do not propose to labour this matter. I have made clear the attitude of myself and the party I lead. As one who at least has had responsibilities, who has occupied the position now held by the honorable member for Wilmot **(Mr. Lyons),** and who regards Australia with pride, and desires to see its governments working harmoniously along constitutional lines, I warn the Government of the danger of adopting a procedure which is political rather than judicial. At the very outset it will stir up political partisanship on both sides, and the merits of the case will be lost sight of. It will provoke resentment and resistance, and therein will lie the danger. {: #subdebate-24-5-s2 .speaker-C7E} ##### Dr EARLE PAGE:
Cowper .- I hope that the course proposed by the Government will be supported by the whole Parliament, and that this will not be regarded as a party issue, because the real struggle is between the honest Government of the Commonwealth and the dishonest Government of a State. I cannot understand the objection of the Leader of the Opposition **(Mr. Scullin)** to the course now proposed, because it seems to me that it is in accordance with the spirit of section 51, paragraph ii, of the Constitution, which forbids discrimination between States or parts of States in the imposition of taxation. New South Wales has an annual interest obligation of approximately £13,000,000, and if it refuses to pay any of that amount, obviously the other States, which are taxed to make good the default, will be discriminated against. Unquestionably if the Constitution did not contain provision against such discrimination the normal course would be for the Commonwealth Parliament to impose special taxation on the people of the defaulting State in order that their burden might not be loaded on to their fellow citizens in the other States; and that would be done without reference to any court of law. The electors and taxpayers of New South Wales must accept responsibility for having placed in power a government which has deliberately adopted a policy of default. Honorable members have not forgotten that when **Mr. Lang** went beforethe electors eighteen months ago he candidly enunciated a policy for smashing the Loan Council. He stated that he had no intention of keeping within the council, and that New South Wales would, be better outside it. Yet, in 1928, the people of Australia, including a 3$ to 1 majority of the electors in New South Wales, approved of the Loan Council becoming part and parcel of our constitutional machinery. {: .speaker-L08} ##### Mr Rosevear: -- What was **Mr. Lang's** majority in 1929 ? {: .speaker-C7E} ##### Dr EARLE PAGE: -- He obtained his majority not by his opposition to the Loan Council, but because of his promise of employment and social benefits, and because of his undertaking to make the wilderness blossom as the rose. The Commonwealth Government is now pursuing the right course to bring the recalcitrant State to book. Unless the Commonwealth takes firm and immediate action, the taxpayers of States other than New South Wales will be mulct in an additional annual £8,000,000 of taxation. If New South Wales defaults in respect of the whole liability of £13,000,000 per annum, Commonwealth taxation will recover approximately two-fifths of that amount from the people of that State, and the other £8,000,000 will have to be provided by the taxpayers of other States. The interest which **Mr. Lang** refuses to pay relates to a debt incurred for public works which were described in the loan prospectuses as reproductive assets which would return interest and sinking fund on the capital invested in them. In fact, many of them are earning more than working expenses. That is true of the railways of New South Wales, which provide between £4,000,000 and £5,000,000 towards the interest bill on the money expended in building them. Yet this amount is being diverted to other purposes in complete defiance of the canons of honesty and decency. There is every reason why the Government should take the swiftest and surest action to secure possession of revenues which can be used to satisfy the payments which are due. What happened in Sydney on Saturday last? No sooner had the Commonwealth Parliament passed legislation enabling the Commonwealth Government to take action to recover the money due to it, than the Government of New South Wales withdrew £1,000,000 in" cash from various banks. {: .speaker-KJQ} ##### Mr James: -- Hear, hear ! {: .speaker-C7E} ##### Dr EARLE PAGE: -- And to-day there are in this chamber members who gloat over such action as another successful attempt by the Government of New South Wales to evade payment of its just dues. I have no hesitation in supporting this motion. As I said during the discussion of the legislation upon which this motion is based, I should have preferred that railway revenue be attached rather than the proceeds of direct taxation. If, however, it is necessary to attach the revenues derived from direct taxation, it must be evident that we should attach practically the whole of such revenue if occasion demanded it. If an exception were made, as suggested by the Leader of the Opposition, in favour of revenue raised for the relief of unemployment, the Government of New South Wales would, no doubt, cease to enforce the provisions of the ordinary income tax law, and raise practically the whole of its revenue by means of unemployment taxation, so that the Commonwealth Government could not collect. I do not propose to allow any minor difference of opinion as to what class of revenue wc should attach to influence my course of action. The Government is responsible for what it does. It is the Executive, and if it is prepared to go ahead and deal with this matter in the firm and courageous manner which the situation demands, the Country party is prepared to support it to the utmost. The Government should, however, be ready to meet all emergencies. In particular, it should make provision for relieving the unemployed and other indigent persons, if by any chance, the Government of New South Wales, for political or tactical reasons, should try to make a pawn of them. If it is necessary, in order to strengthen the hands of the Government, that Parliament should remain in constant session, I am prepared to remain here day and night for that purpose. {: #subdebate-24-5-s3 .speaker-JOM} ##### Mr BEASLEY:
West Sydney -- Before dealing with the motion itself, I should like to reply to some of the re marks made by previous speakers, and particularly by the speaker who has just resumed his seat. In the course of his remarks the Leader of the Country party **(Dr. Earle Page)** mentioned the last New South Wales election, when the present Premier **(Mr. Lang),** who was then the Leader of the Opposition, placed his policy before the people. I remind the right honorable member that **Mr. Lang** at that time told the electors that the Loan Council should not be allowed to interfere with the proper development of his State. He stated that if the Government of New South Wales wished to enter upon a scheme of development, and if it had the necessary assets to provide backing for a loan, it should be within its power to determine its own course of action. But while New South Wales is under the Loan Council, the State of Tasmania, the extent of whose financial operations is not even so great as those of the municipality of Sydney, has the right to veto the application of the Government of New South Wales for a loan. New South Wales is thus not permitted to use its own resources as a means of providing employment for its people. That position was put before the people of that State at the last election, and the people then returned **Mr. Lang** and his colleagues by the largest majority ever recorded in the history of New South Wales. On the subject of election promises generally, I remind honorable members that those who live in glass houses should not throw stones. This Commonwealth Government has still to honour its own election promises. Honorable members representing Queensland constituencies, may recall that, during the last election campaign in that State, **Mr. Moore,** two days before the election, promised that he would, if returned to power, provide £2,000,000 for the relief of unemployment. I shall leave this matter to be further elaborated by honorable members on this side who come from. Queensland. At the present time New South Wales, in common with many other countries, is passing through a period of great stress. Indeed, the situation which confronts that State, confronts also, in varying degree not only countries, but individuals as well. If we were honest with ourselves, we should have to admit that at the present time it is humanly impossible for many governments and for very many individuals to meet their obligations in full. The Government of New South Wales has, by means of moratorium provisions, &c, granted concessions to the extent of over £2,000,000 to various sections of the community, particularly to those living in the country. I agree with what it has done, and I believe that all governments should do whatever they can to tide their people over these difficult times. The commercial interests have also received considerable relief, and many in New South Wales, who disagree with me politically, are grateful to the Government of that State for the help it has given to them.. They have expressed their gratitude without any hesitation, and it is evident that there is much sympathy with the Government of New South Wales to-day in perhaps unexpected quarters. It is all very well to speak of honouring obligations, and to say that governments should subscribe to the same code of honorable conduct as individuals lay down for themselves. The great " Cromwell" Hardy was one of the loudest in advocating such a policy. Has he honoured his own contractual obligations ? No. He is a bankrupt who has paid about 4s. in the £1. That is the man who talks of the duty of governments to honour their obligations. Where does the Treasurer of the Queensland Government **(Mr. Barnes)** stand in this matter of honouring his obligations? He is another bankrupt, from Broadway, in Brisbane, and has paid only 2s. or 3s. in the £1. These are the men who hold up their hands in holy horror at the suggestion that a State might not honour its obligations, but' they themselves were quick to seek the protection of State laws when they found themselves unable to pay their debts. The honorable member for Martin **(Mr. Holman)** was in the bankruptcy court the other day back-stopping for Hugh D. Mcintosh, who could not meet his obligations, either. I do not know 'the merits of that case, but I mention these things to show that at least some persons who set a very high moral standard in regard to the obligations of governments, are prepared to accept a much lower standard when it is a matter of their own obligations. {: .speaker-KHO} ##### Mr Holman: -- The honorable member referred to me as back-stopping in the court for a person who could not meet his obligations. I resent that statement, and regard it as offensive. I was summoned to appear before the court as a witness. {: #subdebate-24-5-s4 .speaker-10000} ##### Mr SPEAKER: -- The honorable member for Martin **(Mr. Holman)** takes exception to the honorable member's statement regarding " back-stopping ", and regards it as offensive to him. I am sure, therefore, that the honorable member for West Sydney **(Mr. Beasley)** will withdraw the statement. {: .speaker-JOM} ##### Mr BEASLEY: -- I withdraw the expression " back-stopping ". Does that meet the honorable member's objections? {: .speaker-KHO} ##### Mr Holman: -- I ask the honorable member to withdraw his whole reference to the matter. I propose later to make a personal explanation regarding it. {: .speaker-10000} ##### Mr SPEAKER: -- I understand that the honorable member objected to the expression " back-stopping ". {: .speaker-KHO} ##### Mr Holman: -- I objected to the whole reference to my appearance in the court. I was called there by subpoena to give evidence. {: .speaker-JOM} ##### Mr BEASLEY: -- I withdraw the expression " back-stopping ", but if the honorable member is so sensitive- {: .speaker-10000} ##### Mr SPEAKER: -- The expression which was objected to has been withdrawn. If the honorable member for Martin desires to make a personal explanation at a later stage he may do so. {: .speaker-JOM} ##### Mr BEASLEY: -- Governments have obligations to others as well as to bondholders. They have a duty to maintain order, and to carry on essential social services within the area over which they rule. The first duty of a government is to the people it represents. The Government' of New South Wales did the right thing on Saturday when it withdrew from the banks money which was necessary to carry on essential governmental services. If, on Thursday next, there were not sufficient funds at the disposal of the Government to pay charges in connexion with education, to maintain the asylums, and hospitals, and to provide other social services, the disorganization and, perhaps, disorder which would ensue would be the responsibility of the Government of New South Wales. Its political opponents, no doubt, believe that if they created such chaos they would derive some benefit therefrom. All along, the object of this Government has been to seize revenues of the State Government of New South Wales to hinder it in the performance of its duties. Members of the Ministry have already expressed, outside of the Parliament, the opinion that there is a doubt as to the constitutionality of the action now contemplated by this Government, but they are not much concerned about that. They are rushing this resolution through so that they may take immediate action in the hope that before legal redress can be obtained the Government of New South Wales will be forced out of office. In other words, they hope to have some excuse whereby a demand could be made on the Bang's Representative to dissolve Parliament. {: .speaker-KZF} ##### Mr Lane: -- The Lang Government should be forced out of office. {: .speaker-JOM} ##### Mr BEASLEY: -- I am pleased to hear that interjection, because it emphatically endorses the statement of the Leader of the Opposition **(Mr. Scullin)** when he likened the situation to a game of political chess in which the Prime Minister **(Mr. Lyons)** makes one move and the Premier of New South Wales another. When the test is applied, the people who need relief will declare their allegiance to the State Government, and will stand behind it in its efforts to meet the every-day obligations of New South Wales. This Government, under recent legislation, is setting up machinery to enable it to take an unconstitutional action without any reference to the High Court. If it is right for the Commonwealth to exercise such a power, it is equally right for the State of New South Wales to combat the action of this Government by every means at its disposal, whether by way of executive act or legislation. Time will tell whether the people of New South Wales are standing behind our efforts to defend the interest of the State. I have listened carefully to the references to the various revenues to be collected by the end of June. Throughout the remarks of the Prime Minister the indication is that there is plenty of money to be col lected from various sources of taxation, and he referred particularly to income taxation. One would think that the State of New South Wales had no obligations whatever, that because £5,000,000 was due by the end of June in income taxation, it could be seized by the Commonwealth Government without placing any serious disability upon the general organization of that State. There are every-day services to maintain in New South Wales; services which, to some extent, are enjoyed by honorable members, and which are for their own personal welfare. The maintenance of the general health of the community is a charge upon the State, just as is the eradication of the cattle tick pest to which frequent reference has been made in this House. If the State revenues were seized, the State Government would be unable to carry out its obligations in that respect. -Any attempt on the part of this Government to seize State revenues is likely to disorganize and dislocate the essential activities of that State. This Government is out to upset the existing social order in New South Wales at a time when it is faced with a financial crisis. Men and women do not think normally when living from day to day under aystem of food relief, not knowing at what moment they may have no roof over their heads. These people are straining every nerve to keep body and soul together. The Government of New South Wales has allocated £7,000,000 for food relief purposes' in an effort to keep intact the social system of that State. The object of the Government in. making this proposed inroad into State revenues is ostensibly to meet our commitments overseas; but, in any case, those commitments are not just. For instance, according to the certificate issued by the Auditor-General, £292,000 of the amount owing by New South Wales is for exchange purposes. It is therefore only natural that the unemployed who are in receipt of food relief, business men whose businesses are declining, and farmers who are finding it difficult to make a living, will use every means at their disposal to defend the State Government against this imposition. It is useless for this Government, situated as it is, in snug quarters in this Parliament, to think that the mere fact' of passing this resolution will bring about the object that it has in view. One would infer from the statement of the Prime Minister that in New South W ales there are enormous revenues which can be seized by the Commonwealth without causing that State any inconvenience. Reference has been made to revenues derived from betting and amusement taxation. But, after all, those sources of revenue are taxed by the State Government to enable it to carry on the ordinary every day services of the State. The revenue from lotteries may be seized. Is it because of spite on account of the New South Wales lottery having had a serious effect upon Queensland and Tasmania, States which also derive revenue from lotteries, that that source of revenue is to be used for the purpose of paying overseas bondholders Let me remind honorable members that the purpose of that lottery is to assist the sick in the community. It is to assist the public hospitals which, in many cases, are being maintained by voluntary subscriptions, and by persons who have devoted their lives to those institutions in attending to the sick and infirm. This Government, which made so many promises on the hustings and said that it would provide employment for the people- which it has failed to do - is now proposing to penalize the sick and the infirm in the State of New South Wales. The Government can pursue that course to the bitter end, but I promise it that the people of New South Wales will stand behind the Lang Government ; they will be prepared to fight for their rights, and I challenge the Prime Minister to test this issue. The resolution provides that the revenue collected under the unemployment relief tax shall be exempt. {: .speaker-F4Q} ##### Mr Scullin: -- Revenue collected for unemployment relief is included in paragraph viii. {: .speaker-JOM} ##### Mr BEASLEY: -- It is excluded in paragraph v., and, as the Leader of the Opposition has said, is included in paragraph viii. New South Wales has, from time to time, endeavoured to provide some form of relief work. The revenue collected from the unemployed relief tax has not only been used for the provision of food relief. From this source of revenue a certain amount of relief work is given in order that clothing and other things may be obtained by those who need them. Under the coupon system only food is supplied, hence the necessity for some other means to provide clothing, &c. This Government proposes to further earmark that revenue for confiscation, so as to embarrass the State Government and the people it is now assisting. Although the resolution names the revenues which may be seized by the Commonwealth Government, the general public may refuse to pay any class of State taxation. This Government is alive to that possibility, and' hopes that it may bring further embarrassment to the State Government. This is a political move, despite the statement of the Prime Minister to the contrary. Ever since this Government has been in office its utterances have been directed towards removing the Lang Government from office. We shall fight this Government, and use every means at our disposal to defeat the object of the resolution. The action of this Government is unjust and unwise. If the Lang Government were permitted to accept the advice already received from the Agent-General for New South Wales in London, it could at once obtain relief from the Bondholders Association. I arn informed that if the State Government were permitted to enter into negotiations that association would be prepared to assist it through this difficult period. Unfortunately, the position is that if the efforts of the Agent-General were successful, the Loan Council would refuse to allow New South Wales to obtain that relief. This legislation is, as has been said by the Attorney-General, a step in the direction of forcing New South Wales to meet its alleged obligations. The next step is to come, and the step after that will be determined by the people of New South Wales. I hope that they will be successful in their efforts to defeat the action of this Government. {: .speaker-KHO} ##### Mr Holman: -- I wish to make a personal explanation. I do not imagine that the House is much concerned with my own personal doings; but I draw attention with indignation to the observations of the honorable member who has just resumed his seat. As honorable members are aware, section SO of the Bankruptcy Act provides that in the event of bankruptcy the official receiver may summon any person as a witness. A few weeks ago there occurred in Sydney the bankruptcy of a **Mr. Mcintosh.** I had been a fellow shareholder in .a company with that gentleman some .ten or eleven years ago, but the transactions between us ended some seven or eight years ago, and I have since had no business relations with him. In the discharge of what the official receiver conceived to be his duty, he summoned me as a witness because I had had transactions with a bankrupt person. Certain information was given by me in open court. {: .speaker-KJQ} ##### Mr James: -- But the honorable member refused to answer certain questions. {: .speaker-KHO} ##### Mr Holman: -- I did nothing of the kind. That suggestion is almost as offensive as the remarks made by the honorable member for West Sydney **(Mr. Beasley).** It is in a spirit of protest against such reckless personalities, which are the principal stock in trade of certain honorable members opposite, that I rise to make this explanation. Every honorable member who knows anything about the bankruptcy laws knows that any person who has had transactions with a bankrupt may be called as a witness. I was called on subpoena. I had had nothing whatever to do with the bankrupt for very many years, and was in no way concerned with his affairs. I should have been quite willing to give what information I could in private to the official receiver, but was subjected to what, in these circumstances, becomes the indignity of a public examination, during which things occur which are capable of misconstruction, and which were misconstrued by the honorable member for West Sydney. I seek the protection of the Chair from this kind of thing. The honorable member who made these statements knows that there was no justification for them, and he has not the courage to make them outside. {: #subdebate-24-5-s5 .speaker-F4B} ##### Mr BRUCE:
Assistant Treasurer · FLINDERS, VICTORIA · NAT; UAP from 1931 -- The subjects brought . under review by this motion were exhaustively discussed during the debate on the Financial Agreements Enforcement Bill, and I do not intend to deal with them again at any length. The Leader of the Opposition **(Mr. Scullin)** in his speech has briefly summarized the objections which he took to the Financial Agreements Enforcement Bill. I point out to the right honorable gentleman that there is now embodied in our Constitution a provision empowering this Parliament to force a defaulting State to honour its obligations under the Financial Agreement. This motion is in exercise of that power. Wo are in no way ousting the judicial power by adopting this procedure, because the final determination of the amount due and payable will be made by the High Court. I also remind the right honorable gentleman that it is not by any means an unheard of thing for a government to make a demand for the payment of money due to it even before the amount of indebtedness has been definitely determined by judicial action. We are facing circumstances which require swift and immediate action to prevent the possibility of chaos in respect of both Commonwealth and State finances. 'The Leader of the Opposition has suggested that we should proceed to recover the amount due by New South Wales by ordinary action in the High Court. The right honorable gentleman has evidently overlooked that we are doing that very thing. But such an action must necessarily be protracted. There would be very little prospect of obtaining a decision in less than eighteen months or two years. The Prime Minister **(Mr. Lyons)** has pointed out that if the New South Wales Government pursues its present course it will be £4,500,000 in default by the 30th June, and if it also refuses to meet its obligations to Australian bondholders it will be £6,000,000 in default by the end of the financial year. If the recovery of these amounts must be deferred for eighteen months or two years pending a judgment of the High Court, many more millions of pounds will then be due to the Commonwealth. It is almost impossible to conceive what may happen to the finances of the Commonwealth and the States if that degree of default were permitted. It is imperative that immediate action be taken to oblige this State to meet its obligations, and to prevent destruction overtaking the Commonwealth. Government and other State Governments. There is certainly real justification for the course which the Government is pursuing. The contention that we arc ignoring the judiciary and infringing the Constitution is without foundation. But even if we took the course that the Leader of the Opposition **(Mr. Scullin)** has suggested, and continued an action in the High Court until judgment was delivered, we .should still have to enforce the judgment in order to recover the money due. Can any honorable member believe that the New South Wales Government would take any notice of a judgment of the High Court? Would the gentleman who is pleading that the default of his Government is due to its desire to help starving men, women, and children allow a judgment of the High Court to stop him from doing what he is doing? Nothing would stop him. The present New South Wales Government would just as readily defy a judgment of the High Court as it is defying this Parliament. If we accepted the advice of the Leader of the Opposition, we should in eighteen months or two years have to face the very problems which are now confronting us, and we should almost certainly have to do something like what we are now doing. We should have to attach certain revenues of the State in order to strengthen the arm of the judiciary, and to ensure that a judgment of the High Court would be observed. Moreover, if we postponed this action for eighteen months or two years, the problems facing us would be intensified a hundredfold. There would be continued default in the interim, and we should still have to do the very thing which the Leader of the Opposition now wrongly describes as ousting the judiciary. {: .speaker-C7E} ##### Dr Earle Page: -- Any action taken then would have to be much more drastic. {: .speaker-F4B} ##### Mr BRUCE:
FLINDERS, VICTORIA · NAT; UAP from 1931 -- That is so, for the amount we should be compelled to recover would not be nearly £1,000,000, as it now is, but many millions of pounds. Probably all the revenues of the State for a year would not be sufficient to meet the payments due to the Commonwealth. The honorable member for West Sydney **(Mr. Beasley)** has argued his case from a different angle. He has said quite frankly that the Premier of New South Wales is out to smash the Loan Council, apparently because, in his enthusiasm, he thinks that he could then obtain all the financial accommodation that he thinks necessary for New South Wale3, and would thus be able to put public works in hand, and provide employment for the people. We have had our credulity stretched frequently by statements made by the honorable member and his followers, but I do not think that any honorable member of the House can for a moment imagine that the New South Wales Government would be able, without the backing of the Loan Council, and of Australia generally, to borrow anything from any one. That argument is absurd on the face of it. New South Wales is extremely fortunate in having the strength of the Loan Council behind it. It is only this fact which has enabled it to go as far as it has gone. If New South Wales had not been able to throw its responsibilities on to the Loan Council, it would have been in a desperate plight. We are for ever being told that a State should be expected to pay its way only if it is able to do so. Rather unfortunately, a comparison has been made between New South Wales and a bankrupt. Apparently honorable gentlemen who make this comparison forget that an unfortunate bankrupt who goes through the court is stripped of everything he possesses. The whole of hi3 assets are used for the purpose of paying his creditors. I cannot, therefore, really imagine that any one desires New South Wales to be reduced to a position comparable with that of a bankrupt. If that time came, a receiver would be put into the State Treasury, and all the assets of the State, as well as its revenues, would immediately become available for the purpose of meeting its obligations. Should such a time arrive, the people of New South Wales will experience very great suffering. Fortunately, the position is not anything like so serious as that. If New South Wales would only show a spirit of reasonableness and sanity, and abandon the attitude which it has adopted, it would be given the help that it needs. All that is asked of the State Government is that it shall act in good faith, make every effort to pay its wax and deal honourably with its creditors. That is what the other States of the Commonwealth are doing. Unfortunately, New South Wales has not shown the slightest disposition to do anything of the kind. If it did so, the Loan Council would not refuse its request for assistance. All that has been asked of the defaulting State is that it shall pursue an honest and upright course. "Instead of doing so it has said in effect, " We will not honour our obligations. It is true that a few months ago we gave an undertaking to the Loan Council to do certain things. We solemnly undertook to live as nearly as possible within our means, and to bring our deficit down to a fixed limit." On that undertaking the Loan Council, acting for the Commonwealth and the remaining States, came to the help of New South Wales and continued to assist it for six months. Then the Government of New South Wales repudiated its undertaking, and its obligations under the Financial Agreement. Nobody would suggest that a State which has done that is deserving of consideration. New South Wales, because of the largeness of its population and the extent of its resources, has probably greater advantages than any other State for getting out of its financial trouble, if it would only show a determination to honour its obligations; but it would be absurd that that State should receive further help from the rest of Australia or from its creditors, while it adopts its present attitude. There would be hope of help from the Commonwealth, from the other States, and from its creditors, if the Government of New South Wales would but show itself prepared honorably to observe its obligations. But we recall the dishonorable character of the action of the Government of New South Wales. References have been made by certain honorable members to the overseas bondholders of New South Wales as bloodsucking Shylocks, and it has been said by them that it is the desire of this Commonwealth Government that these bondholders should be paid the interest clue to them in order to prevent the unem ployed of New South Wales from receiving sustenance and preventing the hospitals of New South Wales from continuing their beneficent work. That is an absurd statement of the position. The money which was borrowed overseas on behalf of New South Wales was spent to create for that State the great assets that it possesses to-day; the assets which are now assisting it to tide over its present troubles. The great assets which have assisted the development of that State were created with the money that is now owing to its bondholders. Yet the present Government of New South Wales says that it will not honour its obligations to them. Such conduct must inevitably lead to almost irretrievable disaster. The people of the State are now faced with the fact that every industry within its borders is going down, and opportunity is being taken to transfer industries from that State to some other part of Australia. Where that is physically impossible, the State industries have become unable to compete with similar industries in other States. So far from helping the unemployed, or doing anything at all for the relief of the poor and suffering in New South Wales, everything that the present State Government is doing will cause further injury to the unfortunate people who are to-day at its mercy. The people of that State must recognize these facts if there is to be any salvation for them. Certain honorable gentlemen have said that the action now proposed to be taken is a political measure, designed by the Commonwealth Government because of its venomous spite for **Mr. Lang,** the Premier . of New South Wales, and the other members of his Government. Actually, **Mr. Lang** and his colleagues, in themselves, do not count at all; it is the incalculable harm that they are doing to New South Wales and Australia that counts. If that Government had not power to do the things it has done, nobody would have been interested in it. It is the incalculable power for evil which that Government possesses and is exercising that gives us concern. It cannot be fairly said that the Commonwealth Government, which, is conscientiously, trying to prevent the ruin of the people of New South Wales and the bringing of disaster upon Australia generally, is prompted in its present action by political spite. It is fighting for a principle in which it believes. The action that is proposed is intended solely to prevent Australia from being faced with the consequences of continued default by New South Wales. The charge that the action of this Government is prompted by political motives does not assist the financial rehabilitation of New South Wales, and I deny that we are actuated by such motives. The statement of the case made by the honorable member for West Sydney **(Mr. Beasley)** was calculated to cause the very damage that he accuses the Commonwealth Government of wishing to do. This Government merely says to the NewSouth Wales Government, "You must honour the word you have solemnly given to the Commonwealth." The honorable member and his friends declare that the Commonwealth Government is trying to starve the people of New South Wales, to deprive the unemployed of sustenance, and to prevent the giving of medical assistance to the poor. It is such inflammatory speeches, and not the action taken by the Commonwealth Government, that endanger the interests of this country, and I trust that the people of Australia will realize this. Although the highest basic wage in Australia is paid in New South Wales, the real wages of the people there, as determined by the purchasing power of the money they receive, bear an extremely unfavorable comparison with those of workers in other parts of Australia. The following figures were prepared by the Commonwealth Statistician, and were quoted at the Premiers Conference that was held recently in Melbourne, and have not been challenged. They show the percentage change from June, 1929, to June, 1931, in real wages for full employment and after allowing for unemployment: - The full significance of the facts will be realized by a study of both columns of that table. Surely the people must be beginning to realize what is happening. Put shortly, the position is this : Although the wage paid in New South Wales is higher than that paid in the other States, the workers in New South Wales are infinitely worse off than those in any other State. I shall, therefore, dismiss the suggestion that the conduct of the New South Wales Government in refusing to honour its obligations is benefiting the workers of that State. On the contrary, its refusal to pay its debts is gradually, and continuously, making their position worse than that of the workers throughout the rest of the Commonwealth. On the subject of the attachment of particular revenues of New South Wales, I need only say that the amount now owing by the State to the Commonwealth is, because of the State's failure to meet its obligations to its bondholders, something less than £1,000,000. When this resolution has been passed by both Houses of the Parliament the Commonwealth Government will proclaim only some of the revenues mentioned in it. If the New South Wales Government was prepared to meet its obligations, the amount due to the Commonwealth could be recovered from the income tax within a period of from eight to ten weeks,_ and it would be unnecessary to attach any other revenue. There need be no dislocation of the affairs of New South Wales as the result of the action of the Commonwealth Government. If any further action has to be taken, it will be on account of something clone deliberately by the Premier of New South Wales. The unemployment relief tax has been mentioned, and the honorable member for West Sydney has frankly said that he considers that the mention of it in the resolution is excellent propaganda. There is not the slightest necessity to attach that revenue in order to recover the debt owing to the Commonwealth at the present time. It would only be necessary to attach that revenue should the Premier of New South Wales, not content with defaulting to the extent of £1,000,000, allow his default to increase to £2.000,000 or £3,000,000. {: .speaker-KNP} ##### Mr Maxwell: -- Does this resolution cover more than the specific amount mentioned in the certificate of the AuditorGeneral on which it is based? {: .speaker-F4B} ##### Mr BRUCE:
FLINDERS, VICTORIA · NAT; UAP from 1931 -- Yes. The certificate that has been issued by the AuditorGeneral is for a sum of £924,082, the amount of the present default of the New South Wales Government; the resolution covers States revenues aggregating some £5,914,000, that will probably be collected between now and the end of June next. If the Government of New South Wales continues to default, its indebtedness to the Commonwealth will be increased by £1,242,000 during the month of March, by a further £985,000 in April, by £695,000 in May, and by £1,903,000 in June, making a total indebtedness of £5,978.000 at the end of the present financial year. Against that may be set off certain moneys that are due to the State of New South Wales by the Commonwealth Government under the terms of the Financial Agreement, amounting to roughly £243,000 a month. If that total is deducted from the amount that will be due by the Lang administration if it continues to default in its overseas commitments, the sum owing to the Commonwealth Government at the end of the financial year will be £4,577,000. If that Government also defaults in its internal interest obligations, a further sum of £1,4'00,000 will be involved, making the total of £5,97S,000 to which I have referred, which is a little more than the sum that can be attached. This resolution would give the Commonwealth Government power to attach not only the sum of £924,000 that is now due, but any additional sum of moneys that the Commonwealth may have to pay to the bondholders of the State because of the default of the Government of New South Wales. It will merely be necessary for the Attorney-General to issue further certificates showing the amounts due and owing, and this Government, can then issue a proclamation attaching other revenues specified in the resolution. Obviously the Commonwealth Government must safeguard itself by including in this motion revenues estimated to be equal to the amount of the possible future defaults of the Government of New South Wales. It is sincerely to be hoped that that Government will yet see the error of its ways, and avoid bringing further disaster and dishonour upon the State of New South Wales. I sincerely trust that there will be no necessity for the AuditorGeneral to issue any further certificates, and that this will be the end of the whole sorry story. {: #subdebate-24-5-s6 .speaker-F4U} ##### Mr FORDE:
Capricornia .- Apparently the Government, suffering from the pangs of remorse for having allowed Australia to default, is now rushing from blunder to blunder in an endeavour to rehabilitate itself in the estimation of investors overseas. It would have been most interesting to listen to the debate that took part in the Nationalist party room after the Government declared its intention to follow the policy of **Mr. Lang** and default. **Senator Colebatch,** one of the ablest men in the ranks of the Nationalist party, and an ex-Premier of Western Australia, declared that the Federal Government had " offended and wrecked the confidence of the public investor ". It is fast losing whatever principles it possessed, and listening to the dictates of the outside political machine it is adopting what will prove to be unconstitutional methods in an endeavour to bring about the downfall of the Lang Administration. When the Financial Agreements Enforcement Bill was introduced, we were told that it had been very carefully considered, but before we saw the last of it it was necessary for the Government to frame a sheaf of amendments, to which we were asked to agree at a moment's notice. The Assistant Treasurer **(Mr. Bruce)** made himself perfectly ludicrous by saying that it would probably involve a delay of eighteen months or two years if the Government waited to obtain a judgment from the High Court. That is merely a wildly extravagant assertion by one who is unable to advance a logical argument to support his case. The right honorable gentleman asked : " How are we going to enforce the act?" Surely constitutional methods are provided by the Judiciary Act, and if any additional powers are needed the Government should introduce the necessary amendments. There is power in the Constitution to carry out the terms of the Financial Agreement, but there is nothing in the Agreement which gives this Government the extraordinary power that it is taking to itself to collect this money. The Assistant Treasurer gave us the assurance that the Government is not " ousting the High Court ". It is difficult to reconcile that statement with the action of the Government, which, as plaintiff, is declaring that certain moneys are due and owing without first obtaining the decision of the High Court, which is being brushed aside. An eminent counsel ha3 given the following opinion in connexion with the Financial Agreements Enforcement Bill : - >The provisions of Parts III. and IV. will have to be carefully considered, especially in view of the possibility that such provisions, or some of them, may be unconstitutional. It is clearly .most desirable, from the point of view of taxpayers and others, that the question of the constitutionality or otherwise of the act should be determined at the earliest possible moment after it becomes law, and before the Commonwealth Government seeks to enforce it against any person or corporation. {: .speaker-KFK} ##### Sir Littleton Groom: -- Doe3 that refer to the bill or to the act as it now stands? {: .speaker-F4U} ##### Mr FORDE: -- It refers to the act. It was a legal opinion quoted in another place to support the views of certain members of the Nationalist party who are opposed to the action of the Government. Under chapter 3 of the Constitution, the judicial power of the Commonwealth is vested in the High Court. Section 78 of the Constitution reads - >The Parliament may make laws conferring rights to proceed against the Commonwealth or a State in respect of matters within the limits of the judicial power. The Constitution does not give this Parliament power to usurp the functions of the High Court. **Senator Colebatch** also said, in other place - >It seems to me that the whole bill, if it is not, in fact, contrary to the letter of the Constitution, does very seriously offend against the spirit of it. lt is for this reason that 1 propose to vote against it ... I go further than the Leader of the Opposition, and say that had any State dreamt that a condition of enforcement entirely foreign to the established principles of British justice would be applied against them, not one State representative would have signed the agreement. I believe that **Senator Colebatch** is right, and that quite a number of honorable members who sit behind the Government do not agree with its action. There are others who are prepared to sacrifice principle for expediency, in an endeavour to honour their election promises, and bring about the downfall of the Lang Administration. We, as a party, do not" stand for the repudiation that has been practised by the New South Wales Government. It does not follow, because we take a stand on a matter of principle, that we support any acts of repudiation that have been perpetrated by the Premier of New South Wales, and to declare that we are apologists for **Mr. Lang** is a reflection on prominent members of the Nationalist party, such as **Senator Colebatch** and **Senator Johnston,** who have censured the action of the Commonwealth Government. *[Quorum formed.]* The Labour party does not stand for repudiation. It stands for the carrying out of commitments, whether incurred by governments or by individuals. The controlling body of the Labour movement has proved that by the resolutions that it passed at Labour conferences. The Assistant Treasurer **(Mr. Bruce)** cannot point to any precedent for a plaintiff taking action of the kind contemplated by the Federal Government. The right honorable gentleman declares that to approach the properly constituted tribunal would bring about delay. There will be more delay in the course adopted by the Government. If an individual has to obtain the decision of a court so should the Government have to do. The Commonwealth Government is taking illconsidered action which will prove a blunder. What is now being done will merely make a martyr and hero of the present Premier of New South Wales. Already that individual is receiving support in his fight against the Prime Minister **(Mr. Lyons)** and the Assistant Treasurer **(Mr. Bruce),** and the stupid action of this Government is -providing him with valuable propaganda, as many people believe that he stands for the supplying of food to the unemployed rather than the providing of interest for the rich Jews of London. The right honorable member for Cowper **(Dr. Earle Page)** says that it is an injustice to the taxpayers of other States to allow New South Wales to default. With that the Labour party agrees, but we insist that the proper legal procedure should be followed. The Scullin Government approached the High Court, and the case against the State was withdrawn only when a definite undertaking was given by **Mr. Lang** that his Government would meet its obligations. {: .speaker-JLJ} ##### Mr Abbott: -- Did he keep his compact ? {: .speaker-F4U} ##### Mr FORDE: -- He definitely promised to do so, but he has since defaulted again. But would the honorable member take the law into his own hands, as the Commonwealth Government is doing, if one of his debtors defaulted? This Government has no mandate from the people to take this extraordinary action. Our quarrel with the Government is over the unconstitutional method that it is adopting to compel the Government of New South Wales to pay its just debts. The Government, has made a tactical blunder of the first magnitude in proposing to seize the income tax imposed specially for the relief of unemployment. This- course must at once rally to the support of the Government of New South Wales a large body of public opinion which is quite opposed to **Mr. Lang's** policy of repudiation. The right honorable member for Cowper **(Dr. Earle Page)** complained in one breath that the default of the New South Wales Government would inflict injustice on the other States, and in the next breath declared that if the seizure by the Commonwealth of unemployment relief funds inflicted hardship on the unemployed of New South Wales, the duty of the other States would be to come to their assistance. Clearly the right honorable gentleman is prepared to resort to any argument to justify his support of the Government's attempt to bring about the downfall of the Lang Government. The Commonwealth Government is committing a breach of the Constitution. The framers of the Constitution and the State Premiers who subscribed to the Financial Agreement never intended that the Commonwealth should have power to seize the revenues of a State without first obtaining a judgment of the High Court. Because the Opposition believes that the methods now being adopted are wrong, and because it stands for principles and not for party political expediency, it joins with two of the ablest men in the nonLabour ranks, **Senator Colebatch** and **Senator Johnston,** in opposing the extreme action which the Government is taking. {: #subdebate-24-5-s7 .speaker-KZF} ##### Mr LANE:
Barton -- I cordially endorse the action which the Government is proposing. When the Scullin Government proposed to prosecute the State of New South Wales for default, the Opposition of the day gave to- it unstinted support. {: .speaker-KLL} ##### Mr Makin: -- Because the Scullin Government was taking the proper constitutional course. {: .speaker-KZF} ##### Mr LANE: -- It is not difficult to understand what is prompting the members of the present Opposition. Not only has **Mr. Lang** defaulted a second time, but it is evident that by the time a judgment has been obtained from the High Court, the liability of New South Wales to the Commonwealth will be greatly increased. Thus any delay in taking action for recovery of the amount due will merely add to the difficulties of the people of that State. No honorable member of the Opposition has denied the possibility of **Mr. Lang** continuing to default, and adding still further to the burden he has already placed upon the Commonwealth. We are told that the Government should not ignore the High Court. Section 6, subsection 3, of the Financial Agreements Enforcement Act provides - >As soon as practicable after such a resolution lias been passed by both Houses o£ the Parliament, and in any event within two months thereafter, tlie Attorney-General shall apply to the High Court for a declaration that the amount stated in the resolution, or any part thereof, is due and payable and unpaid by the State to the Commonwealth. It is clear, therefore, that the Coinnio.ii- wealth's claim will in due course be referred to the High Court for decision. It is unfortunate that after the Scullin Government's experience of **Mr. Lang,** honorable members of the Opposition will not support the present Government in taking action to bring the defaulting State to book. The facts revealed in the motio.ii prove their insincerity in raising technical objections to the course proposed by the Government. Air. Makin. - On a point of order. I take exception to the imputation of insincerity on the part of the Opposition, and ask that it be withdrawn. M.r. SPEAKER. - As exception is taken to the honorable member's statement, I ask him to withdraw it. {: .speaker-KZF} ##### Mr LANE: -- I withdraw the statement. The honorable members of the Opposition are in reality supporting **Mr. Lang's** attitude, but are covering their action by pretending to discover technical objections to the procedure now proposed. They urge that **Mr. Lang** should be prosecuted for default, and then oppose a motion which will compel him to meet hie! liabilities. Although they may be so chin skinned as to object to a charge of insincerity and hypocrisy, their actions speak for themselves. {: .speaker-KLL} ##### Mr Makin: -- On a point of order. You, **Mr. Speaker,** called the honorable member to order for imputing insincerity to the Opposition. I suggest that he is now aggravating his offence by his further reference to hypocrisy and insincerity, and I ask that those words be withdrawn. {: .speaker-10000} ##### Mr SPEAKER: -- If the honorable member for Barton is accusing members of the Opposition of insincerity or hypocrisy he must withdraw that reflection upon them. {: .speaker-KZF} ##### Mr LANE: -- I have not accused them. The Deputy Leader of the Opposition **(Mr. Forde)** declared that the Commonwealth defaulted, and therefore shared the guilt of the New South Wales Government. I do not know whether I would be allowed to term that misrepresentation a wilful perversion of the truth, but the honorable member for Hindmarsh **(Mr. Makin)** can place upon it his own construction, according to his particular conception of ethics. **Mr. Lang** gave the Commonwealth Government only 24 hours notice of his intention to default, and the Commonwealth had not time to make arrangements to avoid that default; yet the Deputy Leader of the Opposition bus said that we who are supporting the Government are suffering pangs of remorse for having sinned in the same way as ifr. Lang. I do not know whether I would be in order in describing that remark as insincere, but the fact is clear that the Commonwealth Government was forced into a distasteful position by an unscrupulous State Government. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member for Barton is not in order in discussing the merits of the Opposition or any other party. I ask him to confine his remarks to the motion before the House. {: .speaker-KZF} ##### Mr LANE: -- I am endeavouring to persuade members of the Opposition to recognize the inconsistency of their attiture. *[Quorum formed.]* The arguments advanced by the Deputy Leader of the Opposition **(Mr. Forde)** were not characterized by common sense or sincerity. His references to the alleged default of the Commonwealth Government were an attempt to link up this Government with the Lang Government of New South Wales. He and the other members of his party have been giving tacit support to the Government of New South Wales in its refusal to meet the just claims of the Commonwealth. The statement of the Leader of the Opposition **(Mr. Scullin),** and, after him, of the Deputy Leader **(Mr. Forde),** cannot be interpreted as meaning anything else than that they stand behind the New South Wales Government in the dispute with the Commonwealth Government. Whatever the merit of the technicalities which have been raised, I am surprised that honorable members opposite should support the action of the Lang Government. I have no doubt that the Premier of New South Wales, in defending his policy, will make full use of the fact that these proposals have been consistently opposed by the Federal Labour party. Members of the Opposition tried first of all to cast obloquy on the Government for allegedly defaulting in regard to payments due by New South Wales, and it is now opposing the attempts of the Commonwealth Government to recover the money due to it. Contrast the attitude of the Opposition with that of the party now supporting the Government, when that party was in opposition. The party which now sits behind the Government offered every assistance possible to the Scullin. Government, in its attempt to force the Government of New South Wales to meet its obligations. The Deputy Leader of the Opposition stated, as one of his objections to this motion, that it was proposed to attach the revenues derived from unemployment taxation. I believe that clauses 5 and S of the motion, taken together, make it clear that there is no intention on the part of the Commonwealth Government to interfere with such revenue. Clause 5 gives power to attach the revenue derived from income taxation, but clause S clearly indicates that the Government has no intention to attach income taxation revenue, which has been specially set apart for the purpose of relieving unemployment. Sufficient revenue will be obtained by the Government of New South Wales from ordinary income tax sources between now and the end of June to meet the debt due to the Commonwealth. The last two months of the financial year always yield more revenue from direct taxation than any corresponding period throughout the year. Therefore, it will not be necessary, in order to satisfy this debt, to levy on revenues raised for the relief of unemployment. The action of the Opposition in refusing to support the Government's attempts to collect what is. due to the Commonwealth clearly indicates the insincerity of certain of its members. {: .speaker-KLL} ##### Mr Makin: -- I ask that the honorable member for Barton **(Mr. Lane)** be called upon to apologize for repeating an offence to which his attention was previously called. {: .speaker-10000} ##### Mr SPEAKER: -- To what statement does the honorable member refer? {: .speaker-KLL} ##### Mr Makin: -- The honorable member for Barton said that members of the Opposition were guilty of insincerity. Members of the Opposition are entitled to an apology from the honorable member, because he has repeated his offence. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member for Barton may not repeat an offence to which his attention has been drawn. He has,'already been asked to withdraw his statement imputing insincerity to members of the Opposition, and he has again offended. I ask him to express regret, and not to offend again. {: .speaker-KZF} ##### Mr LANE: -- I express my regret. {: .speaker-KZR} ##### Mr White: -- On a point of order, **Mr. Speaker.** Is an honorable member not in order in criticizing the moral principles of other honorable members whose political actions' lay them open to such criticism? {: .speaker-10000} ##### Mr SPEAKER: -- An honorable member is justified in expressing himself in his own language within the limits of the Standing Orders, but he must not be offensive to other honorable members. {: .speaker-KZF} ##### Mr LANE: -- I think that I have proved my assertion that the New South Wales Government, in its refusal to meet its just obligations, is receiving the tacit support of members of the Opposition in this House. There may be some exceptions, but the Opposition in general is offering covert support to the Government of New South Wales in its contest with the Commonwealth. {: #subdebate-24-5-s8 .speaker-KJQ} ##### Mr JAMES:
Hunter .- I oppose this motion. The Government is taking this action in an attempt to redeem the promises made by certain of its supporters on the hustings in December last, and repeated by the Prime Minister when speaking at the Millions Club in Sydney. That promise was that the Lang Government in New South Wales would be removed. Ever since this Government has been in office it has persistently harassed the State Government of New South Wales. I refer not only to the proceedings which we are now considering, but also to the inhuman treatment meted out by the Commonwealth Government to the unfortunate unemployed persons in the Federal Capital Territory, to whom it refused food relief so that they would have to cross over into New South Wales, and become a burden on the government of that State. {: .speaker-KZF} ##### Mr Lane: -- Is the honorable member in order in stating that this Government refused to give food to the unemployed in the Federal Capital Territory in order to force them into New South Wales? {: .speaker-10000} ##### Mr SPEAKER: -- I must warn honorable members to refrain from raising points of order which may be regarded as frivolous, and before the honorable member who is speaking has had time to develop his argument. I have been listening carefully to the honorable member for Hunter, and if he oversteps the limits of debate he will be called to order. {: .speaker-KJQ} ##### Mr JAMES: -- I repeat the statement that food was refused to unemployed persons in the Territory so as to force them into New South Wales, and if the honorable member for Barton **(Mr. Lane)** bad attended more regularly to the business of the House, he would have known this for himself, because it was brought out by ministerial answers to questions. {: .speaker-KZF} ##### Mr Lane: -- The honorable member's statement is untrue, and is offensive to me. I am always in my place at the House, and I ask that the honorable member withdraw his statement. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member for Hunter must recognize that the honorable member for Barton has been regular in his attendance in this House. His statement, therefore, was not warranted. I ask him to ignore interjections, and to deal only with the motion before the Chair. {: .speaker-KZF} ##### Mr Lane: -- The statement of the honorable member fdr Hunter **(Mr. James)** if not withdrawn, will be injurious to me, and will prejudice me in the opinion of my constituents. The statement is offensive to me, and I ask for an unqualified withdrawal. {: .speaker-10000} ##### Mr SPEAKER: -- When I spoke to the honorable member for Hunter I should have asked him to withdraw the remark. I now require him to do so. {: .speaker-KJQ} ##### Mr JAMES: -- I withdraw. The unemployed of Canberra have received notice to quit No. 4 camp on Thursday next. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member must not pursue that line of debate. {: .speaker-KJQ} ##### Mr JAMES: -- This Government is attempting to harass the State Government of New South Wales, and the treatment that it is now meting out to the unemployed at Canberra is in accordance with the promises that it made on the hustings to remove the Lang Government from office. Recently the Prime Minister spoke at the Millions Club in Sydney, and when referring to **Mr. Lang** said : " We must remove this incubus from office ". This motion is an attempt to do so. This Government considers that by stealing the revenues of New South Wales the State public servants will not be paid, and the unemployed will not receive food relief. {: #subdebate-24-5-s9 .speaker-KYI} ##### Mr PROWSE: -- I take exception to the statement of the honorable member for Hunter **(Mr. James)** that this Government is stealing, or attempting to steal, the revenues of New South Wales. {: .speaker-10000} ##### Mr SPEAKER: -- I ask the honorable member to withdraw the word to which, exception has been taken. {: .speaker-KJQ} ##### Mr JAMES: -- I withdraw it. This Government, in seizing the revenues of that State, desires to bring about chaos for the purpose of forcing an election. This resolution has been introduced in a venomous political spirit. New South Wales is being carpeted by other States which have from time to time been nursed by that State. Many thousands of pounds have been made available by New South Wales for the assistance of Tasmania. Western Australia and South Australia, and in- return those States are biting the hand that fed them. New South Wales contributes to the CommonwealthTreasury 14s. 4d. more per head of population than it receives from it. The business of Tasmania is about equal to that transacted by the Coal Miners Federation, to which I belong. The business dealings of that State are no bigger than those of the Sydney City Council. Yet Tasmania is a party to this attempt to smash New South Wales, a State which has two-fifths of the total population of Australia, and provides two-fifths of its total revenues. The action that this Government is taking is not likely to strengthen the ties of federation. Honorable members generally do not seem to realize that the operation of this legislation may bring about bloodshed in the community. Quite a number of honorable members believe that **Mr. Lang** is a monster, and beyond the pale of decent society, but in New South Wales there are many thousands of people who respect the name of **Mr. Lang.** He has shown more sympathy for the people than have the Premiers of the other States. The legislation sponsored by him has been designed to assist the poorer section of the community. At one time a woman, when her husband died and left her with no means of support, had to work at the wash-tub or as an office cleaner, but under State legislation a widow is now entitled to a pension. Instead of having to place her children in an orphanage, a widow may now keep her children round her knee, giving them the love, comfort and guidance to which they are entitled from their mother. Prior to the operation of that legislation, many unfortunate children were denied this protection. If the State revenues are seized by the Commonwealth Government, the widows' pension must necessarily cease. The Lang Government has also provided child endowment and workers' compensation, and these have been of great benefit to the people generally. But if the Commonwealth Government put the bailiffs into New South Wales those privileges will be lost to the mothers and the workers. The Assistant Treasurer **(Mr. Bruce)** referred to **Mr. Lang's** act of repudiation, but I contend that the Premier of New South Wales has not repudiated. **Mr. Lang** himself has, by means of the State Moratorium Act, given thousands of the people who are represented by the Country party in this House, time to meet their obligations, thus preventing them from being ejected from their holdings. They now owe £3,00*0,000 to the Government of New South Wales. All **Mr. Lang** is asking for is time to meet his obligations, and an adjustment of interest rates in accordance with the recent fall in values. The Government itself, and even the Opposition when it was in power, adopted the policy of repudiation. During the Great War men who enlisted were promised that they would be provided for when they returned, or, if they did not return, that their dependants would be provided for. That promise, which was made on every recruiting platform, was honoured by various governments until last year, when the Financial Agreement began to operate. The Scullin Government, with the assistance of members sitting behind the present Government, by reducing the pensions of the dependants of fallen soldiers, committed an act of repudiation. When the big loan conversion took place many bondholders refused to convert their holdings, and although the rate of interest applying to their bonds was 6 per cent., legislation was introduced compelling them to convert their holdings at an interest rate of 4 per cent. Is not this repudiation of a written contract? When honorable members talk about **Mr. Lang's** alleged repudiation, they should remember that this Parliament has repudiated some of its undertakings, par ticularly in respect of returned soldiers and the dependants of deceased soldiers. At present, many of our pensioners are being obliged to live on a mere pittance. The sum of 30s. a week is supposed to be enough for a man and his wife. If a married pensioner earns anything up to 30s. a week, he only receives in pension the difference between his earnings and the 30s. This is repudiation of the worst description. The Assistant Treasurer complained that the basic wage in New South Wales was higher than in any other State. To me that is a subject not for complaint, but for pleasure. I am glad that the standards of the working people of New South Wales are higher than those of the working people of the other States. The right honorable gentleman also referred to the percentage of unemployment in New South Wale3, but he did not say that there are to-day 8,000,000 unemployed in the United States of America ; 6,000,000 unemployed in Germany; and 2,400,000 unemployed in England. Is **Mr. Lang** or the high standard of working conditions in the State of New South Wales responsible for this? No; these countries have a standard of living far lower than ours, yet, on a *per capita* basis, they have more unemployed. It is sometimes said that the cause of the unemployment in Australia, is high wages and short hours, but other countries of the world in which lower wages are paid and longer hours worked, have a greater percentage of unemployment than Australia. We shall never solve our unemployment problem by reducing wages and lengthening hours. We know very well, that the mechanization of industry, which has resulted in the displacement of human power by machine power, has had a great deal to do with the extension of unemployment throughout the world. I know that Australia, with her unique opportunities for land settlement, is in a better position than some countries to meet an abnormal situation such as is now facing her; but we shall never solve our unemployment problem until we abandon the obsolete monetary system which is in vogue in this and other countries. If the proposal to seize State revenues were not so tragic it would be Gilbertian. Have honorable members opposite asked themselves what is likley to happen when federal officers attempt to enter State departments for the purpose of receiving State revenue? Do they know that instructions have been issued in New South Wales that no stranger is to be permitted to cross the threshold of any departmental office? What is likely to happen when Commonwealth police officers attempt to take charge of the State lottery office, or of our railway and tramway systems? There will, undoubtedly, be serious trouble. State officers will naturally obey the instructions that have been given to them by their departmental heads, who in turn, have received their instructions from the Government. When resistance is offered to the entry of federal officers into State establishments, does the Government propose to train the guns of H.M.A.S. *Canberra* on Sydney? Honorable members opposite must realize that there will be serious trouble when the first attempt is made to enforce the provisions of this act in New South Wales. As a representative of New South Wales, I shall do my very utmost to resist this action of the Commonwealth Government, and I shall fight to the last ditch for the protection of the State Government. {: .speaker-KIU} ##### Mr Hutchin: -- The honorable member will be thrown into the ditch. {: .speaker-KJQ} ##### Mr JAMES: -- I am sincere in theattitude that I am adopting in connexion with this motion, and the honorable member for Denison need not joke about ditches. The situation is serious. Surely the Government cannot calmly contemplate development of the situation which unfortunately may lead to bloodshed in this wonderful Australia, of which we are so proud! Surely the people of other States cannot lightly contemplate the possibility of fighting against their brothers in New South Wales ! Yet if an attempt is made to enforce this legislation in New South Wales that may happen. The people of the mother State are just as determined to oppose, as this Government seems determined to insist, upon the enforcement of this rotten law, which may lead to a bloody revolution which no sane person desires. -. {: .speaker-10000} ##### Mr SPEAKER: -- Order ! (The honorable member must withdraw the word " rotten." {: .speaker-KJQ} ##### Mr JAMES: -- I do so and substitute "iniquitous." We have anticipated for a long while the setting up in Australia of one government for the whole Commonwealth; but the movement towards unification will be hindered and not helped by the passage of this motion. We know very well that We3ter.11 Australia has been talking secession for some time, and so also have some of the people in Tasmania; but probably nothing that- has been done in recent years by any Government is so calculated to destroy the spirit of unity among the Australian States as the actions of this Government, The Financial Agreements Enforcement Act may be likened to a wedge driven into the Australian federation". It will probably result in the splitting of it asunder. This will mean that instead of this great nation becoming united in sentiment the feeling of nationhood will 'be killed in its infancy. One of the troubles about this legislation is that it has been conceived by persons without Australian sentiment or outlook, who have spent more time abroad than here. This Parliament is now being asked to act in the interests of the overseas bondholders and .not in the interest of the people of Australia. Our own people are to be deprived of the necessaries of life in order that overseas bondholders, who are not in need, may receive their interest payments. Surely the bondholders can wait a little while. Even when **Mr. Lang** entered upon negotiations with the overseas bondholders through the Agent-General for New South Wales **(Mr. Willis)** his efforts were adversely criticized by his enemies in Australia. The Leader of the Opposition in New South Wales declared that even if **Mr. Lang** were successful in getting the overseas bondholders to agree to a reduction of interest rates, his action would be ineffective without the approval of the Loan Council. Is the Loan Council ever likely to do anything that may even remotely benefit the Lang Government? The answer is an emphatic " No." I believe that the Loan Council will do its utmost to crush the Lang Government. Even if by any miracle this Government received, from the action it is now taking, more than enough State revenue to meet the liabilities of New SouthWales it would not pass the balance of the money over to that State. There are, of course, grave doubts about the constitutionality of the Financial Agreements Enforcement Act. I contend that the Government should have these resolved before it endeavours to enforce the law. Any action against New South Wales should be taken by the usual judicial procedure. Disunity and disruption among the people of the country can only be the result of any other action. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member's time has expired. *Sitting suspended from 6.16 to 8 p.m.* {: #subdebate-24-5-s10 .speaker-KZR} ##### Mr WHITE:
Balaclava .- As this debate proceeds, I cannot help being impressed by the similarity of the conduct of the left wing of the Labour party, and of **Mr. Gandhi** in India. The latter incites the people to violence, and then pushes the women and children, starving and otherwise, in front as a shield for the rioters. How many times have we heard the honorable member for Hunter **(Mr. James)** talking of the starving women and children in his electorate! But I claim that it is an exaggeration to say that thousands of women and children in Australia are starving. It is, unfortunately, true that the unemployed number some 400,000, and that their dependants are suffering a good deal of distress; but, at least, measures have been taken to provide them with food. It is to be hoped that when the present abnormal times pass, the unemployed will gradually obtain some useful work, and their dependants will receive again the comforts previously enjoyed by them. Those who constitute the left wing of the Labour party repeatedly refer to the percentage of- unemployment to justify default on the part of the New South Wales Government. It is deplorable that the largest, wealthiest and most populous State of the Commonwealth should have odium cast upon it through the misdeeds of a leader who has got into power by making unscrupulous promises that he has no intention of honouring. The policy of the Lang party is that of repudiation of financial obligations to bondholders. How often have we heard its members eulogizing **Mr. Lang** for refusing to pay the overseas interest bill of New South Wales ? What a policy for a continent occupied solely by white people, who have high ideals! Repudiation would not be acceptable even on a second-class race-course. Consider the disclosures that have been made, to the discredit of the Lang administration, regarding " tin-hare " racing. On reading the debates that have taken place in the New South Wales Parliament, and on hearing the allegations of honorable members of the Opposition in that State, one realizes that the whole career of the Lang Government reeks with corruption. Before the debate that was initiated in the New South Wales Legislative Assembly regarding the "tin-hare" allegations had proceeded to any length, the speakers were " gagged " by the Ministry. Yet members of the Lang group in this chamber are prepared to support the present Premier of New South Wales, and they have the hardihood to say that if the Commonwealth Government attaches a portion of the revenue of New South Wales, women and children in that State will be brought to starvation. I should like to know how the loss of a portion of the revenue derived by the New South Wales Government from " tin-hare " racing, and the running of a lottery could make a. solitary widow or child one whit the worse off. When one remembers that the Premier of New South Wales is a friend and associate of persons who are known to be Commun ists- {: .speaker-KJQ} ##### Mr James: -- That is not correct. {: .speaker-KZR} ##### Mr WHITE: -- I am not castigating members of the Lang Group personally. I give them credit for the frankness that they have displayed in this House. In that respect their policy stands out in strong contrast against the more or less camouflaged policy of the right wing of the Labour party. The members of the left wing were elected on a policy of repudiation, but, fortunately for Australia, they are in a minority, because at the last election the people realized the significance of the politics of Domain demagogues and others, including Communists, and returned to power in overwhelmingnumbers a party thatstands for the interests of the whole of the people. Therefore, it is extraordinary to me that the time of the House is wasted- {: #subdebate-24-5-s11 .speaker-KIT} ##### Mr SPEAKER (Hon G H Mackay: -- An honorable member may not reflect on the proceedings of the House by saying that its time has been wasted. {: .speaker-KZR} ##### Mr WHITE: -- If the discussions in this chamber have shown members generally, and the audiences which crowd the galleries, what can happen in this Parliament, I am sure that their time has not been wasted. Nobody believes that a State Premier who behaves like a fraudulent insolvent is doing the right thing. It must be obvious to honorable members opposite that New South Wales, having defaulted, and forced the Commonwealth to go to its rescue, has done incalculable harm, to the Commonwealth and every other State. The other States have as much right as New South Wales to default, but they are inspired by higher motives than those now in evidence in New South Wales. I believe, however, that the days of **Mr. Lang** and his Government are numbered. {: .speaker-KX7} ##### Mr Ward: **Mr. Ward** *interjecting,* {: .speaker-10000} ##### Mr SPEAKER: -- Several times I have asked the honorable member for East Sydney **(Mr. Ward)** to cease his continual interjections. I now warn him for the last time that he must be silent. {: .speaker-KZR} ##### Mr WHITE: -- If all the States made default with regard to their interest payments, it would be impossible for the Commonwealth to save them from financial disaster. The result would be chaos, and Australia would sink to a level below that of a third-rate South American republic. Yet the Leader of the Lang party recently had the audacity to say that the New South Wales Premier took his place among the immortals, among the great patriots of Australia, among the national figures ! I have seen figures in waxworks with which it might be possible more appropriately to associate **Mr. Lang.** I was surprised to hear the right honorable member for Yarra **(Mr. Scullin),** the Leader of the official Opposition, protest against the action of the present Government in taking steps to bring to a speedy conclusion its dispute with the defaulting State of New South Wales. The right honorable gentleman is an adept at splitting straws. In his eloquent style, he told us that he stood for the honour of Australia, and had opposed **Mr. Lang** and his policy, but that because he believed that the Commonwealth Government was adopting a wrong procedure he intended to oppose it at every stage in the action it was now taking. It follows, therefore, that if the Leader of the Opposition were in a majority in this chamber, **Mr. Lang** would still be permitted to carry out his discreditable financial policy, subject only to any belated action by the High Court. I am disappointed to find that the Leader of the Opposition, who was Prime Minister for two years, was not 'big enough to support the high principles for which the present Government is fighting. He should at least range himself behind this Government on the principal issue in order that effect may speedily be given to the Financial Agreements Enforcement Act, so that the people of New South Wales may receive the relief that they need. When this debate began this morning I moved the application of the closure ; but at the request of the Prime Minister I withdrew the motion. My object was to limit the debate, for the sooner the act was put into operation, the shorter would be the time before happiness and prosperity would be restored in Australia. If the Labour party stood for the interests of the whole of the people, irrespective of class, party, or creed, they would realize that it is necessary in the interests of New South Wales, and of Australia generally, that the reign of the present Premier of New South Wales should promptly be brought to a close. {: #subdebate-24-5-s12 .speaker-KLL} ##### Mr MAKIN:
Hindmarsh .- After listening to honorable gentlemen opposite, one might imagine that all the virtues are to be found in occupants of the ministerial benches; that members who differ from them are devoid of honesty, and have no regard for public ethics. It is regrettable that such a code of conduct is observed in public life. We should at least be generous enough to concede to others the right to follow the dictates of their conscience. I regret that honorable members opposite have not maintained the high standard of debate set by the Leader of the Opposition this afternoon. I wonder whether they realize the profoundly serious nature of the resolution under discussion. I have reason to question seriously honorable members who comprise the Beasley group. {: .speaker-L08} ##### Mr Rosevear: -- -The honorable member means the Labour party. {: .speaker-KLL} ##### Mr MAKIN: -- I distinctly deny the right of that faction to such a title. There is one thing that I shall never depart from, and that is the observance of the principle of honest dealing. The party with which I am associated endeavour to set a standard of conduct in public affairs that is beyond criticism. Members of the Beasley group are under no obligation to me, and I am certainly under no obligation to them. I regard as reprehensible the financial policy of the individual whom they set up as their high priest. I approach this matter entirely free from the sectional jealousies which members on the ministerial benches would like to attribute to me. No one has received less generous treatment, or has been subjected to more open hostility, from that group than I, and I repel emphatically any insinuation that I hold a brief for members of the Beasley section, or for the person that they represent in this chamber. I contend that the Government is not justified in taking an action which cuts right across the fundamental principle of British justice that the accuser shall not constitute himself his own court. The Government should have adopted the constitutional way of dealing with this problem, one that is free of any taint of malice. This afternoon the honorable member for Barton **(Mr. Lane)** endeavoured to create the impression that honorable members of the official Opposition were guilty of gross inconsistency in this matter. He stated that when the Scullin Government was in power members of the present Administration, who were then in opposition, gave it their undivided support when it approached the High Court to launch an action against the defaulting State of New South "Wales. He claimed that in return it was incumbent upon the present official Opposition to stand behind this Government in whatever course of action it deemed wise to pursue , to deal with the present situation. If the action of the Government were similar to that of the Scullin Government, there would be no doubt as to our attitude, but we refuse to endorse the unconstitutional methods that are now being followed. We may be convinced that the claim of the Commonwealth Government against the Government of New South Wales is sound, but we believe that the procedure that is being adopted is unwise, and will recoil on the heads of those whom we seek to safeguard. There is a proper course for a government to pursue in such circumstances. {: .speaker-KUW} ##### Mr Stacey: -- It is a long one. {: .speaker-KLL} ##### Mr MAKIN: -- The course that the Government is following may prove to be much longer than that taken by the Scullin Government, I warn honorable members opposite of the serious consequences that may follow the action of this Government when it sets aside the High Court and trespasses upon the sovereign rights of the government of a State. There is no question, that the Premier of New South Wales will challenge the validity of the action of this Government, which will delay matters longer than if the Commonwealth Government had followed the orthodox procedure of first approaching the High Court. Nothing is more likely to arouse the antipathies of the States against federation than legislation such as this. Australia has suffered much because of interstate jealousy, and the suspicions that have poisoned the minds of the citizens of one State against those who live in an adjoining State have done much to retard the progress of federation. The Commonweath Government proposes to fan the flame of ill feeling, and will make more difficult the task of welding our people into a composite nation. Australia can ill afford to be divided against itself. I am confident that if the Government had followed the prescribed procedure instead of sponsoring an act of coercion such as this, the people of Australia, including the inhabitants of New South Wales, would have stood behind it. {: .speaker-KIU} ##### Mr Hutchin: -- You do not argue with a thief. You arrest him first, and try him afterwards. {: .speaker-KLL} ##### Mr MAKIN: -- The hypothesis of the honorable member is not a good one. Let me cite a case. If a person who owed him money defaulted he would have to comply with the legal formalities, and prove his claim before he could recover the debt. As with an individual, so with a nation. Unfortunately, there is a tendency on the part of governments to make one law for the people and another for themselves. It i3 remarkable how governments seek to give to themselves immunity from even their own legislation. Governments and Parliaments should set an example of observing the law, and not seek, by the exercise of their legislative powers, to set themselves above the law, and ride roughshod over constitutional procedure for the establishment of claims. The illadvised action which Parliament is now taking will create a state of uncertainty which will be harmful to peace, order and good government in New South Wales. No one who has read the newspapers in recent weeks can fail to entertain grave fears of the possible outcome of this procedure. {: .speaker-KZF} ##### Mr Lane: -- Everything will be all right. {: .speaker-KLL} ##### Mr MAKIN: -- The honorable member for Barton may treat the matter flippantly, but a crisis is being precipitated which may cost the lives of honest and worthy citizens of the Commonwealth. Even if only one life be risked, we should fully count the cost before we provoke a struggle between two sovereign powers. No man would more strongly uphold and enforce the law than I, but I will not support action which is being taken without fully counting the cost and reckoning the consequences. I ask honorable members to recognize the wisdom of first proving the Commonwealth's claim in the High Court and trusting to the court to enforce its decision. If that procedure be adopted, any action against New South Wales that subsequently becomes necessary will have legal authority which no law-abiding citizen would dare to dispute. But this attempt to ignore the judiciary, to make the Commonwealth both claimant and judge, and to enforce by duress a claim that it is not prepared to prove in the court, is not in accordance with what I believe to be the correct procedure applicable to the claims of governments as well as of individuals. The members of the New South Wales Lang group sowed the wind and are reaping the whirlwind. For this legislation they must accept some of the responsibility that they seek to fasten on to others. But for their action in the last Parliament, the present Government would not be in office to bring forward this enforcement legislation. These honorable members pose in the House and on the platform as the champions of liberty and freedom, as the special friends of the downtrodden, and as the only men in this Parliament who have real sympathy with the unemployed, but are they prepared to go into the constituencies and confess to the people that they are responsible for having defeated a Labour government which would have dealt with **Mr. Lang** by those constitutional means which they to-night have advocated. I am confident that they will not be able to satisfy those who admire consistency, and expect public, men to live and act according to their professions. I have a vivid recollection of the proceedings in this House six months ago, which brought about the defeat of the Labour Ministry, and subsequently the decimation of the Labour party. The honorable member for West Sydney and his colleagues are now reaping the first fruits of their betrayal of the Scullin Government. I hope that the workers will realize that these honorable gentlemen, who are professing their anxiety to preserve the living standards of the people, and who are defending the Government of New South Wales against the action proposed by the Commonwealth Government, must answer for their direct action in this House, and in the constituencies last year. In my own electorate, I had to fight, not only my lifelong political opponents, but also the Lang group. These honorable gentlemen cannot escape their responsibility for the legislation that is now being directed against the State Government which they claim to represent. They declaim about the starving people in their State; I know from my own observation that there is much serious impoverishment there, but if any person is starving, it is no credit to the Premier of the State. Nothing should be done that will accentuate the existing distress; on the contrary, we should concentrate on endea- vours to relieve it. Let us take no precipitate action that will cause more hardship and unhappiness to the people in New South "Wales and in the other States in Australia. I admit that New South Wales has indirectly made generous contributions to relieve the disabilities of South Australia, but by the repeated default of the Lang Government, the relief of unemployment in South Australia and every other State is possibly being made more difficult. I am only saying what is true. If the Commonwealth has to find moneys which should be paid by a State, it is only natural that, the other States will be deprived of some of the funds which would otherwise be available to relieve distress among their people. I heard the Premier of New South Wales say on one occasion that the working people of that State were already taxed to their full capacity. {: .speaker-L08} ##### Mr Rosevear: -- So they are in South Australia. {: .speaker-KLL} ##### Mr MAKIN: -- That may be so; but we might reasonably expect something better from this prophet of the workingclass movement. **Mr. Lang** said that it was impossible for the workers of New South Wales to contribute another penny by way of taxation. "If money for the bondholders was to be found,, it could come only from one section of the community, namely, the commercial classes and mortgagee interests. If those sections said that the money should be paid, he was quite prepared to provide the machinery by which they could pay it." If the Premier is so solicitous for the welfare of the workers, why does he allow the working people to be taxed to capacity, while still permitting to the commercial and money-lending interests a taxable margin upon which he has not called? Surely it would be only just for him to see that the burden was equally distributed. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member's time has expired. {: #subdebate-24-5-s13 .speaker-KFK} ##### Sir LITTLETON GROOM:
Darling Downs -- We have now arrived at this stage in connexion with these proceedings: Parliament has approved and enacted as law the Financial Agreements Enforcement Bill, and now Parliament is called upon to operate that legislation. Under the act, the Executive is empowered to obtain a certificate from the Auditor-General stating that certain sums are due to the Commonwealth by a State and then to invite Parliament to pass resolutions for the recovery of whatever debt is shown to be due and unpaid under the certificate. Upon the passage of the resolutions, certain revenues of the State are specified, and certain legal action taken to enforce payment. Parliament has been asked to act upon the urgency provision of the act contained in section 6. When the bill was before the House originally, a good deal of criticism was directed against clause 6, and some of the criticism advanced by -honorable members at the present stage would have been more properly directed to the original bill before it was amended. The honorable member for Hindmarsh **(Mr. Makin)** said that Parliament or the Government was proceeding to constitute itself judge and advocate in its own cause, and was, in effect, usurping the judicial functions of the court, as well as those of prosecutor. {: .speaker-KLL} ##### Mr Makin: -- Hear, hear! {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- If he studies the act he will see that his criticism is not justified. The act is very clear, and embodies a proper principle. When a debt is certified to exist and to be unpaid it is a reasonable and proper thing' to empower the Executive, not to give judgment, but to prevent the assets that might ultimately be used to satisfy a legal judgment being dissipated, and to preserve them until a judgment has been given. That is the effect of this provision, and that is all it seeks to do. If the resolution is passed a proclamation will be issued, and on the issue of that proclamation certain debts which are owing to the State Government by virtue of statutes will be made available in accordance with section 9 for the payment of debts due to the Commonwealth by the State. That, however, is only a step in the proceedings. The next step is provided for in sub-section 3 of section 6, which is as follows: - >As soon as practicable after such a resolution has been passed by both Houses of the Parliament, and in any event within two months thereafter, the Attorney-General shall apply to the High Court for a declaration tha* the amount stated in the resolution, or any part thereof, is due and payable and unpaid by the State to the Commonwealth. Having taken the preliminary step to make the revenues available and secure the assets for payment of debts, the next step is to get a judicial declaration, because the Executive must obtain a judicial determination. The very thing which honorable members opposite are asking for has to be done under the provisions of the act. It is provided that, after the issue of the certificate of the AuditorGeneral and the passage of the resolutions, the Attorney-General shall apply to the Court, and in enforcing the provisions of this legislation a judgment of the court must be obtained. If a judgment of the court is obtained', the duty of the Executive, according to the law of the land, is to enforce that judgment, and have the debt paid. That is all the Government seeks to do. {: .speaker-L08} ##### Mr Rosevear: -- Would the honorable member advocate that procedure as proper between private debtors and creditors? {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- We are now concerned with governments, not with private debtors. As a matter of fact, however, the procedure to be taken in this case is somewhat similar to that which is followed in- proceedings between subject and subject. Execution can be enforced on the judgment of a court. {: .speaker-KMZ} ##### Mr Martens: -- Does the honorable member say that the revenues of a State cannot be seized until a judgment is obtained? {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- The revenues ofa State may be seized in the meantime, but a judgment has to be obtained. The words of the resolution before the House applying certain sections of Part II. indicate the position " in order to protect the interests of the Commonwealth until the question of the liability of the said State has been determined by the High Court." It will be seen, therefore, that the Commonwealth is not constituting itself judge in the case. The AttorneyGeneral has to give at least three days' notice before the matter can be heard ; then the case is argued, and the State may dispute the facts, and advance what defence it can. The court which hears the argu ment must consist of not fewer than three judges of the High Court. {: .speaker-KHL} ##### Mr Holloway: -- The Government, under this- legislation, is anticipating the decision of the court. {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- Only in effect to hold the assets, just as a receiver is appointed to take charge of assets pending an action in the courts. This is regarded as the proper procedure as between subject and subject, when the subject-matter of the dispute might otherwise be dissipated bythe defendant so that nothing would be left to satisfy a judgment. I quite agree with honorable members opposite that the right of the Commonwealth should depend ultimately upon a judgment of thecourt obtained afterthe matter has been duly argued, and after opportunity has been given to raise every possible defence. It is not proposed to do any injustice to the State under this provision. One advantage the Commonwealth gets under the act is that the certificate filed by the Attorney-General is accepted as prima facie evidence in the case. {: .speaker-KMZ} ##### Mr Martens: -- Section 6 of the act gives the Government the right to apply a garnishee before it obtains a judgment. {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- That is not so. Garnishee proceedings in the ordinary course follow a judgment.. In' this instance it is proposed only to take action which has the effect of preserving the assets so that, if a judgment is given,, there will be something to answer it. {: .speaker-KNP} ##### Mr MAXWELL:
FAWKNER, VICTORIA · NAT; IND NAT from 1929; UAP from 1931 -- If the judgment is given against the Commonwealth it must hand back the assets. {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- If, after the case is heard, it is found that the Commonwealth has no claim, it will be compelled to refund what it has seized under the provisions of section 18 of this act. The Leader of the Opposition **(Mr. Scullin)** put his case fairly and well. He agreed that it was right that the debt should be paid. The obligation, he said, was there, and a wrong had been done by the Government of New South Wales in failing to pay the money. He suggested, however, that the Government should seek to recover the money through the ordinary processes of the court. I assure him that in the end, even if his proposal were adopted, the same position would possibly be reached. It is necessary to obtain a judgment, and the question then arises, how is itto be enforced? Under the Judiciary Act it is not allowable to issue an execution against the property of a State. After a certificate of a judgment the Treasurer of a State is required to satisfy the judgment out of moneys legally available, but if there is a rebellious Treasurer, how is the Commonwealth to enforce a judgment? The only difference of opinion between the party led by the Leader of the Opposition and the Government is regarding the method which should be adopted to enforce the judgment. {: .speaker-KHL} ##### Mr Holloway: -- The Opposition would rest its case on stronger moral grounds. {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- I cannot agree with that, because, under either method, the case must ultimately rest on the judgment of the court. Both parties admit that already there has been a breach of an agreement by the State of New South Wales and justification for action by the Commonwealth. Both are agreed regarding the moral aspect of that, and of the necessity of enforcing agreements and undertakings. The Executive has asked Parliament to participate in the enforcing of the judgment by passing a resolution putting section6 of the act into operation, and specifying the subjects which should be the subject of seizure under the act. That places a responsibility on members of this Parliament. The question has been asked whether the judgment should be enforced if, by so doing, there would be a possibility of destroying a State. If there were any such possibility, the judgment, of course, should not fee enforced. Itmust be enforced in such a way as to do as little injury as possible, but ultimately it has to be done, especially if the State concerned has the means, and is in a position to pay. That is the position in which we are placed. We have to decide whatare the proper revenues for seizure wader the act. The resolution specifies the different classes of State taxation which may be seized, and the object of seizing those particularrevenues as obviously to prevent the very conflicts that have been suggested by the honorable member for Hindmarsh **(Mr. Makin)** and other speakers. The object is to have a method of recovery by which we shall bring the two governments and their officers as little as possible into conflict. The subjects named in the resolution seem to be suitable for the application of the act. The resolution, following the words of the act, indicates that the action is to protect the Commonwealth interests until the question of liability of the State is determined. The subjects are : revenue from taxation in relation to betting; revenue from taxation upon payments for admission to race-courses; revenue from taxation in relation to totalisators; revenue from taxation in relation to admission to entertainments; revenue from taxation upon incomes; revenue from taxation in relation to motor vehicles; revenue from any State lottery; and revenue from taxation imposed upon incomes for the relief of unemployment. Those are the different revenues which it is suggested should be seized, and no one can. argue that on the whole they are not fit and proper revenues for seizure. Honorable members opposite have said that the seizing of one or two classes of revenue will prevent the State Government from assisting public hospitals and from paying certain sums for relief. But I presumethat New South Wales conducts its business in the same manner as the other States, and that moneys received are paid into the Consolidated Revenue Fund, from which appropriations are made for various purposes, including those mentionedby honorable members opposite. {: .speaker-L08} ##### Mr Rosevear: -- In that case how are we to discriminate between income tax and unemployment tax? {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- I frankly admit thatI have no information whether one or two of these classes of revenue are paid into a special fund and administered by a separatebody, but generally moneys received are paid into the Consolidated Revenue Fund, from which Parliament may make appropriations for charitable and other purposes. The enforcement of this legislation should not give rise to any serious hardship which would justify like Commonwealth Government in staying i ts hand. It is our duty to assist the Executive in deciding what are the proper revenues to be seized. Honorable members opposite have given no good reason why the State of New South Wales should not honour its obligations. The Financial Agreement was made in the interests of the Commonwealth and the States, and it is valid and binding by virtue of the Constitution. The Commonwealth made big concessions of revenue under the agreement, which benefited the States to the extent of over £7,500,000 annually during the period of the agreement. In respect of borrowings the Commonwealth has undertaken to bear a proportion of the sinking fund payments for the redemption of State debts. The Commonwealth and the States entered into that solemn obligation. What justification is there for one of the States at this stage to refuse to be bound by that agreement? Certain honorable members opposite have stated that New South Wales is entitled to carry out any policy which it decides upon, regardless of whether the operation of that policy will prevent the State Government from meeting its obligations under the agreement. Such a contention is destructive of the whole agreement. Certain honorable members opposite have put up a plea on behalf of the widows and orphans. Naturally every member has sympathy for them, but if the other States can meet their obligations and still provide for the widows and orphans, New South Wales, which is the strongest member in the union, should be able to do the same thing. It should not be necessary for it to refuse to honour its obligations under the Financial Agreement and there is no reason why that State should be placed in a privileged position. This Parliament has no right to interfere with the policy of any State which is within the ambit of its powers; but there is a limitation on the policy of all the States to act so as to enable them to fulfil their obligations. Before the Financial Agreement was entered into the States were limited by their sense of honour. {: .speaker-KIU} ##### Mr Hutchin: -- That limitation has gone. {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- It still " exists, but a State cannot claim benefits under the Financial Agreement, and, at the same time, repudiate its obligations under it. The representatives of New South Wales in this House have to look at this issue from the point of view of the other States as well as from their own point of view. {: .speaker-KV7} ##### Mr Stewart: -- The members of the Beasley group are not the only representatives of New South Wales in this House. {: .speaker-KFK} ##### Sir LITTLETON GROOM: -- Each honorable member expresses the voice of his constituency; but we are entitled to heed, not only that voice, but the voice of all the constituencies. Above all, we have our obligations as members of the National Parliament. If New South Wales refuses to make payments under the Financial Agreement, and the Commonwealth, as a result, has to raise money by taxation or other means to make up the deficiency, the burden must fall upon the federal taxpayers generally, including those in New South Wales. If that be- done the State taxpayers of New South Wales will not bear their just burden, and it will fall unfairly on the other five States. Honorable members should not suggest that conflict may arise between governments as a result of this legislation. We have to appeal to the honour of the nation and the honour of the States. This federation was formed with high aspirations. We have built up a great Australian nation. During the last 30 years we have made marvellous progress in the development and peopling of this country. We have developed r.ural and secondary industries, and Australia has its place in the counsels of the nations of the world. Our representatives at world 'conferences have been able to uphold the honour of Australia and the Empire. Surely we can appeal to the sense of honour and patriotism of the States and of their representatives in this House to fulfil their obligations and so bring peace, prosperity and happiness to the people of Australia. {: #subdebate-24-5-s14 .speaker-KX7} ##### Mr WARD:
East Sydney .- The honorable member for Hindmarsh **(Mr. Makin)** has misrepresented the attitude of the members of the party to which I belong. If he believes that this legislation is neces- sary, he should support the Government; but if he is opposed to it, let him oppose it wholeheartedly, without qualifications. The honorable member, who talks so glibly about honesty, has said that we have many things to answer for, but I ask him is it not true that his own party met in caucus on the morning of the late Government's defeat and decided that it was a favorable opportunity to go to the country. {: .speaker-KLL} ##### Mr Makin: -- That is not correct. {: .speaker-KX7} ##### Mr WARD: -- The honorable member for Hindmarsh has stated that the workers of New South Wales are taxed to the limit, while the commercial and mortgagee interests are taxed lightly. If he wishes the burden of taxation to fall more upon the commercial and mortgagee interests he should support **Mr. Lang.** It is not **Mr. Lang,** but the supporters of the honorable member's party in the upper chamber of New South Wales who are preventing a more equitable distribution of the burden of taxation. The honorable member's constituents will want to know what his party is doing in New South Wales in the direction of restoring protection to the rural workers, a protection which is being denied those workers by the honorable member's friends in the upper chamber of New South Wales. Those who support this resolution assert that **Mr. Lang** is guilty, and, therefore, should be executed; but the honorable member for Hindmarsh and his colleagues consider that that execution should be carried out scientifically and not brutally, as is now proposed. I oppose the resolution. The supporters of the Government say, "We are not brushing aside the judiciary". They are prepared to hold an inquest after the murder has been committed. This resolution has a double purpose. The Government intends not only to seize the revenues of New South Wales, but also to avoid the necessity for obtaining a decision of the High Court before giving effect to its legislation. Many honorable members realize that this legislation is unconstitutional, and that the finding of the High Court will be against it, but in the meantime this Government intends to seize the revenues of the State and to bring about chaos by making it impossible for the State Government to carry on. We intend to do all within our power to defeat the object of the Government. It is all very well to talk about preserving the honour of Australia. I often wonder from what angle some honorable members view this question of honour. Is it honorable for honorable members, who are well paid and sheltered from the storms of adversity, to acquiesce in a policy which will crush thousands of Australian men, women, and children? If such action is honorable then I do not wish to be associated with those honorable members who are parties to it. I claim to be as much a patriot as any honorable member in this House, but I do not profess to be a flag-waver, who, in order to prove his loyalty to the British Empire, tries to create the impression overseas that he is actually more British than the Britishers themselves. I have no time for the kind of patriotism preached in this House by honorable members opposite. The real Australian patriot is the man who desires to see the conditions ofthe people of this country so improved that he can justly be proud of his citizenship. Honorable members opposite who talk about honour should remember the attack that was made recently upon the defenceless women and children of Australia, and particularly upon the dependants of those who died on active service, and- the many men who returned from the war broken in body and crushed in spirit. These people, and many mothers who sent their sons away to fight and to make the supreme sacrifice, are now finding it difficult to keep body and soul together, because of the actions of some honorable members of the last Parliament. The honorable member for West Sydney **(Mr. Beasley)** has instanced the case of a war widow who received the miserable pittance of1s. a week as a pension, which was said to be adequate because it assured her of a total income of £3 a fortnight! Is that an adequate sum for the maintenance of the life of any person ? I should like some honorable members opposite to attempt to live on £3 a fortnight for a while, and then say whether it is adequate or not. It was said this afternoon that the action of the Premier of New South Wales in withdrawing State moneys from private banks was dishonest. Evidently those honorable members think that **Mr.** Lang should have waited until after the burglars had come and gone before be attempted to get the money. I think that he is to be commended for his foresight in protecting money which is needed to provide the necessaries of life for the people of New South Wales. Honorable members opposite, who are favorable to the attachment of State revenues by this Government in order to ensure the payment of the interest obligations of that State, seem to think that no hardship will be inflicted on the people if £1,000,000 is applied for this purpose. One would imagine from the remarks of these honorable gentlemen that the State Premier wants the State revenues for his own purposes. Why are they not honest and straightforward, admitting that it is honest for a government to honour its obligations to the people who returned it to office? No one can point to a single dishonest action of the Premier of New South Wales. The honorable member for Parramatta **(Mr. Stewart)** may laugh, but I have a clear recollection that a member of the party to which he belongs, who had made certain charges against **Mr. Lang,** was so humiliated that he had, within a few days, to make his apologies to the Premier on the floor of the State Parliament. The leader of the Country party. **(Dr. Earle Page)** says that there should be no discrimination in taxation between the various States. I agree with the right honorable gentleman in that regard; but has there not been discrimination in taxation ever since the consummation of federation? Is it not a fact that on the average the people of New South Wales pay 14s. 4d. per head more into the Commonwealth Treasury than the State receives from the Commonwealth? Is it not also a fact that the people of some of the other States pay less to the Commonwealth per head than they receive from it, and that thus their States are made able to meet their obligations ? Who provides the moneys to enable these States to meet their obligations? Is it not the taxpayers of New South 'Wales? We know that many special grants have been made to several States in recent years. Western Australia, for instance, has received £3,935,905 from the Commonwealthy Tasmania has received £2,465,656, and since 1925 South Australia has received £1,530,000.' The money to provide those special grants has come out of the pockets of the taxpayers of New South Wales. It has been said that the money on which interest is now being paid by the New South Wales Government was borrowed for public works, such as our harbour bridge and water schemes, and the extension of our railway and tramway systems. That is true. It has also been said that New South Wales is not carrying any war debt. It cannot be said that that statement is actually true, for wo know very well that during the war years large sums were paid out of State revenue for the provision of war services. It is now said that the people who provided the money for the construction of the works to which I have referred should be paid their interest. But although the investor had everything to gain by the protection of the undertakings in which his money was put, was it suggested during the war years that the revenue from those undertakings should be applied for war purposes? Of course not! That would have been counted dishonest. But is it not extraordinary that the people who had to go to the war and fight for the protection of those public works, should now be asked to sacrifice themselves again to provide the money to pay for them ? This is surely an astounding proposition ! Do honorable members opposite who believed that the last war was a war to end war realize that the war cost Australia approximately £744,000,000, or more per head of the population than was paid by the people of any other country in the world? Will these same gentlemen tell us whether Canada assisted Great Britain during the war to the same extent as Australia? Were the Canadian people so foolish as to sacrifice the interests of posterity, in order that the war might be prosecuted with vigour? We know very well that they were more far-sighted than to adopt such a policy. In Australia our leaders had not sufficient vision to realize that the war was being fought, not to. end war, but to secure control of world markets, and that it was a losing proposition for the workers of every country, irrespective of which group of nations might win the victory. Was it not said that German reparation payments would recoup us for what we paid for war purposes? {: .speaker-KVU} ##### Mr Thompson: -- I rise to a point of order. I submit that the honorable member's observations have nothing whatever to do with the motion before the Chair. {: .speaker-10000} ##### Mr SPEAKER: -- I have been following the speech of the honorable member for East Sydney **(Mr. Ward)** very closely, and his observations are relevant to the subject of interest payments. {: .speaker-KX7} ##### Mr WARD: -- I am sorry if my -speech is hurting some honorable members, but they will have their opportunity of placing their views on the subject before the House, The right honorable member for Flinders **(Mr. Bruce),** who in the delivery of his speeches in this chamber always preserves an attitude of contempt for honorable members, and whose bearing suggests that he is bored, by having to speak at all, had something to say about the relative position of a private bankrupt, and a State bankrupt. He said that a private bankrupt is stripped of all his possessions. *No* doubt the right honorable gentleman would like to strip' New South Wales of every penny of its wealth, in order to meet the demands of overseas bondholders. He indicated that he would even be prepared to seize the State railway and tramway services, and hand them over to private enterprise, so that the State might, as he said, preserve its honour. He also observed that a continuance of the present policy of the State Government would undoubtedly bring disaster to New South Wales. The fact is that if the Lang Government had been able to carry out its policy, and had not been hampered by the Legislative Council, and by the supporters of the party to which the honorable member for Hindmarsh belongs, the condition of the people of New South Wales would be very much better than it is to-day. The State Government has not been able to do all that it would like to have done, but its policy is far preferable to that enunciated by the right honorable member for Flinders, who has suggested that we must starve ourselves before We can again walk along the road to pros perity, and enter upon the new era for which we are all looking. I do not describe the present circumstances of Australia or of other countries as depression ; it is due to the decline of a social order, which has outlived its usefulness and cannot now provide for the needs of the people. Those who are attempting to maintain this order are like the boy who tried to stop the leak in the dyke. The present social order has served its purpose and must go. It has been said that the people of New South Wales are suffering the pangs of starvation, but even if that is true to some extent the State Premier is not responsible for it. I ask the honorable member for Angas **(Mr. Gabb),** and the honorable member for Parramatta **(Mr. Stewart)** whether they would care to live on the rations provided for the unemployed in New South Wales or iu any other State. I speak as one who knows what unemployment is, and who has_ suffered hunger. Although my position has been improved by the votes of many thousands of people in East Sydney, I am not unmindful of their needs, and I hope that I shall not forget that while I am in this Parliament it is my duty to do everything I can to relieve their unfortunate condition. I trust that if ever the time comes when my position here is taken by some one else, I shall at least be able to face the people who sent me here with the knowledge that I did my best to improve their conditions. The right honorable member for Cowper said that if the New South Wales Government could not provide for the unemployed the Commonwealth Government would have to do so. This Government cannot, or will not, provide for the 30 or 40 unemployed persons in the Federal Capital Territory. {: .speaker-10000} ##### Mr SPEAKER: -- Order ! The honorable member must not pursue that line of discussion. {: .speaker-KVU} ##### Mr Thompson: -- It. is about time he was called to order. {: .speaker-10000} ##### Mr SPEAKER: -- That is a reflection upon the Chair, which the honorable member for New England **(Mr. Thompson)** must withdraw. {: .speaker-KVU} ##### Mr Thompson: -- What must I withdraw ? My comment was quite fair. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member must withdraw his statement, and apologize to the Chair for having made it. {: .speaker-KVU} ##### Mr Thompson: -- At your request, **Mr. Speaker,** I both withdraw and apologize. Mr.WARD. - The right honorable memberfor Flinders quoted figures by which he sought to show that the purchasing power of wages was less in New South Wales than in the other States, but he referred to only some of the figures. I ask honorable members whether they believe that the invalid and old-age pensioners are better off to-day than they were before their pensions were reduced by half-a-crown a week? I saw aged pensioners, men and women, break down and burst into tears on discovering for the first time that their pensions had been reduced. How long would the right honorable member for Flinders exist on an income of 17s. 6d. per week? I find that far from being in receipt of a salary- {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member must confine his remarks to the matter under consideration. {: .speaker-KX7} ##### Mr WARD: -- If New South Wales is expected to pay the interest due to overseas bondholders, and if there is tobe equality of sacrifice, can it be regarded as fair to reduce the old-age pension from £1 to 17s. 6d. per week, and provide the right honorable member for Flinders with a position on the other side of the world at £5,000, to enable him to attend to his own business? Does that help to bring about equality of sacrifice? {: .speaker-KVU} ##### Mr Thompson: -- I submit that the honorable member is not dealing with the resolution before the House. {: .speaker-10000} ##### Mr SPEAKER: -- I have already called upon the honorable member for East Sydney to connect his remarks with the subject under consideration. ' He has already been allowed a good deal of latitude, and I now ask him to confine himself strictly to the question before the Chair. {: .speaker-KX7} ##### Mr WARD: -- The right honorable member for Flinders, when asked why so many classes of revenue were mentioned in the resolution, said that this would entail no undue hardship on New South Wales, although he admitted that if New South Wales did not pay another penny to the 30th June next, the interest obli gations of the State would then amount to about £6,000,000. The right honorable gentleman added that if the whole of the revenues mentioned in the resolution were attached, the Commonwealth would only take slightly less than £6,000,000. If the Commonwealth were permitted to take all the revenue usually received by the New South Wales Government from race-courses, income taxation, motor vehicle licences and taxation for unemployment relief, no undue hardship would be inflicted, he said, because this money was paid into the Consolidated Revenue. I point out, however, that if the Commonwealth Government took what was needed to meet the interest dueto bondholders overseas, there would not be sufficient left for the ordinary requirements of New South Wales. The right honorable member for Flinders has not an Australian outlook. When **Major Jones,** at the head of the Commonwealth Police Force of sixteen members, marches into New South Wales, he will not find it easy to appropriate the revenues of that State. The honorable member for Barton **(Mr. Lane),** and the honorable member for Parramatta **(Mr. Stewart),** atthe head of their New Guard squads, would find the task equally difficult. The honorable member for Barton, I imagine, would be mounted on a horse, and the honorable member for Parramatta would be seated on a bus. {: .speaker-KZF} ##### Mr Lane: -- The honorable member for East Sydney would be in the rear. {: .speaker-KX7} ##### Mr WARD: -- No. I would be in the forefront, fighting in the interests of the people of New South Wales. I urge honorable members opposite to realize the seriousness of the decision they are about to give. An attempt is to be made to seize revenues that are required to feed the people of New South Wales. The fact that the unemployed are more numerous in that State than in other parts of the Commonwealth is due to the number of those who have flocked into New South Wales from all parts of Australia in order to share the benefits of the legislation passed at the instance of the Lang Government. Would honorable members opposite suggest that the workers were born into the world merely to provide the good things of life for such persons as members of Parliament? I represent a constituency in New South Wales in which a large number of people are in receipt of food relief, and I intend to protect them. They are represented in this chamber by members of the Labour party who do not make mock attacks on the Government, and then fail to carry out their undertakings. The honorable member for New England **(Mr. Thompson),** when travelling in the train between Sydney and Canberra, asked the members of the Lang group to support the Country party against the Government in regard to the tobacco duties. My party agreed to do so; yet, when the vote on the matter took place, that honorable member repudiated his undertaking and crossed over to the Government side. I view the proposed action of the Government with alarm, because it will have far-reaching consequences. I see no necessity for the hasty steps contemplated. As a matter of fact, last month **Mr. Lang** paid the interest due by the New South Wales Government, because he was able to do so. Why does not the party opposite tell us what it means when it talks about " living honestly " ? Does it want the basic wage in New South 'Wales brought down to the South Australian level? Does it desire the widows' pensions to be taken away? Is it suggested that workmen's compensation, and food relief for the unemployed should cease? Members opposite should not hide their true opinions by using vague expressions such as "protecting the honour of the Australian people." Actions are of more value than words. I have heard some honorable members opposite speak of the need for a restoration of confidence, and others have said, " Get down to world conditions." It should be realized that every country has its unemployment problem. Owing to the introduction of machinery, the human element is being largely displaced in industry, and wealth is now being produced like water. What the world needs now is markets. In the United States of America, there is no shortage of finance, but that country has enormous numbers of unemployed. The only country in which unemployment has decreased in recent years is the Soviet Republic of Russia. I have never been a member of the Communist party; but on reference to volumes to be found in the Parliamentary Library, honorable members will see that my statement is correct. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member's time has expired. {: #subdebate-24-5-s15 .speaker-KNX} ##### Mr E J HARRISON:
WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944 -- I do not desire to touch upon the legal technicalities of the Financial Agreements Enforcement Act at this juncture; they have been discussed time and time again. The majority of honorable members in this chamber have decided that they will support this motion. The only thing that worries some is the method of procedure that should be adopted in attaching the revenues of New South Wales. That being so, the motion should have the approval of practically every section in the House. I rise to correct the misrepresentation that is frequently made by members of the Beasley group that they represent the majority of the people in New South Wales. Actually honorable members who sit on this side of the chamber represent SO per cent, of the electors of that State. The honorable member for Hindmarsh **(Mr. Makin)** and honorable members opposite have expressed the fear that there will be a reaction against this proposal in the Mother State. I assure them that the 80 per cent, of the people of New South Wales who are represented by honorable members on this side will welcome the attachment of the revenues of that State by the Commonwealth. There will be no need for armed forces to penetrate New South Wale3 to give effect to the legislation of this Parliament. The Domain oratory that is indulged in so frequently by members of the Lang faction cannot be and is not taken seriously, even by members of the official Opposition. The members of the corner group use the phrase " the starving women and children of New South Wales " over and over again, like the repetition of a gramophone record. I invite honorable members to analyse the legislation that has been introduced by the Lang Government, and then determine who 4is injuring the "starving women and children of New South Wales ". That legislation is aimed at the industry of the State, with tb« result that unemployment and its associated hardships have increased. The Transport Act threw 4,0.00 persons out of employment, and that is not taking into consideration the harm that was done to trades that are associated with the transport industry. The means of transport conveying people who live in outlying suburban districts to their jobs was wiped out, and during the winter workers will be subjected to misery and hardship because of this action of the Lang Government. That Administration introduced an arbitration, bill that was designed to control industry and place it under the control of union secretaries and organizers. As a result it is likely that the commercial interests of New South "Wales will be so seriously handicapped that they will be compelled to invest their money elsewhere: The Lang Government also sponsored an insurance bill which would cause bonds to the value of £3,000,000 to be placed on the market to find cash for the making of compulsory deposits demanded by that Government, so' further lowering our stocks in the eyes of the world. lt appointed a milk board, and the people had then to pay more for milk than was previously the case. The Lang Government introduced a transport coordination scheme and appointed numerous supporters to control it at salaries ranging from £750 to £1,500. Every measure introduced by it has been designed to cripple the industries of the State and to inflict hardships on the people that it professes to represent. One has only to mention the appointment of dole inspectors, the Shadier bread contract, and tin hares to remind honorable members that the whole history of Lang administration is unsavoury, and directly opposed to the interests of the people of New South "Wales. The honorable member for Hindmarsh stated that **Mr. Lang** had declared that *he people of his State were taxed to the limit, and that the only sections that had not been taxed to capacity were tlie commercial and mortgagee sections. **Mr. Lang** owns about £13,000 in debentures in the *Labour Daily b* so he may be included in the mortgagee class. That is possibly why he has not pursued that section with greater vendictiveness. **Mr. Lang** pro- posed to increase the unemployment tax from ls. to 5s. in the £1, and thus to inflict further burdens on the workers of New South "Wales. The people that I represent are New South Welshmen, who love their State, but who first of all are Australians, and have a sense of national honour. They believe that the Financial Agreements Enforcement Act is a national measure, designed to preserve the honour and integrity of Australia. Some honorable members have questioned the need for hurry in this matter. When the body politic is suffering from a cancerous growth it is necessary to apply with all speed the keenest lancet of political endeavour that is available to remove that growth so that the tissues may heal, and the Mother State of the Commonwealth regain a healthy body. That is why there is need for haste. It is necessary for the protection of the two-fifths of the people of the Commonwealth who live in New South Wales, and for the protection of our national honour. The talk of honorable members in the corner about starving women and children is so much political clap-trap, designed only to appeal to the people in the constituencies that they represent. {: #subdebate-24-5-s16 .speaker-L08} ##### Mr ROSEVEAR:
Dalley .- One of the most noticeable features of the speeches that have been made by honorable members opposite during this debate has been the endeavour on the part of both leaders and rank and file to convince the. House that this motion is not a political move. When honorable members remember how frequently that protest has been reiterated they will regard the utterances of honorable members opposite as suspect. We know that this is a move to complete by legislation the action begun by the leaders of the National party at the meetings of the Premiers Conference and Loan Council. There assembled at those conferences representatives of the Governments of Australia, each viewing these matters from a different angle. The representatives of the States which had endeavoured to carry out the Premiers plan in its entirety, by imposing upon their people tremendous burdens, had to admit that the sacrifices made by their people were in vam ; that they could not balance their budgets. The Premier of New South Wales did not adhere to the terms of the Premiers agreement, but the position of New South Wales was no worse than that of other States which had endeavoured to do so. The Premier of South Australia declared that "budgets must be balanced, even if the people of my State have to make further sacrifices ", while the Leader of the Government of Victoria said, " The workers of Australia will have to take their belts in a few more notches ", and the Premier of Queensland, whose State was in an infinitely worse position than New South Wales, as he himself admitted- {: .speaker-K6Q} ##### Mr Bernard Corser: -- That is not so. {: .speaker-L08} ##### Mr ROSEVEAR: -- In any case the Commonwealth Assistant Treasurer **(Mr. Bruce)** told that gentleman that the position of Queensland was hopeless, and worse than that of the other States. In some respects the position of New South Wales is the same as that of the rest of the States ; in others it is not. Borrowing by that State, the richest in the Commonwealth, has been prevented because of the determinations of the Loan Council, which is comprised of representatives of States many of which have been for some time in a state of bankruptcy, and dependent upon the charity of the Commonwealth. In addition, moneys due to New South Wales from federal sources have been confiscated by the Commonwealth Government, with the result that the Lang Government has been entirely dependent upon "its own taxation resources to carry on its social services. The Commonwealth Government now proposes to attach even those revenues. It knows that by doing so it will embarrass the Lang Administration in carrying out the ordinary functions of government. That, of course, is just what this Government desires. Like all previous Tory administrations it acts first and argues about the legality of the matter afterwards. Had the Scullin Government acted on behalf of its people with the same vigour and the same disregard for legal formalities which characterize the actions of this Government in the interests of its supporters, in all probability it would be in -office to-day. The honorable member for Darling Downs **(Sir Littleton Groom)** tried to justify the seizure by this Government of the revenues of New South Wales. He said that it did not matter if the ordinary legal process was not complied with in this instance, as the departure from orthodox action was justified by expediency. The seizure o£ the revenues of New South Wales is claimed to be justified whether the High Court declares that action to be legal or otherwise. In the meantime what is to happen in New South Wales? It is claimed that the lack of confidence that is allegedly felt in the Government of New South Wales is reflected throughout Australia. Nothing is more calculated to destroy the confidence of investors in Australian securities than the action this Government is taking in regard to New South Wales. The Prime Minister has paraded his allegedly fair treatment of that State. To-day he stated that he went so far as to make a final appeal to the Lang Government during the week-end to do the right thing as he saw it. Let me examine the wonderful opportunity that was afforded to the Premier of New South Wales to make a deathbed repentance. On Friday, the Enforcement Bill was passed, and on Saturday it received the assent of the GovernorGeneral. Apparently there wa3 little doing on Sunday, but on Monday the Government set the law in motion. On Tuesday, it secured a certificate from the Auditor-General, and to-day it submits this resolution for putting the bailiff into the Treasury of New South Wales. Yet the Prime Minister **(Mr. Lyons)** parades as a virtue the last effort of the Commonwealth Government to awaken the State Government to a sense of its responsibility to the bondholders. We are told that this measure is urgent, and that New South Wales has defaulted to the extent of £924,000. The Prime Minister did not disclose, nor will the Nationalist press do so, that £242,000 of that amount is due to the adverse exchange rate, which is manipulated by the financial interests supporting the Commonwealth Government. The resolution proposes the seizure of several specified forms of revenue, and to justify the extent of the raid, the Assistant Treasurer built up a supposititious case which depends wholly on the word " if ". He said that if New South Wales should continue to repudiate its overseas liabilities, if in future it repudiates the interest owing to the Australian bondholders, and if such repudiation continues for a further six months, a stated amount will be owing. The right honorable gentleman admitted immediately afterwards that the amount at present due by the State to the Commonwealth could be - recovered by attaching the income tax revenue for the next eight weeks. But by specifying revenues totalling much more than the present 'liability of the State, Cabinet will have power to issue, while Parliament is adjourned, a proclamation which can be manipulated as the Government thinks fit to embarrass the Government of New South Wales. Supporters of this proposal have alleged that New South Wales is creating a new standard of political morality by failing to meet its commitments. Possibly that Stale would be in a better position than, any other to discharge its liabilities if its Government were prepared to accept the policy dictated by the Commonwealth Government. **Mr. Lang** is not prepared to do that. His Government could, for instance, save a considerable amount of money by closing non-paying railways. Would the Country party approve of that? If overseas commitments are to be met regardless of the sacrifice entailed on the people of New South Wales, the Government would possibly be justified in conserving the finances of the State by discontinuing railway services which are a burden on the Treasury. Another £2,000,000 could be saved if the State Government were to enforce the payment of the amounts due to it during the last twelve months by the farmers - debts which the Lang Government has waived in order that these primary producers may be relieved of a portion of their burden. Would Ihe Country party approve of that? Again, if the Commonwealth Government were to expend in New South Wales the revenue it collects there, the State Government would be in a better position to meet its commitments. According to Commonwealth Treasury returns, the federal revenue received from New South Wales last year was £25,147,000, and Commonwealth expenditure in that State £23,372,000. New South Wales, during the twelve months, paid into the Federal Treasury £1,750,000 more than was returned to it. In other words, lis. per head of the taxation raised in New South Wales, and 103. per head of that raised in Victoria, was spent in other States. On the other hand, the Commonwealth expended in other States the following amounts *per capita* more than it collected in those States: - Queensland, 9s.; South Australia, los. 9d. ; Western Australia, 45s, 4d. ; and Tasmania, 76s. 3d. Yet the representatives of these States have the effrontery to charge New South Wales with having refused to meet its commitments. But for the federal revenues collected in New South Wales and Victoria being expended in other parts of the Commonwealth, the finances of the other States would be in an infinitely worse position than they are to-day. The Prime Minister, the AssistantTreasurer, and the Leader of the Country party are most solicitous for the welfare of the oversea bondholders who, we are assured, are not Shylocks. Indeed, the Assistant. Treasurer declared that the foreign lender has been a benefactor to New South Wales, inasmuch as the great public works of that State are assets which were created by loan expenditure. The right honorable gentleman neglected to mention that the bondholders have been repaid over and over again, in interest, the money they lent. Whilst the Commonwealth Government is so concerned about compelling New South Wales to pay its debts to the bondholders, Ministers have not shown similar enthusiasm in attempting to recover from the Kylsant Shipping Company the money contracted to be paid for the purchase of the Commonwealth Shipping Line. If the Government is justified in putting the bailiff into the New South Wales Treasury to recover £900,000, it should adopt the same procedure to recover moneys amounting to £1,320,000 in respect of which default has been committed by Lord Kylsant, to whom the Bruce-Page Government sold the Commonwealth Line of steamers at a sacrifice. The money with which those steamers were purchased by the Common- wealth, was borrowed, and surely the purchaser of those ships from the Common wealth will not force the lenders to forgo their money. If the Commonwealth Government will collect in behalf of the people the money owing for the ships, it will at least give some evidence that it is sincere and consistent in insisting that obligations should be honoured. The Assistant Treasurer told the House that the credit of New South Wales has disappeared. That is a remarkable statement, having regard to the fact that private capitalists were prepared to finance the building of the eastern suburbs railway at a cost of £8,000,000, and to accept New South Wales Government bonds in payment. If the Loan Council and the Premiers Conference had been sincerely desirous of relieving unemployment, they would not have refused to co-operate with the Government of New South Wales in arranging to finance that project. The expenditure of £8,000,000 in New South Wales would have provided work for many hundreds of the unemployed. {: .speaker-KXT} ##### Mr Paterson: -- Was not that sum unreasonably large? {: .speaker-L08} ##### Mr ROSEVEAR: -- Not when compared with the expenditure on other public works. {: .speaker-KV7} ##### Mr Stewart: -- That alleged offer was mere pre-election bluff. {: .speaker-L08} ##### Mr ROSEVEAR: -- It was not. The negotiations had proceeded so far that the Government was able to name the contractors, who in turn publicly stated that they would find the £8,000,000 required and accept New South Wales Government bonds. {: .speaker-KV7} ##### Mr Stewart: -- New South Wales bonds endorsed by the Commonwealth. {: .speaker-L08} ##### Mr ROSEVEAR: -- The contractors were prepared to accept New South Wales bonds without any guarantee by the Commonwealth, but the Loan Council would not allow the State Government to accept the offer. {: .speaker-K6Q} ##### Mr Bernard Corser: -- Would Lang have paid interest on it? {: .speaker-L08} ##### Mr ROSEVEAR: -- The honorable member might put that question to **Mr. Lang.** One remarkable feature of this resolution is the misleading wording of item v. : " revenue from taxation upon incomes, but not including revenue from taxation imposed by the Unemployment Relief Tax Act 1931". The Assistant Treasurer stated that because of the specific exclusion of the proceeds of that act, the money raised for unemployment relief will not be claimed by the Commonwealth. The right honorable gentleman knows as well as I know that the special unemployment relief tax does not .nearly cover the payments made by the 'State Government for the relief of the unemployed. Moreover, all classes of revenue are paid into a common fund, and it is impossible to discriminate between one kind of income tax and another. The talk of separating one form of revenue from other forms is sheer hypocrisy, and the endeavour to make the people believe that the workless are sustained only by the revenue from the unemployment relief tax is a mere subterfuge. Every source of revenue is being tapped to provide work and sustenance for the unemployed ; therefore this House may as well delete the qualifying words in item v. and frankly tell the people what the Government is really doing. The Assistant Treasurer stated that the high basic wage in New South Wales is responsible for the distressful conditions in that State. If high wages are responsible for conditions in New South Wales, what is responsible for unemployment in South Australia? If low wages are the solution of the unemployment problem, let us got down to the coolie standard at once. Perhaps the right honorable member would be satisfied then. If this argument is sound, the coolie standard is the only remedy for unemployment. According to him, the lower wage3 are, the better it is for the country. Therefore, India, China, Japan, and other eastern countries, where the people work as long as the sun shines, for the lowest possible wages, should be the working' man's paradise, but even those countries have their unemployment problem. The fact is that the reduction * of wages will not solve the unemployment problem, and members of the Country party should be the last persons to advocate wage reduction. Owing to falling world prices for primary products, many farmers are suffering hardship today. The only hope for them is to develop a strong, local market, and that cannot be done by reducing wages. *Members* of the Country party should, in this at any rate, agree with us, because thehigher the purchasingpower of the people, the better it will beit the farmers. I thank the honorable member for Hindmarsh **(Mr. Makin)** for the lecturer which he gave to members of the group to which I belong.We are not particularly concerned with what he thinks of us, nor with what the supporters of the Governmentthink of us. We have certain definiteopinions on the subject of honouringobligations, andwe are preparedto act up to them. We believe that if people cannot pay, they should be given time inwhich to meet their obligations. The Federal Government availed itself' of the relief afforded by the Hoover moratorium, and the same sort of treatment should he accorded the Government of New South Wales. That Government is not defaulting because it wishes to do so. The alternative before the Government of New South Wales is to meet its obligations to the overseas bondholders, or to do its duty by the people it represents. It is one of the proudest claims of our party that the Government of New South Wales had no hesitation in saying that the people of Australia should come first. The honorable member for Hindmarsh blamed us for the position he is in to-day; but the honorable member cannot honestly blame any one but himself. If he were in his proper place, he would be among the Government supporters. He abandoned any Labour principles he ever had when he supported legislation which attacked the wage standard of the workers, and the pensions of those who were least able to help themselves. {: .speaker-KMZ} ##### Mr Martens: -- He both spoke and voted against the economyplan. {: .speaker-L08} ##### Mr ROSEVEAR: -- Certain members of the Labourparty, although they voted against the Scullin economy measures, first took good care to see that those measures would be passed. The honorablemember for Cook **(Mr. Riley)** was one of those. He whipped up his own partyto vote for the measure, but " squibbed " the issue himself, and voted against it. It is certain that if the Labour party could not solve the unemployment problem, the reactionary Nationalist forces will not be able to do so. We are not offering any apologies for our attitude in regard to these proposals. The factthat our group is in this Parliament to-day, even though we are small in numbers, shows that the people we represent support the action of the Governmentof New South Wales, and we represent some of the biggest industrial districts, in which the blows of the Scullin economy measures were felt the hardest. The Unemployment problem was really responsible for the downfall of the Scullin Government, and it will bring about the downfall of this Government also. Those who organized the campaign of the party now in office were keen psychologists'; they recognized that the unemployed were becoming depressed, and were ready to turn to any party which would promise them relief. Numerous promises were made to the unemployed - promises which there was never any hope or intention of carrying out. Perhaps the Government thinks it is doing something clever in attempting to embarrass the Government of New South Wales by means of the debt enforcement legislation. No doubt, it is a shrewd political move, but it will inflict great hardship on the workers of New South Wales, and they are not likely to forget it. Honorable members who represent New South Wales constituencies will be held responsible for their support of the action that is being taken to-night. {: .speaker-KV7} ##### Mr Stewart: -- The Premier of New South Wales would not accept my challenge to resign, and contest his seat against me. {: .speaker-L08} ##### Mr ROSEVEAR: -- All sorts of challenges are freely issued during election time. Donations are promised to hospitals, but the hospitals never receive them. Challenges to political contest are flung out but never eventuate. If the Premier of New South Wales were to bother his head about all the challenges issued to him by political cranks who want to contest his seat against him, his whole time would be given up to fighting elections. As I said before, the Government is notconcerned whether this legislation is constitutional or not. We realize that if we had the wisdom of Solomon and the eloquence of Demosthenes we could not deflect the Government from its purpose. No doubt the Government believes that it is obtaining a political advantage, but we realize that, unwittingly perhaps, it is doing itself serious inquiry in the eyes of the electors. Whether this legislation is found to be constitutional or not, the attempt to enforce it will inflict great suffering on the people of New South Wales. So far the Government's proposals have been carried out according to programme, but the next step, and the most important, is to seize the revenue of New South Wales. Judging from the statements of the Premier of New South Wales, who said that he intended to fight this legislation by any and every means in his power, I can promise the Government that it still has a tough job before it. {: #subdebate-24-5-s17 .speaker-KLM} ##### Dr MALONEY:
Melbourne -- It is not necessary for me to speak at length on this motion, because my vote will speak for me, and I intend to vote with the honorable member for West Sydney **(Mr. Beasley)** and his supporters. The other day, in answer to a question, the Prime Minister **(Mr. Lyons)** informed me that of the sum of £968,763 owing by the Government of New South Wales to the Commonwealth, no less than £242,305 represented exchange. The exchange rate on remittances to the United States of America is 79 per cent. The total indebtedness of the Commonwealth to bondholders in the United States of America is £31,067,149, and of this New South Wales owes approximately £14,000,000. At the present time, Germany has declared that she cannot, and will not, meet her obligations under the Peace Treaty. Other European nations which owe war debts are talking of repudiating them. That being so, is it fair that Australia, which is willing to pay its way, should have to send to the United States of America, in addition to every £100 she owes, an extra £79 by way of exchange? New South Wales contains two-fifths of the population of Australia, and, therefore, has to bear the largest proportion of this abnormal exchange burden. If I were a citizen of New South Wales, I should be as strongly opposed to this debtenforcement legislation as I have all my life been opposed to the law which permits a landlord to seize the goods of an unfortunate tenant who cannot pay his rent. Forty-two and a half years ago I introduced a bill designed to prevent that being done. I have fought against that all my life, and I shall continue to fight against it. Why should a civilized country be forced to pay £79 for the privilege of reducing its debt by £100? Let me make a fair suggestion. Loans from another nation have unfortunately to be repaid in the currency of that nation. If we could repay a loan with Australian products our path would be much easier than it is at present. We produce wheat, wool, meat and butter, and we mine silver, zinc, iron and lead. We should offer these in payment of our overseas debts. I hope that honorable members will consider that suggestion, because it is above party consideration. When we repay loans overseas the money should be placed to the credit of the lender at the Commonwealth Bank of Australia, which is the safest financial institution in the British Empire, not even excepting the Bank of England. We should allow bondholders interest at the rate of 4 per cent., and inform their agents that the account may be drawn upon at any time. But in addition the Government should suggest that in payment of the loan the bondholders should take Australian pro- ducts which can be disposed of to advantage in their country. In that way the bondholders, the Commonwealth, and the shipping industry would benefit. I am proud to say that New South Wales pays more to its hungry people than Victoria does. The following rates are paid in Victoria : Single man or woman,5s. a week;man and wife, 8s. 6d. ; man, wife, and one child, 10s. a week.; man, wife, and two children, l1s. 6d. a week; man, wife, and three children, 13s. a week; which is the sum that a single woman receives in England; man wife., and four children, 14s. 6d. ; man, wife, and five children, 16s. a week; man, wife, and six children, 17s. 6d. aweek; man, wife, andseven children, l9s. a week; man, wife, and eight children or more20s. 6d. a week. Those rates are terrible tocon template, yetthe question of honour hasbeen raised. I believe that ifChristwere now on earth He would say: "Feed the hungry before paying the huge exchange ". Following the advice of Napoleon, I have delved into history, but I can find nothing, not even in the United States of America, to compare with this Government's contemplated action of putting bailiffs into a sovereign State. I know that the young men of New South Wales will oppose that action strenuously, and if blood is shed, which God forbid, because all the money in the world is not worth the loss of one human life, then honorable members who support this resolution will regret their vote. I would gladly give my life if that, would destroy unemployment, which is the greatest curse of humanity. It is said that an Englishman fears poverty more than the thought .of hell. That is a splendid fear, and should stimulate the British race to wipe out unemployment altogether. If the Great War had continued for some years money would have been found to finance it. There is more misery in Australia to-day than there was during the years of that awful war. We are gifted with intelligence, and fashioned, we are told, in the likeness of God. Why cannot we, the highest type of life, remove this great curse of poverty which is the cause of unemployment? My conscience tells me that members of the Beasley group are right in putting the interests of those in want before the interests of bondholders overseas, and so long as I am a member of this House I shall vote to assist the unemployed. {: #subdebate-24-5-s18 .speaker-KYZ} ##### Mr RIORDAN:
Kennedy .- The legislation recently passed by this Parliament, and the resolution now before the House, are likely to cause a great deal of trouble, not only in New South Wales, but in the other States. It is .the turn of New South Wales to-day, but it may be the turn of some other State to-morrow. The Loan Council has assisted several States. When the Labour party was in power it provided £1,000,000 for the relief of unemployment, but the State's agreed in conference to pay the whole of that amount to South Australia to relieve the suffering and distress there. That State received assistance from the Loan Council because it was prepared to lower the standard of living. Yet it is doubtful whether the position of South Australia is any better than that of New South Wales. There is just as much poverty in South Australia, although the living conditions of the people have been reduced practically to a minimum. In Queensland men are working two days a week for a wage of £1. When I was in North Queensland, a man who was being given two days' relief work a week, told me that he had a wife and two children. As they were in bad health, he asked me to buy some milk and biscuits for them. That is the position prevailing in Queensland, although, the basic wage has been reduced to £3 5s. The people are prepared to work, but not under slave conditions merely to increase the profits of the capitalists. During the last twenty years we have increased the production of this country enormously ; yet 30 per cent, of our people are to-day on the unemployment market. On the hustings many promises were made by the Government, but what has it done to carry them into effect? It has introduced no legislation which has been of benefit to the nation. Yesterday we had a discussion on the Broadcasting Bill. {: .speaker-10000} ##### Mr SPEAKER: -- Order ! {: .speaker-KYZ} ##### Mr RIORDAN: -- We have had several measures before us, but the only bills passed have been directed at the Government of New South Wales. That class of legislation is not likely to create confidence. The members of the Government remind me of rushing cattle, almost panic stricken, milling and locking their horns together, but getting nowhere. The members of the Government have been doing that since the 19th December. What has the Ministry done to restore confidence in this country? This legislation may restore confidence among a certain section of the community in New South Wales, but what confidence can it restore among those people who are today on the dole in that State? I invite honorable members to try to live on the dole of 5s. a week which is paid to a single man, or to keep a wife and eight children on £1 a week. The people have a right to live, and it is the responsibility of the Government to enable them to live. No honorable member would claim that a dole of from 5s. to £1 a week is a living wage. The Assistant Treasurer **(Mr. Bruce)** to-day stated that the trouble in New South Wales has arisen as a result of the high basic wage operating there. The right honorable gentleman also said that if the basic wage of New South Wales were reduced, that State would be able to overcome its difficulties. But how is it that there are unemployment difficulties in other countries where wages are much lower than in New South Wales? A few years ago, we were carrying out an extensive immigration policy in this country, and we declared that we had large areas of land available for settlement. The trouble we are suffering from is not due to the action of the New South Wales Government, and the action which this Government is proposing to take against that State will not correct the situation. Very serious results mustfollow the application of this policy. If a New South Wales taxpayer pays his tax to the federal authority, he will doubtless be prosecuted by the State authority, and if he pays it to the State authority, he will just as surely be prose,cuted by the federal authority. How is this legislation to be enforced against bookmakers who are required to lodge deposits in respect of the amounts collected by them? How can the entertainment tax be collected from picture show proprietors and the like? If a man's State income tax assessment is unsatisfactory he must pay his tax before he can appeal. If he pays his tax to the federal authority, can it be expected that the State authority will listen to his appeal? The carrying of this motion must result in chaos in New South Wales, and cannot do anything to restore confidence either in that State or in the Commonwealth. The Commonwealth Government should test the validity of the Financial Agreements Enforcement Act in the High Court. The Premier of New South Wales has declared that he will defy the Federal Government to collect State taxation, and the Prime Minister **(Mr. Lyons)** has said that he intends to do,so. Will Lyons or Lang eat the leek? The Premier of New South Wales has issued instructions to the State police which will doubtless be obeyed. In that circumstance, it seems to me that the passing of this motion will be futile. If I am any judge of the Premier of New South Wales, he is not the man to let the Commonwealth Go vernment get its fingers on any of his money. He showed that by going to' the banks at 11.55 a.m. on Saturday, and withdrawing State deposits from them. I was in the Sydney Domain on Sunday, and listened to the speeches made there. It seemed to me that a good deal of sympathy was shown to the Premier of New South Wales. What will happen if there is default by the State for the remainder of this financial year, and the Commonwealth Government steps in and collects State revenue to meet it? Inevitably, many people in New South Wales will starve, for there will be no money to pay them the dole. I am sure that if the Prime Minister saw his wife and children starving, he would not hesitate to take bread from the shops to feed them. That will be the position of many people in New South Wales. If the Government is successful in attaching State revenues, will it use the money it obtains to relieve the unemployed in that State, and to provide sustenance for them? We know very well that various governments have made promises to the people at different times; but the electors are becoming thoroughly dissatisfied with political promises. They want action. **Mr. Moore,** who is now Premier of Queensland, made certain promises to the Queensland people in May, 1929. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member must connect bis remarks with the motion. {: .speaker-KYZ} ##### Mr RIORDAN: -- I propose to do so. The Queensland people at that time believed that the promises made to them would be fulfilled. In an election placard issued prior to the last State election, over **Mr. Moore's** signature, the following statements were made: - {: .page-start } page 1217 {:#debate-25} ### IT CAN BE DONE - IT WILL BE DONE If my party is successful at the polls we pledge ourselves to arrange for the expenditure of £2,000,000 to find early employment for 10,000 workers. {: #debate-25-s0 .speaker-10000} ##### Mr SPEAKER: -- I must again ask the honorable member to connect his remarks with the motion. {: #debate-25-s1 .speaker-KYZ} ##### Mr RIORDAN: -- I shall do so in this way: **Mr. Moore** failed to fulfil his promises, even though £5,000,000, provided for the previous Government, was made available to him by the Loan Council. The result was that the candidates of his party were badly defeated at the last federal election. Are the various State Governments to be absolutely tied to the Loan Council? If that is so, the Commonwealth Government would act wisely if it took a referendum of the people on the question, of the abolition of State Parliaments. {: #debate-25-s2 .speaker-F4O} ##### Mr LYONS:
Prime' Minister and Treasurer · Wilmot · UAP -- Very little criticism, apart from that expressed during the debate on the Financial Agreements Enforcement Bill, has been offered to the Government policy during the discussion of this motion. The honorable member for Kennedy **(Mr. .Riordan)** and some other honorable members have said that dreadful things will happen in New South Wales if the Government puts info effect the policy which it has outlined, but I assure those honorable members that the retribution which will follow continued default and repudiation by the New South Wales Government will be far worse than anything that can follow the attempts that this Government may make to attach State revenues for the purpose of meeting State liabilities. The complete failure of the New South Wales Government to carry out the undertakings which it solemnly gave to the Commonwealth and State Governments at the conference which agreed to the Premiers plan is the original reason for the adoption of the policy which this Government is now pursuing. Nothing that honorable members of the group which supports the Lang Government in this House have said, or can say, can explain away **Mr. Lang's** failure to reduce the expenditure of his Government in accordance with the Premiers plan. Anything that may happen in New South Wales in the. near future in consequence of the failure of the" Lang Government to honour its pledges in that respect will be the responsibility of that Government. The Commonwealth is merely taking steps to "recover moneys paid by it on behalf of New South Wales. Those moneys have been spent on developmental works in New .South Wales. Honorable members of the Lang group in this chamber care nothing about undertakings of the character to which I have referred and they are at least consistent in the course which they are following ; but the honorable member f or Kennedy was one of the great majority of honorable members of this Parliament who, by his vote, declared that the Commonwealth Government should accept liability for any payments due by a State under the Financial Agreement and not paid. Those honorable members who deliberately did that the other day now protest against the action taken by this Government to secure reimbursement of the amounts already paid by the Commonwealth on behalf of New South Wales. {: #debate-25-s3 .speaker-KMZ} ##### Mr MARTENS: -- Because we consider that the Government is adopting an illegal course. {: .speaker-F4O} ##### Mr LYONS: -- We are proceeding under measures that have been approved by both Houses of the Parliament. The question of the validity of our action will soon be determined if the New .South Wales Premier is prepared to assist in obtaining an early decision by the High Court. All the dreadful things that it is hinted will result from the action of the Government take us back to the failure of the New South Wales Government, in the first place, to honour its obligations to bondholders, and to carry out the solemn undertaking given by it to the other State Governments and to the Commonwealth Government. There has been an attempt to make political capital of the fact that the unemployment relief tax is included among the various classes of revenue mentioned in the resolution; but I have already pointed out that the amount now owing by New South Wales can be recovered from ordinary income tas. If the Government of New South Wales is prepared to meet its obligations in future, the £924,000 now required can thus be obtained in a couple of months, and no other class of revenue need be attached. If it should become necessary to attach any other class of revenue, the -responsibility for that wi!! rest on the shoulders of the New South Wales Government. That Government, if it chooses, can start out to-morrow to meet its obligations honestly. New South Wales is the wealthiest State in Australia, and if it meets -its commitments as they fall .due, it will be unnecessary for the Commonwealth Government to issue a further proclamation with respect to this matter. But if the Now South Wales Government refuses to stand up to its obligations, further action by the Commonwealth will have to be taken, and for that the Premier of New South Wales and his Government will be solely responsible. Question - That the motion be agreed to - put. The House divided. (Mr-. Speaker - Hon. G. H. Mackay). AYES: 46 NOES: 14 Majority . . . . 32 AYES NOES Question so resolved in the affirmative. Motion agreed to. {: .page-start } page 1219 {:#debate-26} ### HOUR OF MEETING Motion (by **Mr. Lyons)** agreed to - >That the House, at its rising, adjourn until 11 a.m. to-morrow. {: .page-start } page 1219 {:#debate-27} ### ADJOURNMENT {:#subdebate-27-0} #### Tobacco Duties - Postal Employees Salary- Proclamation Under Financial Agreements Enforcement Act - Primage Duty - Cotton Duties {: #subdebate-27-0-s0 .speaker-F4O} ##### Mr LYONS:
Prime Minister and Treasurer · Wilmot · UAP -- I move - >That the House do now adjourn. The first business to-morrow will be the resumption of the debate on the Australian Broadcasting Commission Bill; following which, in pursuance of an undertaking that I gave yesterday, steps will be taken to continue the debate on unemployment, on the basis adopted when the question was discussed last Friday. {: .speaker-KYZ} ##### Mr Riordan: -- Will the Broadcasting Bill be first disposed of? {: .speaker-F4O} ##### Mr LYONS: -- With the assistance of the honorable member, which I shall be very glad to receive, that is quite possible. {: .speaker-C7E} ##### Dr Earle Page: -- At what hour is it proposed that the House shall rise? {: .speaker-F4O} ##### Mr LYONS: -- It is the intention to adjourn at 4 o'clock. {: #subdebate-27-0-s1 .speaker-KVU} ##### Mr THOMPSON:
New England -- The honorable member for East Sydney **(Mr. Ward)** stated to-night that on the train journey to Canberra the other day 1 approached the honorable member for West Sydney **(Mr.** Beasley) with a request that he and his followers should support the Country party in an attempt to defeat the Government on the tobacco issue. The honorable member also said that, after I had made that request, I acted the part of a coward in going back on my promise to the honorable member for West Sydney by voting for the adjournment of the debate. The honorable gentleman's standard of political ethics apparently is very low when he will mention in this House what happens outside. {: .speaker-KX7} ##### Mr Ward: -- Is it true? That is the main thing! {: .speaker-KVU} ##### Mr THOMPSON: -- It is quite untrue. {: .speaker-KX7} ##### Mr Ward: -- It is true. {: .speaker-KVU} ##### Mr THOMPSON: -- It is not true. I appeal to the honorable member for West Sydney to put his impetuous follower in his place. If he were in his right place he would be in the gutter, whence he came. {: .speaker-KX7} ##### Mr Ward: -- Go back to the sewer ! {: .speaker-KVU} ##### Mr THOMPSON: -- On the Monday before the train left for Canberra I went into the Commonwealth offices in Sydney. {: .speaker-KX7} ##### Mr Ward: -- Go back into the sewer ! {: .speaker-KVU} ##### Mr THOMPSON: -- It grieves me to have to refer to such a matter. I have not had occasion to take action of this sort previously. Had the honorable member not stirred up the garbage tin as he did to-night, I should not have been impelled to make this explanation. {: .speaker-KX7} ##### Mr Ward: -- It is somewhat strange for the honorable member. {: .speaker-KVU} ##### Mr THOMPSON: -- The honorable member for East Sydney does not know his place. {: #subdebate-27-0-s2 .speaker-KIT} ##### Mr SPEAKER (Hon Gr H Mackay:
LILLEY, QUEENSLAND -- Order ! I cannot permit this dialogue between two honorable members to continue, The honorable member for New England is entitled to make his explanation, but he must follow somewhat different lines. {: .speaker-KVU} ##### Mr THOMPSON: -- I cannot proceed because of the interruptions of the honorable member for East Sydney. On the Monday before I left for Canberra, I visited the Commonwealth offices in Sydney, and following my usual custom, engaged in conversation with other members who were there, including the honorable member for West Sydney. That gentleman asked me if we were likely to have a vote on the following day on the tobacco question. I replied that I was not sure, but that I thought that it was quite likely. He said, "Rowley James wants to go to the Maitland show. We are opposing the Government on this ". I said, " So is the Country Party, with one exception ". I mentioned the exception, the honorable member for Swan **(Mr. Gregory).** The honorable member for West Sydney asked me, "Do you think it wise to let him go?" and I replied " That is a matter for you and him to decide." Nothing more was said about the matter. On the train next day I approached the honorable member for West Sydney and asked whether the honorable member for Hunter was aboard. He replied, "No, he ha3 gone to Maitland." I said, " That is a pity. I think that we are going to have a vote on this question to-night ". He put to me the query, " Are you fellows going to stand up to this?" and my reply was " Certainly we are." That was all that was said. {: .speaker-KJQ} ##### Mr James: -- I rise to a point of order. I wish to correct the misstatement that I went to the Maitland show. {: #subdebate-27-0-s3 .speaker-10000} ##### Mr SPEAKER: -- A point of order may not be taken in regard to a statement with which the honorable member disagrees; he may make his explanation later. {: .speaker-KVU} ##### Mr THOMPSON: -- The honorable member for West Sydney informed me that the honorable member for Hunter was going to the Maitland show. {: .speaker-KJQ} ##### Mr James: -- The Maitland show was not held on that day. {: .speaker-KVU} ##### Mr THOMPSON: -- I trust that I am not so lacking in a sense of humour as to approach honorable members in the corner opposite to learn whether they intend to vote against this Government, as the honorable member for East Sydney has alleged that I did. In reply to his charge that I acted the part of a coward, 1 merely repeat what I said on the occasion in question ; that is, that J voted for the adjournment of the tobacco debate on the assurance of the Prime Minister **(Mr. Lyons)** that we should have another opportunity of dealing with the question. {: #subdebate-27-0-s4 .speaker-KX7} ##### Mr WARD:
East Sydney .- I regret having to descend to the level of the honorable member for New England **(Mr. Thompson),** but it appears to be necessary to get into the sewer in order to reply to rats such as sit on the other side of the House. {: .speaker-KZF} ##### Mr Lane: -- Is it permissible for the honorable member to describe as " rats " honorable members who sit on this side of the House? {: .speaker-KJQ} ##### Mr James: -- We should apologize to the rats! {: .speaker-KX7} ##### Mr WARD: -- Either the honorable member for New England misunderstood what I said this evening, or he has deliberately misrepresented me. What I said was that the honorable member came along the corridor of the train and sought out the honorable member for West Sydney **(Mr. Beasley)** so that he might ascertain exactly what our attitude was to be when the matter came before the House. After discussing the matter with the honorable member for New England, the honorable member for "West Sydney asked members of this party if they were prepared to see the thing through. The honorable member for New England was lobbying, anxious to secure as many votes as possible against the action of the Government in connexion with the tobacco duties. When the fight came on, he beat a retreat, and now he is trying *to cover* his tracks by placing the blame on somebody else. If the political ethics to which the honorable member refers require that one must not tell the truth, I am glad that I have introduced ethics different from those which previously obtained in this chamber. Every statement that I have made is accurate. If honorable members are afraid of their actions becoming known, they should not adopt shady tactics in an endeavour to obtain support. I leave no doubt as to my attitude upon any question that is put before this House. If I, think that by lobbying I can further the interests of my party, I shall indulge in that practice, and will not apologize for my action. Lobbying is indulged in by all political parties, so why should the honorable member for New England object to it? The honorable member has made a personal attack upon me, deliberately, or while labouring under a misapprehension. He also declared that it would have been futile to obtain the support of the " corner " group. Members of this party number five, and it has been demonstrated that their influence can be important in a division. The honorable member has merely been beating the air in his feeble explanation of what took place. {: .speaker-KVU} ##### Mr Thompson: -- I rise to a point of order. I take strong objection to the statement that I approached the honorable member for West Sydney **(Mr. Beasley)** in -an attempt to lobby. That statement is not true, and I ask that it be withdrawn. {: #subdebate-27-0-s5 .speaker-KIT} ##### Mr SPEAKER (Hon G H Mackay: -- The honorable member has already had his opportunity to place his case before the House, if he had any objection to a statement that was made by the honorable member for East Sydney **(Mr. Ward)** he should have said so immediately it was made. {: #subdebate-27-0-s6 .speaker-KJQ} ##### Mr JAMES:
Hunter .- I desire to correct- the statement of the honorable member for New England **(Mr. Thompson)** that I told the honorable member for West Sydney **(Mr. Beasley)** that I was going to the Maitland show on the occasion referred to. Actually, the Maitland show occurred a week before that date. What I told the honorable member for West Sydney was that I was about to attend a sitting of the Tariff Board that was taking place at Newcastle to deal with the matter of bunker coal. {: #subdebate-27-0-s7 .speaker-JOM} ##### Mr BEASLEY:
West Sydney -- I desire to bring the following newspaper extract under the notice of the Postmaster-General **(Mr. Fenton)** : - . By a. special amendment of the regulations, the Bruce-Lyons Government has abolished the basic wage for a large number of Commonwealth public servants as from to-day. Under the regulations governing the employment of juniors as assistants, telegraph messengers, ordinary messengers, telephonists, and launch boys in the Customs Department, it was provided that the adult minimum wage in the Commonwealth service would be paid on the employee reaching adult age. This regulation lias been abolished, fmd tlie employees in question have been notified that from to-day they will receive a junior's wage only. Previously these employees who had reached 2 years automatically received the basic wage of £182 a year. They will now be reduced to the earnings of youths of 20 years, which incurs a drop of £39. That this is a direct blow at the principle of the basic wage is illustrated by the fact that in the telegraph branch, of SO junior assistants, 20 are 21 years of age and over. It is pointed out that it is no fault of the majority of the employees that they arc still designated juniors. Most of them have qualified themselves for promotion, but no vacancies have been created to which they could be appointed as adult workers. The only way in which these " juniors " who have reached 21 years *can* now receive the minimum base rate is by getting married. This is provided for by award. Before the Commonwealth Public Service Salaries Reductions Act was introduced, these employees received £232 per annum. When that measure came into operation, they were reduced to £182; now they have suffered a further reduction, which makes their income only £143 per annum. Perhaps the Postmaster-General is not aware that that drastic alteration has been made. If strikes a vital blow against the system of wage fixation. After all, it is not the fault of these employees that they happened to be employed upon the class of work to which I have referred. They have qualified for promotion, but the department has not seen fit to transfer them to other grades. {: .speaker-KZR} ##### Mr White: -- Would they not otherwise have lost their positions? {: .speaker-JOM} ##### Mr BEASLEY: -- I am not aware that that is so. Surely the Government does not seek, by this process, to introduce a means to defeat the determinations of wage-fixing tribunals? I am aware that the Postmaster-General may not be able to give me an answer immediately, but as I may not have had an opportunity to ventilate the matter to-morrow, I bring it forward now in the hope that the honorable gentleman will give the matterhis personal consideration, and that he will not, permit any officer of his department to penalize these employees. {: #subdebate-27-0-s8 .speaker-KFA} ##### Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP -- I desire to ask the Prime Minister **(Mr. Lyons)** whether, consequent upon certain legislation that has been passed by both Houses of Parliament, and requires further executive action by the Government in the form of a proclamation, he will expedite the issuing of that proclamation, in order to reassure the people of New South Wales, living in that portion of the State which I represent, and also to prevent them from paying to the despicable Government of New South Wales taxation due to the Commonwealth Government? {: #subdebate-27-0-s9 .speaker-KF9} ##### Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936 .- I direct the attention of the Minister for Trade and Customs **(Mr. Gullett)** to the disabilities experienced by settlers in Western Australia who are compelled to pay primage duty on wire netting and calcium cyanide used to prevent the spread or cause the destruction of rabbits. This pest is causing considerable damage in the agricultural districts, and naturally the settlers are anxious to obtain supplies of these commodities at the lowest possible cost. I have brought this matter under the notice of the customs authorities, and it would appear that on one phase of the subject I have been misinformed by those who brought the matter under my notice. I have received a communication from the Greenough Road Board, a portion of which reads - >In view of the alarming increase of rabbits all through the agricultural districts of Western Australia, every road board in the State is being circularized with an urgent request to pass resolutions asking the Federal Government to take off the duty from English-made double-dipped rabbit netting wire. Netting now costs £45 per mile, the best British can be purchased, duty free, from 40 to 45 per cent. cheaper. The damage caused through the pest is enormous, not only to crops, but graziers find their holdings are reduced in feeding value by 50 per cent. That statement is not altogether accurate as I shall show later. In a communication from the Moora Road Board, referring to a resolution passed at a road board meeting, it is stated that - >The particular motion for your consideration is the one . . . with regard to a reduction of duties on rabbit netting and calcium cyanide. An earlier motion, as you will sen, asks for netting at world's parity. World's parity is now about £7 to £9 per mile. I have made inquiries into this matter, and the Minister was good enough to supply me with certain information. I am advised that instead of there being a duty on all wire netting, as stated in certain circulars I have received, this commodity is admitted under the British preferential tariff free of duty, while the general tariff is 200s. per ton. Calcium cyanide is also admitted under the British and general tariffs free of duty. British wire netting is not,as indicated in the circular, sold at £45, but at £24 4s. per ton f.o.b., as against foreign wire netting at £28 l1s. which is £4 7s. cheaper. On the 2nd March I asked the Minister the following questions: - {: type="1" start="1"} 0. What is the amount of primage duty received from - {: type="a" start="a"} 0. wire netting, and 1. calcium cyanide from the date of imposition of the duty to the present date? 1. What was the date from which the primage duty was instituted in each case? The answer I received was as follows: - {: type="1" start="1"} 0. The amounts of primage duty received from individual items are not recorded separately in the statistics. It is estimated however, that the amounts of primage duty received during the period, 10th July, 1930 to the 31st January, 1932, on the goods mentioned were - {: type="a" start="a"} 0. wire netting £466. 1. calcium cyanide £460. 1. 10th of July. 1930. As the primage duty collected on these two commodities represents such a small sum, the interests of the farmers could best be served by removing the primage duty, thus making them availableas cheaply as possible. As wire netting and calcium cyanide are used extensively for destroying rabbits, I ask the Government to consider seriously the desirableness of removing the primage duty. {: #subdebate-27-0-s10 .speaker-KEV} ##### Mr FENTON:
General · MaribyrnongPostm aster · UAP -- In reply to the point raised by the honorable member for West Sydney **(Mr. Beasley),** I may say that the Government was faced with the position of having to dispense with the services of the 700 employees mentioned who were redundant officers or to employ them at a reduced salary. All married men receive £182 perannum. The officers whose salaries have been reduced will, of course, be entitled to promotion as vacancies occur, when they will receive a higher salary. {: #subdebate-27-0-s11 .speaker-F4U} ##### Mr FORDE:
Capricomia .- Is the Minister for Trade and Customs **(Mr. Gullett)** in a position to makea statement before the House rises tomorrow, with respect to the Government's intentions in connexion with the protection afforded to the cotton and tobacco industries? {: #subdebate-27-0-s12 .speaker-KFS} ##### Mr GULLETT:
Minister for Trade and Customs · Henty · UAP .- The matters mentioned by the honorable member forCapricornia **(Mr. Forde)** are stillreceivingthe earnest consideration of the Government, andI hope to be able within a few days to make a statement concerning the tobacco duties. In reply to the representations of the honorable member for Kalgoorlie **(Mr. A. Green),** I may say that the imposition of primage duties is purely a Treasury matter. That tax was imposed by the late Government in order to raise revenue. The Government will, however, consider the points raised by the honorable member. {: #subdebate-27-0-s13 .speaker-F4O} ##### Mr LYONS:
Prime Minister and Treasurer · Wilmot · UAP -- I may inform the honorable member for Richmond (Mr.R. Green) that litigation between the Commonwealthand the State has already been commenced. There will be no loss of time on the part of the Commonwealth in givingeffect to the legislationrecently passed by the Parliament, and to the resolution adopted to-day. In these circumstances, I do not think it wise to make any statement with regard to the intentions of the Government in the matter. Question resolved in the affirmative. Houseadjournedat 11.39 p.m.

Cite as: Australia, House of Representatives, Debates, 16 March 1932, viewed 22 October 2017, <http://historichansard.net/hofreps/1932/19320316_reps_13_133/>.