13th Parliament · 1st Session
Mr. Speaker (Hon. G. H. Mackay) took the chair at 2.30 p.m., and read prayers.
Cost ofliving Allowance - Recruiting.
-I ask the Prime Minister whether the newspaper report that the Commonwealth Government does not intend to apply the Commonwealth Public Service reduction of £12 in accordance with the decline in the cost of living, is correct?
-I have already announced through the newspapers that the Government proposes to take such steps as will prevent the reduction of Commonwealth salaries by £12 on account of the cost of living figure.
– I have asked the Prime Minister a number of questions on the subject of recruiting in the Public Service. Recently, he offered to allow me to peruse a report on the subject prepared by the Public Service Commissioner, but stated that the document would be made available to me in confidence.I suggest to the right honorable gentleman that the perusal of the report under such conditions would prevent me even from asking further questions on the matter, and. if he appreciates my difficulty, will he reconsider his decision, and have the report laid on the table of the House?
– I appreciate the honorable member’s difficulty, though at the time I made the offer I thought I was meeting his wishes. I shall again study the report of the Commissioner, and endeavour to arrange that the essential parts of it shall be made available to honorable members. Of course any sections which it might be inadvisable to publish would be withheld.
SALE AND DISTRIBUTION OF PETROL.
– In view of the. difficulties of the Commonwealth Government and the Australian people in getting satisfactory service in connexion with the supply and distribution of such a basic and necessary commodity as petrol, and of the decision of the Finance Commission of the French Chamber of Deputies in favour of a State monopoly of the sale and distribution of petrol, will the Attorney-General discuss with the Government the advisability of adopting a similar policy in the Commonwealth in the interests of the Australian people?
– The Commonwealth is a partner in the Commonwealth Oil Refineries Limited, which was established for the purpose of securing on a competitive basis the sale of petrol products at a reasonable price. Doubtless honorable members have their own views as to h’ow far this purpose has been achieved. In regard to the far-reaching suggestion that a government monopoly of the sale and distribution of petrol should he established, I doubt whether it would be possible for a Commonwealth Government under any legislation of this Parliament to engage in such an enterprise.
Trade Agreement with The United States of America.
– Is the Minister for Commerce yet in possession of details of the provisions of the agreement recently made between the Governments of New Zealand and the United States of America ? Is he able to inform the House, particularly, whether the agreement contains any conditions by which a foreign country would be more favorably situated than a sister dominion for the export of goods to New Zealand ?
– The Government has not yet been supplied with details of the agreement, but steps have been taken to secure the information.
COMMONWEALTHOIL REFINERIES LIMITED.
– The Commonwealth holds 250,001 of the 500,000 shares in Commonwealth Oil Refineries Limited. Will the Attorney-General state the ratio of Commonwealth representation on the Board of Directors to the total number of directors ?
– The Commonwealth has three representatives on a board of seven directors.
– I ask the PostmasterGeneral when the investigations of the wave lengths of B class wireless broadcasting stations will be completed?
– In the absence of the Postmaster-General I undertake to get the. information for the honorable member.
JAPANESE TRADE WITH AUSTRALIA.
– I ask the Minister for Trade and Customs whether the following cablegrams from London, published in the Sydney Sun, have been brought to his notice: -
A Sydney draper named Brasch tells the Sun representative that British manufacturers were annoyed at Australia’s permitting Japanese sweated labour unfairly to compete with them. They suggested thatJapanese purchases of Australian wool should be no reason why Australia should fail to play true to the Ottawa agreement.
In theHouse of Commons Mr. Thomas told Mr. Hammersley that the general question of Japanese competition with British goods in Australia was still engaging attention.
Mr. Hammersley. In view of the abnormal increase in Japanese exports to Australia, would Mr. Thomas invite opinion from Australia as to the best way of dealing with the menace of these products of low-priced labour ?
Mr. Thomas. The question is applicable to many parts of the. world, and GreatBritain would welcome Australia’s opinion on these and other matters.
Has the Secretary of State for the Dominions asked the Commonwealth Government for such information; if so, has the information been sent?
– I am unaware of the identity of the draper named Brasch. The importations of Japanese goods are not abnormal; the balance of trade with Japan is most favorable to Australia.
– The records show that the importations are abnormal.
– That is not so, but even if it were, a breach of the Ottawa agreement would not necessarily he committed. As a matter of fact, the Commonwealth Government is implementing that treaty in both letter and spirit. The Industries Preservation Act enables dumping from any country to be dealt with. When a prima facie case of dumping is established, the matter is inquired into by the Tariff Board, and upon its report action is taken by the Government.
– Has the Prime Minister received any communication on the subject from the Secretary of State for the Dominions, and if so, what was the nature of the reply furnished by the Australian Government?
– Up to date I have received no such communication from the Secretary of State for the Dominions.
Call from the Chair.
– Yesterday the honorable member for Gippsland (Mr. Paterson) received a call from the Chair immediately after the honorable member for Swan (Mr. Gregory) had spoken. Both are members of the Country party. I ask you, Mr. Speaker, whether calls from the Chair are made in accordance with the party adherence of honorable members or are given alternately to the right and left of the Chair. The former custom was to give the call to a member of each party in turn, regardless of the position he occupied in the chamber?
– The honorable member will realize that the constitution of this House is peculiar. There are in the chamber not less than five parties or groups, and their members are distributed to the right and left of the Chair. The majority of the members of the Country party sit on my left, hut two of them sit on my right. My practice is to give the call to members on my right and left alternately. There are three parties sitting on my left, but only one call is given alternatively for every call on my right. The honorable member for Swan, the honorable member for Corangamite, and the three Independent honorable members all take their turn with honorable members on the right. I hope that this is perfectly clear, and that honorable members-
– It is clear, but not quite fair.
– The honorable member for Maribyrnong (Mr. Fenton) is guilty of disorderly conduct in making that remark while an explanation of the matter is being given.
– I apologize.
– If the honorable member can suggest a fairer method of calling, I shall be pleased to adopt it.
– Is the Prime Minister aware that the Pensions Department is assessing as income for pensions purposes rebates paid to members of co-operative societies? I made representations to the department on this subject, but that the practice is still in operation is evident from the following letter received from the department by the manager of the Newcastle Co-operative Society: -
In reply to your letter of the 10th instant, I have to say that the question of whether amounts refunded by the society to the shareholders is income, has been considered on several occasions. The determination, however, was that for pension purposes such amounts should be treated as income, and that practice will for the present continue.
In view of the fact that the money thus received is not additional income, but merely a refund of payments over-charged on commodities, the actual cost of which was not ascertainable at the time of sale, will the Prime Minister instruct the department to discontinue treating such refunds as income?
– I shall have the matter looked into, but I suggest, without wishing to deprive honorable members of the right to ask questions in the House, that their requests would receive more prompt attention, and be more quickly dealt with, if they communicated directly with me, or with the department concerned.
– I have brought this matter before the department on several occasions.
– The right honorable member for North Sydney (Mr. Hughes), in his report to the House last night on the Thirteenth Assembly of the League of Nations, stated that the contributions of the nations towards the support of the League were based on their ability to pay, and that Australia’s contribution amounted to £65,000 a year. Has the Attorney-General any information regarding the amounts paid by the other nations, and is he satisfied that Australia is receiving value for her contribution ?
– At first, contributions to the League of Nations were assessed on the basis of the universal postal union. Subsequently, a new method was adopted, which is very complicated in character, and takes into account revenue, expenditure, population and various other matters which are regarded as indicating in some measure the financial position of the country. From time to time efforts have been made to bring about a readjustment of the basis of payment, but when I examined the matter recently while in Geneva, and observed that the object of every country in seeking to readjust the basis was to obtain a reduction of its own contribution, I concluded that it was wiser to concentrate on securing a reduction of the total expenditure of the League, than to run the risk of introducing a new basis of contribution, which, I was informed, might very well increase Australia’s payments.
– The right honorable member for North Sydney said that the arrears owing by various nations to the League amounted to 17,000,000 gold francs. Can the Attorney-General inform honorable members what countries are in arrears, and how much each owes ?
– The information sought by the honorable member is contained in an annex to the report prepared by Mr. Bruce on the Thirteenth Assembly of the League.
– Are the costs of the International Labour Office at Geneva included in the total cost of the League of Nations?
Application to Mandated Territories, Etc
– Will the AttorneyGeneral request the Government to consider the extension to Norfolk Island, Lord Howe Island, Papua, and the Mandated Territory of New Guinea such Commonwealth legislation as relates to moratoriums and the reduction of interest ?
– There is no Commonwealth legislation providing in general terms for a moratorium or for the reduction of interest, but the matters to which he refers are within the legislative powers of the Commonwealth in relation to the places mentioned, and I shall see that consideration is given to his request.
– Has the Minister for Trade and Customs yet received a report from the Tariff Board on the dumping of wire netting, the inquiry into which subject was held about nine months ago? If he has received the report, will he place it on the table of the House; if it is not yet to hand, will he inquire where it is?
– The report has not yet been received. The inquiry is being held.
The following papers were presented : -
Performing Eights - Report of Royal Commissioner (Mr. Justice Owen).
Ordered to be printed.
Industrial Property - Protection of - International Convention (signed at The Hague, Cth November, 1925).
Legal Proceedings in Civil and Commercial Matters - Convention between His Majesty and the President of the German Reich (London, 20th March, 1928).
Taxation - Fifteenth Report of the Commissioner, years 1928-29, 1929-30, 1930-31, and 1931-32.
Motion (by Mr. Lyons) agreed to -
That he have leave to bring in a bill for an act to amend the Commonwealth Inscribed Stock Act 1911-1932.
Bill brought up by Mr. Lyons, and read a first time.
Motion (by Mr. Lyons) agreed to -
That he have leave to bring in a bill for an act to amend section 18b of the Financial Emergency Act 1931-1932.
Bill brought up by Mr. Lyons, and read a first time.
Motion (by Mr. Latham) agreed to -
That he have leave to bring in a bill for an act to provide for the acceptance of certain territory in the Antarctic seas as a territory under the authority of the Commonwealth and for the government thereof.
Bill brought up by Mr. Latham, and read a first time.
Motion (by Mr. Parkhill, through Mr. Latham) agreed to -
That ho have leave to bring in a bill for an act to amend the Australian Institute of Anatomy Agreement Act 1924-1931.
Bill brought up by Mr. Latham, and read a first time.
Motion (by Mr. Stewart) agreed to -
That he have leave to bring in a bill for an act to give effect to certain international conventions, to amend the provisions of the Navigation Act 1912-1920 relating to matters dealt with by those conventions, and to repeal section 8 and amend section 419 of the said act.
Bill brought up by Mr. Stewart, and read a first time.
Debate resumed from 23rd May (vide page 1626) on motion by Mr. Lyons -
That the bill be now read a second time.
Upon which Mr. Gabb had moved by way of amendment -
That all the words after” That “ be omitted with a view to insert in lieu thereof the following words: - “the bill he withdrawn with a view to introducing legislation appointing a permanent body of inquiry constituted as suggested by the Joint Committee of Public Accounts in its report of 17th June, 1931, relating to South Australia.”.
.- Prior to last year, I had at my disposal no further information or opinions on this subject than those which were available to the ordinary newspaper reader. But last year, as a member of this House, I heard the debate on the subject with which this bill proposes to deal. The provisions of the measure, in my opinion, should not be considered from either the party viewpoint or that of the States. Last year’s debate was notable for a good deal of acrimonious discussion in which some very unpleasant terms, such as “ mendicant States “ and “ coming cap in hand to the Government “ were used. Such terms are most objectionable. Members representing the three States which were then dealt with had some difficulty in repressing their State feelings.
This bill is intituled “A bill for an act relating to a commission to deal with the matter of grants by the Commonwealth of financial assistance to the States “. It does not specify what States are to receive grants, and it will not dispel the unpleasant feeling that has arisen during the last few years respecting Commonwealth grants to States, because when this commission, if it is appointed, makes its report, Parliament will have to consider it, and the previous arguments and recriminations will again be heard. The disabilities which the bill purports to remove have nothing whatever to do with the States as such. This is purely an accident of boundaries. The industries of the smaller States, being chiefly primary, are bringing upon the Governments of those States financial embarrassment; but the like embarrassment is also present in the larger States in respect of certain of their areas. This difficulty is not mentioned in, and will not be removed by this measure. It is the duty of this Parliament to ascertain the cause of the disabilities of the smaller States, and that cause is not dealt with in the bill. The proposed commission is to inquire into many things in respect of which the House has already full information. It will be a costly body, although the cost in proportion to the amount of money involved would not be great, provided that the results were satisfactory. I cannot see the necessity for appointing this commission for a period of five years.
Surely if it is to inquire into all the circumstances of the States concerned, it should be able to recommend to the Parliament some formula or policy which could be put into operation until the position of those States changed. It is not within the bounds of human nature to imagine that this commission will limit its sittings, if it is free to meet when the chairman thinks necessary and to draw sitting fees during a period of not less than five years. This Parliament should make some effort to solve the difficulties of the State instead of appointing a commission to inquire into matters of which we already have full knowledge. The Prime Minister (Mr. Lyons), in his policyspeech, said -
The present subdivision of Australia into States cannot be regarded as permanent. There are areas in Australia, particularly in New South Wales, which are demanding fuller recognition of the principle of local selfgovernment. The provisions of the Constitution with respect to the creation of new States are vague and ambiguous. We consider that these provisions should be amended and clarified.
The creation of new federal units in New South Wales is in no sense in line with the policy of unification, but it would certainly involve the granting of increased powers to the Federal Parliament, and a different allocation of duties to new and existing units. The granting of such additional powers would undoubtedly tend towards the solution of many of the difficulties with which this bill proposes to deal. This question is not a new one. In 1891, Sir Henry Parkes said, almost prophetically -
Ag a matter of reason and logical forecast, it cannot be doubted that if the union - the federation - were inaugurated with double the number of present colonies, the growth and prosperity of all would be more absolutely assured.
He further remarked -
The division of the existing colonies into smaller areas to equalize the distribution of political power will be the next great constitutional reform.
We have for 43 years been waiting for that constitutional reform. At the first new States convention, held at Armidale in 1921, Sir William Cullen said-
I am of the opinion that the new State movement is as national as federation itself, and its natural corollary.
I am aware that a number of honorable members of conservative opinions hold that whatever is is best; but I ask honorable members generally to discuss this matter in a deliberative spirit, and to consider whether a careful inquiry into the position of the States concerned will be of much benefit to the Commonwealth as a whole. Recently, the people of Western Australia carried a referendum in favour of secession from the federation. I certainly deplore that vote. In New South Wales a country movement has arisen in favour of the subdivision of States, and that movement is not restricted to that State. It is gaining much ground in the large cities, particularly Sydney. I know that the Young Nationalists of Victoria are supporting the movement. The Supreme Court of the United States of America has made the following important announcement : -
Experience has shown that, in a country of great territorial extent and varied interest, peace and lasting prosperity can rest with the civilized people only when local affairs are controlled by local authority.
The difficulties of the three States concerned are not difficulties confined within their boundaries, and if the bill purports to remove some of those difficulties, it must also take cognizance of the fact that their causes are .to be found in other States as well. It was at one time suggested that New South Wales - the State with which I am most familiar - should be divided into three new States, and, as a result of the policy enunciated by the Prime Minister, and later by the Premier and Deputy Premier of New South Wales, a State boundary commission was appointed, and is at present inquiring into this matter from the view-point, not of party or class, but of the benefit to the country as a whole. It is of interest to compare the suggested divisions in New South Wales with the States proposed to be helped by this bill. The area of the proposed division of New England consists of 42,000,000 acres; the proposed central division contains 94,000,000 acres, and -the Riverina division 57,000,000 acres. The population of the New England division is 547,000, and that of the State of South Australia 585,000. Therefore, this division has practically the same population as South. Australia. The population of the proposed central division is 1,600,000, and of Victoria 1,800,000. The population of the Riverina division is 326,000, and of Tasmania 224,000. So that the population of the Riverina is considerably more than that of Tasmania. The unimproved capital values of rateable property in these divisions are - New England, £80,000,000; Central division, £233,000,000, and the Riverina division £66,000,000. I ask those who have a knowledge of federal history to consider how small were the population and the wealth of Victoria and Queensland at the time when those States separated from New South Wales, compared with the wealth and the population of these three divisions. But from the moment that those two States assumed control of their own destinies, they began to progress. We do not find either of them approaching the Commonwealth for support as, unfortunately, other States have had to do. It is admitted that very grave difficulties are involved in this matter, and that a solution of them cannot be found by New South Wales alone; although the Constitution contains a provision which enables the Government of that State, of its own volition, to subdivide its area. Since the establishment of federation, the control of the Commonwealth has .become more and more involved. Under the Financial Agreement of 1927, the affairs of the Commonwealth and the States in relation to commitments abroad, have been interwoven. There is also the allocation of federal and state powers, the creation of new provincial constitutions, and the necessity for endeavouring to reduce governmental expenditure. These matters are worthy of the closest consideration and inquiry by constitutional lawyers, as well as by those politicians who aim at being considered statesmen. As Australia comprises 3,000,000 square miles of territory, it is a matter for wonder that we have been able to carry on with only six State administrations. Every large country in the world aims at decentralization. Canada has nine provinces and two Territories. The United States of America consists at present of 48 States and two Territories, compared with only thirteen
States 150 years ago, since when, there has been continuous extension. In that country, it is considered that from 50,000 to 60,000 square miles is an ideal area for a state. The Argentine has fourteen States and ten Territories; while Austral, with an area practically equal to that qf the United- States of America and “ the Argentine, has but six States.
I cannot support the amendment of the honorable member for Angas (Mr. Gabb). The bill may be regarded as an honest endeavour by the Government to avoid the unpleasantness that has characterized the treatment of this subject in the past, and to deal with it in a fitting manner. I am sorry, however, that I cannot give the measure wholehearted support, because I consider that it falls short of what the Government could do. The honorable member for Wakefield .(Mr. Hawker) referred to the proposed commissioners as Fathers Confessor, and said that the Commonwealth was merely paying conscience money, the implication being that there is something sinful in the plea of unfortunate States for assistance. The analogy that I would apply is that there is something wrong with Australia, that the body politic is sick, and that the Govrnment is attempting to restore it to health by administering morphia. As a sedative, that may alleviate the difficulty temporarily; but, as everyone knows, the taking of morphia causes a craving for more frequent and larger doses, until the subject becomes a drug addict, who loses not only all self respect, but also the esteem of his .fellows. This case calls for skilled surgery, and the Ministry is well qualified to perform the operation. There may have to be a period of convalescence, but ultimately the federation must have a strong and a healthy constitution. In view of the excellent diagnosis of the position which the Prime Minister made in his policy speech, I trust that he will deal with the matter in a broad, non-party, non-State, and purely federal spirit; that he will take the action necessary to get to the root of our constitutional difficulties and, by meeting the growing needs for the further subdivision of this young country, will so greatly enhance his reputation that his name will stand alongside those of the all too few statesmen of Australia’s past who have done great things for the federation.
.- For quite a long time many recommendations have been ‘made in different quarters in favour of the appointment of a body such as the proposed commission, which would inquire into and recommend what grants should be made to different States. Those recommendations came, I think, mainly from the States which had received grants from the Commonwealth. I am not prepared to join with the representatives of those States who are disposed to reject this proposal. I am not in entire agreement with my colleagues in that respect. “Western Australia can expect to obtain a good deal of advantage from the appointment of this commission, which, I believe, will give fairer and more sympathetic consideration to the claims of the needy States than they have received from any government or from the members of this House. Western Australia has pronounced ‘very definitely in favour of secession from the federation. I, however, shall approach the consideration of this measure from what I regard as the practical point of view; that is to say, that Western Australia still is, in fact, within the federation, and that, so long as she remains there, we should endeavour to make the best of whatever position may arise. This commission, I believe, can do most useful work. It will have to report upon all applications for grants that are made to the Government. Those grants may be made under two heads; first, on account of necessitous circumstances in a State; and secondly, because of disabilities caused to a State. It would seem that the commission will be obliged to inquire into those disabilities, if it is properly to perform its functions. Many of these grants will be in the nature of compensation for disabilities arising from the federal connexion. In order to ascertain the extent of the disabilities, it will be necessary for the commission to inquire into federal laws, and to find out how these bring about the disabilities. Unless an inquiry is made, I fail to see how the commission can make a reasonable assessment of the disabilities.
– Should not provision for that be made in the bill?
– I agree with the honorable member for Swan (Mr. Gregory) that the bill is unnecessarily restrictive in its terms. I am inclined to think that the draftsman who drew up the measure was meticulous to see that its terms limited the commission to the special powers set out in section 96 of the Constitution, which authorizes the making of grants to the States. I notice that that section is quoted - unnecessarily, it seems to me - three times in the effective clause of the bill. It may be inferred, presumably, that that is an intimation to the commission that its inquiry is to be strictly limited, in accordance with the terms of section 96 ; that it is not to yield to any temptation to inquire into federal laws, or their consequences. If the provisions of that clause were strictly carried “ out by the commission, its efforts would be hampered, and it would be unable to ascertain what grants should be made.
Of course, the needy States have good cause for complaint, in that no grant of money which is likely to be made by this Parliament will adequately compensate them. When Tasmania, South Australia, and Western Australia entered the federation, they were all comparatively prosperous. It is true that, since federation, Western Australia has increased its population; but that was inevitable. In so far as that State has advanced, it has done so, not on account of federation, but in spite of it. The history of South Australia and Tasmania, from the time of federation, is one of languishment. I have not heard anybody suggest any other cause for this retrogression than the adverse effect upon these States of Commonwealth legislation. Western Australia will be glad to receive compensation; but, rather than a monetary grant, it desires the removal of the causes of the trouble. What would stifle the complaint of that State against federation would be the granting to it of the right to control its own tariff. It enjoyed that right under the Constitution for five years, at the outset of federation, and, therefore, there is a precedent for giving the State fiscal autonomy. That was recommended after inquiry by an independent body composed of men, not from Western Australia, but from the eastern States.
– The Constitution prevents the granting to Western Australia of the right to operate its own tariff.
– The Constitution, could be amended, if the eastern States are prepared to concede that right. High protection is the accepted policy of the eastern States, which contain the majority of the people of Australia; but I fail to see how that policy can be operated so as to make it compatible with the interests of Western Australia. Under the present tariff system, the exporting industries of that State are at a great disadvantage. The people of Western Australia are obliged to trade with the eastern States, but get scarcely any trade in return. Their trade interests lie, not with the eastern States, but with the Dutch East Indies, Singapore, Malay and Great Britain. Being obliged to buy their goods from the eastern States, Western Australians are debarred, to that extent, from dealing with Eastern countries in return for the trade which those countries do with them.
This .bill seems to assume that there will be a continuation of the fiscal policy which has proved injurious to Western Australia in the past. The repeated references to section 96 of the Constitution indicate, I think, that the commission must not enter the political field in making its inquiries. Yet the Constitution imposes a positive duty on the government of the day to appoint an interstate commission, because it states, “ There shall be an interstate commission.” I do not agree with the Attorney-General (Mr. Latham), that the effect of the High Court decision was to paralyse that commission. As the right honorable gentleman pointed out, it was merely a decision that the interstate commission was not a court, and, therefore, could not issue an injunction, or take positive steps to enforce its decisions. But that left untouched the altogether wider field which was open to the commission to make the inquiries that it had formerly conducted into trade and commerce, and the effect of the tariff, and Commonwealth laws generally, upon the States. The old interstate commission made those inquiries, and they were untouched by the decisions of the High Court. The Attorney-General has told us that the tariff functions of the commission have been transferred to the Tariff Board. I have read many reports of that board, and I appreciate its work; but I am not aware that it has ever given special consideration to a duty as it affects any particular State. Apparently, the principle on which the Tariff Board acts is that the interests of the majority shall be protected. This means, of course, that the interests of the eastern States, and particularly those of the two large cities, Sydney and Melbourne, must be the paramount consideration. The adoption of such a policy makes it impossible for the board to give special consideration to the smaller States.
– Surely the board can act only on that principle.
– That may .be so. But it is a regrettable effect of the transference to the Tariff Board of part of the work which should have been done by the Interstate Commission. The Interstate Commission was charged with the duty, among others, of inquiring into the effect of the tariff upon all the States, including the smaller States. The Tariff Board, however, has concerned itself chiefly with the interests of the large centres of population which are, obviously, incompatible with those of the smaller States. I regret that the Interstate Commission should have been allowed to fall into disuse. It would be quite easy for the Government, to provide that this commission should give consideration to trade and commerce generally, and particularly to our customs and excise duties. If it were disposed to extend the usefulness of the commission in this way, it should recite in the bill the trade and commerce and tariff sections of the Constitution. That would make it clear that the commission would not be confined to the narrow subject of State grants, but could make the widest investigation into the principles which, should govern the making of such grants. We have been told frequently that the smaller States voted in favour of federation, but the proposed Federal Constitution seemed, at that time, to .be a very different instrument from what it has turned out to be in actual experience.
At the ‘time federation was being discussed, we were told that the Commonwealth would cost an amount equivalent to only 2s. 6d. per head of the population.
– Only one man made that statement.
– The statement undoubtedly was made by one man originally, but it received wide publication from both press and platform, and I feel sure that it was repeated by many more than one man. We were also told that the Constitution provided for the return of surplus Commonwealth revenue to the States. That provision was apparently expressed in unmistakable language, but the High Court subsequently held that the Commonwealth Government was entitled to arrange its expenditure in such a way that there would be no surplus revenue to return to the States. It was also provided in the Constitution that the Commonwealth should retain 25 per cent, of the Customs revenue, and return the remaining 75 per cent, of it to the States. The trouble was that all these provisions were interpreted to the disadvantage of the States. The early members of the High Court Bench were strong federalists, and the effect of their interpretation of the Constitution, together with the taxation policy adopted by successive Commonwealth Governments, was such that the financial resources of the States were so depleted that they had ultimately to accept a new scheme of finance in substitution of the provision of the Constitution that 75 per cent, of the Customs revenue should be returned to them. The Financial Agreement was made in 1927. I believed at the time it was ratified that it was justifiable from the point of view of the smaller States; but actually, the States were forced into it because the Commonwealth had invaded their fields of taxation to such an extent that it had exhausted their sources of revenue. The States had either to accept the financial agreement or become bankrupt. I believe that if a vote on federation were to be taken throughout the Commonwealth to-day, the result would be very different in the smaller States from what it was years ago.
I wish to make a few observations regarding the character of the appointments to be made under this bill. I hope that the Government in making these appointments will not attempt to select men whose associations might pledge them to a continuance of the easternStates, or eastern-cities, policy. It is extremely important that men of broad outlook should be appointed. It is undeniable that previous commissions which have inquired into the disabilities of certain States have given their claims much more sympathetic consideration than this Parliament has given them. As a matter of fact, the claims of the smaller States have been given short shrift in this Parliament. When the interests of the smaller States have clashed with those of the big cities of Australia, they have received scant consideration. I am a federalist, and I hope that the past policy of this Parliament in that connexion will be reviewed. In the past, governments of every political complexion have undoubtedly given their chief attention to the interests of the eastern States and the big cities to the serious detriment of the other States and the small cities. If this policy is continued, a secession movement will undoubtedly develop in South Australia. I utter a warning, particularly to the- Labour party, which, in the past, has, to an even greater extent than the parties on this side of the chamber, promoted the interests of the large centres of population, that if they desire the federation to be preserved, they must be prepared to give fairer play to the communities living in the country districts of the eastern States, and to those States which are dependent mainly upon rural industries.
As regards the bill itself, I agree with several other honorable members, that we do not need a commission of the size indicated, nor should its members be appointed for a period of five years. In my opinion, three men would be quite sufficient to discharge the duties required of them. There are alternative methods for the appointment of such a body. For example, the bill might provide for State representation, in which case there would be on it a representative of each of the States, with a Commonwealth appointee as chairman to hold the balance of power. But such a method would lead to the appointment of too cumbersome and expensive a body.
– Such a body would not give results.
– That is the reason why I am not prepared to support the amendment of the honorable member for Angas. I repeat that three men would be sufficient, and, furthermore, they should not be appointed for five years as provided in the bill. Practically the whole of their work could be done in one year.
– They could, at all events, agree upon basic principles in one year.
– I agree with the honorable member. In any case, a period of two years would be sufficient provided the commission had authority to continue its inquiries if necessary. My fear is that members of the commission will be appointed for the maximum period, and, as a consequence, this country will be saddled with another expensive public body. I thought that this Government had sufficient experience of costly commissions not to make this mistake. Certainly the people of this country are tired of them, and, moreover, this is not the time for unnecessary expenditure of public money on such bodies. I accept the principles of the bill. I believe that the people in the smallerStates will have a better chance of making their views known through the medium of this proposed inquiry. I, therefore, hope that the proceedings of the commission will be open to the general public, and that the fullest publicity will be given to its investigations. I consider that the Government is right as regards the principles of the measure, and I intend to support its second reading.
– Some diplomat or high official is credited with having, while in a generous mood, coined the phrase “ State disabilities “. It would have been more to the point if, in his observations concerning the position of the smaller States under federation, he had spoken of the States inefficiency. In my opinion, the precarious position in which many of the States now find themselves is due to the fact that, for a long time, they have been propounding and giving legislative effect to economically unsound schemes.
– Socialistic experiments.
– Now, because they are in difficulties, they are endeavouring by constant appeals to the Commonwealth Government for financial assistance to justify proposals which have been definitely proved to be uneconomic.
In the discussion of this bill, we have to face the facts, and we should attempt to trace to their source the uneconomic proposals of State Governments which have been responsible for their present financial troubles. There is no need to stress the uneconomic nature of land settlement proposals initiated by State Governments. The disastrous results of those schemes are too well known to need recapitulation, so we must consider to what extent we are justified in extending further financial assistance in connexion with them. It should be remembered that the people of the various States entered the federation with their eyes open. They knew, or should have known, to what they were committing themselves when they joined the union. Under the constitutional provision known as the Braddon blot, the Commonwealth undertook for a definite period, to return to the several States a certain proportion of the revenue from customs and excise duties, to assist to maintain State finances in a condition of reasonable stability. Subsequently, the Commonwealth made an arrangement for the per capita payments, the effect of which was to bolster up the many uneconomic and expensive State schemes which were responsible for the deficits in State Government accounts.With the progress of time, the States became so accustomed to successful appeals to the Commonwealth Government to make good these deficits, that now they claim this assistance as a right. The slogan at the inauguration of the federation was, “ one people, one flag, one destiny.” To what extent has that slogan been translated into the activities of the various States? Is it not a fact that to-day States are fighting one against the other with a view to securing political advantages ? From whatever angle we view the bill we must be forced to the conclusion that the “ dole “ payments to be made under it to the States will be determined by political instead of national considerations. It is high time that members of this Parliament and the people generally adopted the slogan of “Australia first,” not “ party first “, which, to the outsider, appears now to be the general policy of governments and parties. No one can deny that a great deal of work of a national character lies ahead of us. Consequently, wo must realize our responsibilities if we should like our names to be revered, instead of despised, by those who come after us, as will surely be the case if we continue to administer the affairs of this country in the interests of party instead of the nation. Our apathy in regard to affairs of national significance is imperilling the future of this country. If we do not shake off this apathy, we cannot expect to see the materialization of those national aspirations which were so much in evidence at the inauguration of federation. I wish my children to think that I have done something to consolidate Australia’s future, and I am sure that every other honorable member is actuated by a similar desire. I make no apologies for placing before honorable members figures that are startling, in an endeavour to compel the Government to do something that will effect national stability rather than play with the problem as if is doing with this bill. Speaking in Adelaide recently, Senator Sir George Pearce made an alarming, but true, statement. He pointed to the danger of leaving a huge portion of Australia unpopulated, and, therefore, undefended and undeveloped. Senator Sir George. Pearce said that if we did not populate that area, some other country would do it for us - and it would not be Great Britain. Those words are significant, particularly when we remember that an island lying to the north-west of Australia has an area of only 140,000 square miles and a population of 64,000,000, which is increasing at the rate of 750,000 per annum. It is s?timated that in 24 years’ time the population of that island will be 90,000,000. Those figures convey a warning to all who are willing to listen. Two eminent authors, Mr. P. T. Hetherton and Mr. Hessel Tiltman-
– Order. Will the honorable member indicate in what way his remarks are connected with the bill?
– The bill is to set up a commission to consider the alleged dis abilities of the States, and I am endeavouring to show that the word “ disabilities “ is a misnomer ; that’ the term used should be “ inefficiency “. I am trying to demonstrate that the money that itis proposed to grant to the States could be more profitably expended in areas where the expenditure would permanently benefit the people of Australia. I submit that I am in order in suggesting an alternative proposal, and in urging that the stability of Australia as a nation should be our first consideration. I was pointing out that two well-known authors, Mr. P. T. Hetherton and Mr. Hessel Tiltman have analysed the problems to which I have referred, and have embodied their opinions in a volume that has just been issued in London, entitled, Japan, Mistress of the Pacific. These gentlemen say that Japan is deeply committed- ‘
– I cannot allow the honorable member to proceed along those lines.
– Where there is a positive there must also be a negative. I am opposing the bill lock, stock, and barrel, because I believe that it will not confer any permanent benefit on the people of Australia, and I am endeavouring to prove that permanent’ benefit could be obtained by the expenditure of money through -other channels than the State departments. I submit that that argument is relevant’ to the bill.
– If I were to extend to the honorable member the latitude that he desires, there would be no need for him to discuss the bill or its provisions at all.
– I certainly do not desire to evade your ruling, sir, but other honorable members have addressed themselves at length to the subject of the creation of new States, a line of debate that, apparently, was permissible. May I suggest that there is ample room for the creation of new States in the area that I have the honour to represent?
– If the honorable member will not proceed to discuss the motion for the second reading of the bill, I must ask him to resume his seat.
– Am I to understand, sir, that I am not to be given the same latitude that was extended to other honorable members’
– I have allowed the honorable member even more latitude than has been granted to other honorable members during the debate, and I must insist upon him obeying my ruling or resuming his seat.
– I should like your ruling, sir, as to whether I am to be allowed to express my opinion about the expenditure of public moneys, and to suggest alternatives to the proposals contained in the bill.
– The honorable member is not new to the procedure of this House. He is aware that no honorable member may disgress from the question that is under discussion. Of course, the illustration of points by minor digressions is allowed, but, generally, a member addressing the Chair must confine his remarks to the question under debate. Although the honorable member has been speaking for some minutes, he has not even mentioned any of the provisions of the bill. He would be in order in referring to the disabilities of a State due to the smallness of its population, but he must not continue to ignore the provisions of the measure.
– I have already pointed out that the term “disabilities” in regard to the financial position of the States is a misnomer, and that “inefficiency” could be correctly substituted for it.
– I am not prepared to enter into a debate with the honorable member. He must proceed along the lines that I have indicated.
– It is not often that I address myself to subjects other than those which relate to the Northern Territory, and, naturally, when an opportunity such as this presents itself, I desire to participate in the debate. I am prepared to advance schemes which, I believe, would benefit Australia, and I shall not allow myself to be deprived of the opportunity to do so, even if I have to wait in this chamber all night.
– I suggest to the honorable member for the Northern Territory (Mr. Nelson), and to certain other honorable members who have opposed the measure, that they should approach the discussion on this bill more on the principle of “Each for all, all for each.” Our outlook would then be truly Australian, instead of parochial. As there is urgent necessity to conclude the consideration of this bill so that we may have an opportunity to debate other important matters, my remarks shall be brief. I strongly support the measure, as I believe it to incorporate a desirable reform, and to give effect to a promise that was made in the Treasurer’s last budget speech. There is no need for honorable members to debate the merits or demerits of the claims of the various States. Indeed, a discussion at this stage of the disabilities of the individual States is undesirable; that is entirely a matter for judicial investigation by the proposed’ commission, whose main purpose will be; to hear and analyse the evidence tendered by the States and make a recommendation! for the guidance of this Parliament. At present, grants to the States are fixed more or less by rule of thumb; they are not based on any accepted principle or formula.
– Is any formula provided in this bill ?
– No, but it is hoped that the commission will be able to devise a better system for the making of these grants than has operated in the past. The Government is proposing the appointment of an independent body, the personnel of which will be absolutely impartial, owing allegiance to neither Commonwealth nor States, and free to give a judicial report for the guidance of Parliament. In the past several tribunals have considered applications by the States to the Commonwealth for financial assistance, and each report has deprecated the interminable inquiries and limitation of the periods for which grants have been made. All recommended that a permanent body should be appointed to advise Parliament in this regard. The yearly review of applications for assistance is fair neither to the States nor to the Commonwealth. Stable government and a long range policy of economic rehabilitation is possible for the States only if their governments know approximately what their financial position will be for a few years ahead. The frequent inquiries into the grounds upon which the claims for assistance are based have been irritating. and, to some extent, futile. The principle of a central federal government making financial grants to the component States or provinces is by no means new. It has been adopted in the United States of America, Canada, South Africa, Germany, and Switzerland. The Canadian maritime provinces of Nova Scotia, New Brunswick and Prince Edward Island are in much the same relation to the central dominion government as is Tasmania to the Commonwealth, and, following the investigations by a royal commission, the maritime provinces were generously treated by the dominion Parliament. The honorable member for Hindmarsh (Mr. Makin), and other honorable members, have complained that this bill contains no proposal for the removal of State disabilities. As has been rightly said, State disabilities are a constitutional problem to be dealt with on a more appropriate occasion. But, what are State disabilities? Does the honorable member for Hindmarsh agree that the tariff is one of the disabilities of South Australia? In the case submitted by the South Australian Government in support of its claim for financial assistance from the Commonwealth, the tariff was declared to be the greatest disability of the State, costing it over £3,000,000 a year.
– But the commission that inquired into South Australia’s case said that the State had advantages as well as disadvantages under federation. Mr. GUY. - Undoubtedly that is so. The small States claim that the tariff is their greatest disability; and it is one of the federal influences which some honorable members have suggested, by inference, should be removed. The Commonwealth Arbitration Act and the Navigation Act also, are referred to as grave disabilities. Do honorable members wish those statutes to be repealed? It is true that certain States suffer disabilities under federation, but the States are part and parcel of the Commonwealth, and the good of the whole is the good of the part. But a federal policy which is advantageous to the Commonwealth as a whole may be injurious to certain parts, and the Government is suggesting the appointment of a commission to inquire into such injuries or disabilities, and to assess the compensation that should be paid to the States. The only suggestion made by the honorable member for Hindmarsh to rectify the defects of the present constitutional position was unification, but would the people of South Australia approve of that? I believe that they would regard such a remedy as worse than the present disease.
The honorable member for Dalley (Mr. Rosevear) complained that Tasmania had not carried out the recommendations made by the Public Accounts Committee, following its investigations into the finances and disabilities of that State. That committee reported to the Commonwealth Government, not to the Tasmanian Government. In any case certain recommendations calling for action by the State Parliament were contingent upon action by this Parliament. If the Commonwealth Parliament failed to carry out its part of the policy recommended by the committee, the State Parliament could do little. As a matter of fact the Tasmanian Government did everything reasonably possible to give effect to the recommendations of the Public Accounts Committee.
– The committee did not recommend any action by the Commonwealth Government.
– The honorable member is in error. The committee recommended -
That was to be purely a Commonwealth liability.
That recommendation also called for federal action.
Obviously that was not a State responsibility.
That was a recommendation to this Parliament.
The Tasmanian Government has given effect to that.
That has been done.
That requires action by this Parliament. Other recommendations included an investigation by the Commonwealth development branch of the fruit industry of Tasmania, and a federal grant of £3,000 a year for five years to the State Forestry Department. The committee also proposed -
That a permanent body be appointed to make a continuous study of the financial relations of the Commonwealth and the States.
This bill is designed to give effect to that. The proposal that an effort be made to bring about uniformity in the preparation of Commonwealth and State financial statements placed a responsibility upon both the Commonwealth and the State. The final recommendation was that the Commonwealth should make certain refunds of customs duty paid on plant imported by the Hydro-Electric Department of Tasmania. The honorable member for Dalley will see that, of the thirteen recommendations by the Public Accounts Committee, nine are definitely directed to the Commonwealth, and one called for the co-operation of the Commonwealth and theState. I hope that the honorable member, before again criticizing Tasmania, will make a closer study of the facts.
.- To several features of the bill I take strong exception, but other provisions will receive my support. The title, “A bill for an act relating to a commission to deal with the matter of grants by ‘the Common wealth of financial . assistance to the States,” is a clear indication that there are many difficulties and problems which must be thoroughly investigated before this Parliament will be justified in making further large grants to the various States. By the submission of this bill, the Government admits the existence of State disabilities, and the need for investigating them systematically before committing the Commonwealth to further grants. By proposing to appoint to the commission five men with special qualifications, the Government declares, in effect, that the problems to be investigated are complex. The Government has stated, also, that the existing difficulties are largely the outcome of the constitutional relations of the Commonwealth and the States, and it proposes a national convention to consider the remodelling of the Constitution. In other words, a commission is to be appointed to assess the grants to be made to the States as compensation for disabilities arising out of the present constitutional relations of the Commonwealth and the States, and simultaneously a convention is to report on the Constitution with a view to removing the disabilities which are the reasons for the grants. If a commission is necessary, I cannot understand why the Government thinks that it should be composed of five members. A commission of three would be more workable and more expeditious, and would be fully equal to its responsible task; in addition, the cost of the inquiry would be considerably reduced. The Government having admitted that the States suffer disabilities, and having decided to recommend the calling of a constitutional convention to remove, at any rate, some of the causes of those disabilities, why does it propose that this commission shall be appointed for five years? Is it contended that the disabilities will exist for all time, and that year after year the position will have to be investigated, and fresh recommendations made? Surely it is feasible for the Government to appoint a lesser number of men for a shorter time to investigate the immediate difficulties, and leave other matters for the consideration of the constitutional commission which will be appointed later. Under this bill power is given to the commission to investigate any matter which a State may place before it. Clause 9 of the bill states -
The commission shall inquire into and report to the Governor-General upon -
When we examine section 96, we find that it covers anything and everything. The wording is as follows: -
Therefore, the bill provides that any State may make application to the commission for assistance in respect to a financial disability, no matter to what that disability may be attributed. This will apply also, no doubt, to the Northern Territory, which has many real difficulties of its own, and to the Federal Capital Territory as well. As these territories obtain certain State powers, and are granted electoral rights which they do not now possess, difficulties, no doubt, will arise which, under this bill, may be submitted to the commission for investigation.
– The honorable member will notice that the bill also gave power for the commission to inquire into the manner in which a grant has been used by a State.
– That is so, but it does not provide for attaching conditions to the grant. Our experience has taught us that States are sometimes brought face to face with financial difficulties, largely through their own faulty administration. There is nothing in the bill to say that the matters to be considered by the commission shall be those arising directly out of federation, or out of the acts of the Federal Government. There should be some safeguard to provide that a State which runs off at a political tangent, as it were, and dissipates its revenues on extravagant or mischievous undertakings, shall not be able to come back after a year or two, and beg, cap in hand, for the consideration of its difficulties by this commission with a view to receiving assistance from the Commonwealth.
I readily admit that there should be some authority to carry out investigations into State disabilities. Within the States themselves, we find certain districts in practically the same position in relation to the whole State as certain States now are in relation to the whole Commonwealth, and the State Parliaments have power to endow various local governments to compensate them for disabilities suffered as a result of the establishment, perhaps, of other local governing bodies. One district may suffer serious disabilities through the development of a neighbouring district, while certain sections of a State may suffer disabilities on account of the concentration of population in a capital city. Such disabilities can be satisfactorily investigated and removed only by a decentralized authority; no government sitting in Canberra can deal effectively with them. State and Federal powers should be clearly defined, and the Commonwealth should not dabble in many of the matters with which it now concerns itself. There is a great deal of duplication of Federal and State efforts, particularly in regard to taxation. The Federal Government takes a large sum of money every year from the pockets of the taxpayers, who are also State taxpayers, and then appoints expensive commissions to determine how some of that money shall be handed back to the States. Not only is the duplication itself costly in the first place, but the machinery for handing back the taxes gathered by the Commonwealth is also expensive to operate. The sooner we get a clear line of demarcation between State and Federal powers, the better off we shall be.
There has been no lack of investigation of State disabilities. Apart from the Interstate Commission set up under section 101 of the Constitution, which came into existence in 1913, and was terminated in 1920, we find that, in 1925, a royal commission, known as the Higgs Commission, was appointed to inquire into the disabilities of Western Australia under federation. In 1926, the Lockyer Commission Avas appointed to inquire into the financial position of Tasmania, and in 1929 the Cook Royal Commission conducted an investigation into the finances of South Australia as they were affected by federation. In 1929, the Joint Committee of Public Accounts also investigated the position of South Australia as affected by federation, and in the same year the committee inquired into the general question of Tasmania’s disabilities. In 1930, the Joint Committee of Public Accounts made a further investigation into the position of South Australia under federation, -while in 192S-29 the Development and Migration Commission carried out an investigation into the internal position of Tasmania. All these authorities inquired into exactly the same matters as it is proposed that this commission shall investigate. The Government would be well advised to hasten the calling together of the Constitutional Convention, whose duty it would be to endeavour to discover reasons for the financial disabilities under which the States suffer. The convention ought to be able to lay down a formula which would be acceptable to the Commonwealth Government, and known to the States, so that they might use it as a basis for arranging their finances. As the Assistant Minister for Trade and Customs (Mr. Guy) pointed out, it is essential that a State Government should know, as far ahead as possible, what grants it may look for from the Commonwealth Government, so that it may budget accordingly. The commission to be appointed under this bill will have no power to investigate the effect of the Commonwealth Constitution on the affairs of the States, and there is no suggestion that the Government will take action to overcome the disabilities which have arisen under the Constitution. Something should be done to clarify the position, so that the States would know over a period of ten or twenty years what financial assistance they might expect from the Commonwealth, and the Commonwealth Government would know what liability it would have to shoulder on behalf of the States.
The financial position of the States seeking assistance is controlled by the export value of their products. Those States which are largely exporters of primary produce are suffering serious financial difficulties, not through federation alone, but because the value of their products is below the cost of production. They are making no profit on the export of their produce, yet the manu factured goods which they require have to be bought at high prices in a protected market from the more prosperous States where the secondary industries have been established. It was this situation which brought about the secession movement in Western Australia. The people of that State are clamouring for something which is practically impossible of attainment, but they are seeking in that way to overcome a disability which is directly traceable to our present tariff policy. The tariff operates for the benefit of Victoria, New South Wales, and Queensland at the expense of Western Australia, South Australia, and Tasmania. The three lastmentioned States purchase practically the whole of their requirements of manufactured goods from the other three States, which share almost’ the whole of the benefits arising from our fiscal policy, and they sell their primary produce in the world’s markets, and receive for it world’s prices. Little, if any, of those primary products is disposed of in the eastern States. Australia’s fiscal policy places a heavy burden on three States, while conferring benefits on the remaining three States. The Government proposes to appoint a commission of five members, notwithstanding that three would be sufficient, and to continue it in office for five years, when one year would be ample were action taken to hold a constitutional convention. Already, the Constitution is 35 years old; since it was drafted, many things have happened to justify its being remodelled. I ‘ hope that when this bill reaches the committee stage the Government will accept amendments designed to. save both time and money. The Government should recognize that a solution of the difficulties caused by the Constitution are beyond the ability of the commission proposed to be appointed.
.- In the opinion of some honorable members who have spoken, this bill has a very wide scope, for they have discussed such questions as secession and the new States movement. I shall not follow them by departing from the subject-matter of the bill, but shall endeavour to confine myself to its provisions. The measure before us seeks to set up a commission to inquire into and report on the measure of financial assistance which should be given by the Commonwealth to needy States. L take it that the commission, if appointed, will be empowered to investigate the finances of the States of South Australia, Western Australia and Tasmania. I regard the Government’s proposal as a real step forward.
– The bill leaves us where we were.
– On other occasions, the disabilities of South Australia have been investigated; first, by the Cook Com-‘ mission, and later by the Joint Committee of Public Accounts. As a result of the reports submitted by those investigations, South Australia received certain grants from the Commonwealth, but, unfortunately, they were less than that State had asked for. Consequently, successive State treasurers have experienced great difficulty in balancing the State budgets year after year. The appointment of this commission should enable the Commonwealth to know the true financial position of the States. That should be of benefit to both the States and to the Commonwealth. Although I am of the opinion that some of the clauses ought to be amended in committee, I am prepared to give the Government’s proposal a trial, and to allow the commission to function. On numerous occasions since 1928, I have referred to the disabilities of South Australia as a result of federation; but I assure honorable members that it has been no pleasure to do so. No honorable member takes any pride in coming cap in hand to the Federal Government for assistance to his State.
– It is an indignity.
– The time has arrived when the determination of the financial assistance which should be granted to necessitous States should be placed on a more satisfactory basis.
Some honorable members have- asked what disabilities Western Australia, South Australia, and Tasmania suffer by reason of federation. I am not fully acquainted with the position in Western Australia and Tasmania; but I know how federation has affected South Australia, and I shall confine myself to putting the case for that State. The disabilities of South Australia can be placed under a number of headings. First, there are those which are the direct result of federation. These disabilities are so many that I shall not attempt to enumerate them now. Secondly,
South Australia has suffered because of the war ; thirdly, through over-borrowing ; and fourthly, by a continuation of deficits.
– Due to bad government.
– I do not admit’ the truth of that sweeping statement. Fifthly, South Australia has had a succession of bad seasons.
– Does the honorable member contend that the Commonwealth should pay for them?
– The sufferings and losses of one State affect all the other States in the federation. In the sixth place, there has been a shrinkage of South Australia’s national income because of the fall in the prices of export commodities. Although I have stressed these several points on many occasions, South Australia has not been granted the assistance for which that State has asked. For what it has received South Australia is thankful; but it needs more.
In June, 1931, all the governments of Australia agreed to adopt the Premiers plan, which was designed to bring about a gradual recovery of the nation’s finances. South Australia carried out that plan to the letter; it decreased its adjustable expenditure to a greater extent than did any other government, and reduced its loan expenditure to the minimum. In doing so, it placed a heavy burden on the people of that State.
– Does the honorable gentleman suggest that this Parliament should subsidize the Premiers plan?
– State taxation in South Australia is exceedingly heavy, and with federal taxation superimposed on it, the burden placed on the citizens of that State is almost insupportable. The tremendous fall in the prices received overseas for the State’s exportable products has meant a serious decline in the State’s total income, with a corresponding restriction of the taxable field. The reduced national income has resulted in a considerable falling off in the volume of ordinary business transacted within the State.
– I am sorry to interrupt the honorable member; but he is not confining his remarks to the subjectmatter of the bill.
– I was leading up to the work which the commission will be called upon to do. I was pointing out that the heroic attempts of South Australia to comply with the Premiers plan, together with the fall in the prices of that State’s exportable products, had reduced the purchasing power of the community and increased unemployment, with the result that the State had had to come to the relief of its necessitous citizens, thereby incurring heavy deficits. Both the Cook Commission and the Public Accounts Committee which investigated the difficulties of South Australia emphasized the necessity for setting up a commission to deal with the granting of assistance to that State. There should be some impartial body appointed to investigate the claims of the weaker States. The bill is a step in the right direction, because it aims at alleviating their position. I do not agree with all its provisions, and at the committee stage I shall endeavour to improve some of them.
– There is no necessity for the appointment of this proposedcommission, because sufficient investigation has already been made of the financial position of the States concerned. Prom what we can gather from the records of the proceedings of this and other Parliaments, it is evident that many commissions and boards, instead of being of benefit, have led to disaster. I estimate that the cost of travelling expenses and fees to be paid to a commission composed of five members will be at least £4,500.
– Probably more than that.
– My estimate is a conservative one. If this commission is appointed it will probably become a subdepartment, with an office and staff, consisting of a secretary, typist and clerks. As it is probable that considerable evidence will be taken from those competent to give information respecting the financial position of some of the States, stenographers may also be required. Surely we have awakened to the fact that at this time of lamentable financial stress not only every pound, but also every penny counts. This Government is embarking lightheartedly upon this expen diture. The peregrinations of this commission must be undertaken at considerable expense.
– Why should there be any necessity for a commission of this kind to peregrinate?
– None of the weaker States will be satisfied unless the commission makes its inquiries and takes evidence on the spot. The travelling expenses of the commission from, say, Sydney or Canberra to Perth, can be easily calculated.
– Either the commission or the witnesses will haveto peregrinate.
– Witnesses will not be able to travel long distances, and, therefore, the lesser number must go to the greater. I estimate that the expense of this commission during a period of five years will be from £30,000 to £40,000, and those who are prepared to justify that expenditure for the purpose indicated in the bill will find some difficulty in explaining their action to the electors, particularly as many in this time of stress have been cut, not only to the bone, but even to the marrow. I am opposed to the appointment of a commission which must recommend to this Parliament additional avenues of expenditure. In the past our treatment of the States has been generous. I cannot for one moment support the claims of Western Australia for the entire control of its customs revenue. That claim can never be recognized by this Parliament, whose duty it is to act in the interests of Australia as a whole. In considering the claims of the smaller States, we must take into account their previous conduct. One of our greatest handicaps is our annual interest bill. The Federal Parliament has frequently been accused byState members of extravagant expenditure of loan moneys. I admit that this Parliament has expended money in many directions that were not justified, including the appointment ofboards and commissions. I have ascertained from the Statistician’s figures that, from 1920 to 1930, the Commonwealth borrowed, on its own behalf, £17,000,000, and for and on behalf of the States, £302,000,000. From those figures it is apparent that much of the blame for the extravagant expenditure which took place during that period can be laid at the door of the States.
– Only some of the States.
– The honorable member for Angas (Mr. Gabb) yesterday spoke on behalf of South Australia. I have always admired him for his outspokenness. He has stated that, when the commission has been appointed, that State will approach it for assistance. He has also moved an amendment which, if carried, will reduce and alter the personnel of the commission. If the bill is not defeated I shall certainly vote for amendments to improve it. In the past I have heard eulogies expressed by some honorable members of the ex-Commissioner of Railways in South Australia, who was said to be a heaven-born administrator; but those honorable members now condemn him for his lavish expenditure in carrying out railway projects in that State. It was the administration of that official that placed South Australia in a serious financial position.
– To what extent?
– To the extent of about £11,000,000, which is indeed a considerable sum. It is therefore necessary for the Commonwealth, when considering the claims of the smallerStates for financial assistance, to take into account any lavish expenditure of that kind. The cost of governing this country, which has a population of 6,500,000, is too great, and cannot continue on the present scale. I shall always be prepared to lend a helping hand to a deservingState. At one time I attended a Premiers conference, at which the then Premier of South Australia, Mr. Hill, admitted that he was faced with a deficit of £1,000,000, and, in order to assist him, a sum of nearly £1,000,000, which the Commonwealth Government had originally intended to distribute among the States for the relief of unemployment, was, with the consent of the other States, given to South Australia. The very man who made that appeal for assistance has now become the self-appointed Agent-General of that State. Why should the States continue to appoint Agents-General, and thus incur useless expenditure. State AgentsGeneral are not now required in London.
What we really require - and we have some of them - are experts and trade publicity men, to assist in marketing our products in Great Britain. I am opposed to the conduct of the Victorian Government in appointing recently an AgentGeneral in London. It is needless expenditure at a time when every penny counts. We must reduce our expenditure.
– Does not the honorable member think that the appointment of this commission will lead to a reduction of expenditure?
– If South Australia is badly in need of financial assistance, it will make a claim upon the Commonwealth whether the commission is appointed or not.
– But the commission will be an impartial body.
Mr.FENTON.-We have yet to obtain a commission whose members hold unbiased opinions. Surely the Commonwealth has shown fairness towards the States in its legislation, its administration, and in the grants that it has made to them. To whom will the commission go for the information that it will require to enable it to make a recommendation to this Parliament? If South Australia applies for a grant, the first man to be examined regarding its past and present financial position will be the UnderTreasurer of that State. If the Commonwealth Government itself conducted the investigation, it would approach the same official. Why, then, this needless expense and trouble? I am sorry that the newly-elected Premier of South Australia considered it expedient to say recently that if a vote were taken in that State on the question of secession the result would be the same as in Western Australia. I cannot imagine an honorable member from South Australia subscribing to that view. It was a most indiscreet utterance. We have the right to ask the States to put their house in order. In the days that immediately preceded and followed federation, the promise was made that the taxation imposed in this country would be greatly reduced. That has never been effected; and those who have conducted the affairs of the different States have been largely responsible. In regard to the borrowing of money, the States have been the worst offenders, not only in days gone by, but also in the recent past. But for the Great War, Australia to-day would be in an extremely happy position, and there would have been no need for the Commonwealth to entrench upon some of the fields of taxation that it has exploited. But, from 1914 onwards, it has been found necessary to incur an expenditure of £800,000,000, largely out of borrowed money, and the interest on that sum has to be met every year. To-day, with the responsibility that rests on this National Parliament in regard to repatriation, pensions, interest, and many other commitments, there is no possibility of our being as liberal as we could have been had we not passed through the awful ordeal of war. I admit that South Australia and other States have been, and are, affected; but the financial responsibility rests mostly on this Parliament. I hope and pray that this country will never suffer from adverse seasons. If it does, the effect will be severely felt, not only by the Commonwealth Government, but also by every other government in Australia. The Commonwealth has rendered material assistance to South Australia. It took over the Northern Territory, with all the liabilities that attached to it. As every one knows, one of the greatest leaders that Western Australia has had - the late Lord Forrest - insisted upon railway communication being provided between the eastern and the western portion of the continent. . That work was carried out by the Commonwealth at a cost of millions of pounds. The Oodnadatta line was taken over from South Australia, and lines running into the Northern Territory from Central and North Australia have been constructed by the federal authority at an expenditure totalling about £11,000,000. A great deal has been done for the States, and we shall be forced to do more for them. Any justifiable proposition that is placed before this House will receive my support. Whatever may be the result of the investigation by this commission, the final judgment will rest with this and another place. We can either amend or reject any proposal advanced by the commission, or adopt one of our own making. I can readily conceive of a position arising, leading to the complete rejection of the recommendation of the commission and the adoption of our own proposals.
We have done this work fairly satisfactorily in the past, and there is no need to incur this expense to have it done in the future. .
Metaphorically, I take off my hat to the 70,000 true Australians who voted to keep Western Australia part and parcel of the Commonwealth. Other threats are now being made, .and if there is any truth in them, I trust that the federal authorites will take steps to see that the leaders of the secessionists are not permitted to carry out their devious designs.
Recently, the honorable member for Forrest (Mr. Prowse) uttered a great tirade against Melbourne. Speaking by and large, I believe that many of our cities are over-populated. Adelaide is about the worst instance in that regard, because, proportionately to the population of the State, its citizens are numerically stronger than those of any other capital city. I believe that the honorable member for Fremantle (Mr. Watson) will bear me out when I say that Melbourne in particular, and Victoria generally, have done more than any other portion of Australia to develop Western Australia by way of capital, management, and labour. Therefore, the charge that their assistance has been negligible does not weigh very heavily with me, especially coming from the honorable member for Forrest. Western Australia is bound to apply to the Commonwealth for a grant; yet it has recently appointed an Agent-General, who is not needed. In regard to Tasmania
– Not guilty.
– An eminent citizen of that delightful little island has made a statement concerning it in which I believe some of us concur. He intimated that before long two alternatives would face Tasmania, one that of becoming a federal territory, and the other that of joining up with another State. I know that neither would be palatable to Tasmania. I have as much regard and respect for Tasmania as for any other part of the Commonwealth, and I am not disloyal when I object to its proposal to appoint a governor from the Old Country. The previous Government conducted that office on the cheapest possible scale, yet it cost something like £4,S00 a year. I am reliably informed that the Chief Justice of the State is discharging the duties of the office at a cost of £800 a year. It is about time that we put in the peg. We cannot continue this kind of expenditure. The people are asking why money is being spent on this, that, and the other thing. Even though each involves only a few thousand pounds, they are extravagances in our present financial position.
The Commonwealth is branded as the most extravagant partner in the federation, yet, as I have said, the amount borrowed on its behalf from 1920 to 1930 was only £17,000,000 compared with £302,000,000 on behalf of or by the States. Loans raised at the present time have the backing of the whole of the assets of the Commonwealth, and that is better security than the assets of any one State. Imagine Western Australia seceding, when its proportion of the public debt amounts to £73,000,000! It is unthinkable! If it went out of the federation it would be absolutely insolvent within two years. The public debts of the States to which grants will probably be made by the Commonwealth are - South Australia, £95,000,000; Western Australia, £73,000,000; and Tasmania, £23,000,000. Those figures total £191,000,000, upon which between £10,000,000 and £11,000,000 has to be found for interest every year. I want to remain a federalist. But there must be some reduction of expenditure. I am not wedded to any particular system. I have no quarrel with those who say that New South Wales should be subdivided into a greater number of States. That, however, would be a piecemeal method of dealing with the question. If we are to do things, let us do them as a Commonwealth. I pay no regard to existing State boundaries. Wherever there is population with a community of interest, let the people band together for their own government. There is too much complexity in the world today; what we want is simplicity in our legislation, our administration, our finance, and all our other activities. If the States combine with the Commonwealth in action designed to advance the welfare of the whole of the people, they :will reap the benefit. I warn them, how- ever, that if they continue their extravagant practices they will not obtain from this Parliament concessions as great as those that have been granted to them in the past. If they are prepared to mend their ways and to cheapen the cost of government, thus benefiting a heavilytaxed people, I shall be with them to the uttermost.
– Judging by their speeches, honorable members recognize that the people are tired of commissions and committees of inquiry, and I am disappointed to find that neither the bill nor the amendment makes an attempt to get at the root of the trouble experienced by several of the States. Everybody agrees, I think, that the statesmen who founded federation had in mind, and mentioned in their speeches, that it would be necessary to remodel the Constitution from time to time, as anomalies became apparent and called for rectification. We have had instances, in the last eight or ten years, of the necessity for the amendment of the Constitution. During that period, members of the present and previous Parliaments have joined in an appeal, to the people to give the Parliament the right to amend the Constitution in certain directions. Constitutional commissions have made various recommendations, other committees have been appointed to deal with the disabilities of the States under federation, and these bodies have directed attention to the fact that the Constitution needed remodelling in several directions. Yet, by this bill, no suggestion whatever is made for an alteration of the present policy, which causes the State governments to come cap in hand to the Commonwealth authorities, and ask for grants of money to enable them to discharge their governmental responsibilities. It is provided in the bill that the proposed commission shall deal only with applications made to it by the States. Therefore, it seems to me that the measure will merely perpetuate the old policy of granting doles to the States, thus imposing indignities upon them.
What should be aimed at is an allotment of fields of taxation, as between the Commonwealth and the States, in such a way as to give the States sufficient revenue to meet their local requirements. It was intended by the founders of fede ration that the Constitution should be so modelled that no hardship would be imposed upon any State ; but experience has shown that the Constitution has not operated as was hoped and intended at the outset. Eight or ten years ago, grants were made to the States as emergency measures; but it was never thought that the special grants given to South Australia, Tasmania, and Western Australia would be continued year by year. The amendment before the House appeals to me more than does the bill itself, because the bill certainly does not go to the root of the trouble.
– Not does the amendment.
– I have already expressed that opinion. If the proposed commission merely collaborates with government officials that work could be done by the States themselves, because they have access to the same records as would be available to the members of the commission. The practice of appointing commissions to inquire into the effect of legislation passed in this country is abhorrent to the public. These inquiries have cost enormous sums in the past, and vast numbers of reports are stacked in parliamentary archives throughout the Commonwealth. It would shock the public to see the great piles of reports that have accumulated. Many of us have been called as witnesses before royal commissions, and although elaborate reports have been presented by those bodies, generally speaking, not a line of their recommendations has been given effect. Yet we are invited this afternoon to perpetuate this useless policy.
I desire to help the people of States that are in difficulty, and if I vote against this measure, I run the risk of doing an injury to those States ; but I am not satisfied to vote for the hill either as it stands, or as it is proposed to be amended. The logical way to deal with the disabilities of the States has become more and more apparent every year. Special grants are being made to the States more frequently than in the past, and the amounts are increasing year by year. The Constitution gives this Parliament the absolute and exclusive right of taxation in certain fields. It also confers absolute freedom to encroach upon all the other fields of taxation which the States now enjoy.
Nominally, it says to the States : “ There are certain fields which are left to you to exploit “. But the Commonwealth Parliament, because of its own necessities, has steadily encroached further upon those fields, and has increased the taxation imposed upon the people, making it more and more difficult for the States to obtain revenue in the fields reserved te them. The Constitution should be remodelled so as to remove the anomalies which are apparent, and equitably re. allot the fields of taxation as between the Commonwealth and the States. Surely the States should not be deprived of their means of raising revenue for their own services, if they must continue to discharge their present responsibilities. Under the present arrangement, Australia is not making satisfactory progress. I differ from the honorable member who said to-day that this measure marks a real reform. It is not a reform at’ all; it practically provides merely for a change in the personnel of an old commission, which is to be asked to inquire into the disabilities of the States.
The honorable member for Calare (Mr. Thorby) showed, by his remarks, that his thoughts run along lines similar to those of my own. He expressed the hope that this bill would be followed by a convention for the purpose of considering the alteration of the Constitution in order that anomalies might be rectified. I do not share the honorable member’s expectation. Nothing definite has been said, either by the Prime Minister (Mr. Lyons), or by any other member of the Government, during the present or previous sessions, to lead us to believe that such a convention will take place in the near future. The first thing necessary to prevent the present waste of money and effort through the overlapping of Commonwealth and State services, and to rectify the lopsided budgets of this country, is an overhauling of the Constitution, so as to give this Parliament greater responsibilities, and thus reduce the legislative functions of the States. If, however, the States are to retain their present powers, it will be necessary to provide them with fields of revenue to enable them to finance the services that they are expected to render. Surely it should be possible fairly to allocate fields of revenue so that the States will be able to discharge their functions without having to ask the Commonwealth for doles from year to year. We have had the undignified spectacle of the States perpetuating the system of granting doles to individuals, and the Commonwealth regularly handing doles to the States. The Constitution should be immediately altered to make that practice unnecessary. I desire to move, at the proper time -
That the following words be added to the motion : - “And that before any appointments are made to the commission, the question of grants by the Commonwealth of financial assistance to the States be referred to a convention arranged by the Commonwealth and the States for a comprehensive review of the Commonwealth Constitution, to include a re-adjustment of Commonwealth and State finances.”
That suggestion seems to me to offer the only hope of escape from the unsatisfactory, unsavoury, and undignified practice of repeatedly making doles to the States to help them in balancing their budgets.
The overlapping of Commonwealth and State services must result in great financial loss to the people. A commission appointed by a previous government inquired as to how the Constitution could be tightened up in order to obviate the envy and discord occasioned by the overlapping of governmental services. One might mention, for instance, the duplication of industrial and social laws, such as those relating to hours and conditions of labour.
– Does the honorable member believe that the States would agree to hand over to the Commonwealth their pow.ers iu that regard?
– The States must be prepared to adopt a sensible line of action, in order to prevent the waste now occasioned by the duplication of many services. There are also the matters of governmental sendees. There are further the matters of unemployment and accident insurance, taxation, and transport by air, land, and sea. As recently as last week, reference was made in the press to cut-throat competition between State railway systems, and surely the overlapping of transport services must result in great financial waste. The numerous railway gauges in Australia cause much financial loss to the public, and the duplication of Federal and State forestry activities should not be permitted. The overlapping of the powers of the States and the Commonwealth may make it impossible to give effect to international conventions, such as those of the League of Nations. If both the Commonwealth and the States, owing to their conflicting powers, are unable to give effect to such conventions, Australia may be blamed for not observing them. A great deal of money is wasted in the collection and tabulation of statistics by the Commonwealth as well as by the State authorities. Probably half a dozen decisions of the High Court have been given with regard to disputes between the Commonwealth and a State, or between a State and a company, and these decisions have been reversed from time to time as the personnel of the court has been changed.
This Parliament should not be dependent upon the recommendations of commissions, but it should go straight to the root of the trouble of the States, and eliminate the cause of anomalies, which constantly become evident, by having a convention as soon as possible, and at the least possible expense, with a view to the alteration of the Constitution. There is a danger of the political freedom of the States being taken from them if we continue the practice of handing over to boards and commissions functions which should be performed by this Parliament. We know that on previous occasions when committees or commissions have inquired into the subject of grants in aid to the States they have recommended that the States should spend the money voted to them in certain ways. They have even demanded, in some cases, that certain kinds of roads should be constructed, and that the work should be done by the contract system in preference to the day-labour system. I am acquainted with many chairmen of roads boards in two or three States who hold the opinion that roads can be constructed more cheaply by day labour than by contract. We also know that certain State governments favour the day-labour system in preference to the contract system. Is it right that boards or commissions of inquiry should be able to require such governments to depart from the policy which they consider to be the best for the State?
I agree with those honorable members who have suggested that the best men available should be appointed to this commission if it is set up. I consider, also, that the suggestion that is continually being made in this House, that we cannot find honest men to appoint to such bodies is unworthy of this Parliament, and lowers the tone of its debates. I do not hold such views; but I believe that men who are perfectly honest may be also consciously, or unconsciously, biased in their political opinions. I am a politician, and bear in mind the criticism of Abraham Lincoln of politicians. I am compelled to admit, on examination of my own mind, that I am biased in favour of certain principles. This will be true, also, of the persons appointed to this commission. Such persons may be favorable, or unfavorable, to the policy of State governments applying for grants in aid, but it is not desirable that they should be able to force their views upon such governments. I realize that men of integrity and honesty, who are members of this commission, may feel strongly that it is wise that the policy which they believe to be right should be followed by the States which receive grants from the Commonwealth. They might feel that the money would be unwisely spent if the policies of certain democratic governments were adhered to, and wisely spent if the policies of more reactionary governments were followed. But it would he dangerous to allow the members of such a commission to obtrude their political views upon State governments.
– Would not the members of a constitution convention be actuated by the same prejudices?
– There would not be the same danger in that case, because a convention would make recommendations for the alteration of the Constitution which would apply to all States, and would not be able to impose their particular political views upon any one State. Men must not be regarded as dishonest because they hold certain political views. I feel strongly, however, that it would be un wise for us to allow a commission of this kind to interferewith the political freedom of a State by determining the conditions under which grants made to such States should be expended. I intend later to move an amendment to the bill to ensure that this will not be done. In the last analysis I shall be compelled to vote for the bill, though I hope that it will be amended. I shall vote for it because, if it is not passed, certain States may be subjected to an injustice, because they may not obtain the grant which they deserve. I shall vote for the bill with reluctance, for I feel that it perpetuates a wrong policy, and does not touch the basic principles of the subject with which it deals.
– How could the rejection of the bill adversely affect a State?
– It might result in grants being withheld for some time from necessitous States. I regret that there appears to be nothing in the bill to provide that the commission shall do any more than investigate and report upon the claims made by States. This is not a measure of reform. I am afraid that if we continue to pursue this policy we shall bring certain State Governments to the point at which they will openly resent being put in the position of having to come cap in hand to the Commonwealth Government for money to discharge administrative duties which the constitution of their State places upon them. If such States have, like Oliver Twist, repeatedly to ask for more they will sooner or later resent the indignity that is put upon them, or, what will be worse, they will tamely submit to it. We knowthat hundreds of thousands of people in different States of the Commonwealth are to-day accepting sustenance doles, whereas a few years ago they would have resented as an indignity the mere suggestion that they should do so. Unfortunately, many people in this new land are accepting poverty like some of the people of London accept it. In the old world people believe that, having been born in a state of poverty, they must remain in it all their lives. The perpetuation of the system of paying doles is ruining the character of many of our people, and I am afraid that the perpetuation of the system of making grants to State Governments will ruin the morale of such governments.
.- I am pleased that the Government has introduced this bill for the appointment of a commission to inquire into the disabilities of necessitous States, and that it desires to remove the commission as far as possible from political interference. I do not agree with all the provisions of this bill. It is provided, in clause 3, that the commission shall bc appointed for a period of five years. In my opinion, this period is too long. Such a commission should have ample time in two years to make all the inquiries that are necessary, and to submit its recommendations to the Government. If it found that two years is too short a period in which to do the work, the commission could be reappointed. Such work should not take five years to perform. It is proposed in clause 15 of the bill that retaining fees - for that is what they amount to - shall be paid the chairman and members of commission. The chairman is to receive £300 a year and the other members £200 a year. I have no objection to those payments. But I consider that the proposed sitting fee of £5 5s. a day is too high. The commission may sit for five or six days a week for the whole five years. I do not say that that will be done; but it could be done, because the chairman is empowered to call meetings of the commission when he thinks fit. If the commission were to sit several days every week for the full term of its appointment, it would be very expensive to the country. I should like an explanation to be given of the provision relating to travelling fees. Will members of the commission draw travelling fees and sitting fees at the same time?
There is no doubt that South Australia, Western Australia, and Tasmania have suffered disabilities in consequence of federation. The Constitution provides, in section 87, that “during a period of ten years after the establishment of the Commonwealth and thereafter until Parliament otherwise provides “ 75 per cent, of the net revenue of the Commonwealth from customs and excise shall be paid to the various States. We know that on the expiration of the tenyear term the Commonwealth Parliament decided that a per capita grant of 25s. per head of the population should be paid to the States. The amount that this yielded was very much below the amount received by the States from the customs and excise duties. Subsequently the per capita payment was also reviewed, and under the financial agreement the States received smaller payments than ever from the Commonwealth. The last investigation of South Australia’s disabilities under federation was made by the Joint Committee of Public Accounts which gave careful consideration to the “ Case for South Australia “, prepared by State treasury and other officials, who, in their report to the Government of South Australia, stated -
South Australia’s claim was duly presented . . . in a comprehensive survey entitled “ Case for South Australia, 1930 “. “ The committee examined a large number of witnesses in connexion with the case and finally recommended that South Australia had a reasonable claim for a grant of £1,000,000 for 1931-32. The committee also recommended the establishment of a permanent body to make a continuous and intensive study of Commonwealth and State finances. That South Australia suffers substantial disabilities arising from federation has been well established by the investigations of the royal commission in 1928-29 and the Commonwealth Parliamentary Joint Committee of Public Accounts 1930-31 ; and also by independent and competent critics. After exhaustive inquiry by the Commonwealth Parliamentary Joint Committee of Public Accounts, the “ Case for South Australia 1930 “ was .found to bo substantially sound and the findings of the committee may be briefly summarized as follows: -
Special disabilities arising out of federation - South Australia does suffer special disabilities to a substantially greater extent than the majority of other States.
Special advantages arising out of federation - South Australia undoubtedly derives substantial special benefits from federation.
Financial position - South Australia is in a serious position financially, and it will be necessary for the Commonwealth to render assistance in the form of a grant to enable the Government to carry out its contractual obligations.
The committee referred also to the difficulties due to high taxation, and pointed out that expenditure on essential services in that State was well below the average of the six States.
As to the financial position of my State,, I may remind honorable members that before federation South Australia was almost free of debt, and now our public debt stands at £103,118,476, or £175* 18s. lid. per head of population. It is safe to say that South Australia is the most heavily taxed country in the world. Its people have made every effort to meet their obligations, and if they are to live, they cannot be further taxed. Following the adoption of the Premiers plan, the Government of South Australia made every effort to live within its income, and reduced administrative expenses to the lowest possible limit. Unlike New South Wales, South Australia has no important coal-bearing measures, with the result that electric power for industry is expensive. Prior to federation, many manufacturing industries were operating successfully, but when border trade barriers were removed, the more highly developed secondary industries in the eastern States put the majority of South Australian manufacturers out of business. The State now depends almost entirely upon primary production. Although it has at Iron Knob one of the most valuable iron ore deposits in the world, owing to the lack of suitable coal, it is unable to establish the iron and steel industry within its borders, the iron ore being transported to Newcastle and other parts of the world.
– Order ! I am loath to intervene; but I must remind the honorable member that his observations are entirely outside the scope of the bill. He is proceeding to show that South Australia’s financial position is due, in part, to the absence of coal measures, which are essential to the development of the iron ore deposits in the State. That line of argument is not relevant to the bill, which provides for a commission to consider grants by the Commonwealth of financial assistance to the States.
– I am endeavouring to show that South Australia’s disabilities are not unrelated to Commonwealth policy for the encouragement of the secondary industries of the eastern States. When the tariff schedule was under discussion last week, I directed attention to the effect, on South Australia, of the duties onoregon, and moved an amendment for an alteration of the duties, but it was outvoted by the representatives of the eastern States. As South Australia is practically destitute of timber suitable for building purposes, the timber duties definitely handicap the building and other industries in that State.
– The honorable member might also mention the effect on the State of the Navigation Act.
– I insist that the honorable member confine his remarks to the terms of the bill, and the proposed appointment of a commission whose duty it will be to inquire into and report upon the disabilities, if any, of the States under federation.
– Very well. During the last two or three years, primary producers in South Australia have experienced considerable trouble with the State of New South Wales, which placed an embargo on the importation of celery, alleging the risk of the introduction of the lucerne flea. Yet there is just as much lucerne flea in New South Wales as in South Australia. That definitely is a disability suffered by South Australia owing to action by another State, and I feel sure that the proposed commission will, after investigating the various other difficulties that have arisen, offer suggestions for remedying them. South Australia, as I have stated, depends almost entirely upon primary production, 98 per cent. of its exports being of primary products.
We have been told that it is the habit of the smaller States to appeal, capinhand, to the Commonwealth for assistance. These appeals are rendered necessary because of the disabilities directly imposed on the smaller States under federation. If the commission does its work thoroughly, I feel sure it will make quite plain the fact that financial assistance to the smaller States is not in any sense a gratuity or a “ dole “, as has been suggested. We do not wish to be treated as mendicants. We entered the federation knowing full well that, as one of the smaller States, we should suffer certain disabilities ; but we expected to be treated fairly. I regret to say that we have not been so treated. The honorable member for Maribyrnong (Mr. Fenton) mentioned that the Port Augusta to Kalgoorlie railway was constructed by the Commonwealth for the purpose of assisting Western Australia. A private contractor offered to carry out that work for £2,000,000, but, instead of accepting that offer, the Commonwealth undertook its construction at a cost of £5,000,000.
Even then the work was not completed. The additional cost of that railway as compared with the tender price of the private contractor, is a definite financial burden on the several States. State Governments are not solely to blame for many of their present difficulties; the Commonwealth must accept its share of the responsibility. As a representative of South Australia, I shall never be satisfied until the Commonwealth does justice to the smaller States. I intend to support the second reading of the bill, because I feel sure that an investigation by the proposed commission will disclose disabilities which should be righted by the Commonwealth. I propose to have much more to say on this matter when the State Grants Bill comes before the House and when we are dealing with the budget later in the year.
.- I am opposed to the bill for many reasons. One is that I believe that the commission will not be able to furnish information which Parliament does not already possess. We have listened to many speeches on various occasions setting out the disabilities which, it is alleged, the smaller States are suffering as the result of federation. We have to consider the probable expense of this proposed commission. I noted, with interest, that members of the legal profession are in favour of the proposal, believing, apparently, that an inquiry such as is indicated will offer scope for the employment of legal talent. Consequently, they support the measure. Professor Giblin, with whom I do not always agree, gave thi3 evidence before the Joint Committee of Public Accounts which reported on the finances of South Australia as affected by federation -
It is not possible to determine special grants to States by assessing directly the net economic disadvantage on account of federation. At first view this procedure seems simple and attractive. On examination, however, it appears that it is practically impossible, how > desirable it may be . . .
The economic position is in a state of rapid flux and the future is uncertain. It is therefore impossible to make any assessment of a special grant which may not become inequitable a year hence, and impossible even to make an equitable assessment for the present year on the information that is available, which must, in general, refer to a previous financial year.
Honorable members who contend that the proposed commission should hear evidence and make recommendations to Parliament regarding a basis for the permanent allotment of grants to States, should realize that those recommendations would be based on evidence which might not accurately describe conditions a year or so hence. I suggest that the commission would only be in a position to make a recommendation for a particular year.
It may be necessary to have some sort of an inquiry into the effects of the operation of the Premiers plan. The honorable member for Boothby (Mr. Price) and other honorable members who represent South Australia have declared that that State has endeavoured to give effect to the strict letter of the provisions of the Premiers plan. They admit that their State is the most heavily taxed, and that the wages paid in South Australia are the lowest in the Commonwealth. It was claimed that if the Premiers plan were given effect by the different State Governments all would attain budget equilibrium. Now the Commonwealth Government is asked to make up South Australia’s unfavorable balance - the result of adherence to that plan. Honorable members should be honest, and admit that the Premiers plan has not done what its supporters claimed it would do.
Only about a fortnight ago, the honorable member for Bourke (Mr. Anstey) related his experiences as a member of the Navigation Commission. If that is the way in which these commissions set about their work no good can be achieved by the establishment of another. The honorable member said that the Navigation Commission perambulated Australia from one end to the other, allegedly to obtain evidence. But, curiously, its itinerary conveniently enabled the commission to take evidence in Tasmania in summer, and in the north of Queensland in winter; incidently, at great cost to the taxpayers of Australia.
Under this measure, the Government proposes to establish a commission composed of five members, the chairman to receive a salary of £300, and each other mem’ber £200 a year, in addition to travelling expenses and a fee of £5 5s. for each sitting day. Judging from the experience of past commissions, honorable members who vote for the bill have no conception of the expenditure to which they are pledging the taxpayers of Australia. Even the Attorney-General (Mr. Latham) was discreet enough not to venture the opinion as to the probable cost of this commission. Honorable members know that the revenue to be used for this purpose and for any grants that are made is supplied by the taxpayers generally, while the benefits are confined to sections of the community. It is essential that the Commonwealth should maintain certain social services for all, and we should ask ourselves why those States which have incurred an adverse balance should receive preference over others. Honorable members who support the payment of these recurring grants to chosen. States apparently assume that the Commonwealth has an inexhaustible purse, and will always be in a position to make available the relief that is sought. It is true that at the moment the Commonwealth Government has a surplus obtained, largely, by reducing old-age and invalid pensions. I am not prepared to consent to give to mendicant State governments that which has been wrongfully taken from a most deserving section of the community, and other honorable members would do well to view the matter from that angle. How do honorable members justify the Commonwealth Government effecting economies at the expense of a section, to provide a surplus to be given to mendicant State governments?
– I rise to a point of order. I submit that it is unparliamentary to describe, as mendicants, the States that are to be benefited by this bill.
– The term is not unparliamentary. If the honorable member claims that it is offensive his protest may be justified.
– I claim that it is an offensive term, sir.
– The honorable member will, perhaps, substitute another word for “ mendicant “.
– Some honorable members hope to evade honest criticism of the actions of their State Governments by adopting obstructive methods in this House. Had the honorable member listened attentively to my remarks he would know that I referred to mendicant State Governments, not to mendicant States, which is a vastly different matter. Practically every honorable member who has supported the measure has claimed that he desires to assist the Commonwealth as a whole, and then has directed his remarks to an argument in favour of special assistance being granted to the State which he represents. If honorable members are genuine in the desire to render assistance to deserving sections, let them insist that the Government shall relieve the community of some of the heavy burden of taxation which is due to overseas interest and exchange. The Resident Minister in London (Mr. Bruce) has failed dismally in the work that he was sent overseas to do, and has made specious excuses for his failure. From information that was supplied in answer to questions asked by me, I find that the Commonwealth Government has the option of redeeming overseas loans, both State and Commonwealth, which amount in the aggregate to considerable sums.
Here are the figures for the three States which it is proposed to assist by grants -
If Australia were to receive justice in this respect, and the burden of interest were lessened by a satisfactory conver sion, the States which now have an adverse balance should be able to adjust their budgets. Honorable members know that loans have recently been raised on the British market at as low as 2£ per cent. Consequently, Australia is not receiving a fair deal in this matter.
The Assistant Minister for Trade and Customs (Mr. Guy) said that he had not exhaustively perused the report of the Public Accounts Committee regarding the disabilities suffered by these States. The honorable gentleman should have paid more attention to the matter. It is claimed by many honorable members that the disabilities suffered by “Western Australia, South Australia, and Tasmania are caused mainly because they are primaryproducing States, suffering from the operation of the tariff policy of this Government. In its report, the Public Accounts Committee made certain recommendations regarding an improvement of the methods of agriculture employed in these States. Can the Assistant Minister point to one State that has given effect to those recommendations? The honorable member for Boothby (Mr. Price) wanted to widen the scope of the bill to provide, not only for disabilities suffered by these States under federation, but also for other disabilities suffered by all the States which are members of the Commonwealth. Honorable members of the Country party, while stressing the necessity for avoiding duplication of activities, urged that new States should be set up.
Sitting suspended from 6.15 to 8 p.m.
– The members of the Country party are merely using the present bill as an opportunity for propaganda in support of the agitation for the establishment of new States. They contend that many of the disabilities suffered by the States would disappear if further States were created. But for seven years the Country party supported the BrucePage Government, and although during all that time the fate of the Ministry was in their hands, they made no effort to force upon the Parliament the new States issue. Many of the arguments advanced by the members of the Country party regarding means of cheapening the cost of Government will not bear analysis. In New South Wales, for instance, a large proportion of the population resides in and about Sydney, and if new States were created, those parts which were separated from Sydney would, through lack of population and the cost of maintaining an enormous mileage of non-paying railway lines, soon find themselves in financial difficulties.
– Order! This bill does not deal with new States.
– I was replying to the contention of the honorable member for Werriwa (Mr. McNicoll) that the establishment of new States would help to remove some of the existing disabilities, but apparently you, sir, realize as I do, the illogicality of that argument.
We are told that the members of the proposed commission will function without any political bias. Evidently that opinion is not shared by the honorable member for Perth (Mr. Nairn), because he stated that the Commonwealth Government had evaded many of its obligations through decisions of the High Court, the early members of which he described as keen federalists. The implication was that even High Court justices are biased by preconceived ideas. If absolute impartiality is absent from justices of the High Court, how much more difficult would it be to get an unbiased commission composed of men whose training may not have fitted them to exercise judicial functions? ‘ The proposal to create this commission is only a sop offered by the Government to the secessionists in Western Australia. Members representing that State are endeavouring to intimidate this Parliament into granting additional financial assistance to Western Australia in order to keep it in the federation. The affirmative vote recorded in the recent referendum in that State was not so much a demand for secession as a vote of no confidence in the present Commonwealth Government. The Prime Minister (Mr. Lyons), and the right honorable member for North Sydney (Mr. Hughes), visited Western Australia to advise its people to vote against secession, and the people not only rejected their advice, but also refused to hear them. That the affirmative vote was not a declaration for secession was proved by the defeat of the Nationalist party, and the return to power of the
Labour party, whose policy is unification. The people of Western Australia could not vote for secession and at the same time place in office a party pledged to extend the powers of the federation. In those circumstances, the vote must have been an expression of want of confidence in the present Commonwealth Government.
In regard to the cost of the proposed commission, honorable members have said that, although in addition to the retaining fees of £300 a year for the chairman and £200 for each other member, the commissioners are to receive an allowance of £5 5s. a sitting, plus travelling expenses, it does not follow that the commissioners will sit on five or six days a week. There is nothing in the bill to prevent them from doing so. The scope of the inquiry is unlimited and if we may judge by what the honorable member for Bourke (Mr. Anstey) told us recently of earlier commissions, if witnesses are not available, the Commonwealth will be combed to discover them. If evidence is not forthcoming it will probably be invented by the commission, as has been’ done by other commissions, in order to provide an excuse for meeting five or six days a week throughout the five years of its tenure. Apparently, even so distinguished a body as the League of Nations is not above these weaknesses, for the right honorable member for North Sydney told us last night how committees of the Assembly wasted time, one committee occupying seventeen sittings in discussing whether the staff of the League should suffer a 10 per cent, reduction of salaries. With such an example before us, we can estimate what may be expected of commissions. Instead of listening to the statements of honorable members who complain that their States have suffered bv their inclusion in the Commonwealth, more real advantage can be conferred on both Commonwealth and States by demanding the recall of the Resident Minister in London (Mr. Bruce), and the appointment in his stead of a man with an Australian outlook and sentiment, who will grapple seriously with the financial problems that require solution on the other side of the world, in order that the people of Australia may get some relief from the burden of taxation. Because this bill is merely a sop offered by the
Government to those who supported the no-confidence motion in Western Australia, because, like other similar proposals, it will provide an opportunity for the Government to appoint, to highly remunerative positions, supporters and friends, thus paying them for services rendered to the Nationalist party in political contests, the party to which I belong is not prepared to support it. We believe that at this period in the history of Australia the proposed expenditure is unwarranted. All the information that the commission might gather is already known to members of this House, or is available in government departments. Moreover, the committee might report in favour of granting enormous sums to various States - sums that could not be paid out of Commonwealth revenues, unless the already curtailed social services were further reduced. We believe that no good purpose would be served by the creation of the proposed commission, and we shall vote against the bill.
Debate (on motion by Mr. E. J. Harrison) adjourned.
(1932-33) (Nos. i to 4.)
In Committee of Ways and Means: Consideration resumed from the 6th April, 1933, ou motions by Sir Henry Gullett (vide page 363, volume 133, and page 1288, volume 134), and on further motions by Mr. White (vide pages 53 and 935)-“
That the schedule to the Excise Tariff 1921- 192S be amended as hereunder set out . . .
Division 1. - Ales, Spirits and Beverages
Item 1 (Beer)
.-Unless honorable members express their view on this item, the Government may conclude that the committee is satisfied with the existing excise duties on beer. This beverage is rightly expected to make some contribution to the revenue, but as this is primarily a tax on the workers, who are the principal drinkers of beer, and their wages and salaries have been reduced in recent years, the Government should take early steps to review the duties. At the present time of every 6d. expended on beer, approximately 3d. is paid to the Commonwealth revenue. The wharf labourers, coal-miners, and other men following strenuous occupations, who feel that after a solid day’s work they are entitled to a pint of beer, should not be required to pay for it 7d. or 8d., of which nearly half is taxation. A study of the excise duties on beer shows that since federation, and particularly since the war, they have risen very rapidly. As wages and salaries have been reduced, I support the movement on the coal-fields and elsewhere for a reduction in the cost of beer in accordance with reductions of other forms of taxation. We cannot by taxation force the workers to become teetotallers. Whilst during the wai and the years immediately following an increase of excise duties for revenue purposes was justified, the time has come for a reconsideration of this unjust impost on the workers. A reduction of the excise duty from 2s. to ls. 6d. a gallon would enable beer to be bought foi 3d. a glass, a privilege which the workers have not enjoyed since pre-war day3. When we realize that for every pint of beer that a working man drinks he contributes 3d. to the Commonwealth revenue, honorable members, irrespective of their opinions on the liquor question, will agree that the workers are being taxed far too heavily in this regard. The consumers of beer have, during the last few years, contributed approximately £500,000 a month to Commonwealth revenue. Even those working men who still have jobs are now receiving substantially reduced wages, so that there is a good case for the proposal that the Government should consider, when preparing its budget for next year, the reduction of the excise duty on beer. Had I remained silent the Government might have believed that the committee was satisfied with the existing rates. I urge the Government to give sympathetic consideration to the proposal for a reduction in excise duties.
– The excise duty on beer undoubtedly provides a considerable part of Commonwealth revenue. In fact, it provides a little over half of the revenue derived from excise duties. 1 point out, however, that the Commonwealth has every year to find £67,300,000 to meet the following commitments: -
It is evident, therefore, that excise revenue must be collected if the Commonwealth is to pay its way. The Government will give consideration to the point raised by the honorable member when framing its budget proposals, but most honorable members will agree that, when it comes to a matter of remitting taxation, there are other classes of taxpayers more worthy of consideration than those who pay the excise duty on beer. The present excise duty is 2s. a gallon, which is only 3d. a gallon more than in 1921. The honorable member asked for a reduction of the rate by 6d. a gallon, which, on the present rate of consumption, would lead to a loss of revenue equal to £1,191,691.
– If the excise duty were reduced more beer would be drunk.
– Every time an application is made for a reduction of duty on any item we are told that, if it were granted, more of the commodity would be consumed. Those who have asked for a reduction of the excise duty on beer point out that conditions are bad in the industry; but are they not bad in every industry? They state that, because of the falling off in the consumption of beer, the allied industries, such as the bottlemaking industry and the sugar industry, are suffering, and they say that the excise duty represents 70 per cent, of the brewers’ price to the hotelkeepers. Other points are that the consumption of beer fell from 39.9 gallons per head in 1929 to 7.28 gallons in 1931-32, and that unemployment is being increased because of the constantly contracting consumption of beer. The Government has heard deputations on the subject, and has asked pertinent questions regarding the cost of production, and the selling price to hotelkeepers. That information is essential if the Government is to consider seriously any reduction of the excise duty. It has not yet been forthcoming, and, in its absence, the Government finds it difficult to make a decision.
In the absence of this information, the following comment is offered: In the first place, the large contraction in consumption cannot be dissociated from the depressed conditions obtaining to-day. The reduction of revenue receipts is common to most of the lines on which revenue duties are imposed, and is noticeable in regard to both customs and excise revenue items. The greatest quantity of beer on which excise has been paid in any year was 71,160,000 gallons in 1928-29, and the revenue received was £6,191,276, the rate then being ls. 9d. a gallon. The quantity cleared in 1931-32 was 47,668,000 gallons, on which excise amounting to £4,770,000 was paid. Compared with the peak period, 1928-29, consumption has fallen by 33 per cent., and revenue returns by 23 per cent. The excise duty operating last year was 2s. a gallon.
As it is claimed that a reduced excise and selling price would increase both consumption and revenue returns, the question should be looked at from the point of view of what increase in consumption would be necessary at the various reduced rates suggested by the applicants, even to maintain the present revenue. If the excise rate were reduced to ls. 8d. a gallon, consumption would have to be increased by 9,536,000 gallons, or 20 per cent, if the excise rate were ls. 6d. a gallon, 15,892,000 gallons more beer, or 33-J ner cent., would have to be consumed ; and with the excise rate of ls. 4d., the increased consumption would need to be 23,838,000 gallons, or a 50 per cent, increase. At a rate of ls. 4d. a gallon, consumption would have to approximate that of the peak year of 1928-29 in order to return the same revenue as last year. These facts cannot be overlooked, and, as the Government must obtain revenue, a stronger case will have to be made out in favour of a reduced excise duty on beer than has so far been advanced.
.- I support the request of the honorable member for Cook (Mr. Riley) that the Government should, when considering its budget for 1933-34, consider reducing the excise duty on beer. “When other forms of taxation were remitted, we were told that their remission would bring about increased purchasing power, and greater employment. In Queensland, it is generally understood among medical men that beer drinking tends to preserve the health of men employed in dusty work such as mining. In the Mount Morgan district, I have been told that beer drinking has reduced the tendency of miners to contract phthisis. If that is so, the proposal of the honorable member for Cook is worthy of consideration by the Government.
Item agreed to.
Item 2, sub-item (b) -
By omitting the whole of sub-item (b) and inserting in its stead the following sub-item: - “(b) Blended brandy, distilled wholly from wine, the fermented juice of fresh grapes, and containing not less than 25 per cent, of pure spirit (which has been separately distilled from wine, the fermented juice of fresh grapes, by a pot-still or similar process at a strength not exceeding 40 per cent, over proof), the whole being matured by storage in wood for a period of not less than two years, and certified by an officer to be brandy so blended and matured, per proof gallon, 29s.”
.- I appeal to the Government to reduce, if possible, the present rate of excise on brandy. Australian brandies are reputed to be the purest and best in the world, and they are made from wine which, in turn, is made from grapes grown in Australia. Hospitals use a considerable amount of brandy for medicinal purposes, but the excise duty is now so high that they find it difficult to obtain as much brandy as they need. I appeal to the Government to reduce the excise duty in order to help the hospitals.
.- I ask the Minister whether he will give an assurance that the excise duty on blended brandy will be reduced to the same rate as that of brandy distilled wholly from wine? This difference of duty has been in the schedule for a long time, and has had a discouraging effect on the distilling and blending in Australia of brandy suitable for a hot climate. Brandy distilled direct from wine without any blending usually contains a good deal of other matter out of the grapes apart from the alcohol and basic juices. That gives what is known as a “fatty” quality to much Australian brandy, and imposes a handicap on the distilling industry, and, through it, on the growers of grapes which are suitable for making wines for distillation, because it prevents them from making what is both the most palatable and the most healthy kind of brandy. I do not suggest that in a highly technical matter of this kind the Minister should give an immediate decision; I merely ask that he will assure the committee that the question which I have raised, and which I know has been submitted to his department by the principal brandy distillers, will be carefully considered, and that, if the officers can see no obstacle, he will give an undertaking that the discrepancy between the two kinds of brandy will be removed.
– Last year, blended brandy to the value of only £1,617 was cleared from bond.
Mr-. Hawker. - This discrepancy prevents distillers from blending the brandy which is the most saleable, because it is the most palatable.
– There is a differentiation. The proposed amendment is one which the Government is prepared to accept. On last years’ figures, only £80 is involved.
Amendment (by Mr. Hawker) agreed to -
That sub-item (b) be amended by adding the following: - “And on and after 25th May, 1933-
Blended brandy, distilled wholly from wine, the fermented juice of fresh grapes, and containing not less than 25 per cent. of pure spirit (which has been separately distilled from wine, the fermented juice of fresh grapes, by a pot-still or similar process at a strength not exceeding 40 per cent. over proof), the whole being matured by storage in wood for a period of not less than two years, and certified by an officer to be brandy so blended and matured, per proof gallon, 28s.”
Item 2, sub-item (c) -
By omitting the whole of sub-item (c) (twice occurring) and inserting in its stead the following sub-item: - “(c) Apple brandy, distilled wholly from apple cider and brandies distilled from other approved fruit juices by a pot-still or similar process at a strength not exceeding 40 per cent. over proof, matured by storage in wood for a period of not less than two years, and certified by an officer to be pure apple or pure fruit brandy, per proof gallon, 29s.”
Amendment (by Mr. Hawker) agreed to-
That sub-item (c) be amended by adding the following: - “ And on and after 25th May, 1933 -
Item 2, sub-item (d) -
By omitting the whole of sub-item (d) and inserting in its stead the following sub-item: - “(d) Whisky, distilled wholly from barley malt by a pot-still or similar process at a strength not exceeding 45 per cent. over proof, matured by storage in wood for a period of not less than two years, and certified by an officer to be pure malt whisky, per proof gallon, 28s.; .
And on and after 1st October, 1933 -
d ) Whisky, distilled wholly from barley malt by a pot-still or similar process at a strength not exceeding 45 per cent. over proof, matured by storage in wood ‘for a period of not less than three years, and certified by an officer to bepure malt whisky, per proof gallon, 28s.”
.- I move-
That sub-itemd be amended by omitting “ 1933 “ with a view to insert in lieu thereof “ 1935 “.
Sub-item 2 d provides for the maturation period of pure malt whisky to be increased from two years to three years as from the 1st October, 1933. This extention to three years was first passed by the last Parliament, and the proposal then was to make it operative forthwith. However, upon the assumption of office by the present Government, the representations submitted by the smaller whisky distillers received the Government’s con-‘ sideration, and in order that these may be in a position to accumulate stock of threeyearold whisky, and carry on their businesses continuously, the item was amended to provide for the three-year maturation period to operate as from the 1st October, 1933. One distillery which commenced the distillation of whisky in September, 1931, when the period was two years, would, however, be unable to market its product before September, 1934, and, as the Government had endeavoured to safeguard the position of the other smaller distilleries, it believed that this particular distillery should not be penalized. Consequently, it proposes to postpone the operation of the three-year period until the 1st October, 1935.
Amendment agreed to.
Item 2, sub-item (e)-
By omitting the whole of sub-item (e) and inserting in its stead the following sub-item: - “(e) Blended whisky, distilled partly from barley malt and partly from other grain, containing not less than 25 per cent. of pure barley malt spirit (which has been separately distilled by a potstill or similar process at a strength not exceeding 45 per cent. overproof), the whole being matured by storage in wood for a period of not less than two years, and certified by an officer to be whisky so blended and matured, per proof gallon, 28s.
And on and after 1st October, 1933 -
Blended whisky, distilled partly from barley malt and partly from other grain, containing not less than 25 per cent. of pure barley malt spirit (which has been separately distilled by a pot-still or similar process at a strength not exceeding 45 per cent. overproof), the whole being matured by storage in wood for a period of not less than three years, and certified by an officer to be whisky so blended and matured, per proof gallon, 28s.”
.- I move -
That sub-item (e) be amended by omitting “ 1933” with a view to insert in lieu thereof “ 1935 “.
This is a similar amendment to that moved previously; it deals with blended whisky, whereas the other dealt with malt whisky. This sub-item provides for the maturation period of blended whisky to be increased from two years to three years as from the 1st October, 1933. The amendment extends the date of the operation of the three-year period to the 1st October, 1935. The object is to ensure that the small whisky distillers who do not hold stocks of three-year old whisky will not be penalized, but will be able to carry on continuous operations.
.- A couple of years ago this Parliament decided that Australian whisky should not be sold until it had been three years in bond. Am I right in assuming that, under this amendment, whisky which has been two years in bond can be sold up to a certain date?
– That is satisfactory, for it will give the Australian manufacturers a chance.
Amendment agreed to.
Item 2. sub-item (p) -
By omitting the whole of sub-item (f) and inserting in its stead the following sub-item: - “(f) Rum, distilled wholly from sugar, sugar syrup, molasses, or the refuse of sugar cane, by a pot-still or similar process at a strength not exceeding 45 per cent. overproof, matured by storage in wood for a period of not less than two years, and certified by an officer to be pure rum, per proof gallon, 30s.”
– I move -
That sub-item (f) be amended by adding the following: - “ And on and after 25th May, 1933 -
Rum, distilled wholly from sugar, sugar syrup, molasses, or the refuse of sugar-cane, by a pot-still or similar process at a strength not exceeding 45 per cent. overproof, matured by storage in wood for a period of not less than two years, and certified by an officer to be pure rum, per proof gallon, 28s. “.
The amendment, if agreed to, will bring the excise duty on rum into line with the duties on brandy and whisky, both in bulk and bottled. The excise duty is 2s. a gallon higher on rum than on any other spirit manufactured in this country under similar conditions. The excise duty on whisky is 28s., whereas on rum it is 30s. a gallon.
– The excise duty on gin is as high as that on rum.
– Freshly distilled gin can be placed on the market, whereas rum must mature for two years before it can be offered for sale. There are rum distilleries in practically every State ; the three largest are in. Queensland, which
State distils 75 per cent, of the rum consumed in Australia. The largest rum distillery in Australia is situated in my electorate ; but for the last twelve months it has not manufactured any additional rum, because it already has on hand 360,000 liquid gallons, equal to about 500,000 proof gallons, of rum, varying in age from one and a half to five years. Large sums of money have been invested in this industry, which assists the sugar industry by using molasses for the making of rum. Owing to the depression, there has been a falling off in the consumption of rum similar to that in the case of other spirits and beer. The heavy excise duty has added to the difficulties of the rum industry.
– Why did not the honorable member, when Minister for Trade and Customs, reduce the dutson rum?
– The honorable member for Henty (Sir Henry Gullett), ought to know that this industry has been placed at a great disadvantage by what occurred at the Ottawa Conference. Previously, Australian rum enjoyed a marginal difference of lis. a proof gallon o/er foreign rum, the respective rates being 30s. and 41s. a gallon. The recent decisions at Ottawa reduced the import duty on foreign rum, including that from the West Indies, to 36s., and in the short time that has elapsed since then, there has been a considerable increase in the importation of rum, notwithstanding that it is the product of black labour.
– Like the Tamworth tobacco.
– Australian brandy enjoys a marginal difference of 18s. a gallon over imported brandy, and gin and whisky a difference of 17s. a gallon. In the case of rum, however, the marginal difference is only 6s. a gallon. Those rates give an unfair preference to the other spirits, and place rum at a disadvantage. Queensland is the only place in the world in which rum is produced by white labour. Honorable members should not forget that the Ottawa agreement, which it was said would do so much for our primary industries, diminished the difference between the import duty on rum produced by black labour countries and ihe excise duty on Australian rum. It is contended by those who support the Ottawa agreement that the effect of the reduction of the import duty will be to increase our exports to the West Indies. There has been no evidence of such a happening. I am aware that some honorable members have decided views about the wisdom of drinking rum; but since a big section of the Australian public chooses to drink this beverage, we should give a preference to the Australian product. Like the honorable member for Angas (Mr. Gabb), I am of the opinion that if tho public wants wine or rum or whisky, we should, at least, see that the Australian product is given a preference over the imported product, especially when the former is produced by white labour. The excise duty on ale and porter is 2s. a gallon; on brandy, both in bulk and bottled, it is 28s. ; on gin and rum it is 30s. ; on whisky in bulk or bottled, it is 28s. The amendment will bring rum into line with whisky and brandy. Gin, as I have already stated, is in a different category, because, unlike rum, whisky, or brandy, it has not to be stored for at least two years before being allowed to be sold. I hope that this simple amendment will be carried, for it will assist to get this industry out of its difficulties. During recent years the consumption of rum in Australia has fallen off considerably. The carrying of the amendment will make no appreciable difference to the revenue. If, by reducing the excise duty on rum, this beverage can be sold more cheaply, more of it will be consumed, and there will be a corresponding decrease in the consumption of rum from the West Indies.
.- The amendment is not so simple as the honorable member for Capricornia (Mr. Forde) would have us believe. As the honorable member for Wakefield (Mr. Hawker) has pointed out, the excise duty on gin is the same as on rum.
– I admitted that.
– There has been a good deal of propaganda in regard to this matter. I have here a pamphlet headed, “ Unfair discrimination ; Victorian whisky versus Queensland rum”, from which I quote the following extract: -
Speaking on behalf of several Queensland rum distilleries, Mr. Harden, the general manager of Thomas Brown and Sons Limited, said: “ The Federal Government is driving Queensland rum off the -market by collecting 20s. a gallon inland duty on it, as against 28s. for Victorian whisky.”
Mr. Harden made it clear that the Queensland rum interests, most of whom had ceased operations, had no desire to alter the arrangement under the Ottawa agreement whereby the duties on imported rum were reduced. . . .
This is more than the Deputy Leader of the Opposition has admitted. According to Mr. Harden, these varying duties have been fixed with a view to forcing Victorian whisky on an unwilling public. The pamphlet continues -
It appears that Queensland industries never receive fair treatment when our interests conflict with Victorian interests. Under the Ottawa agreement, they reduced the duty on imported rum, and gave the Australian distillers protection of (is. a gallon, whereas Victorian whisky has protection of 17s. a gallon. The arrangement- the Government made at Ottawa must be carried out, and we do not ask now that it should be altered or varied in any way.
Neither does the Government wish the Ottawa agreement to be varied or altered in any way. One great reason for the disparity between the excise duty on rum and that on whisky is that rum is produced from a by-product of sugar, and is, therefore, produced at a lower cost. In 1906, a royal commission on customs and excise tariffs made the following remarks respecting the disparity in the excise duties : -
That cheaply-produced spirits should pay a higher excise duty than more expensive spirits; that spirits produced from molasses at 9d. and ls. a gallon should not be allowed to kill out the distillation of whisky from barley malt, which costs from 3s. 6d. to 4s. per gallon; and that the consumption of cheap and inferior spirits should not’ be encouraged at the expense and sacrifice of spirits of higher grade, quality, and price.
During the last fiscal year, 283,000 gallons of Australian rum were cleared from bond, as against only 142,000 gallons of Australian whisky. Honorable members do not seem to be aware of that fact. It has been argued that rum is becoming too expensive for the consumer; but I would point out that the sales of rum, as in the case of beer, have fallen because of the depression and the lower pur chasing power of the community. When the customs and excise clearances for 1928-29 are taken as a basis of comparison, it is found that the consumption of whisky has declined 57.2 per cent., whereas the decrease in the consumption of rum is only 48.3 per cent. It is also interesting to note that 71 per cent, of the whisky consumed was imported whisky, which carried customs duties ranging from 45s. to 53s. a gallon. On the other hand, almost the whole of the rum which went into consumption was of Australian origin, dutiable at 30s. a gallon, the imports contributing less than 9,000 gallons out of a total consumption of 292,000 gallons. Evidently the Queensland distillers, who are doing very well, want the whole of the Australian trade for themselves. They have frequently corresponded with the department and myself, and have been extended a cordial invitation to submit their case to the Tariff Board. They have refused to avail themselves of that opportunity; it may be that they are afraid to disclose their production costs. As they are not willing to place their case before the Tariff ‘ Board, and as they cannot prove that the consumption of rum has declined to any extraordinary extent, I submit that the committee should not alter the present rate of excise duty.
– Notwithstanding what the Minister has said, I am more convinced than ever that the rum industry has suffered a grave injustice ever since the royal commission which was appointed in 1906, inquired into it. Honorable members will understand that, since then, conditions have changed. That commission recommended -
That .the consumption of cheap and inferior spirit, e.g., rum, should not be encouraged at the expense and sacrifice of spirits of higher grade, quality, and price, such as whisky.
That recommendation has proved to be absolutely erroneous, since it has been shown beyond doubt that rum is now a universal drink. It is consumed in practically every part of Australia in as large a quantity of whisky or any other spirit. The commission, in its report, endeavoured to show that rum was not so pure and wholesome as whisky. I am satisfied that it is the purest drink produced, and the industry should, therefore, receive greater consideration from this Government. As a matter of fact, rum is chiefly a working man’s drink. If the amendment moved by the Deputy Leader of the Opposition (Mr. Forde), for a reduction of the excise duty were carried, this product could be sold more cheaply, and larger quantities would be consumed. The excise duties - on brandy 28s., on gin 30s., on rum 30s., and on whisky 28s. - provide the following margins for Australian spirits as against imported : - Brandy, 18s. ; gin, 17s. ; whisky, 17s. ; rum, 6s. I claim that rum should have at least the same margin of protection as whisky. The high excise duty prevents the rum distillers from lowering the price of rum. As the Deputy Leader of the Opposition has pointed out, the bulk of the Australian rum is distilled in Queensland. There are three distilleries in that State, and another in New South “Wales. The three distilleries in Queensland are producing rum from molasses, which is a by-product of one of the greatest Australian primary industries. The molasses from which Australian rum i3 distilled is produced in Australia by white labour, whereas the molasses from which West Indian rum is distilled is produced by black labour. The Bundaberg distillery is in a precarious position. The management, in its correspondence, states -
We have stored in our spirit bonds at the present time, 360,000 liquid gallons of rum, equivalent to nearly 500 proof gallons, varying in age from one and a half to five years, which, partly on account of the high excise duty, and partly to the distressing economic conditions, is going into consumption at a very slow rate. In fact, notwithstanding our enormous storage capacity, wo have not distilled any rum for over twelve months.
That distillery has been closed down for over twelve months, and I understand that the company will not distil any further rum for another twelve months. That will mean a loss of revenue in many directions. It will mean a reduction of employees, a loss of wages, and a loss of revenue to the Queensland Government by way of railway freights. The Beenleigh distillery is in a similar position. During the last twelve months of its operations it paid no less than £1,260 in wages, and £2,374 in railway freights. I am satisfied that if the industry is not assisted by a reduction of the excise duty, it will receive a severe setback, many men will be thrown out of employment, and the revenue of the Queensland Government will suffer. I hope that the committee will accept the amendment of the Deputy Leader of the Opposition. .
.- The Minister (Mr. White), in reply to the Deputy Leader of the Opposition (Mr. Forde), endeavoured in his usual “ conciliatory “ manner to divide one section of the committee against the other by stating that what the Government had done in respect of this item evidently constituted the vendetta against Queensland of which we had heard so much.
– Only from the honorable member. I did him the honour of not mentioning his name.
– The representatives of Queensland in this chamber have not only heard about this vendetta, but have also been experiencing it since the people of that State saw fit at the last elections to return to this Parliament a large number of Labour representatives and three Labour senators. The Government’s action in respect of this item is another instance of this particular vendetta. The superficial argument of the Minister is not sufficient to answer the charge which we have made against this Government, that for no particular reason at all it has imposed upon rum an excise duty of 30s., whereas the excise duty on whisky is only 2Ss. Prior to the Ottawa Conference, and consequent upon the action of the Scullin Government, Australian rum enjoyed a protective margin of lis. per proof gallon against West Indian rum, but since the ratification of the remarkably unsuccessful Ottawa agreement it has enjoyed a protection of only 6s. a gallon. The Government, in making this differentiation in the margin of protection, relies upon the report of a royal commission which inquired into the Australian rum industry over a quarter of a century ago, whereas in dealing with important tariff items it has become practically the established practice if this Parliament, where the report or: the Tariff Board on any particular item is more than six months old, to call for a fresh report. About 27 years ago a royal commission decided that rum was a cheap and inferior spirit. As a matter of fact it is recognized even by the man in the street to-day that this product is probably the purest procurable. It is drunk to a large extent by the poorer classes who cannot afford to purchase whisky and other expensive spirits. Therefore, apartfrom any other reason, it is entitled to more consideration than is given to whisky and other spirits.
– Does the honorable member consider that we should be doing the people a service by enabling them to increase their consumption?
– I shall not engage in a debate concerning the qualities of different kinds of liquor, nor upon prohibition generally. The committee is now discussing the relative assistance given to rum and to whisky. This Parliament has seen fit to assist the whisky, rum, brandy, wine, and other industries, and we are now asking only that the rum industry be given the same measure of assistance as is received by the others.
On behalf of the Government, the Minister has referred to the position in regard to gin, and has stated that Australian gin does not receive any more assistance than Australian rum. I point out that the excise duty on both Australian gin and Australian rum is 30s. a gallon, but that the import duty is 47s. a gallon in the case of gin, and only 36s. a gallon in the case of rum - a difference in favour of gin of11s. a gallon. Australian rum must be matured in wood for two years before going into consumption, while gin need not be matured, and may be 3old freshly distilled.While rum is produced to a slight extent in other States, over 75 per cent. of the production takes place in Queensland, where three companies are operating which, at the present time, are able to find only a very small market for their product.We ask the Government to take advantage of the opportunity that now presents itself to assist the Australian rum industry, by placing upon Australian rum the same excise duty - no higher, and no lower - as is placed on whisky and other spirits.
.- The excise duty on Australian rum, under the 1921-28 tariff, was 28s. a gallon. The Scullin Government increased that rate to 30s. a gallon. The present proposalis to continue the Scullin rate.
– I am sorry that the honorable member for Oxley (Mr. Baker) introduced the question of a vendetta against Queensland. I do not believe that it exists, except in his imagination. Ifthe report made in 1906 is so old that cognizance may not be taken of it, why does not the Australian rum industry approach the Tariff Board for an up-to-date recommendation? It has been invited to place its case before that body, but has refused to do so.
The honorable member for New England (Mr. Thompson) has asked to what extent the revenue would be affected by a reduction of 2s. a gallon. On the present consumption the revenue would lose to the extent of £28,000. I point out, too, that the consumer would not benefit from such a reduction, because by the nobbler the reduction would be only fractional. Consequently, the distillers of the rum alone wouldbenefit.
.- In reply to the honorable member for Perth (Mr. Nairn), I point out that the Scullin Government substantially raised the import duty on rum from foreign countries, and thus greatly increased the margin of protection given to the Australian rum producers. If the excise duty is restored to the rate that operated while the Scullin Government was in office, why is it not intended to continue the measure of protection that was given to the Australian rum-makers during that period? The Ottawa agreement has reduced the preference enjoyed by Australian rum distilleries.
Item 2, sub-item (j) -
By omitting the whole of sub-item (j) and inserting in its stead the following sub-item : -
(1) Spirit for fortifying Australian wine, distilled wholly from the fresh juice of doradillo grapes, subject to regulations, per proof gallon, 10s.
– I move -
That sub-item (J) be amended, by adding the following: - “ And on and after the 25th May, 1933 - (j) Spirit for fortifying Australian wine, subject to regulations, per proof gallon, 9s.”
This is an important amendment. The Government is alive to the difficulties in the wine industry. In this, as in many other industries, there has been overproduction, in addition to which there has been a conflict of interests as between the grape-growers and the wine-makers. Although the export of wine has been increasing, the domestic market has been smaller than was expected. There is a big surplus of wine in the cellars of the wine-makers, and the grape-growers have had considerable difficulty in selling their crops. The proposed reduction of the excise duty does not go as far as the Federal Viticultural Council desires. Frequent conferences have been held between the wine interests and the Government, and, as honorable members are aware, the Government called for a report by an authority on the wine industry - Mr. Leo. Buring. That report is now in the hands of the Government, and, as a result of it, action has been taken in certain directions; for example, in the prevention of the artificial sweetening of wine by the addition of dried fruits and glycerine. It is hoped that, in consequence, a considerable loss of Commonwealth revenue will be avoided. Action has also been taken in the matter of the differentiation between the prices of grapes for the domestic market and grapes for the exported wine, the Government insisting that the fixed price be paid for grapes used in the making of wine for export, but allowing the buyers of grapes to be used in the making of wine for the domestic market to pay any price they choose. The Government could not enforce the payment of a fixed price in connexion with wine used locally, that matter being within the province of the States. The amendment goes a little further. Although it is not believed that it will right the many troubles in the wine industry - I do not think that any one can suggest how that may be done - it will be at least a palliative, and will assist the industry. The Federal Viticultural Council wanted a reduction to 6s. 6d. a proof gallon, in addition to a reduction of the bounty to1s. a gallon. The Government intends to allow the bounty to remain as at present for the time being.
– Will this reduction affect the payments into the trust fund, or only the revenue portion of the excise ?
– It will affect the payments into the trust fund, because it will come out of the total excise.
– Therefore it may affect the bounty, by decreasing the trust fund ?
– No, because any shortage in that fund will be made up from Consolidated Revenue, as at present. The matter is so important that I have prepared a statement on it, which, with the indulgence of honorable members, I shall place before them.
The bounty has already been altered on five occasions, and the Government does not propose to alter it again, at any rate during the present vintage. These alterations have undoubtedly upset trade, and have taken from the exporter what the act at present gives him. The present ratesof 10s. and11s. do little more than pay the bounty. This year, the excess of revenue over expenditure will probably be only about £14,000. There is, therefore, little justification for reducing the excise duty. The Government, however, recognizes that the industry is confronted with very serious difficulties, and, as an earnest of its desire to help it, has decided to reduce the excise duty to 9s. a proof gallon. The trust fund contribution will remain at 5s. To the extent that this may be insufficient to pay the bounty, the Government will give further aid to the industry. It must be remembered that the Government could reasonably expect to receive a substantial revenue from spirit for fortifying wine. All other intoxicants contribute heavily to the revenue. The old duty of 5s. and 6s. was imposed as a revenue duty, and the extra 5s. was intended to finance the bounty. A heavy falling off in local consumption, and an increase of exports, have defeated that object; and practically the whole of the collections are now devoted to the payment of the bounty. Thus the Government is already sacrificing revenue to assist the industry. It is now prepared to do more by reducing the excise duty; but it is not willing to go to the lengths asked for by the industry, as it believes that, by having more than surrendered its revenue from the spirit, its sacrifice is sufficiently great.
I shall deal now with the differentiation between doradillo and other fortifying spirit. For some years prior to 1924, all spirit used for the fortification of wine was subject to duty at the rate of 6s. a proof gallon. In that year there was over-production of doradillo grapes, caused through large areas having been planted with that variety for occupation by returned soldiers. It was at this time that the Federal Government, as a measure of relief, assisted the growers of doradillo grapes by granting a bounty on the 1924 production. The Government also decided further to assist these growers by lowering to 5s. a proof gallon the duty on spirit made from doradillo grapes, spirit made from- other kinds of grapes still being liable to a duty of 6s. a gallon. For a time this relief to the doradillo growers was appreciable; but the full benefit intended has not been realized. Members of co-operative distilleries and wineries have, as a consequence, received a little more for doradillo grapes; but the benefit has been negligible, more especially since the rates of duty were raised from 5s. and 6s. to 10s. and lis. a proof gallon. When the differential rates were imposed, it was thought that it would be a sufficient inducement for distillers to make most of their fortifying spirit from doradillo grapes. That hope has not been fulfilled, the greater quantity of fortifying spirit used during the last five years having been made from other than doradillo grapes. That the higher average yield of doradillo compared with non-doradillo grapes in the irrigation, as well as in the dry areas, will be a set off against having now a flat rate of duty on fortifying spirit, is borne out in the report that the Government has received from the authority on the wine industry, to which I have already referred. Doradillo grapes are produced largely in South Australia ; but in the Murrumbidgee area there is an excess production of shiraz grapes, and no special consideration has been given to these as is given in the case of the preferential duty on doradillo spirit.
The Federal Viticultural Council is opposed to the tariff differentiation which favours spirit distilled from wine made from doradillo grapes, and has brought the question under notice in the following terms: -
No adequate or substantial reason appears to exist for the maintenance of differential rates of excise duty upon fortifying spirit derived from mixed grapes and doradillo grapes respectively, and this council, therefore, urges that steps should be taken to remove this anomaly by subjecting mixed spirit and doradillo spirit to the same rate of excise duty.
– Will this action not penalize the returned soldiers who are engaged in grape growing?
– No. The Government would be averse to taking any preference away from returned soldiers on thi3 matter or any other. Inquiries have shown that there is little or no benefit in the preferential rate in favour of doradillo spirit, and a return to the flat rate of duty for fortifying spirit is desirable. At the present time, regulations governing the processing of doradillo grapes necessitate the separate storage of the spirit, and the keeping of separate accounts. The expense incurred in supervision does not appear justifiable, considering the small benefit to doradillo grape-growers. Wine-makers and distillers find it irksome to keep the two kinds of spirit separate and distinct from each other.
A number of reasons have actuated the Government in adopting this course, and it has acted on expert advice. I understand that in those areas where there is a surplus of doradillo spirit, a grafting of vines is taking place, so that - grapes suitable for drying purposes may be grown. At a meeting of the Grape Prices Fixation Committee held in Melbourne on the 19th January last, it was unanimously agreed that there should be a flat rate of duty on doradillo and other fortifying spirits. This committee was composed of representatives from New South Wales, Victoria and South Australia of grape-growers, and of both cooperative ana proprietary wine-makers. This proposal is made by the Government in order to provide material help to the wine industry, which, under the present adverse conditions, is in need of assistance, and I confidently submit the proposal for the acceptance of the committee. I think that the immediate result will be some movement of the surplus stocks at present held, and the proposal will, undoubtedly, in small measure, help the growers, next vintage.
– What is the total value of the reduction?
– About £60,000; but a considerable revenue has been picked up by the action of the Government in preventing the fortifying of wine with sugar, dried fruits and glycerine.
.- It has been interesting to hear the remarks of the Minister with regard to the proposed alteration of the excise duty. I do not think that any section of the primary producers have suffered so much through changes in excise duties and bounties as have the grape-growers throughout the Commonwealth. When in New South Wales, as a member of the Government, I was administering the affairs of this section of agriculturist’s in that State, I witnessed the spectacle of wineries being closed down through the actions - illadvised as they were - of the Federal Government of the day. Only after considerable effort were the difficulties overcome, and the growers partially reestablished in their industry. The New South Wales Government had to send out expert officers to advise the growers to remove hundreds of acres of grape vines, simply because their industry was threatened with disaster, largely through federal legislative action. The Minister has drawn attention to what is commonly referred to as the overproduction of wine in this country. I venture to say that it is not a matter of overproduction; but it must be realized that a considerable falling off has occurred in the consumption of various classes of wine in this and other countries, with the result that our most valuable outlet for wines - the British market - has been taken from us, to a great extent, by the dumping of Continental wine upon that market at greatly reduced prices.
I wish to emphasize the point referred to by the Minister when he said that the bounty had been altered five times. The great difference between the wine industry and the manufacture of whisky, brandy, gin, rum, or any other alcoholic spirit, is that the grape-growers have spent large sums of money in establishing their vineyards over a long period of years, to enable them to produce the grapes which are the basis of the wine industry. A fair amount of capital and a lot of hard work are necessary in establishing a vineyard. The growers are dependent on the sale of their grapes, and the varieties of grapes which they grow cannot be altered overnight, whereas excise duties and bounties have been altered overnight, and, on many occasions, the growers have been faced with ruin, because of changes made by federal legislation. I compliment the Minister upon the action that he now proposes to take. It will go a long way towards stabilizing the wine section of the viticultural industry of Australia. Although, on many occasions, growers have gone to the expense of endeavouring to graft their grapes over to other varieties, so as to preserve the value of their root stock, and meet the altered conditions, it is a slow and expensive operation, and does not yield the results that some persons imagine. The viticultural industry is unable to meet the sudden changes which have been experienced in excise duties and bounties. The crops required for the production of other alcoholic beverages are annual, and can be produced in a few months. For instance, those who grow barley and other cereals necessary for the production of spirits, can curtail or extend the areas under cultivation at a few months’ notice, or they can use their land for other crops, which often prove just as remunerative, if not more so ; but, as I have pointed out, it is a very slow process which viticulturalists have to adopt, in order to meet the altered conditions with respect to their industry, brought about by the actions of this Parliament.
.- There are two points in regard to this amendment upon which I desire to comment. In the first place, it provides for a reduction of taxation on the wine drinker, and through that reduction it will do something to help thesale of Australian wine in this country. Every section of the grape-growing and winemaking industries, from the grower to the final vendor, will welcome the reduction of the excise duty. It is not a large reduction, but it will give some relief. I do not think that there will be any difference of opinion in that regard. The other point to which I direct the attention of the committee is that part of the reduction is made by removing the differentiation between the tax upon spirit made from doradillo grapes and that upon spirit made from other grapes. Undoubtedly, this amounts to a repeal of the preference which, was given to the returned soldier growers who are mainly doradillo growers. The Minister says that the preference is now valueless, and that, therefore, putting an end to it does not amount to the repeal of a preference given to returned soldiers ; but I am quite certain that the removal of this differentiation will give rise to a whole series of fresh anomalies and new difficulties, with which the Minister will be faced within the next few weeks. I hope f-hat he will give the committee an assurance that he will restore to the doradillo growers the same chance of marketing their spirit, in competition with the spirit made from other grapes, as they had prior to this repeal of the differentiation.
I shall now give some account of the history of this differentiation in order to make plain to the committee what its value was. Originally, as the Minister’ has told us, the whole question of the bounty was raised through the overplanting of doradillo grapes, largely for the purpose of settling returned soldiers on the land. In order to encourage the use of doradillo spirit, the excise on such spirit was reduced by ls. a gallon, aud when the prices were fixed for grapes and for spirits, that differentiation in the excise was taken into account, a slightly higher fixed price being established for doradillo spirit. In the early days of the bounty an exported wine that differentiation was sufficient to create a brisk demand for doradillo spirit, and there was almost a boom in the doradillo grape industry in the irrigated areas. Later, plantings took place of other grapes, mainly in other areas. A certain number, of course, were on the holdings of returned soldiers, but’ the main new plantings following the boom were on lands other than those devoted to soldier settlement. There is no doubt that the price fixed originally for doradillo grapes made it more attractive to wine-makers to distil wine from other grapes, and in doing so pay a higher excise duty rather than buy spirit distilled from doradillo grapes from the main soldier settlements. The result was a tremendous accumulation of doradillo spirit, mainly in the irrigated areas, and chiefly on account of the co-operative wine distilleries, a very large proportion of whose members are returned soldiers. About eighteen months ago, in order to liquidate that big accumulation, which was a menace to the whole of the wine-making industry, because there was always the danger of it being unloaded on the market at sacrifice rates, the fixed price of the spirit was made the flat rate for both doradillo and other spirits. Since then, there hasbeen some movement in the consumption of doradillo spirit.
This removal of the differentiation willi do something to tip the attractiveness theother way - to grapes other than doradillos, which, generally speaking, are” grown in more convenient localities. I am not prepared to ask the committee, even in those circumstances, to continue the differentiation, provided that any fresh anomaly which is created is removed. There is little prospect of finding an outlet for the enormous accumlations of doradillo spirit in the distilleries on the irrigation areas, excepting by their purchase for wine for export as well as for local sale. If they are purchased for export, the distillers must pay the full fixed price for the grapes from which the spirit is distilled; that is, for the whole of the vintage of the year, because it is now impossible to earmark the spirit of vintages two or three years ago, and say “ These were for export, and these were for local consumption “. This removal of the differentiation practically makes it, very unlikely that any of these stocks of spirit’s will be sold in competition with spirit made from other grapes for use in the production of wine for local consumption at a figure which will return the price fixed for doradillo grapes some years ago. If the wineries which are holding these large stocks of spirit are not able to show that they are selling at’ a price which will return fixed prices to the growers, the makers of wine who use their spirit will be ineligible to collect bounty with respect to the wine which is exported, and which, in that way, would be providing an outlet for these large accumulations of spirit.
If the Minister will give the committee an undertaking that he will see that any anomalies of this nature will be prevented, and that this most unfortunate section of a very unfortunate industry will not be stuck with over 1,000,000 gallons of spirit - because the attractiveness of its sale has been lessened by the removal of the differentiation - and if he will also assure it that some arrangement will be made by which this wine may be released on the home market in a manner that will retain its eligibility for the bounty, the committee may safely agree to the Government’s proposal to eliminate the differentiation. There are, of course, many good reasons why the differentiation should be eliminated. The imposing of different rates of duty on wine fortified by spirit distilled from different kinds of grapes enormously complicates the work of administration and the expenses of the wine-makers who handle the wine. It also greatly increases the work of watching every particular hogshead, to ascertain,^ not only the quantity of wine which it contains, but also the quantity of wine which it contains of each particular blend. This differentiation is a complicated, and, in many ways, an artificial, handicap to the industry, which the industry itself will be very glad to be relieved of if the obtaining ‘of such relief does not inflict injustice upon that section which is holding large stocks of spirit under the circumstances that I have mentioned. If the preference is removed from these stocks, the price of the spirit should be reduced accordingly. If, however, some of the wine fortified with this spirit can be released for local consumption without rendering the rest ineligible for the bounty it will be safeguarded.
I have referred in some detail to the complicated set of circumstances which surround this complicated industry, because I desire to obtain from the Minister an assurance that a serious injustice will not be done. If this assurance is given, the committee may safely support the Government’s proposal.
.- It is time that this Government, and every other government interested in the wine industry, set before the grape-growers a fact which they themselves should face because of the difficulties which they are brought up against every year. If we maintain the system of paying bounties out of the general revenue of the country to this particular industry, it will never overcome its difficulties. It seems to me to be a common practice for a primary industry which encounters trouble to come at once to the Commonwealth Government and ask it for relief. I remember, in 1923, while I was a member of the State Parliament, directing the attention of the Minister of Agriculture of New South Wales to the difficulties of this industry, and that gentleman assured me, on that occasion, that the reason why the Government had dealt leniently with the growers of doradillo grapes was that they had declared publicly that they intended to cut their vines down and graft other kinds of grapes on to the stock rather than continue to suffer a loss, because the wine-makers would not pay them a reasonable price for their product. In 1923, I visited certain doradillo grape-growing areas with a parliamentary party and learned something of the difficulties of the situation. But that was ten years ago. Is it fair to the Commonwealth that money should be taken from the general revenue every year in order to maintain the doradillo grape-growers in this industry? The fact of the matter is, of course, that an endeavour is being made to convert Australia into a wine-drinking country. It is thought by some people that if the price of wine can be cheapened our people will make it a common beverage. I know some honorable members are fond of referring to the ablebodied men of Prance as wine-drinkers; but, with due deference to the French nation, I hope that Australia will never reach the same position as France. Neither this nor any other government should respond to the appeals of a few honorable members of this Parliament who represent wine-growing constituencies to encourage our people to drink wine. The Government should make a definite stand in regard to the payment of a bounty to the wine industry.
It appears to me that if a few members interested in a particular industry make enough noise they can get anything they want. A few honorable members from Queensland made a loud screech the other day and obtained £5,000 for the benefit of the banana industry of that State. It is remarkable that they did not get something to-night for the Queensland rum industry. No one can gainsay the fact that we cannot produce wine in competition with Trance and Portugal for sale on the English market. Ten years ago, when Canada embarked upon a new experiment in the regulation of the drink traffic, France sold enormous quantities of wine to the Canadian Government at a price for which it could not be bought under ordinary circumstances.
– Australian wine is replacing Portuguese and Spanish wine on the British market.
– It is no credit to Australia that this is so, nor is it any credit to certain people in this country that they should be endeavouring to convert Australians into a wine-drinking community. Those who are interested in this industry should develop it without so much bolstering on the part of the Government. It is high time that a protest was made against the expenditure of such large sums of public money in helping the wine industry. It is of no use for honorable members to say now that if the men who are growing dora.dillos on a few acres of land are prevented from doing so they will be ruined. I well recollect that a Renmark newspaper published a statement twelve years ago to the effect that the doradillo grape-growers would cut down their vines because it was not profitable to grow doradillo grapes. When I made the interjection that by this proposal the Government were cutting in on preference to returned soldiers, the Minister denied it. I know very well that the chief argument used in the Parliament of New South Wales for the support of the doradillo grape-growers, was that they were returned soldiers. It is no pleasure to me that returned soldiers are growing doradillo grapes for spirit making. I think it is high time that a stand was taken in this Parliament against the expendi ture of large sums of public money for the purpose of encouraging the drinking of wine in Australia. It is improper for the National Parliament to spend its revenues in this way.
.- I should like to know why, at every possible opportunity, the honorable member for Barton (Mr. Lane) attacks the wine industry? Very many men are engaged in the growing of grapes for wine-making. Tonight we have discussed whisky, beer, brandy, gin, and rum, and the honorable member has remained silent; but now that wine is being discussed he is participating in the debate. Is this because there are no wine shops in his district, but many hotels which sell these other spirituous liquors? It ill-becomes the* honorable member to bombard this industry, because of all the industries engaged in the making of alcoholic liquors, the wine industry gives the greatest amount of employment. My main object in? speaking on this occasion is to ask whether the Minister said that the “ usual amount paid into the trust fund for bounty purposes out of the excise duty will still be paid into it?
– That is so.
– In that case, I do not need to say much more, as the bounty is the main consideration so far’ as I am concerned. The honorable member for Barton has said that a very few members have been able to influence the Government to continue a certain measure of help to the wine, industry. I suppose only half a dozen honorable members of this House represent the grape-growing districts of South Australia, New South Wales, and Victoria. If they have been able to make out such a good case for their constituents that the Government has seen fit to continue a measure of assistance to them it is to the credit of the honorable gentlemen concerned.
.- I shall not offer any objection to this proposal to reduce the existing excise rates of 10s. and lis. on spirit for fortifying wine to a flat rate of 9s. a gallon. I realize that the wine industry is in a parlous condition to-day, and that the grape-growers, in particular, are in a bad way, because the arrangement which has existed for several years for the payment of a fixed price for grapes has been discontinued. The consequence of this has been that the price of grapes has been reduced by practically 50 per cent.
– That is only on the domestic market, “which the Commonwealth Government cannot control.
– The Scullin Government had an arrangement under which the wine-makers paid a fixed price for all the grapes they bought, whether the wine made from them was sold on the local or overseas market. I understand that the wine-makers have now obtained legal opinion to the effect that they are not obliged to pay a fixed price for the grapes used for making wine for local consumption. This has, undoubtedly, had a -damaging effect upon the grape-growing industry of Australia, and I fear that “before very long the grape-growers will be requesting the Government to grant them additional assistance.
This industry was not helped by the State Governments in years gone by. Until 1920 the viticultural industry of Australia was being conducted on a sound economic basis. The whole of the grapes produced were bought by the local winemakers for the manufacture of wine for sale on the Australian market. Only about 800,000 gallons of the white dry, or Burgundy type of wine found a market in Great Britain. But after the war when the various State Governments were looking for opportunities to settle returned soldiers on the land they spent millions of pounds on closer settlement irrigation schemes in New South Wales, Victoria and South Australia, and advised the returned soldiers who were settled on these areas to plant vines. The men took the advice that was offered to them. When the vines that they planted came into bearing in 1923-24, the quantity of grapes produced was largely in excess of local requirements, and the Commonwealth Government then in office was appealed to for assistance. It seems that whenever the States get into difficulties they appeal to the Commonwealth Government for assistance. The Government proposed to relieve the position by reducing the duty on spirit used for fortifying wine, but this was opposed by the Viticultural Council, because such a re duction would disorganize the winemakers’ business by reducing the value of the stocks held by the amount of the proposed reduction.
– Now they have changed their minds, and are supporting it.
– That is because the conditions to-day are different. The council suggested that a bounty be paid on the export of fortified wines. That suggestion was adopted by the Commonwealth Government, but the amount of the bounty has been altered from time to time. It was as much as 4s. a gallon, and later was reduced to ls. The Scullin Administration increased it to ls. 9d.
– The 4s. a gallon was really equivalent to ls. 9d., because it included the excise.
– As I have explained, the previous Government increased the bounty from ls. to ls. 9d. a gallon, and called upon the industry to pay the whole of the cost by increasing the excise duty of 5s., on spirit wholly distilled from doradillo grapes, and 6s. on spirit n.e.i., to 10s. and lis. respectively. .The Minister has given us an assurance that there will be no reduction of the export bounty, which will be kept at the present figure - ls. 4.8d. per gallon. According to the Commonwealth Statistician, the industry gives employment to 12,500 persons, while 15,000 other persons are dependent upon it, making in all a total of 27,500 directly or indirectly interested in its continued development. The honorable member for Barton (Mr. Lane) appeared to regret that we were trying to expand our export trade in wine with Great Britain ; but, seeing that the Mother. Country consumes annually 15,000,000 gallons of wine, including 10,000,000 gallons of sweet wines which can be supplied by Australia, surely we have every reason to expect a greater measure of preference in the British market than we have been getting hitherto. We now supply one-fifteenth of Great Britain’s requirements in this class of wine, the balance being imported from Portugal and Spain. I am pleased to know that we are developing our export trade in sweet wines, because the Australian industry has reached a stage at which it is impossible for the whole of the output to be consumed locally. All manner of uneconomic proposals have been adopted by State governments from time to time to extend the industry far beyond Australia’s requirements, and, unless we can find a profitable market overseas for the surplus product, there will be absolute chaos and ruin in the industry. I hope that the Minister will give sympathetic consideration to the representations that have been made to him from time to time by those engaged in it. Thousands of grape-growers are now reduced to a standard bordering on poverty owing to the decline in the price for their grapes by at least 50 per cent. Quite recently, 8,000 tons of grapes were sold in South Australia for £2 a ton, £1 a ton, and 15s. a ton, whereas two years ago some of the best qualities realized £8 15s. a ton, and other qualities £5 and £4 10s. a ton. The extraordinary drop in prices will give honorable members some idea of the terrible plight of thousands of grapegrowers in the various States.
– The present position is partly due to over-planting.
– That is so. Unfortunately, for some years there was a tendency to overplant, due, of course, to lack of foresight on the part of State governments and to the encouraging outlook at that time. I offer no objection to the proposed reduction of the duty; but I realize the perilous position of those engaged in the industry, and I hope that the Minister will soon be able to give it some additional assistance.
Mr.WHITE (Balaclava- Minister for Trade and Customs) [9.50] . - I hope that the alteration of the excise duty will not react in the way suggested by the honorable member for Wakefield (Mr. Hawker), and do any harm to returned soldier grape-growers. The reduction of the duty applies to the product of the doradillo grapes, as well as the other varieties. The Government can only watch the whole situation. This is a most difficult and complex industry. In the short time that I have held office as Minister, I have given a great deal of my time to its study, with a view to finding a solution of the difficulties confronting our growers, and have sought the views of a number of persons qualified to express an opinion, with a view to putting the industry on a better footing.
– This is again an illustration of the operation of the law of supply and demand.
– If economic forces were allowed to work inexorably, there would be a great deal of misery in this industry. State governments have assisted returned soldier growers in many ways, and at Renmark and White Cliffs, growers - at all events the growers of sultanas - are prospering. I understand that the problem of grafting doradillo stocks with types of dried fruit grapes is receiving attention. Members of the Viticultural Council and the experts whose opinion was sought by the Government, have suggested a flat rate for all spirit. The Government would very much regret if any hardship were imposed upon returned soldier growers, and will give careful attention to any representations that may be made on their behalf. The honorable member for Indi (Mr. Hutchinson), who represents a large number of grapegrowers and wineries, has, on many occasions, advocated their interests in this Parliament, and I am sure they will appreciate the flattening out of the two rates. Apparently the honorable member for Barton (Mr. Lane) was under a misapprehension when he said that this was another primary industry to which the Government was paying out bounties. It is true that the Government is providing a bounty, but I remind him that it is really paid by the wine industry itself, because the estimated revenue from fortified spirit this year is £207,000, and the probable amount of the bounty is £193,000, though, of course, part of this is provided from revenue. This is one of the problem industries, its present difficulties being due to the catastrophic fall that has taken place in world prices. The Government is making this gesture to the industry in the hope that it will help the growers. Its action is not, as was suggested by the honorable member for Barton, prompted by a desire to make Australians wine drinkers, but to give aid to a deserving section of primary producers. This question of excise duties is purely a pounds, shillings, and pence problem, and not one of temperance. I appreciated the remarks of the honorable member for Calare (Mr. Thorby) who has an intimate knowledge of this industry, and believes, with the honorable members for Angas (Mr. Gabb) andWakefield (Mr. Hawker), that the Government’s proposal will do some good.
Amendment agreed to.
Item, as amended, agreed to.
By omitting the whole item and inserting in its stead the following item: -
Tobacco, hand-made strand, per lb., 4s. 3d.
Provided that, in the case of tobacco to which this sub-item applies which has been manufactured partly or wholly from imported tobacco leaf upon which import duty at the rate of 5s. 2d. or 5s. 8d. per lb. was paid, the duty payable under this sub-item on that proportion of the hand-made strand tobacco which has been made from such imported tobacco leaf shall be at the rate of 2s.1d. per lb.
Tobacco, manufactured, n.e.i., made either from imported leaf or Australiangrown leaf or an admixture of imported leaf and Australiangrown leaf, per lb., 4s.6d.
Provided that, in the case of tobacco to which this sub-item applies which has been manufactured partly or wholly from imported tobacco leaf upon which import duty at the rate of 5s. 2d. or 5s. 8d. per lb. was paid, the duty payable under this sub-item on that proportion of the manufactured tobacco which has been made from such imported tobacco leaf shall be at the rate of 2s. 4d. per lb.
.- I move -
That sub-item b be amended by adding the following: -
Provided further that an allowance equivalent to1s.6d. per lb of manufactured tobacco shall be made for each pound weight of Australian-grown leaf tobacco used in the manufacture of tobacco classifiable under this sub-item.
As we had a full debate on the tobacco duties a couple of weeks ago, I do not intend to deal in detail with the subject to-night. The consensus of at least one-half of the members of this chamber is that the protection given by the Scullin Government to the Australian tobacco-growing industry has been very considerably whittled away by the present Government. This amendment is equiva lent to a reduction of the excise on tobacco made from Australian-grown leaf to 3s. per lb., leaving the excise on tobacco made from imported leaf at 4s. 6d. per lb. It is, in essence, the proposal submitted to the Minister last Friday afternoon by a deputation of tobacco-growers. On a consumption of 5,000,000 lb. of Australiangrown leaf, the revenue on the excisable portion, approximately 4,000,000 lb., would be reduced by1s. 6d. per lb., that is, by £300,000, which could be made up by a readjustment of excise and import duties on the imported leaf. This reduction would enable the companies to pass on the concession to consumers of tobacco, and, in the main, it would benefit the working-class section of our community. The reduction would be highly appreciated at a time like this, when individual incomes have been so seriously depleted. It would provide the consumers with Australian tobacco at 10s. per lb. instead of 41s. 6d., thus reducing the living expenses of the community generally, and it would increase the demand for tobacco made from Australian leaf. The reduction by this Government of the margin of protection of 5s. 2d. per lb. granted by the Scullin Government to 3s. per lb. brought the price of Australian tobacco up to within one penny, and, in some cases, 2d. of a 2-oz. tin of the imported article, and, with the usual prejudice that exists against the locallymade article, the public has consumed imported tobacco in preference to our own product. If my amendment is accepted, the margin of preference will be increased from 3s. per lb. to 4s. 6d. per lb. Naturally, I should prefer to have continued, if only for a time, the margin of preference that was granted by the Scullin Government. I realize that, as the Australian tobacco industry expands, re-adjustment will have to be made in excise and import duties. Up to the 30th June, 1932, the industry contributed £7,200,000 in taxation to the Treasury, and this year it will pay about an equivalent amount. When commenting on the revenue derived from the tobacco industry, the Tariff Board stated in its report -
Having regard to all the circumstances, the Tariff Board is of opinion that it would be unwise during the period in which the Australian leaf-growing industry is becoming established to seek to increase the net revenue from tobacco beyond the amount raised during 1920-30, namely, approximately £6,500,000.
So that even if this concession of £300,000 is made to the smokers of tobacco made from Australian leaf to popularize our product, the amount of revenue which the Tariff Board specified as reasonable would still go to the Treasury from this industry. I hope that the committee will support my amendment.
.- Before the alteration was made last year in the rates of Australian duties, there was a wide margin between the retail prices of Australian and American tobacco, running to as high as 6d. for a 2-oz. packet. That provided an incentive to the smoker to purchase Australian rather than American tobacco. With the alterations that have been made in the past twelve months in the duties on tobacco, that difference has largely disappeared, and, with it, to a large extent, the incentive to cultivate a taste for Australian tobacco. As a result, the Minister is worried as to how he will arrange with manufacturers to ensure that, so far as possible, the whole of the Australian crop shall be purchased, and growers fear that the demand for Australian tobacco will not increase in the same ratio as its production.
Members of the Country party realize that it is vital for the Government to obtain revenue, and they do not propose to advance any suggestion that would entail a loss of revenue to the Government from this source. I recognize that the amendment which has been moved by the Deputy Leader of the Opposition would involve a substantial loss of revenue, for the honorable gentleman has not suggested that the loss resulting from a lower rate of excise on Australian tobacco should be made up by an increase in the duty on American tobacco.
– I suggest that, if it so desires, the Government can make up the £300,000 that is involved by a readjustment of the excise duties on imported leaf.
– To obtain sufficient additional revenue to compensate for a drop of ls. 6d. per lb. in the excise duty on Australian tobacco, taking the basis of consumption to be two parts American and one part Australian, it would be necessary to increase by 9d. per lb. the rate of imported tobacco, which would give a range of total protection slightly in excess of the amount which was enjoyed by the industry when the Scullin Government was in office.
The question is: How can a cheaper smoke be provided for the man who has been hit by the depression without loss of revenue to the Government; and how can a price incentive be given to the use of Australian tobacco, again without loss of revenue? My colleagues and I believe that this can be done, and we have submitted to the Minister a proposal that has been worked out by the secretary to the Victorian Tobacco Growers Association, which would permit of Australian tobacco being sold for Id. less than to-day’s prices for a 2-oz. packet, while blended tobacco would be sold at rates ranging from those now charged, to prices which would be just a little cheaper. The small retail price difference that now exists in favour of Australian as compared with imported tobacco, would be increased under - the proposal by at least 1-^d. for a 2-oz. packet, which would give a considerable incentive to smokers to buy and acquire a taste for Australian tobacco, and the problem of the absorption of all the suitable Australian leaf would present less difficulty. I hope, therefore, that the Government will agree to the proposal, either wholly or substantially. Briefly put, it is that instead of having a flat rate of excise of 4s. 6d. per lb. on both Australian and imported tobacco, for the first year there should be an increase in the excise on imported leaf of 4d., and a reduction on Australian leaf of 8d. per lb., making a differentiation of ls. per lb., that is, 3s. lOd. on Australian and 4s. lOd. on imported leaf. Throughout these calculations, the Australian consumption of finecut and plug tobacco is estimated at 14,000,000 lb. per annum, the proposal excluding entirely consideration of cigarettes and cigars, for they are not yet affected by the production of Australian leaf. For the first year the basis is taken on a consumption of 4,000,000 lb. of Australian, and 10,000,000 lb. of imported leaf, which would leave the Government a little better off from a revenue point of view than under the present excise duties, for under the scheme it would collect £4,683,000 as against £4,650,000 under the existing duties. It is suggested that for the next year, there should be a difference of11d. in the rate of excise duty on the two tobaccoes, that is, 3s.11d. per lb. on Australian leaf, and 4s.10d. per lb. on imported leaf. On the basis of a consumption of 5,000,000 lb. of Australian leaf and 9,000,000 lb. of imported leaf, the revenue would then be £4,504,166 as compared with £4,500,000 anticipated under present conditions. For the third year, the basis taken is 6,000,000 lb. of Australian leaf and 8,000,000 lb. of imported leaf, the rates of excise being respectively 4s.1d. and 4s.10d. For the fourth year, the figures would be 7,000,000 lb. of Australian and 7,000,000 lb. of imported tobacco, the rates of excise being 4s. 2d. per lb. and 4s.10d. per lb. respectively, while for the fifth year, the proportions would be 8,000,000 Australian and 6,000,000 lb. imported, with the rates of excise of 4s. 3d. and 4s.10d. ; and for the sixth year, the figures would be 10,000,000 lb. Australian and 4,000,000 lb. imported, the rate of excise being 4s. 5d. and 4s.10d. respectively. The scheme also works out the amount that the Government would need to add both on Australian and imported leaf if it desired to maintain a revenue of £4,500,00 on plug and fine-cut tobacco as the imports decreased; in the third year it would be necessary to add 3d. per lb. to both varieties of leaf, in the fourth year 5d., in the fifth year 8d., and in the sixth year 1s. per lb. In such circumstances, the excise would then be 5s. 5d. on Australian leaf, and 5s.10d. per lb. on imported leaf.
– What about the poor smoker then?
– The honorable gentleman will realize that as the amount of imported tobacco diminishes and our own increases, there must be an increase in the rate of excise. The scheme provides for such a contingency, which would have to be provided for in the same way even if the Government adhered to its present proposals.
– So that the honorable member’s sympathy with the smoker is only for a year or two.
– No; but there is apparently no escape from that position which the honorable getnleman himself, in his speeches, has admitted. I am endeavouring to demonstrate that a means can be provided which would make possible a differentiation of 1s. per lb. between the rate of excise on Australian and imported tobacco to begin with, which would decrease as the volume of the consumption of Australian tobacco increased. From the Government’s point of view, the revenue would be safeguarded, whilst the smoker, who alike with the non-smoker, has been hit by the depression, could buy a cheaper smoke if he cared to make use of the lower-priced ranges which would be available under these proposals.
– For two years.
– For six years, under this proposal.
– This is a growers’ scheme, absolutely.
– Only in so far as it would increase the likelihood of the consumption of Australian leaf keeping pace with the growth of production. The grower does not want to get any price advantage out of the proposed increase of 1s.; he desires the smoker to get the benefit, and that is what would happen. There would be no loss to the revenue - on the contrary, there would be a slight gain - cheaper tobacco would be purchasable, and the consumption of Australian leaf would be stimulated to an extent that might enable the demand to keep pace with the growing production. There would be no insuperable difficulty in imposing differential rates of duty, because the Government has provided for differentiation in sub-item b, which imposes a duty of 4s. 6d. per lb. on manufactured tobacco n.e.i., made either from imported leaf or Australian-grown leaf or an admixture of both -
Provided that, in the case of tobacco to which this sub-item applies, which has been manufactured partly or wholly from imported tobacco leaf upon which import duty at the rate of 5s. 2d. or 5s. 8d. per lb. was paid, the duty payable under this sub-item on that proportion of the manufactured tobacco which has been made from such imported tobacco leaf shall be at the rate of 2s. 4d. per lb.
That proviso shows that the Government does not regard it as impracticable to apply differential rates to varying kinds of leaf made into the same tobacco.
– In 1927, the board recommended differential rates.
– The Board then recommended a differentiation of 6d. per lb. I repeat that the growers are not seeking any price advantage. The proposal that I am submitting will help to widen the demand for Australian tobacco without injury to the excise revenue. Therefore, I urge the Minister to adopt it. As a private member, I cannot move to increase the foreign rate by 4d. per lb., but I give notice of my intention to adopt the only course open to me, namely, to move that the duties on Australian leaf be reduced by Sd. per lb., leaving it to the Government to impose an additional 4d. on American leaf in order to implement this proposal and yet safeguard the revenue. If that amendment be agreed to, the rate on the imported tobacco, hand-made strand, would be increased from 4s. 3d. to 4s. 7d. per lb., and on imported manufactured tobacco from 4s. G’d. to 4s. lOd. per lb.
– I hope that the committee will not agree to either the amendment moved by the Deputy Leader of the Opposition (Mr. Forde) or that foreshadowed by the Acting Leader of the Country party (Mr. Paterson). A year ago, after full examination of the tobacco industry, this committee decided to reduce from 5s. 2d. to 3s. per lb. the protection afforded to Australian-grown leaf. We have had a year’s experience of the reduced rate, and we know that the Government’s forecasts have been fulfilled. There was sold during the year, at the extraordinarily profitable price of 2s. 3d. per lb., four times as much tobacco leaf as had been sold in Australia in any previous year. That should demonstrate conclusively that the duty of 3s. was ample protection for this little primary industry. I do not suppose that any other protective duty has ever been so completely vindicated. What is the meaning of the two amendments that are being submitted to the committee? The purpose of that of the Deputy Leader of the Opposition is to reverse lastyear’s vote by allowing a rebate of ls. 6d. per lb. on Australian leaf, thus increasing the protection from 3s. to 4s. 6d. This would be almost a restoration of the Scullin protective duty.
– No; the Scullin rate was 5s. 2d.
– The Acting Leader of the Country party, having a few days ago voted that an import duty of 3s. per lb. was ample to protect the Australian industry, now proposes by some complicated scheme of raising and lowering excise duties to increase the protection from 3s. to 4s. The honorable gentleman is not doing justice to himself. His proposal panders to the growers of inferior leaf. The 3s. duty has been proved ample protection for the growers of anything approaching good leaf. It is true that last year approximately 1,000,000 lb. of rubbish such as was exhibited in this chamber last week - tobacco that would menace the health of the smoker, and half of which was grown by Chinese labourers working from dawn till dusk on seven days a week - was not sold. It is in aid of growers of this class and tobacco of this quality that these amendments are proposed. All the bright lemon leaf produced in Australia was sold at prices in excess of 3s. per lb., and I predict that when the sales open next week that result will be repeated. Yet we are asked further to pamper an industry which already has protection ranging from 300 to 500 per cent. I marvel at this proposal emanating from the Deputy Leader of the Opposition. I am surprised that we should be asked by the apostles of reduced duties to increase the rate on tobacco from 3s. to 4s. per lb. It is the most inconsistent tariff action taken by any party in the history of this Parliament. There is country in Australia capable of growing, riot only our total annual requirement of 20,000,000 lb. of first-class leaf, but probably hundreds of millions of pounds of leaf equal to the best Virginian. Beyond question the 3s. duty will sell high-grade leaf to Australian manufacturers at satisfactory prices, although similar tobacco can be landed in Australia at about ls. per lb. The plea “ for the poor tobacco-grower “ is really a plea for the grower of poor tobacco. I am surprised that the honorable member for Gippsland (Mr. Paterson), who, as Minister for Markets, did so much to improve the quality of primary products, is to-night the champion of the inferior product of the tobacco industry. That all first-class leaf will bring first class prices, has been conclusively proved; the only leaf that is dragging in the market is the filthy stuff of the class exhibited in this chamber by the Minister for Trade and Customs last week, and grown in the Tamworth’ district.
I cannot understand the Deputy Leader of the Opposition, a representative of Queensland, submitting a proposal in favour of the growers of low-grade tobacco in order to foist this inferior stuff on the smoker. If there is one portion of Australia which has grown almost uniformly first-class leaf for which a uniformly first-class price is assured, it is Queensland. I warn members representing that State that if by this amendment they make a better market for the inferior leaf, they will do so at the expense of the successful growers of superior leaf. Every pound of dark tobacco they force into consumption will be sold to the detriment of the bright lemon leaf that is produced in abundance and excellence in Queensland. The Government has made good on the tobacco issue ; it has carried” out all its undertakings to the growers, and as, after a full and sympathetic reconsideration of the matter by the present Minister for Trade and Customs (Mr. White) the Government is satisfied of the adequacy of the existing protection, that should weigh with the committee. The Government said that 3s. would protect the growers, and that their crop would be sold. The protection proved ample, and the crop was sold. Would my friends in the corner get up here and advocate the selling of bad butter or inferior wool, or the taking of any other retrograde step in regard to those industries, such as they advocate in regard to this? If there was not a Surplus of this filthy mahogany tobacco in the country at the present time, which, had our warning been heeded, would never have been grown, neither of these amendments would have been moved to-night.
A good deal has been said of the estimate made last year. We said that, if the difference between the impost on Australian and imported leaf were to continue, and the industry to develop as proposed, the Government would lose about £1,000,000 in revenue. I still say that, having regard to the factors then operating, the prophecy was true, although it is also true that, ‘because of the changes which were effected, the revenue collected has been increased. Everybody knows, however, that during this year there have been abnormally large importations of tobacco purchased overseas prior to the tariff changes made last year, which the Government properly admitted. I ask honorable members to look ahead, and consider the financial position of the country. It will be many years before we are out of our financial difficulties. The present impost is 7s. 6d. per lb. on imported tobacco, and 4s. 6d. per lb. on local tobacco, so that the ratio between the two is as nine is to fifteen. The Government is obtaining from local tobacco only three-fifths of the revenue it collects on the imported leaf, and, were we to adopt the proposal of the honorable member for Gippsland (Mr. Paterson), we should lose still more, until very soon we should be obtaining from local tobacco only half the revenue provided by imported tobacco. The honorable member made a plea for the smokers, urging that we should allow them to buy a 2-oz. tin of tobacco for Id. less than the present price. I put it to him that his sympathy for the smokers is a transitory thing. They will derive benefit under his scheme for only two years, after which the price of the local tobacco will gradually rise until it is approximately the same as that now paid for imported tobacco. I hope that the committee will not agree to this proposal, the effect of which would be substantially to reduce the revenue. I admit that there is a heavy impost on tobacco; but it is easily collected, and the tax is, to a certain extent, paid voluntarily. In that, it differs from such taxes as land tax, income tax, and sales tax. If people do not want to pay the tax on tobacco at all, they can, conceivably, cut out tobacco; but they cannot escape income tax. If they want to reduce the amount they pay, they can reduce their smoking. The
Minister, speaking on the subject of brandy, referred to the relative undesirability of taxation, and I submit that, when we come to reduce taxation, we should not go about it in the slipshod manner proposed in these amendments. We should take taxation as a whole, and, when we are able to make some remission, we should remove or reduce those taxes which are most onerous, and press most heavily upon us, and the removal of which will contribute to the revival of prosperity, and the increase of employment. Nobody can show that the tobacco tax falls as heavily as the sales tax, for instance. No one can compare it with the tax of 4d. a lb. on tea, or the 4d. per lb. on raw rubber, or the tax of 7d. a gallon on petrol, which seriously affects the industry of the country. Thi3 tax satisfies many of the most important canons of taxation : It is fairly constant in its return, and is relatively easy and inexpensive to collect. I appeal to the committee to pass the excise duty as it stands, just as, a few nights ago, it agreed to the import duties.
– It is a strange thing that the honorable member for Henty (Sir Henry Gullett) can never speak on the subject of the Australian tobacco industry without displaying a considerable amount of heat, and a great deal of venom. I am satisfied that his protests of friendliness towards the industry are not sincere, because they are belied by his own utterances, and he takes every opportunity of throwing mud at the majority of the growers. He did so again to-night. As I have said before, the tobacco combine has no better advocate in this Parliament than the honorable member, and, while he is here to represent its interests, it has nothing much to worry about. The honorable member made several misstatements on the subject of tobacco. He misrepresented the honorable member for Gippsland (Mr. Paterson), the Acting Leader of the Country party, in the most reprehensible manner. I do not know whether he was in the chamber the other night when the honorable member for Gippsland spoke on tobacco. He hardly ever seems to be here when honorable members of this party are stating their opinions ; but, had he been here the other night, he would recollect that the honorable member for Gippsland made it clear that he, and the other members of this party, were supporting the Government’s proposal to maintain the duty at 3s. per lb. only on the understanding that the Government would give serious consideration to a proposal for the modification of the excise duty. There was no undertaking given, I admit.
– No sort of undertaking.
– We had waited on the Minister, and he said that our representations would’ be given serious consideration. Apparently, if the honorable member knows what has happened, our representations were given serious consideration.
– I know nothing about it.
– Well, that is what the Minister told us, and, while we wore not foolish enough, in view of the treatment we have received from ‘the Government in regard to this matter, to accept it as a promise, or even as a suggestion that our wishes would be met, we believed that we were entitled to give the Minister a chance to put the matter before the Government, and the majority of the members of our party decided not to oppose the confirmation of the 3s. duty. The honorable member for Gippsland (Mr. Paterson) made it clear that, if the Government did not accept our proposals regarding excise, we should take steps in committee to translate our wishes into action. That is what we are doing now. There has been nothing inconsistent in the attitude of the Acting Leader of the Country party.
The honorable member for Henty stated that our proposal to reduce the excise duty is put forward in the interests of the growers of the worst kinds of tobacco; that it is a scheme designed to protect the producers of what he calls black tobacco, and the honorable member spoke of what he described as the filthy rubbish displayed on the table by the Minister the other night. If he knew anything at all about tobacco, he must know that what the Minister exhibited was not filthy rubbish, but only a poor quality of tobacco deliberately picked out, in my opinion, by an officer of the department, and shown in contrast’ with one of the best samples that Australia produces. If the honorable member had heard my criticism of the officer’s report, he would know that there is nothing in the suggestion that our proposal is designed to provide a market for the worst kind of rubbish grown by Chinese in the Tamworth district. As a matter of fact, the Minister himself admitted that only one-half of the tobacco of that district which remained unsold was grown by Chinese.
– He said a little more than half.
– The Minister said that more than half the Chinese tobacco in the district was unsold, which is a very different thing. In justice to me and the district I represent, I remind honorable members that Tamworth is only one of the tobacco-growing districts in New England. There are at least half a dozen others. In this muchdespised district, 600 tons of tobacco were sold at an average price of 2s. 3d. per lb., which the honorable member says is a magnificent price for the best class of tobacco in Australia. If I had the opportunity, I could prove that there is just as good tobacco being grown in the Tamworth district, as the sample exhibited here the other night by the Minister.
The proposal put forward by the Acting Leader of the Country party would, if accepted, be of great benefit to the producers of good tobacco, the majority of whom are in the area I represent. If any further evidence is required that some such scheme is necessary to assist the tobacco-growers to obtain a market for their leaf, it is provided by the fact that, since the alteration of the duties by this Government, the market for Australian tobacco has contracted by 40 per cent. The manufacturers themselves tell us that the demand for Australian tobacco, as such, has fallen off in a remarkable manner, simply because the heavy increase in the excise duty has made it necessary to raise the price of Australian brands practically to the level of American and other imported tobaccoes. Australian tobacco has been called upon to provide 93 per cent, of the extra revenue which the Government demanded, and this practically in the first year of the industry’s establishment on its present footing. Just as the industry was becoming .established, the Government dealt it this sledge-hammer blow. Never before has such a burden been placed on an Australian industry in the early stages of its development.
The honorable member for Henty is a past master at omissions. He says many things, but he generally omits to tell us those things which, if revealed, would completely alter the complexion of a matter. He spoke of the- fulfilment of the Government’s expectations regarding revenue, and also of the general success of the Government’s policy for establishing the tobacco-growing industry. He said that the Government, as the result of an agreement with the manufacturers, had found a market for 10,000,000 lb. of Australian-grown tobacco at the magnificent price of 2s. 3d. per lb. To begin with, his figures were incorrect. According to the manufacturers, the growers sold only 8,500,000 lb. of tobacco at an average price of 2s. 3d. per lb., the rest being sold at a lower price. He did not mention that about 2,000,000 lb. of tobacco was left on the growers’ hands, nor did he say that in that period, when the local industry was producing about half the Australian tobacco requirements, the present Government opened the door to the entry of tobacco from other countries, with the result that 10,500,000 lb. of leaf was imported from * the United States of America.
– That was the average importation.
– In that case, there is no scope for the Australian industry; all that we grow here is surplus. Is it any wonder that the manufacturers are complaining that they are compelled to pay high prices for Australian tobacco when they can get American tobacco at much lower prices?
– How can the imported tobacco be cheaper if it is subject to a duty of 3s. per lb?
– The Minister should know that the duty of 3s. per lb. is not the real margin of protection, because 20 per cent, of that 3s. is handed back to the manufacturers in respect of the stems. That makes the duty 3s. per lb. less 20 per cent. Another 20 per cent, must be deducted because of the great amount of wastage of Australian leaf due to a lack of proper maturation.
Apparently the report of the Select Committee on the Tobacco Industry has not been read by many honorable members. The committee stated that manufacturers had said that they could afford to pay 2s. or 3s. per lb. for the Australian leaf, and still sell American leaf at $ of a Id. per lb. less than the price of Australian leaf. Owing to the lack of maturation, and the consequent wastage, Australian, leaf is cheaper than the prices indicated. So long as there is no proper system of maturation it is unfair to say that the Australian industry enjoys a protection of 300 per cent. Manufacturers are able to place American tobacco on the market at prices less than Australian tobacco can be sold for. If we maintain an annual importation of 21,000,000 lb. of tobacco leaf, and the industry is protected by means of the excise duty, it will be useless to try to grow tobacco in Australia. A high excise duty on Australian leaf will enable manufacturers to import as much American tobacco as before, and it will be hopeless for Australian growers to continue in the industry. Australian tobacco needs popularizing, and the best way to do that is to reduce its price. The tobacco manufacturers told the select committee to which I have referred that the price was the all important factor in the sale of tobacco. They said that if a brand of tobacco were reduced in price, its sales immediately increased. Especially in times of depression, the working man looks for cheap tobacco. He will buy tobacco which is not so palatable as that sold under other brands if he can get it for 4d., 5d. or 6d. a tin less. Under the old tariff, when the import duty was 5s. 2d. per lb., and the excise duty 2s. 4d. per lb., the demand for Australian brands of tobacco could not be met. ‘ Retailers throughout the country were inundated with requests for supplies of Australian tobacco, particularly of the cheaper brands. Ultimately, the manufacturers had to admit that they had used up all their stocks of Australian leaf, including the “ filthy rubbish “ mentioned by the honorable member for Henty. As the manufacturers paid the Chinese growers of that tobacco only 3d. or 4d. per lb. for it, and sold it at top prices, they lost nothing on the deal.
– That is a fine argument for high duties!
– It shows what the manufacturers will do.
– It shows what an excessive duty will do.
– If the Government will not alter its policy, and keep out imported leaf, at least until the Australian industry gets on its feet - and, in spite of what the honorable member for Henty, when Minister for Trade and Customs, promised, the Government has apparently no intention of doing so - the only course left is to try to cheapen the Australian product until smokers have acquired a taste for it. That can be done only through the excise. If we keep the excise duty at 4s. 6d. per lb., and the import duty at 3s. per lb., the Australian industry will be. left without hope. I have received from the Mareeba Chamber of Commerce a telegram urging me to support any proposal for an alteration of the excise duty on tobacco. Even in Queensland, where, according to the honorable member for Henty, so much bright tobacco is now being grown, the growers do not hold out any hope for the future of the industry unless the duties ‘ are altered. If the Minister adopts the proposal of the Acting Leader of the Country party, there will be an increased demand for Australian - tobacco, provided the price is reduced - and in its own interests, the industry will reduce the price - and also a revival of a number of small manufacturing concerns which deal wholly in Australian tobacco. Before the present Government altered the duties, as many as seven buyers representing the big manufacturing companies would visit one dis- trict - even the despised Tamworth district. The year before last, seven buyers, representing firms in competition, visited the tobacco-growing areas; but when the duties were altered by the present Government, a number of the smaller manufacturers were forced out of business. Tamworth tobacco, which the combine refused to buy, was sold at 9d. per lb. in Brisbane, and, later, was disposed of to smokers as high grade American tobacco. That tobacco was sold, not as an Australian product, but as Special No. 1, Special No. 2, and Special No. 3, and the smokers of Brisbane bought it, not because it was cheaper than other tobaccoes, but because they liked it. The manufacturer of that tobacco told me that he could not afford to pay more than 9d. per lb. for it because the excise duty was so high, but that if the excise duty were reduced by 2s. per lb., he could pay the growers as much as1s. 9d. per lb. Australian tobacco is not properly matured, and, consequently, manufacturers lose at least 25 per cent. of it in manufacture. They have to allow for that loss when buying Australian tobacco. By maintaining the excise duty at the present high level, we are actually robbing the tobacco-growers, because we are preventing them from marketing even a comparatively inferior type of tobacco. Other than as a means of protecting the revenue, there is no excuse for that. The Acting Leader of the Country party produced figures which have been checked by the Customs Department officials to show that if his proposal were adopted the Government would actually gain revenue. For a definite period we would work on a sliding scale, and would guarantee a revenue of £750,000 in excess of what the Tariff Board said was a fair thing. If, however, the Government will not accept the solid arguments of the honorable member for Gippsland, but chooses instead the nonsensical advice of the honorable member for Henty, who all along has been a biased witness against this Australian industry, those of us who, without any reward whatever, represent the tobacco-growing industry, will have to take other steps to bring the industry out of the position in which the policy of the present Government has placed it.
– It is a prosperous industry.
– The honorable member for Henty spoke of the magnificent position which the industry has built up for itself - so magnificent that the Minister for Trade and Customs told us that he could not make another agreement with the manufacturers !We know that at one time these manufacturers had been brought to their knees, whereas to-day they were standing on their feet and unwilling to enter into any agreement. The Government should be made to understand that only by reducing the excise duty will serious consequences be averted.
– This year the manufacturers will buy 6,000,000 lb. of Australian leaf.
– The honorable member for Henty, when Minister for Trade and Customs, terrified them into submission. One manufacturer told me that the honorable gentleman sent for him and almost bullied him into paying so much per lb. for tobacco. How different the position to-day! The manufacturers have told the present Minister that they will not make an agreement with the growers of tobacco this year, and will not put a price on this year’s crop. Last year the growers received 2s. 3d. per lb. for their leaf, but they are not likely to get paid at that rate this year. Probably they will not sell more than about 40 per cent. of the total crop, and the average price is not likely to exceed 2s. per lb. It is rather strange that a government, which says that it has the interests of this industry at heart, should be applauding the manufacturers for their alleged generosity in being prepared to buy only bright mahogany leaf, which represents about 40 per cent. or 50 per cent. of the crop. We are also given to understand that the price to the growers may he 2s. per lb. if the price is only 2s. per lb. for half of the crop, the average price for the whole crop will be1s. per lb. The tobacco combine in Australia has made a vast fortune by penalizing the smokers of this country. For many years it did not pay more than from1s. to1s. 3d. per lb. for Australian leaf. It has always been anxious to keep prices down. Under the agreement which was entered into with the manufacturers, the growers received better prices, but now this Government is, perhaps misguidedly and blindly, allowing the position to revert to what it was previously. According to the honorable member for Henty (Sir Henry Gullett), this industry has been a magnificent success; but I submit that, if the manufacturers refuse to pay more than from1s. to1s. 3d. per lb. as the average price for the whole of this year’s crop, it will mean the death of the Australian tobacco industry. If the Minister cannot make a better arrangement with the combine, no tobacco will be grown in Australia next year. It is of no use to delude ourselves. This industry has provided employment during the depression, and, unless we do something to assist it, unless we stand up to this combine more courageously than we are doing at present, no tobacco will be grown at all in Australia, from 4,000 to 5,000 growers will be ruined, from 15,000 to 20,000 workers in the industry will be deprived of remunerative employment, and the smokers of Australia will have to pay ls. lOd. or 2s. for a 2-oz. tin of tobacco. The combine has made huge profits. For the last 30 years its declared profit, taken out of the pockets of the smokers oi Australia, has been about £500,000 per annum. For at least five or six years its profits have averaged £1,000,000. Last year, which was a year of depression, the combine had the audacity to publish a declared dividend of £500,000, and the year before it gave a bonus of 40 per cent, to the shareholders, and, in addition, watered its capital to an alarming extent. This Government, by its present policy, is protecting that monopoly, and I warn the members of the Ministry that, if they do not accept the suggestion of the Acting Leader of the Country party (Mr. Paterson), their blood will be upon their own heads.
.- I regret that the Government did not see its way clear to debate the customs and excise duties at the one time, so that one vote only would have been needed on this item. However, that opportunity has gone. I should not have risen to speak had it not been for the fact that the honorable member for Henty (Sir Henry Gullett) endeavoured to attach to the members of the Country party statements which are incorrect. It is unfortunate that he displayed a certain amount of heat in making his speech, because no other honorable member knows as much as he of the position of the tobacco industry. He said that the members of the Country party had set themselves up as champions of low-quality black tobacco. That statement is incorrect. We have never suggested that, nor have we suggested that low-grade tobacco should be purchased at all.
– The honorable member for New England (Mr. Thompson) has suggested that.
– I have said that, if the growers of tobacco produce an unsaleable leaf, they must do what the producers of other unsaleable products do, and that is, scrap it. By accepting the suggestion of the honorable member for Gippsland (Mr. Paterson), the Government would not only assist the industry, but would also safeguard its revenue, because that honorable member has clearly shown that, in every one of the years to which he has referred, the amount of revenue received by the Government would be greater than it is receiving this year. If that were not so, I should be prepared to support other proposals which would give the Government the amount of revenue that it is seeking. As it is not possible for the Acting Leader of the Country party to move for an increase of the excise duty on tobacco manufactured from imported leaf, the Deputy Leader of the Opposition (Mr. Forde), in order to overcome that difficulty, has moved for the reduction of the excise by ls. 6d. per lb. on tobacco manufactured from Australian leaf. That amendment I do not propose to support. But the honorable member for Henty went still further, and said that our proposal, if given effect, would deprive the Government of revenue. It would do nothing of the kind, because the Government would receive more revenue than it has received in the past. The object of our proposal is not to give more money to the grower, but to give some advantage to the smoker. The amendment of the Deputy Leader of the Opposition aims at an increased consumption of Australian tobacco; but the amendment foreshadowed by the honorable member for Gippsland aims at a decrease in the price of that tobacco. To-day the margin is so small between the price of Australian tobacco and that of imported tobacco, that people prefer to buy the imported article. It is really a matter of taste. Even if the Australian tobacco were better than the imported tobacco, acquired taste would impel smokers to buy the more expensive tobacco. Only those who are prepared to buy a cheap article smoke Australian tobacco, and when they acquire a taste for it, they prefer it to the imported article. The honorable member for
Henty again made reference to a protection of 300 per cent., or 400 per cent., but he said nothing of the protection of 600 per cent.,800 per cent., and 1,000 per cent. which was given by the Scullin Administration, and continued by him when Minister for Trade and Customs. Some of the excessive duties imposed by the previous Government still exist. The honorable member for Henty has attributed to us the statement that we are supporting a duty which provides a protection of something like 500 per cent. or 600 per cent. We should like the Government to adopt the suggestion of the honorable member for Gippsland, in the belief that sooner or later Australia will grow a first-class leaf for which there will be a ready sale, and when that time arrives the Government will have to alter the excise duty to meet the greater demand for Australian tobacco, and the consequent smaller demand for imported tobacco. I hope that the Government will see its way clear to make some concessions to the growers so that a greater demand may be created for Australian tobacco.
.- The Deputy Leader of the Opposition (Mr. Forde) has moved an amendment for the reduction of the excise duty by1s. 6d. per lb., and the honorable member for Gippsland (Mr. Paterson) has foreshadowed another amendment. First, let me say that a reduction of the excise duty by 1s. 6d. per lb. would mean a loss to the Government of £322,920.
– The import duties could be increased to offset that loss.
– I admit that; but we are dealing with the effect of the honorable member’s amendment. The acceptance of the amendment foreshadowed by the Acting Leader of the Country party who, as he has stated, cannot move for an increased duty, would mean a loss of something like £125,000, although I admit that he proposes a system of equalization which would provide the Government with the revenue that it requires. I shall later deal with the faults of that system. We know that the honorable member for New England (Mr. Thompson) is enthusiastic about the Australian tobacco industry, and that by any means he would make honorable members to believe that Tamworth tobacco is what it should be.
– I do not want that at all.
– The honorable member has attacked the Government expert who went to Tamworth and made an impartial report, a man in whom the representatives of Queensland in this chamber have great faith, and whose judgment they are prepared to accept. I have with me an extract from the Tamworth Leader, a newspaper which, I think, is edited by the honorable member for New England.
– How can I edit that newspaper from Canberra?
– The extract reads-
Referring to grading, Mr. Gilbert declared that 80 per cent. of the leaf in the Tamworth district was got up in a very unsatisfactory manner, and in a lot of cases everything that could be done was done to cheat the buyer.
That statement was published in the honorable member’s own newspaper.
– Was there any reply to that statement at the meeting?
– The honorable member can tell the committee what the answer was, because I cannot. The honorable member asked that an investigation be made into the industry, and an investigation took place. I shall not traverse the whole of the ground again, because this subject has already been thoroughly threshed out, but the committee will agree that the inquiry showed that there was a great deal of inferior tobacco in the district of Tamworth. Any product - whether butter, wool, or wheat - unless up to standard, is not likely to be sold. I remind the honorable member for New England that it is not the Government’s business to find a sale for primary products. Although the Government has in the past done its best to assist the tobacco industry, it rests with the growers themselves to produce a class of leaf that will find a ready market. Last year the growers sold all their good leaf, and, as I have told honorable members previously, this year the manufacturers have undertaken to buy all that class of leaf. Our estimate of the quantity that the two largest companies will purchase is something like 6,000,000 lb. of good leaf, and the ordinary usage of inferior grades of tobacco. The honorable member for
New England said that the manufacturers have undertaken to buy only half of the expected crop. He also said that the Australian crop this year will be 12,000,000 lb.
– That is not so.
– Yet he makes that rash statement.
– I made no such statement.
– The Minister and the honorable member are dealing with two entirely different points.
– The honorable member, -if he so desires, can explain the position later. The honorable member for New England said that the company will buy only half of the available crop.
– He mentioned 40 per cent. .
– The honorable member for New England deplored the fact that the manufacturers were prepared to buy only a portion of the crop.
– The Minister said that the manufacturers would buy all grades above mahogany, and as everybody knows, that would exclude half of the total crop.
– I said that the manufacturers would buy all the bright leaf, which represents usually 30 per cent. of the crop, and their ordinary usage of coarser leaf. The estimate was that they would purchase about 6,000,000 lb. Now the honorable member says that the price paid will be 2s. per lb. That is another figment of his imagination. From advices that I have received, I believe that the growers will receive for absolutely first-grade leaf, from 3s. 2d. to 3s. 9d. per lb.
Mr.Forde. - That is the top price.
– I shall now deal with the proposal of the Acting Leader of the Country party (Mr. Paterson). Almost daily, new schemes have been propounded by letter, by deputation, or personally by honorable members. When the import duty on tobacco was discussed last week, two deputations on the subject arrived in Canberra on two successive days. They pressed upon me a mass of figures, and stated their case to me. Generally speaking, that case was in favour of some reductionof the excise duty.
– Did officials of the Customs Department check those figures?
– Yes; I shall give the result of the check. So many proposals have been made, that it seems as though opinions regarding what is best for the growers, as well as for the smokers - for whom so much solicitude has suddenly been expressed by members of the Country party - have changed from day to day. It is not many months since certain members of the Country party advocated an import duty of 5s. 2d. per lb. The present duty of 3s. per lb. represents protection in the vicinity of 400 per cent.
– We supported the Government on both occasions.
– Some members of the Country party voted on one side, and some on the other.
– The question was agreed to on the voices.
– Their case having been shattered by the honorable member for Henty (Sir Henry Gullett) - whom I was glad to hear in such good form - they have now shifted their ground, and say that it is not so much the grower whom they want to help, as the poor smoker who wishes to buy tobacco cheaply; so they bring forward a plausible scheme for a reduction of the excise duty which would involve an equalization of the revenue position. But, no matter how the calculation is made, if you lower the excise duty you increase the import duty. At the present time tobacco contributes to the revenue to the extent of 7s. 6d. per lb. - an import duty of 3s. per lb. and an excise duty of 4s. 6d. per lb. Australian tobacco pays only the excise duty; consequently, it has an advantage of 3s. per lb. By raising the foreign excise duty and lowering the Australian, as proposed, so as to increase the difference by1s. per lb., you add another 100 per cent. to the import duty.
– Let us assume that the landed cost of tobacco is1s. per lb. - it is less for any except the best grades. That represents protection to the extent of 300 per cent. By adding1s. per lb. to the margin that exists between the imported and the Australian tobacco, you raise the measure of protection to 400 per cent. No matter how the figures are juggled, that conclusion cannot be escaped. I could respect the opinion of the Country party if, in common with the Labour party, it frankly admitted that it wants prohibitive protection in this case. Instead of saying that, it wants no duty on wire netting, barbed wire and fencing wire, and is dissatisfied generally with all that the Government has done, and, besides, has shown no gratitude whatever for the relief that has been afforded by the Government to the man on the land. It now finds that it is somewhat inconsistent, and hopes that its present scheme will be more favorably received.
I shall point to some of the fundamental faults in that scheme, which show that it would not work. It is estimated that for the forthcoming financial year the net quantity of imported stemmed leaf tobacco will be 8,240,000 lb., and of Australian stemmed leaf tobacco 3,680,000 lb., a total excisable quantity of tobacco of 13,946,400 lb. Although 4,600,000 lb. of Australian leaf will be used next year, that represents only 3,680,000 lb. of stripped leaf. The statement “B” circulated by the representatives of the tobacco-growers, which has been put forward by the Country party, gives details of the effects of various changes by raising the foreign and lowering the Australian excise duty.
– There is no proposal to raise the foreign excise duty after the first year ; it then remains constant.
– Members of the committee must see that, as the imported leaf was displaced and the Australian demand became greater - as it naturally must become in any case - so the Australian excise duty would have to be raised. I put that forward as a reason why the reduction of the Australian excise should not be asked for, because it is definitely known that, in the future, importations will be less. But the figures quoted have been based upon faulty premises.
– The base figure of excisable manufactured tobacco is fairly accurate, being out to the extent of only 53,600 lb. in a calculation involving 14,000,000 lb. The quantity of imported stemmed leaf is placed at 10,000,000 lb. ; but it is estimated that 13,946,000 lb. will be used.
– That does not affect the comparison between the two. The Minister should not try to mislead the committee.
– I am not misleading the committee. The quantity of excisable tobacco leaf made from that 10,000,000 lb. of stemmed leaf is said to be 10,000,000 lb.; but that is not so. An average loading of 17 per cent. is added to the stemmed leaf to make the manufactured tobacco. This loading consists of various ingredients. It must be appreciated that considerably less than 10,000,000 lb. of imported stemmed leaf is needed to make 10,000,000 lb. of tobacco. In fact, the figure should be 8,547,000 lb.
– Again, that does not affect the comparison.
– Therefore, the estimated revenue in the first table in statement “ B “ is inaccurate to the extent of £218,000.
– In what way?
– It is made up by the difference between 8,547,000 lb. and 10,000,000 lb. The error is such a fundamental one that it is not possible to reconcile the figures given with the departmental estimate. But in order to try out the scheme, I shall take the quantities of Australian and imported leaf and manufactured tobacco which the department estimates will be used during the next financial year, and apply the rates set out in statement “ B “. Adopting the excise rate of 3s.10d. per lb. on tobacco made from Australian leaf, and of 4s.10d. per lb. on tobacco made from imported leaf, the net effect on the revenue, if the proportions of imported and Australian leaf did not vary, would appear to be a gain of £17,160 on what is estimated to be the revenue for next year, calculated on existing rates.
– Which substantially supports my proposal.
– The very object, however, of submitting the proposal for a differential rate in the excise tariff is to increase the consumption of Australian leaf. A difference of approximately1s. per lb. in the excise duty should at least swing over another 1,000,000 lb. net from the imported to the Australian leaf. A swing over of a further 1,000,000 lb. net of Australian leaf would automatically bring into operation the second table in statement “ B “. On the revised rates in the second table, namely, 4s. lOd. per lb. in the case of imported leaf, and 3s. lid. per lb. in the case of Australian leaf, the loss of revenue would be £168,525. Under the third table, with rates of 5s. Id. on imported and 4s. 4d. on Australian leaf, there would be a loss of £142,440.
– The Minister does not show how the figures are arrived at.
– Under the fourth table, with rates of 5s. 3d. and 4s. 7d., respectively, the loss would be £187,530. The fifth table, with rates of 5s. 6d. and 4s. lid., respectively, would show a loss of £164,760; and the sixth table, with rates of 5s. lOd. and 5s. 5d., respectively, would show a loss of £206,190. This scheme, like all suggestions of a difference in excise rates, only seeks to grant an increased margin of protection to the local industry, which already amounts to approximately 400 per cent.
– Does the Minister say that it is impossible so to adjust the excise duty on Australian and imported tobacco as to obtain an exact balance?
– I admit that it is possible to do so. The statement with which I have been dealing was presented to me just as the House was about to meet this afternoon. When the excise tariff is being considered it is not an appropriate time to advance . some guesswork, haphazard proposal that may seriously affect the revenues of the Commonwealth. The Government is watching the interests of the tobacco-growers, and has adequately protected the industry. If honorable members considered that the protection afforded is not adequate, they should have brought forward a concrete proposal when the import duty was before the committee; they should not shift their ground when the excise tariff is being considered.
– The Minister did not tell the committee that when the import duty was before it’.
– The Minister then asked the committee not to bring forward the question of the excise duty.
– While the import duty was being discussed, the Chairman gave honorable members full licence to debate the excise duty as well as the import duty. It has been made to appear that I said that the Government would agree to the reduction of the excise duty. I made no such statement. All that I said was that the matter would be given consideration. This proposal, which resembles a crossword puzzle, was placed in my hands only a few minutes before the House met this afternoon. We are told that it would protect the revenue. I have not’ wasted much time in showing that the proposal will not work. The Government has looked after this industry. There is an adequate sale of Australian leaf of good quality. The manufacturing company has been fiercely attacked, the allegation having been made that it is a combine, that it has watered its capital, and that it has made abnormal profits. I know nothing about that. Let honorable members make these accusations - in the right quarter. All that I am interested in is, whether the duty is adequate or not. This is one of the most prosperous primary industries in Australia; and its return is out of all proportion to what the wool and the wheat-growers are receiving.
– Surely that is not a sin.
– I did not say that it is a sin. But let it be frankly admitted. I ask the committee to accept the present revenue duty.
– What is the Minister’s reply to the charge of the honorable member for New England (Mr. Thompson) that certain samples of tobacco were deliberately chosen by the department with the object of misleading the committee ?
– That is on a par with many other of the statements of the honorable member for New England.
– I repeat it.
– The first time that I met Mr. Marks was when I instructed him to proceed to Tamworth. Yet the honorable member for New England actually said that the words of the company were put into that official’s mouth. I say that he made a most impartial report. I have produced a sample of excellent leaf grown in Mareeba. A large crop of similar leaf would have been obtained from many parts of Victoria this year, but for frosts. The other sample was one of rejected leaf from Tamworth.
– Was there only one sample of Tamworth leaf?
– I produced a couple of samples of Tamworth leaf, and one of ordinary Mareeba leaf. The Mareeba leaf shows to great advantage. I do not think the committee should debate the question much longer. This is the fourth debate that we have had upon it. The same ground has been covered on each occasion, and the effort has been made to prove that in some way the Government has been iharsh to the growers. The growers should be thankful to the Government that it has, to some extent, protected them from themselves, by encouraging them to adopt the best cultural methods, and grow only leaf that is saleable at a good price.
.- The Minister has stated that this is the fourth time on which the committee has debated the subject of the tobacco duties, and I may add that it is the fourth occasion on which the Country party has had its “ leg pulled “. It is evident that that party is again engaged in a sham fight. The question to be decided now is not whether the figures presented by the Acting Leader of the Country party (Mr. Paterson) are right or wrong. The Country party asks from what source the Government is to get its revenue. The ex-Minister for Trade and Customs (Sir Henry Gullett), the present Minister (Mr. White), and the Prime Minister (Mr. Lyons) stated definitely, in reply to every deputation that waited on them with regard to the tobacco duties, that the United Australia Party had no intention to reduce the duties, and it threw the responsibility for any reduction upon the Country and the Labour parties. If honorable members are desirous of bringing relief to the tobacco-growers, that result can be achieved only by a vote in this chamber; but the Country party has not had sufficient courage to support the Opposition. Apparently, it does not wish to embarrass the Government, and the Government evidently does not intend to embarrass the Country party.
– Order ! I ask the honorable member to deal with the subject before the Chair.
– It would not cause great inconvenience to the Minister if he had the import duty on tobacco reconsidered, with a view to increasing it by 1s. 6d. per lb., as suggested under the amendment submitted by the Opposition. The Acting Leader of the Country party has declared that his party has no intention to support the amendment tabled by the Opposition. The Labour party proposes to adhere to its amendment ; but, if defeated, it will supportthe amendment to be proposed by the Country party. That amendment would result in a reduction of the excise duty to the extent of 1s. per lb., which would enable the Queensland growers to market their leaf at1s. per lb. less than the price of the imported leaf. The problem with which the growers of tobacco in Australia have been faced, has been the initial difficulty of capturing the local market, and to do that it has been necessary to reduce the price of tobacco to a figure that Australian smokers can afford to pay, having regard to the reduction of their incomes.
– And we must produce a tobacco that Australians can smoke.
– Yes. . There are several good brands of Australian tobacco on the market, and I commend them to the notice of the honorable member. I contend that tobacco equal to the imported article is now produced from Australian leaf; but, unfortunately, the action of the present Government in increasing the excise duty has caused an increase of the price of the locallyproduced article, and has forced the Australian grown tobacco into competition with tobacco produced by negro labour in the United States of America. Can anybody imagine that country purchasing Australian butter, wool, or meat?
The honorable member for Henty (Sir Henry Gullett) declared that the tobacco industry receives protection amounting to 300 per cent.; but, having regard to the average price of 2s. 3d. per lb. which was obtained for last year’s crop, the protection amounts to only about 50 per cent. Great Britain does not produce tobacco leaf. It has imposed an import duty on that commodity amounting to 9s. 6d. per lb., yet tobacco is cheaper in Great Britain than in Australia. Britain gives a preference of 2s. 0½d. per lb. on Empire-grown leaf, and the benefit of that preference is handed on to the consumers. All that the Opposition asks for is a reduction of ls. 6d, per lb. in the excise duty, and that reduction would, undoubtedly, be passed on by the local manufacturers to the consumers. New manufacturers of tobacco have entered the market in Australia, and the smokers are acquiring a liking for the tobacco that is now being produced from locally-grown leaf. In 1930, only a few brands of Australian tobacco, such as “ “Waratah “, were put on the market, and were being sold at about ls. 6d. a 2-oz. packet.” But, to-day, “ Waratah “ has practically disappeared from the market, and other brands of a better quality have taken its place. The Minister said that difficulty would arise if differential excise rates were adopted. I point out, however, that in 1922 and 1927, the excise duties showed a variation of 6d. per lb. When the tobacco duties were under discussion last year, the then Minister for Trade and Customs said that if the proposal put forward by a deputation was adopted, the revenue would suffer to the extent of from £2,000,000 to £3,000,000, and he anticipated a loss in that year of £1,000,000; but there was no loss of revenue.
Those honorable members who are anxious for the success of the Australian tobacco industry should dismiss party considerations on this occasion, and take action to assist this industry, which pro- vides a great deal of employment, and is capable of considerable development. It is not a sound argument to say that a reduction of the excise duty will encourage the production of an inferior class of leaf, because it must be admitted that the manufacturers will buy only such leaf as suits their purposes. Two hands of tobacco were recently displayed in this chamber by the Minister, who said that one was from Mareeba and the other from the Tamworth district. I remind honorable members that it would be possible in any district, including Mareeba, to select two hands of tobacco of totally different qualities. One might be first class leaf, and the other an inferior grade. If half the leaf grown in the Tamworth district last year happened to be of a certain quality, that fact would not justify the destruction of this industry. If the amendment of the Deputy Leader of the Opposition is agreed to, the Government will have to take steps to protect the revenue to ensure that no loss will be sustained.
– I am not prepared to support the amendment of the Deputy Leader of the Opposition (Mr. Forde), but I think that something more might be done by the Government to assist the tobacco-growers to dispose of the leaf that they produce. I do not believe that it is the responsibility of the Government to make any industry profitable. It is not the duty of the Government to make the production of wheat and wool pay, or to make manufacturing enterprises successful; that is the responsibility of the people who put their money into such enterprises. But in certain circumstances a responsibility rests upon the Government which it should not lightly throw off. The Tariff Board has stated that such circumstances exist in connexion with the glass industry, and I submit that it also exists in connexion with the tobacco industry. The Tariff Board, in its report on the glass industry, stated that -
The industry based on so high a cost would be of doubtful value on economic grounds, but the board is actuated in recommending it - that is, the high tariff - by the fact that the deferred duty encouraged the installation of the factory.
I submit that the provision of a duty of 5s. 2d. per lb. encouraged people to engage in the tobacco industry. Following upon the provision of this duty, an immense development occurred in tobacco production. Large amounts of new capital were invested in the industry, and heavy commitments in the nature of hirepurchase instalments were made by the tobacco-growers. In these circumstances, the Country party considers that an obligation rests on the Government to see that the tobacco-growers are not left stranded by the sudden chopping off of the tariff. This Government made a 40 per cent, chop in the duties with one stroke of the pen. Such a bad knock to the growers will prevent the industry from being carried on. profitably. It has been stated by the honorable member for Henty (Sir Henry Gullett) that the price of 2s. 3d. per lb. obtained for leaf last year was extraordinarily profitable. The honorable gentleman added that this showed that the 3s. per lb. duty was ample to safeguard the industry. In reply to that statement, I remind the committee that there has been no extension of tobacco-growing this season. As a matter of fact, there has been a material decrease in the acreage. It must be remembered also that growers will not obtain anything like the same yield per acre this year as they received last year. Until to-night we had not been given any indication by the Government of the price that would be obtainable for the quantity of leaf that the manufacturers are prepared to buy this year.
Four parties are interested in the tobacco industry - the growers, the manufacturers, the Government, and the users of tobacco.
I do not think that we need worry ourselves very much about the tobacco manufacturers, because the Tariff Board has pointed out in its report that -
Viewed in the light of disclosed profits, the operations of the British Tobacco Company (Australia) Limited have been far more remunerative than those of most other Australian industries. The board’s examination of the accounts of this company and its subsidiaries has failed to disclose the need for the large amount of capital that now ranks for dividends. In fact, the profits made per 11). of tobacco in 1929 were considerably higher than the whole of the wages paid in production.
We may, therefore, leave the tobacco manufacturers out of our consideration
The next party to be considered is the Government, which is vitally interested in this industry from the revenue point of view. But the proposal which the Acting Leader of the Country party (Mr. Paterson) intends to submit as a further amendment to the Government’s proposal does not give much room for complaint from the revenue aspect. The Minister (Mr. White) examined this proposal in some detail, but in the end he had to admit, in reply to a question, that it was not impossible to adjust the excise on tobacco manufactured from imported leaf and that manufactured from local leaf, so that there need be no loss of revenue.
Let us now consider the position of the growers. Their chief trouble is their inability to dispose of a large portion of their production. I am prepared to admit that the arrangements made with the tobacco companies last year for the purchase of the locally-grown leaf were generally satisfactory, and in most districts the growers were able to dispose of the bulk of their production. I do not suggest that it is an obligation of the Government to provide buyers for the whole production of any industry. If growers produce an inferior article, they are responsible for it, and not the Government. But the very heavy cut in the duty on tobacco was made too suddenly, and as growers have made large commitments, principally in the signing of hirepurchase agreements for the equipment of their kilns and for irrigation plant, they are entitled to a little more consideration. We should not forget that this industry provided a large amount of employment at a time when such employment was badly needed.
The adjustment of the excise duty can be considered in conjunction with the position of the users of tobacco. I recognize that it would be possible, with the proposed margin of ls., either to pay the growers a higher price for their leaf or to reduce the price of tobacco manufactured from locallyproduced leaf. I understand that it is not desired that the price of tobacco shall be increased. The growers are principally concerned about the disposal of their crop. If the manufacturers will assist the growers by buying the local leaf, the price of the tobacco made from it can be reduced. As pointed out by the Acting Leader of the Country party, it would be possible under his proposal to provide a margin of 1-Jd. per 2-oz. tin or packet in favour of the local tobacco, and this would, inevitably, have the effect of stimulating its consumption.
I do not desire, nor do I think it is the desire of any honorable member, that this industry should be developed on uneconomic lines. I realize that, if we over-protect it, either by an import duty alone or by such a duty in conjunction with an excise duty, the production of tobacco leaf will be encouraged on unstable lines, which will not be good for the industry. Such a policy would cause the growers to use lands that are unsuitable, and to produce large quantities of inferior leaf; there would be cut-throat competition to quit it, and this would ultimately ruin the industry. The proposal of the Acting Leader of the Country party would not have that effect, for it is not intended that it shall remain in force indefinitely. Last year when we were discussing the . tobacco industry the Country party made an effort to get the Government to adjust the excise duties on a sliding scale for two years, to cover the period of extreme difficulty of those engaged in this industry who had committed themselves to heavy liabilities for capital outlay. The Government made a satisfactory sale arrangement for last year, but it is necessary that some arrangement shall also ‘be made for this year, if the growers are to be given a reasonable chance to meet their commitments. We hope, therefore, that the proposal of the Country party will be accepted, for it would give very little room for complaint by the growers, the Government, or the users of tobacco. The growers would be able to sell their leaf; the Government would be able to obtain the revenue it needs; and the users of tobacco would be able to obtain their requirements at a lower price than would otherwise obtain. In these circumstances I intend to support the proposal of the Acting Leader of the Country party, and I hope that the Government will accept it.
.- I have already expressed my views on the tobacco industry on several occasions this session, and I shall not delay the committee long at this stage. I was not surprised to hear the Minister for Trade and Customs (Mr. White) say that the Government would not amend its excise proposal. Like certain honorable members of the Country party, I attended the deputation of tobacco-growers which waited upon the Prime Minister (Mr. Lyons) and the then Minister for Trade and Customs (Sir Henry Gullett) last year. Then, as always, we were told the same story - “ This matter will receive the earnest consideration of the Government “. It is still receiving thi3 consideration, and, I presume, will continue to receive it until the Government gets to the end of its tether. The Minister has told us to-night that he received word to-day that the tobacco companies would buy all the good leaf for 3s. 2d. per lb. I hope that that information is correct. The advice that I received from North Queensland a fortnight ago was that there was plenty of leaf available in that area similar in quality to that which the companies bought last year, but there were no buyers for it. My authority for that statement is Mr. Hunter, the president of the Mareeba Chamber of Commerce. When we asked the Minister for the name of his informant on the North Queensland position he told us that his information came from a reputable firm, but that he could not divulge the name. We do not wish to keep secret the authorities for the information that we use in discussing this subject. I consider that the president of the Mareeba Chamber of Commerce is just as reliable an authority as that on which the Minister is relying. There is a representative of the Commonwealth in that district, but, apparently, his advice has not been sought. The telegram which I received from Mr. Hunter - I admit that it is a fortnight old, but the position has not changed - reads as follows : -
The tobacco-growers of North Queensland would appreciate your support and influence in getting a reduction of the tobacco excise, and expedite same as much as possible. Unless this reduction is made tlie industry will be greatly retarded in this State. Large quantity of tobacco leaf now ready for sale but buyers not operating.
I have received similar telegrams from the Chambers of Commerce at Townsville, Bowen, and other places in my own electorate. Mareeba, of course, is in the electorate of the honorable member for Kennedy (Mr. Riordan). It appears that an effort is being made to pit the North Queensland to’bacco-growers against the growers of other districts, because the statement has been made that North Queensland is the only district that can produce good tobacco. That opinion has been exploded by the sworn testimony given before the select committee on the tobacco industry, and also by the returns furnished to growers in many districts by the British-Australasian Tobacco Company. We know very well that the tobacco grown at Pomonal, in Victoria, and at Tumut, in New South Wales, is as good as that grown in other parts of Australia. That good tobacco is also grown at Tamworth, notwithstanding what has been said about the Chinese there having grown inferior tobacco, is proved by the returns of the BritishAustralasian Tobacco- Company to the growers in that area. Good quality tobacco can be grown in many parts of the Commonwealth. The amendment of the Deputy Leader of the Opposition (Mr. Forde) should be acceptable to every one who desires to give the tobacco industry the support that it really needs. But, as the honorable member for Kennedy has said, if it is not carried by the committee, we shall support the amendment of the Country party. We shall not refuse to support honorable members of that party because they will not support us. We believe that the proposal of the Acting Leader of the Country party will give the tobacco-growers some relief. I must say that I cannot follow the reasoning of the Minister for Trade and Customs. This Government has, for the last twelve or eighteen months, been giving “ earnest consideration “ to the representations of the tobacco-growers. Last year, a deputation of 41 representatives of the tobacco industry which waited on the Prime Minister and the then Minister for Trade and Customs (Sir Henry Gullett), was told that the Government was then giving earnest consideration to the industry. The same statement has been made twice or thrice since then. I cannot understand the statement of the Minister that if our proposal were agreed to, the revenue would be adversely affected. It should be an easy matter for the Government to protect the revenue. I trust that the amendment of the Deputy Leader of the Opposition will be accepted.
Sitting suspended from 11.59 p.m. to 12.80 a.m. (Thursday).
Thursday, 25 May 1933 [Quorum formed.]
.I do not wish the debate on these duties to close without expressing my views concerning this very important industry of tobacco-growing. I intend to support the amendment foreshadowed by the honorable member for Gippsland (Mr. Paterson), because I am convinced that, if carried, it will give some measure of protection to Australian tobaccogrowers, and perhaps enable them to recover from the blow dealt to them last year when they were brought into competition with outside growers. They have been put to considerable expenditure to arrange finance for this year’s production, and should be protected. I wish it to be clearly understood, however, that I am not in favour of excessive duties on the product of any industry, because I realize that competition is the soul of trade. Unless producers and manufacturers are in reasonable competition, they may not produce the quality of goods expected of them. Excessive protection leads to the establishment of monopolies, and destroys that competitive spirit which is essential to the economic expansion of a nation’s activities in primary and secondary production. The measure of protection which the amendment of the honorable member for Gippsland would give the industry is necessary to tide Australian growers over their present difficulties. I have nothing to say about the manner in which last year’s crop was sold as a result of the arrangement made by the Government with the manufacturers, but I note that much has been said in criticism of the quality of leaf grown in some areas. This we must deplore, because it is desirable that Australian smokers be provided with a high quality, local product. The amendment, I repeat, would give our growers an opportunity to find their feet, and, as the industry develops, we may expect them to give their attention to the production of a better quality tobacco. Excellent leaf is being produced in many localities, including Mareeba, Wagga, Tumut, and Tamworth. Some of the leaf is exceptionally good, and as our growers have demonstrated their ability to supply the requirements of this country, they should be given the necessary protection to enable them to extend their activities, and, later, give attention to an export trade. An alteration of the excise as suggested would give a much needed incentive to the industry, the expansion of which would permit prices for Australian tobacco to be reduced consequent on an increase of sales. I appeal to the committee to accept the amendment forecast by the honorable member for Gippsland, so that this important industry may be put upon its feet. The figures used by the honorable gentleman were those upon which excise revenue was based last year.
I was much surprised at the statements made this evening by the honorable member for Henty (Sir Henry Gullett). His speech was notable for. its inaccuracies, and the insults which he hurled at members of the Country party. The honorable gentleman deliberately misquoted figures used by the honorable member for Gippsland. Obviously, he was not in the House, otherwise he would have known that the Acting Leader of the Country party did not make the statements attributed to him. “We all know that the honorable member for Henty has been absent from the House for some considerable time owing to illness, and I, as well as other honorable members of this chamber, extend to him a full measure of sympathy. But I strongly resent hie unfair criticism of Country party members. It is outrageous for him to come into this chamber periodically, as some honorable members do, and hurl insults at the party to which I have the honour to belong. Men who indulge in this kind of criticism merely display the weakness of their case, and, because of the privileges which they enjoy as members of this Parliament, it is they who really indulge in sham-fighting. If, outside this chamber, they repeated (he insults which they hurl at the Country party in Parliament, they would find us ready, at all times, to stand up and justify ourselves. At various times other honorable members protest loudly on behalf of unfortunate widows and children who have suffered some disability through the administration of our pension laws. But we all know that they are not so deeply concerned as they would have the people believe they are; that the “ sob stuff “ which they indulge in, and the crocodile tears which they shed, are merely so much political propaganda.
-Order ! The honorable gentleman must discuss the item before the committee.
– I am aware of that, Mr. Chaiirman, but I was determined to say something, by way of reply to the insulting remarks made, not only in this. chamber, but outside also, concerning members of the Country party. I shall always be prepared to stand up to take my share of responsibility for anything which the party may do. I again appeal to honorable members to give full consideration to the amendment foreshadowed by the Acting Leader of the Country party.
– I intend to support the amendment foreshadowed by the honorable member for Gippsland (Mr. Paterson). I do not favour the amendment moved by the Deputy Leader of the Opposition (Mr. Forde). If carried, it would seriously affect the revenue. The Minister (Mr. “White), in reply to the honorable member for Gippsland, pointed out that his amendment would mean a loss in revenue of £206,000 in the last year. An ex-Minister (Sir Henry Gullett) on introducing these proposed duties, expressed the fear lest there should be a much more serious loss of revenue. Assuming that the figures quoted by the honorable member for Gippsland were not ‘ quite correct, the necessary revenue could be secured by a very slight adjustment of the rates. Queensland members have been urged to support the Government’s proposal, because that State produces the best quality of tobacco leaf and would be benefited considerably. Such a suggestion does not appeal to me, nor, I think, to other Queensland members in this chamber. I prefer to regard tobacco-growing as an Australian industry, and to consider the effect of excise duties from that point of view. It has been urged that, as the general debate on these duties was concluded on the import duties on tobacco, an amendment of the excise duties should not now be discussed. I listened very carefully to the general debate, and my clear impression was that the Minister had implied with respect to import duties that the discussion of customs duties would not in any way, interfere with our discretion when considering the excise duties; that we were free, to deal with them in a manner calculated to give protection to the industry as a whole. During these debates I have urged that there should be differentiation between the local and imported leaf with respect to the excise duties, and have pointed out that the reduction of the import duties made by the present Government was too sudden and drastic, because the industry had expanded on the basis of duties imposed by the Scullin Government. Having in mind the large amount of additional capital invested in the industry, I felt that any sudden withdrawal of the protection given would have disastrous results. Therefore, I preferred a differentiation in the excise duties to enable the industry to become thoroughly established. This, briefly, is the intention of the amendment outlined by the honorable member for Gippsland. “We are now growing tobacco in various parts of the Commonwealth. A gradual increase of the excise duties on Australian leaf will lead to the production of a better class of leaf, which will induce a heavier consumption of tobacco manufactured from the Australian leaf. I am not satisfied that the larger manufacturers are greatly concerned in promoting the consumption of Australian tobacco.
Mr.White. - Neither is any one else.
– The growers are concerned, and every true Australian patriot is concerned in the establishment of Australian industries, of which tobacco-growing is one.
– The industry is well established, and the Government is helping it to progress.
– I admit that the Government is doing what it believes will help the industry, but I consider that it would be better assisted if the proposal of the honorable member for Gippsland were accepted. Some comments have been made* about the alleged production of inferior tobacco last season. It must be remembered that that was the first big year of production in Australia; roughly speaking, about 12,500,000 lb. of tobacco was produced, of which 10,000,000 lb. was purchased by the manufacturers, and will go into consumption. Those results compare favorably with the record of the wheat, fruitgrowing, or any other industry, considering that so many people undertook tobacco-growing for the first time. The honorable member for Henty (Sir Henry Gullett) said that if the protection given to the Australian industry were increased, encouragement would be given to a greater production of inferior tobacco such as was shown in this chamber. The answer is that the manufacturers know what they want, and will not purchase unsuitable leaf. I am confident that Australia will be able to produce all our local requirements of first-class leaf, but it is essential that reasonable protection should be given to the industry. I intend to vote against the amendment moved by the honorable member for Capricornia, and to support that indicated by the honorable member for. Gippsland.
.- We all become very tired of hearing the story about “ every patriotic member will follow me in this “. Does the honorable member for Darling Downs (Sir Littleton Groom) consider that he is not like other men, and that the Government is wanting in patriotism, because it does not agree to every abnormal proposition that is put before it?
– I do not suggest that.
– The honorable member talked in generalities of honorable members condemning Australian tobacco. Neither the honorable member for Henty (Sir Henry Gullett), nor anybody else, made such a suggestion. This matter has been inquired into by the Tariff Board, and I am surprised that the honorable member for Darling Downs, with his legal mind, should accept such a rule-of-thumb project as that outlined by the honorable member for Gippsland, which, if accepted, would merely circumvent the Tariff Board. Honorable members termed it an excise duty; actually it merely involves raising the import duty.
– Did the Tariff Board recommend differential rates of excise duty?
Mr.WHITE.- I believe so. Honorable members who support both the amendment and the proposal of the honorable member for Gippsland are illogical. They say that they want to increase the consumption of Australian leaf by raising the excise duty on imported leaf. Naturally, the less foreign leaf that we import the higher must he the excise duty on Australian tobacco. Then why reverse the process at the outset by moving to reduce the excise duty on tobacco made from Australian leaf? We have had anexample of the operation of differential rates of duty in connexion with the wine industry, yet without much thought, it is suggested that there should be differential rates of excise duty on tobacco. Obviously, the scheme would be unworkable.
Motion (by Mr. Ward) agreed to -
That the question be now put.
Question - That the amendment (Mr. Forde’s) be agreed to - put. The committee divided. (The Chairman - Mr. Bell.)
Majority . . . . 19
Question so resolved in the negative.
– I move -
That the item be amended by adding the following: - “And on and after 25th May, 1933 -
Tobacco, hand-made strand - Australian leaf content, per lb., 3s. 7d. ; imported leaf content, per lb., 4s. 3d.
Tobacco, manufactured, n.e.i., Australian leaf content, . per lb., 3s.10d. ; imported leaf content, per lb., 4s. 6d.
Tobacco, fine cut suitable for the manufacture of cigarettes, per lb., 7s. 3d.”.
The honorable member for Henty (Sir Henry Gullett) expressed the opinion that I had shown inconsistency in proposing an amendment of this nature. I submit that the reason why honorable members of the Country party support lower duties generally is that it is necessary to do so in order to bring about lower prices for goods, and that is what will be the result if the excise duty on Australian tobacco is decreased. If any inconsistency can be shown in that attitude, I should like a full explanation on the subject by the honorable member for Henty. I regret that when the honorable gentleman speaks on matters such as this he cannot refrain from becoming somewhat heated, which should be totally unnecessary when dealing with an economic problem. The honorable gentleman said that this proposal would mean a reduction of price only for two years, and in that he was supported, by way of interjection, by another honorable member. How they arrive at that conclusion I cannot say. I admit that it is difficult for honorable members thoroughly to appreciate the effects of this proposal without having the figures before them. The figures, which were compiled by. the secretary of the Victorian Tobacco Growers Association from departmental statistics, show that if this proposal were adopted, the excise duty on Australian tobacco would, at the end of six years, still be 1d. per lb. less than it is to-day. The proposal is for a reduction of the excise duty on Australian tobacco by 8d. in the first year, tapering to1d. in the sixth year. Therefore the statement by the honorable member for Henty that the advantage to the user would be confined to the first two years was inaccurate.
I assume that his erroneous conclusion was based on figures I mentioned regarding the additional rates that would be necessary to produce the present amount of excise in future years as importations decrease. But these additions would be just as necessary under the rate of 4s. 6d. as under the rates which have been suggested, and do not affect the comparison at all. These figures were mentioned merely to present a fuller case, but there was no need to take them into consideration. The scheme I have suggested would enable Australian tobacco to be sold to the consumer at a slightly cheaper rate even at the end of six years, but my amendment deals only with one year. The figures relating to the quantities of Australian and American leaf going into consumption in future years were necessarily only estimates, indicating the lines on which the Government, if it were willing to adopt this proposal, could obtain the same amount of excise as under the 4s. 6d. rate. The Minister admitted that if the figures for the ‘ first year, namely, 10,000,000 lb. of imported leaf and 4,000,000 lb. of local leaf, proved to be substantially correct, the revenue would be better off than under the present rate. Even on the department’s figures for the year, namely, 8,240,000 lb. and 3,860,000 lb. respectively, the Government would be better off under this scheme than under its own proposal. I am not suggesting that the system I am submitting would guarantee to the Government in future years the same revenue as it is getting to-day. But one could guarantee that it would enable the Government , to obtain the same amount of revenue in future as it would obtain from the 4s. 6d. rate. I have already explained that my reason for moving a reduction of 8d. in respect of the Australian leaf without a compensating increase of 4d. in respect of the imported leaf, is that a private member may not move to increase a rate of duty. If my amendment is agreed to, the Government can then move for the necessary increase of the rate on the imported leaf.
– Some of the wild statements which have been made call for a reply. For instance, the honorable member for ‘ New England (Mr. Thompson) said that the sample of Tamworth tobacco leaf which the department* supplied to me, and which I pro:duced in the chamber for comparison with the Mareeba leaf, was exceptional and had been specially picked out by the department. I now produce other samples from the Tamworth district, all of them with the names of the growers attached, and I invite the honorable member to inspect them and declare whether they are up to the sample of the Mareeba leaf.
– I do not .think it is right that the Minister should be advertising in this chamber the worst products.
– I agree with the right honorable gentleman, but when an honorable member makes wild assertions that he disbelieves the statements of Ministers and the departmental expert, and believes nobody but himself, the facts must bo driven home in a convincing manner. I am adopting the only method of dealing with a man of such mentality. I have no desire to attack any party, as such, in regard to its attitude on the customs and excise duties. In all parties, members hold divergent views, but it is a fact that some members of the Country party supported higher import duties on tobacco, and have shown great inconsistency.
– The duties were agreed to on the voices.
– The honorable members for New England (Mr. Thompson) and Forrest (Mr. Prowse) advocated an import duty of 5s. 2d. per lb. Now they have sought to get increased protection by means of the excise duties’, and the Acting Leader of the Country party declares that the object of his amendment is to make tobacco cheaper for the smoker. If that was his object why did he not move for the reduction of the duties on both imported and Australian tobaccoes.
– Because one does not want to have fluctuating customs duties. It is admitted that we must have a variation from year to year of the quantities of local and imported leaf respectively, and such variations can be met by adjustment of the excise duties.
– The honorable member could have moved for an equal reduction in respect of both imported and local tobaccoes, but his amendment means nothing more or less than an increase of the import duties. He has said that he is not a prophet and cannot estimate what quantities of Australian and imported leaf will be used in future years. We know, however, that as the consumption of Australian tobacco increases, the excise rate on it must be raised to compensate the Government for the loss of revenue through the diminution of imports. When earlier the honorable member moved for a reduction of import duties to the level of the 1921 tariff schedule, he wanted a schedule of his own making.
– Order ! The Minister must confine his remarks to the item before the committee.
– On another group in the customs tariff the honorable member was anxious that all duties should be referred to the Tariff Board.
– Order !
– Yet in regard to the item now before the committee, instead of asking that it be referred to the Tariff Board, he asks the committee to accept his views as to what should be the excise duties. The Government cannot accept random figures. It has the interests of the growers at heart, and they have received good prices for their leaf. Those who produce the type of tobacco which the Australian smoker wants will have no difficulty in selling all of it, and as the Government cannot afford to lose revenue, it is unable to accept the amendment.
.The Minister for Trade and Customs (Mr. White) has endeavoured to misrepresent the proposal which the Acting Leader of the Country party (Mr. Paterson) clearly submitted to the committee. He asked why, if the Country party desired to reduce the price of tobacco to the smoker, it did not propose a reduction of the excise duties on all tobacco. The honorable gentleman must be aware that the mover of the amendment stated that his party had no desire to deplete the public revenue. When any amendment affecting taxation is proposed, the Government invariably objects that it would interfere with the revenue, and, therefore, cannot be accepted. The Acting Leader of the Country party has explained on many occasions that neither he nor his supporters have any desire to embarrass the Government in respect of the public finances. Any honorable member who has the audacity to declare to the contrary is either ignorant or deliberately endeavouring to mislead the committee and the public. We have heard during the last few months honorable members of all parties advocating the development of Australian industries. Tobacco cultivation is a primary industry which, in proportion to its size, is yielding more revenue to the Treasury than is any other branch of primary production. It is virtually a gold mine, by reason of the hard cash it yields to the Commonwealth Government month in and month out in the form of excise duty, which is merely a tax for revenue purposes. This industry has wonderful possibilities of expansion at the expense of the United States of America, which is probably Australia’s greatest commercial enemy. We have had less quarter from the United States of America commercially than from any other country. Our trade balance with it for the last five or six years has been four to one against us. For every £1 worth of goods that the Americans buy from us, they dump £4 worth of their own goods into Australia. This amendment, even if it has no other virtue, would help to correct our adverse trade balance, and at the same time establish an important primary industry without asking the Government to sacrifice any revenue. There is no bias in this proposal. The members of the County party are not attempting to undermine the financial stability of the Government or to gain a party advantage. No amendment was ever put before a legislative chamber more honestly and frankly than was this amendment by the Acting Leader of the Country party. Yet we have been’ viciously attacked and misrepresented. We have been vilified by an ex-Minister who should, and does, know better, but who when he rises to his feet becomes politically irresponsible and makes inaccurate statements which are broadcast for party purposes. Even the Minister for Trade and Customs accused us of having made wild statements.
– Does the. honorable member deny that the statements of the honorable member for New England (Mr. Thompson) were wild?
– I do not accept responsibility for every statement made in the committee, but I certainly take exception to the remarks of the honorable member for Henty (Sir Henry Gullett). It is only because he is a sick man, and is not present in the chamber now, that I refrain from dealing with his statement in a different manner. I have been overpolite in the references I have made to him.
– The honorable member had better hurry; his time is running short.
– I have sat for many hours in this House listening to the speeches by the honorable member when I might have been better employed outside. I seldom trouble the patience of honorable members, and I intend to have my say until I am stopped by the Chairman, or am gagged. If we carefully analyse the amendment of the Acting Leader of the Country party, we find that it scrupulously safeguards the revenue by means of a sliding scale which can be amended or altered to suit the requirements of the Government, so long as the general principle is preserved, namely, the margin between the excise rates on Australian and imported tobacco. We are prepared to accept a scale worked out by the Government or its officers that will achieve the same financial results as the present rates of duty. The principle involved is that we should give preference to this Australian product, and we have put forward a proposal that, while not interfering with the revenue, will give to the industry a greater share of the Australian market, so that it will be able to expand and absorb a greater number of people. The acceptance of our proposal would be a definite move in the direction of reducing the cost of Australian-grown tobacco to the consumers. No one can object to that.
– That is necessary.
– It is necessary. Every time we suggest a reduction of the tariff we are told that to do so would interfere with an Australian industry. Here we have an opportunity to reduce the excise duty on an Australian product, and increase the excise duty on a foreign product, without doing any harm whatever. The same difficulty does not arise in this case as when we were discussing the duties on glass. We were then dealing with the product of a nation which is an especially good customer of Australia, and with which we have a favorable trade balance of between £6,000,000 and £7,000,000 a year. Belgium is a country we cannot afford to offend. In the’ case of tobacco, however, we have an opportunity seldom presented to us. We may do something to assist an Australian primary industry without suffering any loss of revenue, and do so at the expense of a country with which we have every year a heavy adverse trade balance. The United States of America is one of the few foreign countries with which we trade that sells to us more than we buy from her, our adverse trade balance running into several millions of pounds.
Members of our party have been abused on the ground that they have been trying to undermine the Government, and take away from it the control of the country’s finances; but if we analyse the objections, we see that they are nothing but political bias or political bluff, when they have not been inspired by sheer ignorance.
– I understood the honorable member to say that he was being over-polite.
– I am still being overpolite, having regard to the statements which have been made about us. I am justified, I think, in answering statements that are illogical and exaggerated, and in the course of which our remarks were misquoted and misrepresented. We have been charged by honorable members of the Opposition with putting up a sham fight - though now I am pleased to see that they are prepared to support us - simply because we have had. the courage to state our case, and support it with arguments that cannot be refuted.
– But not by voting for it.
– Yes, and by voting for it, too. Efforts have been made to misrepresent the position at Tamworth. I am disinterested and impartial regarding this issue, because I do not think that there is a tobacco-grower in the whole of my district. It is not necessary for me to canvass the support of the tobaccogrowers. Because there is a email percentage of Chinese engaged in the production of tobacco in the Tamworth district, the honorable member for Henty charges us with trying to foist on the public an inferior product grown by Chinese labour.
-What about the negroes in the United States of America ?
– The honorable member’s references to Chinese-labour furnish merely another example of his unscrupulous
– The honorable member said that he was being over-polite. I remind him that I spoke only in defence of a government official who had been maligned.
– I did not say that the Government had been unscrupulous. I referred to the unscrupulous tactics of the honorable member for Henty.
– The use of the word” unscrupulous “ in reference to any honorable member is unparliamentary.
– I withdraw the expression, and say that I object to the unfair tactics of the honorable member for Henty in endeavouring to misrepresent the position in regard to the amount of Chinese labour employed in the growing of tobacco in the Tamworth district. If a choice must be made, I should prefer tobacco grown by Chinese or black labour in Australia to that grown by such labour in America.
I also object to the action of the Minister in exhibiting in this chamber inferior samples of tobacco, the implication being that they furnished an idea of what the whole Australian crop was like. There is no primary industry that does not produce a fairly large proportion of inferior commodities. It would be possible for any Minister or member of this Parliament to produce a bad sample of any crop grown in Australia, and, using it as an argument, mislead the public and members of this committee.
I do not believe, in view of the attitude taken up by honorable members opposite, that the amendment will be carried, but it represents an “honest attempt on the part of the Country party to put before the committee a proposal which is not based on party considerations. It has been put forward with one object in view, namely, to give increased preference to an Australian product, with a view to developing the industry at the expense of a foreign country with which we have had, year after year, an adverse trade balance.
Motion (by Mr. Ward) put -
That the question be now put.
The committee divided. (Chairman - Mr. Bell.)
Majority . . . . 19
Question so resolved in the affirmative.
Question - That the amendment (Mr. Paterson’s) be agreed to - put. The committee divided. (Chairman - Mr. Bell.)
Majority . . . . 2
Question so resolved in the negative.
– I move -
That the item be amended by adding the following new sub-item: - “And on and after 25th May, 1933 - (ba) Tobacco manufactured wholly from Australian leaf, per lb., 3s.6d. “.
The effect of the amendment, if agreed to, would be to exclude from any reduction of excise duty all brands of tobacco which are not made solely of Australian leaf. The previous amendments with which the committee has dealt referred to all the Australian tobacco on the market to-day; my amendment is intended to apply only to those brands of tobacco which are 100 per cent. of Australian leaf. There are not many such brands on the market; probably the only purely Australian tobacco now offered for sale is the Mareeba brand.
-There are several other brands.
– The loss of revenue which would result from the acceptance of the amendment would be infinitesimal; but the effect would be to encourage manufacturers to make tobacco wholly of Australian leaf, and to prove whether or not Australian smokers are prepared to smoke Australian tobacco unblended with imported leaf. If manufacturers could place this unblended tobacco on the market, at1s. per lb. less than their present prices, I feel sure that they would do so. I believe, moreover, that the product would be acceptable to the smokers of this country. Had we adopted some of the previous proposals, difficulties might have arisen with the Trade and Customs Department in calculating the differential rates of excise. That difficulty has always been a ground for objection by the department to differential rates of excise on imported and on Australian leaf. The department claims that about 95 per cent. of the Australian leaf is used for blending with imported leaf, and that very little of it is used in the manufacture of purely Australian brands of tobacco. Under my amendment, those difficulties would disappear. Officers of the Customs Department and manufacturers with whom I have conferred on this subject, say that my proposal is the only practical means of applying differential rates of duty.
– Had the honorable member submitted his proposal earlier, a good deal of time might have been saved.
– I put the suggestion forward when a member of the Select Committee on the Tobacco Industry, and the committee included the proposal in its recommendations. It does not, however, go far enough: it does not grant the industry the assistance it needs immediately. From my conversations with officers of the Customs Department, I feel confident that a way could be found to meet the difficulties which have been mentioned during this debate. If accepted, the amendment would not have any immediate or great effect on the revenue. Later, when the manufacturers of tobacco were producing brands containing. 100 per cent. Australian leaf, there would, of course, be some loss of revenue, but it would be small; it would be at least twelve months before any difference was noticeable. Anything that we can do to popularize Australian tobacco will be of benefit to the industry. My proposal would assist the industry slowly but surely. Its great advantages are its simplicity, and the fact that there would be no immediate loss of revenue. By accepting the amendment, the Government would give evidence of its desire to help this important Australian industry. “With those who contend that it is not practicable to put on the market tobacco and cigarettes made wholly of Australian leaf, 1 disagree, for 1 have seen excellent cigarettes made solely of Texas tobacco. Australia can produce its own requirements of both tobacco and cigarettes. I appeal to the Minister to accept this, my last proposal, to the Government. There is no bite in it. What I ask for is little in itself, but its acceptance by the Government would be some evidence of a desire to assist this Australian industry. I do not know what objection the Minister can raise to my amendment, but I daresay that he will oppose it. He referred to my previous remarks concerning Tamworth tobacco, and even went to the trouble of obtaining samples to disprove my statement that one particular sample had been selected. One sample was certainly bad, and it seemed as though it had been chosen on that account. The other samples, although not good, were not bad tobacco. One sample was certainly green, but it might surprise honorable members to know that if that tobacco were left in the barn for twelve months it would change to a different colour altogether. The manufacturers buy green tobacco and store it until it changes colour; there is no need for some honorable members to be shocked just because one particular sample looks green. I have seen infinitely worse samples of tobacco in all the tobacco-growing districts of Australia, including those in Queensland, South Australia and Victoria. The samples produced convey absolutely nothing. As the Minister has questioned my motive in attacking Mr. Marks’ report, I should like to remind him that I stated in my speech that I questioned, not the bona fides of that gentleman, but the methods adopted by him in compiling the report which he presented to Parliament, and which contained a damning indictment of the tobacco grown in the Tamworth district. Mr. Marks did not mention in his report that out of 1,000 tons of leaf grown in the district 600 tons produced by white labour were sold last year at an average price of 2s. 3d. per lb., and that for the past 40 years the manufacturers have been buying that class of leaf and manufacturing it into tobacco for consumption in Australia. It is only now that some honorable members have become horror-stricken because of the employment in the industry of Chinese, many of whom have been living in this country for 50 years. The proportion of Chinese to white people employed in the industry throughout Australia is only one per cent. The Minister has been caustic in his remarks concerning my attitude on this matter, but I have received from a tobacco-grower at Scone a letter in which he informs me that the inspector who made an analysis of the tobacco grown in that district did not inspect the tobacco at all, although the growers invited him to do so. He merely took samples and presented to this Parliament a report to the effect that he had made a careful analysis of 52 tons of tobacco grown in that district. That surely is conclusive proof that he did not carry out his work properly.
– The honorable member’s amendment is based on mere guess work, because he cannot state what .revenue would be lost if it were accepted, although he has had time to collect some figures on the subject. He has said that he had this proposal in mind years- ago and that not much tobacco wholly of Australian leaf is manufactured in this country.’ Let me inform him that, in addition to Mareeba tobacco, the BritishAustralasian Tobacco Company, and Messrs. Dudgeon and Arnell are manufacturing an entirely Australian product. The honorable member admitted that the amendment, if accepted, would not be pf much assistance to the Australian industry, but he suggested that it might serve as a gesture. We cannot make too many gestures when each involves a considerable loss of revenue. I have no wish to refer further to the tobacco grown in the Tamworth district. The expert made a complete list of the growers whom he visited in the Scone district. He obtained samples of 95 per cent. of the tobacco grown, and I amprepared to accept his statement. In conclusion let me say that the Government is aware that splendid tobacco is being produced by Australian growers in spite of hardships, pests and little instruction, and often adverse climatic conditions. Good tobacco has been produced not only in Queensland, but also in other parts of the Commonwealth, particularly in Victoria, and if the growers will study cultivation methods there is no doubt that they will obtain good crops and be able to sell it. This yearsome 6,000,000 lb. of good quality tobacco leaf will be bought.
I cannot accept the honorable member’s amendment.
Item agreed to.
Items 7 and8 agreed to.
By adding a new item as follows: - 11. (a) Petroleum or shale products, viz. : - Petrol, benzine, benzol, benzol ine, gasoline, naphtha, pentane and any other petroleum or shale spirit, having a flash point of under 73 degrees fahrenheit when tested in an Abel Pensky closed test apparatus -
1) As prescribed by departmental by-laws, free.
N.E.I., per gallon, 4d.
Petroleum or shale distillates, viz.: -Turpentine substitutes -
1 ) As prescribed by departmental by-laws, free.
N.E.I., per gallon, 4d.
Coal tar and coke oven distillates suitable for use as petrol substitutes having a flash point of under 73 degrees fahrenheit when tested in an Abel Pensky closed test apparatus -
As prescribed by departmental by-laws, free.
N.E.I., per gallon, 4d.
– I move -
That that portion of the excise tariff resolution introduced into the House of Representatives on the 24th May, 1932, relating to item 11 be incorporated in the present proposals as on and from the 25th May, 1932, in lieu of item 11 of the excise tariff resolution introduced into the House of Representatives on the 25th February, 1932.
This is purely a formal amendment in order that item 11, as amended by the resolution of the 24th May, 1932, may be brought before the committee. No alteration is made to the position as set out in the memorandum issued to honorable members.
Amendment agreed to.
Item, as amended, agreed to.
Items 12 and 13 agreed to.
Proposed new item 14 (Cigarette tubes, paper and papers).
– I move -
That the following new item be added: - “ On and after 25th May, 1932-
Cigarette tubes, paper and papers, for each60 cigarette tubes,1d.; for each 60 cigarette papers or the equivalent of60 cigarette papers, 1d.; and on and after 9th March, 1933 -
Cigarette tubes, paper and papers, for each60 cigarette tubes,11d.; for each 60 cigarette papers or the equivalent of 60 cigarette papers, 11d.”
This amendment is moved in order that the portion of the excise tariff resolutions of the 24th May, 1932, and the 8th March, 1933, relating to item 14 may be brought before the committee. An excise duty of 1d. per 60 cigarette papers was imposed on the 25th May, 1932, and this was increased to1¼d. as from the 9th March, 1933.
Proposed new item agreed to.
Proposed new item 15 (Matches).
– I move -
That the following new item be added: - “ On and after 25th May, 1932 -
Matches, per8,640 matches, 6d.”
This amendment is a formal one, and made for the purpose of bringing before the committee that portion of the excise tariff resolution of the 24th May, 1932, relating to item 15. That resolution imposed a duty of 6d. per 8,640 matches, and this amendment makes no alteration to the position as set out in the memorandum issued to honorable members.
Proposed new item agreed to.
Proposed new item 16 (Wine).
– I move -
That the following new item be added: - “ On and after 7th April, 1933 -
Wine produced on or after 7th April, 1933-
Wholly or partly made from dried grapes or extracts therefrom;
containing added sugar in any form other than concentrated grape must produced from fresh grapes; or
containing honey, glucose or any other sweetening matter prescribed by departmental by-laws; not being -
natural or artificial sparkling wine;
wine contained in liqueurs, cocktails, or wine cordials;
wine produced from fruit other than grapes ; or
medicated wine, as prescribed by departmental by-laws; per gallon, 20s.”
This amendment is necessary in order to block a leakage in revenue in respect of fortified wine.
Proposed new item agreed to.
Proposed new item 17 (Wine containing glycerine).
– I move -
That the following new item be added: - “On and after 7th April, 1933-
Wine produced on or after 7th April, 1933, containing added glycerine, per gallon, 5s.”
This amendment is made to the tariff proposals of the 6th April, 1933, for the following reasons : -
Proposed new item agreed to.
Preliminary matter agreed to.
Standing orders suspended; resolution adopted.
That Mr. White and Mr. Guy do prepare and bring in a bill to carry out the foregoing resolution.
Bill brought up by Mr. White, and passed through all its stages without amendment or debate.
– by leave - I move -
That Standing Order No. 70 be suspended for the remainder of this sitting.
The object is to continue the consideration of the Commonwealth Grants Commission Bill.
– I think that I should draw the attention of the House to the wording of Standing Order No. 70.It reads -
No opposed business shall be taken after 11 o’clock at night, unless the House otherwise order.
I take this action so as to guard our par- liamentary practice. It has been the custom to suspend the Standing Orders after 11 o’clock; but the question arises whether a motion for their suspension should be regarded as “ opposed business.” I am not prepared to rule that it should be so regarded. It may be claimed that the adjournment of the debate to a “ later hour “ will comply with the Standing Order quoted. I content myself with drawing attention to the matter, so that on ‘some future occasion the point may be satisfactorily decided.
Question resolved in the affirmative.
Standing Order No. 70 suspended.
Debate resumed from page 1685 on motion (by Mr. Lyons) -
That the bill be now read a second time.
Upon which Mr. Gabb had moved, by way of amendment -
That all the words after “That” be omitted, with a view to insert in lieu thereof the following words: - “ the bill be withdrawn with a view to introducing legislation appointing a permanent body of inquiry constituted as suggested by the Joint Committee of Public Accounts in its report of 17th June, 1931, relating to South Australia”.
– On a previous occasion, I informed the honorable member for Melbourne Ports (Mr. Holloway) that his amendment could not he considered until the question before the
Chair had. been decided. The question that the House will be asked to decide is “ That the words proposed to be omitted stand part of the question “. Should the House decide to create the vacancy in the motion as proposed by the amendment of the honorable member for Angas (Mr. Gabb), an amendment could be proposed to that amendment; but should the House decide that the words in question shall not be omitted from the motion, there will be no opportunity to move a further amendment.
Question - That the words proposed to be omitted (Mr. Gabb’s amendment) stand part of the question - put. The House divided. (Mr. Speaker - Hon. G. H. Mackay.)
Majority . . . . 38
Question so resolved in the affirmative.
Question - That the bill be now read a second time - put. The House divided. (Mr. Speaker - Hon. G. H. Mackay.)
Majority . . . . 38
Question so resolved in the affirmative.
Bill read a second time.
Clauses 1 and 2 agreed to.
Clause 3 - ( 1. ) There shall be a Commonwealth Grants Commission, which shall consist of five members. (2.) The members of the commission shall be appointed by the Governor-General and, upon the happening of a vacancy in any office of member of the commission, the GovernorGeneral shall appoint a person to the vacant office. (3.) Each appointment shall be for such term not exceeding five years as is specified in the instrument of appointment.
.I move -
That the word “ five “ in sub-clause 1 be omitted, with a view to insert in lieu thereof the word “three”.
The object of the amendment is to reduce the number of members of the commission from five to three. The Interstate Commission consisted of onlythree members, and the personnel of most important commissions, as well as courts of justice, is seldom more than three. The proposed reduction would bring about a considerable saving in expenditure, and would probably expedite the work of the commission. Three capable men could well carry out the necessary investigation, and, after all, their recommendations will be submitted to this Parliament before decisions are made.
– I hope that the honorable member for Calare (Mr. Thorby) will not press his amendment. Three carefully selected men could probably do the work of the commission as well as five could do it; but if the personnel were limited to three, the field for the selection of commissioners would be unduly restricted. It is not intended to appoint the members of the commission as representatives of particular States. I am sure, however, that the smaller States will expect to be represented on the commission, and the appointment of five members would enable satisfactory representation to be given to both the small and the large States. The Cabinet gave careful consideration to the question of whether there should be three or five members, and, for the reason that I have stated, decided upon five.
.- I hope that the amendment will be accepted. A number of members have expressed objection to. the appointment of a commission consisting of five members, and I shall be much surprised if they do not record a vote consistent with their speeches on the second reading of the bill. The Prime Minister (Mr. Lyons), in his speech on the second reading of the measure, remarked that if the members of the commission were chosen from the smaller States, they would have their State prejudices, and now he suggests that those States will be directly represented. I pointed out that, no matter from what State the members of the commission came, they would have prejudices. One honorable member stated that the three States that were appealing for assistance from the Commonwealth were mendicant States. If the amendment that I moved to the second reading of the bill had been carried, the commission would have consisted of three members, and the recommendation of the Parliamentary Committee of Public Accounts was that three men could do the work. The present Government seems to imagine that the payment of £5 5s. a day to each member of the commission, for as many days as the members choose to sit, is a matter of no concern to the people generally. The Prime Minister (Mr. Lyons) has admitted that three men can do the work that has to be done. If only three appointments are made, the expenditure on the commission will be reduced.
– Why does not the honorable member limit expenditure in regard to divisions?
– Order !
– If I were a party hack like the honorable member for Denison (Mr. Hutchin) there would be fewer divisions.
– I have my rights as a member of this committee.
– Order ! The honorable member will resume his seat.
– For what reason?
– When the Chair calls an honorable member to order for interjecting, the honorable member who has the floor is not in order in proceeding to answer the interjection. It should not again be referred to.
– Do I understand, Mr. Chairman, that an honorable member can make remarksof that nature to me, and that I cannot reply to them ?
– The honorable member must confine his remarks to the clause before the Chair.
– You are in the chair, sir, and I am here; so I must obey you.
– Order ! If the honorable member casts reflections upon the Chair, I shall instruct him to resume his seat.
– I wish to discuss the amendment from the point of view of expense. When I asked the AttorneyGeneral (Mr. Latham) a question to-day, to ascertain the amount the Government is spending on another commission, that right honorable gentleman went as near as he could to giving an evasive answer.
– Order ! The honorable member must discuss the clause.
– I am referring to expenditure in connexion with another royal commission.
– In dealing with this clause, the honorable member may not discuss the proceedings of another - royal commission.
– In support of the amendment that has been proposed to this clause, I wish to say that I question the bona fides of the Government, in its concern for economy. If the Government is prepared to fling the taxpayers’ money about in this way, it cannot claim to ‘be interested in economy. When I asked the Attorney-General to-day about the expenditure of another royal commission, the right honorable gentleman burked the question.
– I have given the honorable member considerable latitude. If he again digresses from the clause, I shall order him to resume his seat.
– I am discussing the subject of expense. In view of the apparent indifference of the Government, and the light-hearted manner in which it is prepared to handle the taxpayers’ money, there is room for concern. Surely, in discussing this subject, I am in order in referring, by way of illustration, to the Government’s actions in connexion with another commission. This commission may sit five or six days a week for five years. I hear honorable gentlemen suggesting that the five-year term will nol be agreed to; but certain honorable members of the committee, who said that they would vote against the bill, “ squibbed “ at the last moment.
– The honorable member is distinctly out of order in reflecting on members of this Parliament in that manner.
– I will say, then, that in the light of what happened a few minutes ago, I am justified in distrusting the word of certain honorable gentlemen. After all, it is votes, and not words, that count in this chamber. The Government has its well-trained divisions behind it, and it can instruct its followers to support a five-year term in the certain knowledge that they will do so. This Parliament is fast becoming a machine for the registration of Cabinet decisions. I believe that we should do everything possible to reduce the expenditure on this commission, and as it is admitted that three men- will be able to do the work as well as five men, I think the amendment should be agreed to.
.I support the amendment. The reasons given by the Prime Minister (Mr. Lyons) in favour of the appointment of five members were not convincing. The right honorable gentleman admitted that three members could make the investigation, but he added that a wider representation was desirable. It would be a grave mistake for us to agree to the appointment of members of this commission on the understanding that they would represent certain sections or interests. One argument that was stressed by the Government in introducing the bill for the appointment of this commission - and, in passing, may I say that I am not enamoured of the proposal, and hope that it is not merely the first of a number of proposals for the appointment of commissions and boards - was that it was desired to make the commission as nearly as possible a judicial body which would be independent of Parliament and political influence. It was desired, we were told, that the commission should examine the facts, sift the evidence, and bring an unprejudiced report to Parliament. This will not be possible if the members of the commission are appointed to represent certain interests. Three men can make the necessary inquiries probably better than five men can make them. I agree with the honorable member for Angas (Mr. Gabb) that this is not a time to enter lightly upon the expenditure of money. Five men travelling round the Commonwealth, receiving fees of £5 5s. a day and being recouped their travelling expenses for doing so, will cost the Government a considerable amount of money. At a time when we are forced to pursue a cheese-paring policy in many directions, unnecessary expenditure of this kind is to be deprecated.
– I support the amendment. I recollect that the commission which inquired into the disabilities of Western Australia consisted of three men, and that the commission which inquired into South Australia’s disabilities, of which Sir Joseph
Cook was chairman, also consisted of three men. Those commissions did satisfactory work, and, in the circumstances, I think there is no reason why a commission of five should he appointed in this instance.
.I support the amendment. If Ave had a committee of three, comprising a Supreme Court Judge, an expert accountant, and an economist, we could expect an impartial recommendation within a reasonable space of time. There have been numerous inquiries into the disabilities of the States under federation; Tasmania, South Australia and “Western Australia have all had their inquiries, and I assume the proposed inquiry will resolve itself into a verification and tabulation of information already available. In the circumstances, it would be an excessive expenditure to appoint a commission of five members, the chairman of which would receive a salary of £300 a year and other members would get £200 a year, as well as £5 5s. a day sitting fees, and travelling allowances.
– The desire of theGovernment is to ensure the appointment of a thoroughly representative commission of five members. If, however, the committee feels that it would be wiser to have a commission of three, the Government, not having a strong feeling in the matter, will offer no objection. I assure the committee that the Government does not wish to spend, more money than is absolutely necessary to ensure an efficient investigation. Probably it will save the time of the committee if I indicate that, in the circumstances, the Government- will accept the amendment.
Amendment agreed to.
– I move -
That the words “ five years “ in sub-clause 3, be omitted with a view to insert in lieu thereof the words “ one year “.
A .period of five years is altogether too long and will involve the Commonwealth in needless expense. As the commission proposed could do all that is necessary in one year, it should be .appointed for that term. If it does not complete* the inquiry within that period, it could be appointed for a further term. My experience is that whenever a new com: mission or committee is appointed to inquire into a subject that has been investigated by previous committees, as in this case, its report is made up largely of extracts taken from earlier reports on the subject. The Government would, I think, be well advised to accept the amendment.
– The amendment is entirely different from the one which the Government has just accepted. State Governments have complained, year after year, that because of the uncertainty concerning the amount of Commonwealth assistance to be made available they have experienced the greatest difficulty in presenting their financial proposals to their parliaments. I speak as a former State Treasurer who has been in that position. The Public Accounts Committee recommended the appointment of .a permanent body, and while we are not proposing to do that, we are seeking the appointment of a commission for a definite term so as to ensure continuity of service in the interests of the States. It is hoped that the commission will establish a definite principle upon which Commonwealth grants may be made in the future. The commission will then be in a position to deal with the problems of the States on a fixed basis. If the amendment is carried there will be no justification for the bill. Following a practice on former occasions, the Government could appoint an individual, or two or three individuals, to investigate the position of the States. If honorable members think that a term of five years is too long, they might consider an appointment for three years. To appoint the commission for one year only would make the position of the State Treasurers impossible. In this matter we have to consider their views as well as our own. I hope that the committee will not accept the amendment.
.I cannot support the amendment. I- had drafted, an amendment to limit the term of appointment to . three years,- and intend to submit it when the one now before the committee is disposed of. I agree with the right honorable the Prime Minister (Mr. Lyons) that it would be futile to appoint a commission for one year only, but I think it would be unwise to make the term five years, because once appointed that body could not be disbanded without compensation being paid to its members.
– The clause reads “not exceeding “ five years.
– Judging by the opinion expressed by the Prime Minister (Mr. Lyons), and the speeches made by honorable members, it is the intention of the Government to make the term specifically five years.
– That is so.
– That would not preclude another government terminating the commission before the five years had expired, without compensation.
– If the Government, appointed this commission for a period of five years, which would be the result if the bill, as it stands, became law, and a subsequent government terminated its services, the commissioners would be entitled to full compensation at the salary specified ; but, as there would be no further sittings, they would not be entitled to five guineas a day for any portion of their unexpired term. We shall have another general election in about eighteen months time, and one never knows what changes may take place. If the period of five years were accepted, it would cover the greater portiou of the next government’s term of office. I suggest that it would he advisable to appoint the commission for three years. If a constitutional convention were established, and it dealt with some of the problems of State disabilities, it might not be necessary to have the Commonwealth Grants Commission functioning for five years. If the honorable member for Maribyrnong (Mr. Fen ton) altered his amendment to read “ three “ instead of “ five “ years, it would have my wholehearted support, and would probably be acceptable to the Government.
– As there appears to be no likelihood of my amendment being accepted by the Government, I am prepared to withdraw it, and substitute another providing for a period of three years.
– I am pleased that the honorable member for Maribyrnong (Mr. Fenton) has signified his readiness to withdraw his amendment, and substitute another which will make the life of the commission three years. I do not. think that it will take that body three years to come to a determnation, but it is desirable that that period should be specified, in order to give the commission security of tenure. After reviewing the many reports that have been submitted by commissions, the Public Accounts Committee, and other bodies, as to the disabilities suffered by certain States as a result of federation, I have formed the opinion that the subject has been exhaustively dealt with, and that it would not take five years for another commission to arrive at a determination. The chief task of the commission would be to knit together the loose ends left by other bodies, and deal particularly with disabilities resulting from the operations of the coasting trade provisions of the Navigation Act and of the tariff. I would support an amendment providing for a three-year period, because that would give security oftenure to the commissioners.
– Is it the desire of the committee that the honorable member for Maribyrnong (Mr. Fenton) shall have leave to amend his amendment?
Leave not granted.
Question - That the words proposed to be omitted (Mr. Fenton’s amendment) stand part of the clause - resolved in the negative.
Amendment (by Mr. Fenton) negatived
That the words “ one year “ be inserted.
Amendment (by Mr. Thorby) proposed -
That the. words “ three years “ be inserted.
– I accept the amendment.
Amendment agreed to.
Clause, as amended, agreed to.
Clause 4 agreed to.
Clause 5 - (1.) The chairman of the commission shall receive a salary of Three hundred pounds a year and each of the other members of the commission shall receive a salary of Two hundred pounds a year. (2.) Each member of the commission. shall, in addition to the salaries provided in the last preceding sub-section, and each deputy of a member shall, receive a fee of Five guineas for each day upon which he attends a meeting of the commission. (3.) There shall be paid to each member, and to each deputy of a member, of the commission, on account of his expenses in travelling to discharge the duties of his office, such sums as are prescribed. (4.) The salaries, fees and expenses payable under this section shall be subject to reduction in accordance with the provisions of the Financial Emergency Act 1931-1932, and in accordance with any act amending or in substitution for that act.
– I move -
That the word “ five “, in sub-clause 2, be omitted with a view to insert in lieu thereof the word “ three “.
En these times three guineas per sitting will be adequate remuneration, especially as travelling expenses will bc additional.
– The committee has already decided ‘to reduce the membership of the commission from five to three. There is no intention that the commission shall sit throughout the year.
– We do not intend that it shall; but what does the commission intend ?
– For this responsible work the Government must choose men of standing and ability; otherwise the recommendations of the commission will not carry weight, or be acceptable to either the Commonwealth or the States. There will be a limit to the number of sittings, particularly after the first year.
– How does ‘ the right . honorable gentleman know that?
– The Government will exercise the greatest care in selecting the members of the commission. Men must be chosen who not only have the ability to investigate the claims of the State’s, and report judicially upon them, but can also be depended upon to act fairly and. honestly towards the’” Commonwealth, which appoints them.
– Will not the fee of £5 5s. per day be subject to a 20 per cent, reduction under the financial emergency legislation ?
– Yes. We shall not get men of the right type for less than £5 5s. a sitting. If the commission is to be cheap and shoddy, we had better withdraw the bill. Each of the thirteen members of the Dairy Produce Export Control Board draws £4 4s. a day, and that fee is paid by the producers. Three commissioners are to be appointed by the nation to carry out an important and responsible duty, which will necessitate that they be men of high qualifications, and we should not hesitate to pay five guineas per day for their services.
– How will the financial emergency legislation be applied to the travelling expenses?
– It is already applied to travelling allowances within the Public Service, and there should be no difficulty in applying it to the commission. The three commissioners are to pass judgment on claims by the States possibly amounting to millions of pounds, yet honorable members are quibbling as to whether these experts are to receive £5 5s. or £3 3s. a sitting, either sum. being reducible under the Financial Emergency Act. The retaining fee of £300 a year for the chairman, and £200 for each of the other members, is very small. If we adopt a cheeseparing policy, we shall not get a commission in which the people will have complete confidence.
– The commission is to receive travelling expenses ; will boat and rail fares be paid by the Commonwealth?
– Yes. The commissioners must travel, and surely the honorable member would not suggest that they should pay their boat and railway fares!
– I do not suggest that; but I want to understand clearly what fees and expenses are to be paid.
– The position is made, clear in the bill. First of all there is to be a retainer, and then a fee of £5 5s. for each sitting day, besides “travelling allowances. I hope that honorable members will allow us to set up a commission that will enjoy the confidence and respect, not only of the States, but of the Commonwealth as well. I ask the committee to allow the fees to stand as they are, so that the Government may appoint men who will not travel merely for the sake of collecting fees, and who will sit just long enough to carry out the work as it should be done.
.We have heard some remarkable arguments regarding the terms and conditions of appointment of the members of this commission. We have been accused of cheese paring because we have sought to cut down the fees payable to these men, but it is not the first time this Parliament has practised cheese paring, and iti matters of greater importance than this. Then we have been told that the appointees must have security of tenure. The honorable member who expressed this view told us that the work of the commission may be completed in twelve months, yet they are to be given security of tenure for three years. If they are given a tenure of three years, they will be paid for that period. While human nature remains what it is, we may be as careful as we like about whom we appoint to the commission, but once appointed, the members will take their own time about the job and the Government will have no power over them or their expenses. The Prime Minister (Mr. Lyons) said that the provisions of the Financial .Emergency Act will apply to their remuneration and travelling expenses, but there may be difficulties in that regard. At any rate, any deductions made under that act can easily be compensated for by the commission itself in the manner in which it does its work. In my opinion, the amendment of the honorable member for Melbourne Ports (Mr. Holloway) provides for the payment of ample compensation.
– The honorable member who has just spoken is under a misapprehension with regard to what is meant by security of tenure. This proposal has. been introduced very largely to meet the desires of the Governments of the States. Those Governments desire the appointment of a body of real standing and capacity which will have security in this sense - that it will continue to hold office independent of the Government of the day. The States have asked for what they have described as a permanent body, which will not be removable even if it brings in a report that does not meet with the approval of the Federal Government of the day. The subsequent clauses of the bill provide that security of tenure. On the subject of the amount of the fees, I am somewhat afraid that if the proposal outlined in the amendment is adopted, the commission will become almost a thing of contempt. We do want it to have a standing in the community, and we hope that we shall be able to find men who have special qualifications for the task. We can hardly ask them to do highly responsible work dealing with sums of great magnitude, and with issues of profound importance, for fees smaller than those proposed.
– I heartily support the bill as it stands, and I believe that members of the commission should receive sitting fees of £5 5s. a day. The smaller States have been looking forward to the appointment of this commission for years, and they expect most important results from it. If the fees are cut down, so that men of real worth cannot be induced to serve on the commission, we may as well send a couple of navvies to Western Australia to inquire into its disabilities. This commission is going to have power over governments which apply to the Commonwealth Government for financial assistance. The commission will be authorized to inquire into the financial position of States applying for assistance, and the methods of their administration. If the States are to receive a fair deal, let- us appoint a real commission to do the work.
.- I support the amendment moved by the honorable member for Melbourne Ports (Mr. Holloway). The Attorney-General (Mr. Latham) said that the bill proposed to provide security of tenure for the members of the commission. As a matter of fact, an amendment to which the committee agreed a few minutes ago provided that the members shall be appointed for a term of three years, so that their term of office will end about the middle of the term of the next Parliament, assuming that this Parliament runs its full term, which seems likely. Therefore, the matter of security of tenure is of no importance, because the incoming Parliament can dissolve the commission, and appoint whom it likes. The bill provides for the payment of a retainer of £300 to the chairman, and retainers of £200 each to the other members of the commission. The word “ retainer “ is the correct one in the circumstances, because, even if the commission does not sit for one hour during the whole period of its existence the retainers are to be paid to the chairman and the members for three years. That such payments might be limited to a period of three years is not clue to the Government, which desired the term to be for five years, even though, during that time, no service whatever need necessarily be rendered. As I have said, the chairman is to receive £300 a year, and the other members of the commission £200 a year, and whether the sitting fees be £3 3s. or £5 5s. a day members of the commission will receive full expenses. In this case, expenses are not restricted merely to steamer and train fares, for which tickets or vouchers are issued by the Government. The term “ expenses “ covers amounts which are to be paid to the members of the commission so long as they hold office. Clause 15 empowers the Governor-General to make regulations prescribing all matters which by this measure are required or permitted to be prescribed, so that it will be seen that this Parliament has no control over the amounts which may be paid to the members of the commission. I do not suggest that their expenses will amount to a huge sum; they will probably be similar to the expenses paid to high public officials in Australia - between £2 2s. and £3 3s. a day. The position therefore is that, in addition to retaining fees of £300 or £200 per annum, the members of the commission will have their fares paid, and will be paid between £2 2s. and £3 3s. a day for expenses, and £5 5s. a day for each sitting of the commission which they attend. For these positions the Government should naturally endeavour to select the best persons available, but once it appoints them, it will have no control over them. The members of the commission could, if they so desired, sit 365 clays each year, and draw fees for each sitting day. I do not suggest that they would do so ; but this bill empowers them to do so. Only their good conscience would stand in the way. The principle underlying all legislation is restrictive, and in these matters some limit should be fixed. We should not make it open to the members of the commission to draw £5 5s. a day for 365 days a year.
– Less 20 per cent.
– It is true that the emoluments of the members of the commission are to be subject to reduction under the financial emergency legislation passed by this Parliament; nevertheless, wide powers are to be conferred on the commission. If, in addition to a retaining fee, free fares and travelling expenses, the members get’ £3 3s. for each sitting of the commission, they will do well.
– It is not likely that the Government would go into the market and pick out indiscriminately three gentlemen who are out of work, and not earning their own living, and appoint them to this commission. We can take it for granted that the men who would be selected for appointment to this commission would be men of substance, earning their own living, to whom the acceptance of this task would mean a sacrifice. They would have to give up some of the time which otherwise would be devoted to their business or profession, and therefore it is not likely that suitable- men would undertake this work unless assured of reasonable treatment. Even supposing that the commission sat 300 days a year, which they would never do, and drew fees for each sit’ting day, the chairman would receive only £1,500, and each of the other two members £1,400 a year. Having regard to the judicial nature of the work which they will be called upon to perform, such remuneration would not equal that which many business men receive for less onerous duties. Such salaries, moreover, are low compared with those paid to some public servants carrying out less important duties. Even if they worked full time, the members of the commission would not be paid excessively when the interference with their ordinary avocations is taken into account. The committee would be well advised to reject the amendment.
– I support the amendment of the honorable member for Melbourne Ports (Mr. Holloway), although I wish that it went further. A fee of £3 3s. a day is more than sufficient recompense for the work which the members of this commission will be called upon to perform. Some honorable members have spoken of the special qualifications required’ for this work, but they have not defined those qualifications.. The honorable members for Franklin (Mr. Blacklow) and Denison (Mr. Hutchin) made sneering references to those unfortunate men who are unemployed and in receipt of State relief, but many of them are cleverer than the honorable members who have spoken disparagingly of them. Men holding university degrees are registered at the State labour bureaux. After all, the greatest qualification required of the members of this commission will be honesty, and where is that attribute more likely to be found than among the men who have nothing? The mere fact that a man has nothing is evidence of his honesty. In the ranks of the unemployed we should probably find men more fitted for appointment to this commission than in any other class of society. What will be the outcome of this commission ? After it has arrived at its findings, it will have provided voluminous reports, to which honorable members will refer when making future speeches on the subject of grants to the States. The commission will merely take a holiday trip to the States concerned, and, I contend, that three navvies - men at whom the honorable member for Denison (Mr. Hutchin) .sneers - “would be just as useful as three men of substance.
– The suggestion that the honorable member for Denison sneers is distinctly unparliamentary, and I ask the honorable member not to use such remarks.
– I suggest that, taking into account the nature of the work of this commission, three navvies would enjoy the trip to the States at the expense of the taxpayers, just as much as the three men of substance to whom the honorablemember for Denison has referred. He suggests that a fee of five guineas a day is low, and that in spite of this remuneration, the men who are appointed to the commission will have to. be prepared to make enormous sacrifices. That sort of talk may be acceptable in the honorable member’s electorate and in the rest of Tasmania, but the people generally are not foolish enough to take such a statement at its face value. They know that the men who accept these positions will do so because they will be bettering themselves. The honorable member for Wentworth (Mr. E. J. Harrison) says that we must give the members of the commission some security of tenure. In his opinion, no matter whether their work is finished, within six or twelve months, the taxpayers must be prepared to place them, as it were, on the pension list for a number of years. Who would cavil at being paid a sitting fee of five guineas a day?
– The fee is not five but four guineas.
– The honorable member is splitting straws. The salaries of the public servants are cited by this Government not at the actual amounts received, but at the nominal amounts subject to reduction under the Financial Emergency Act. I suggest that the bill provides for a retaining fee of £300 a year for the chairman, and £200 .a year for the other members of the commission, a sitting fee of five guineas a day, and travelling expenses.
– Less 20 per cent.
– The honorable member for Perth (Mr. Nairn) is no doubt trying to justify this enormous expenditure, but had he had experience on previous commissions he would know that what the members lose in sitting fees, they make up, in travelling expenses. When this commission completes its task this Parliament will probably be faced with an expenditure much larger than it originally anticipated. As I realize that the committee is not likely to accept an amendment lowering the sitting fee to under £3, I shall support the amendment of the honorable member for Melbourne Ports (Mr. Holloway).
– The honorable member is doing an injustice to the future members of this commission by suggesting that they will make a considerable profit out of travelling expenses. The travelling expenses will be prescribed by act of Parliament, and will merely cover outofpocket expenses. They will not in any sense be remuneration. The members of this commission will have to travel over a great part of Australia, and those of us who have had experience on royal commissions know that when travelling from the eastern States to Western Australia, much of the time is spent on a boat or in a train, and that, therefore, the sitting days are few in comparison. On a trip to Western Australia, South Australia, or Tasmania, only the outofpocket expenses are covered. We know by experience that the time spent in travelling restricts the number of sitting days.
– If the commission travels by boat to Western Australia, and the fares of the members are paid, would the honorable member suggest that their expenses would be two guineas a day?
– I am not suggesting that the travelling allowance will be two guineas a day. That will be prescribed by regulation, and as a rule it covers only out-of-pocket expenses. The honorable member for Denison (Mr. Hutchin) has suggested that the maximum number of sitting days during the year would be 300, but the number of sitting days will be actually much less. As a member of the Navigation Commission, I found that the number of sitting days compared with the number of travelling days was relatively small. I had the same experience as a member of the Iron Bounties Commission. We should appoint to this commission men of wide experience and knowledge, who, as the honorable member for Denison has suggested, will be prepared to make some sacrifices in respect of their own business in order to serve their country. What would be the position of a leading accountant of Australia if he were appointed to the commission? His work being largely of a personal nature, there would, during periods of travelling, be every likelihood of loss of business, say, in connexion with large estates, for which his remuneration as a member of the commission would not by any means compensate. The same thing applies to professional men. If this commission is to be of any value at all it should be composed of men of considerable attainment and experience, and in whom the community has confidence. In view of the fact that last year we voted £1,830,000 for the relief of the smaller States, any investigation into such large expenditure should be undertaken by men of ability so as to ensure that justice is done both to the Commonwealth and to the States concerned. In view of the services required from the members of the commission, I consider that the allowance is modest.
– The committee has largely misunderstood the reasons which actuated me in moving the amendment. I agree to a large extent with the remarks of the Prime Minister (Mr. Lyons) and of the honorable member for Darling Downs (Sir Littleton Groom). It is essential that we should appoint to the commission the best men available - men who are imbued with a spirit of patriotism and are prepared, at personal inconvenience, to investigate this difficult problem. The retaining fee should not be the incentive for appointment to the commission. If we desired to appoint men who were in need of work, I should not contend that the remuneration provided in the bill was excessive. I understood that the Government wished to appoint to the commission public spirited men who would gladly give their services because of their patriotism, and not because of the remuneration offering. Any one who accepts a position on the commission should not be out of pocket because of the work he performs as a member of it. I know something about public committees of different descriptions. Those who are membersof them wisely meet one another’s convenience and avoid as much as possible the interruption of their private business affairs. The odds are almost a million to one that business men will be appointed to these positions. I do not suggest that they will be appointed
Motion (by Mr. Scholfield) agreed to -
That the question be now put.
Question - That the word proposed to be omitted (Mr. Holloway’s amendment) stand part of the clause - put. The committee divided. (Chairman - Mr. Bell.)
Majority . . . . 10
Question so resolved in the affirmative.
Clause agreed to.
Clause 6 agreed to.
Clause 7 consequentially amended, and, as amended, agreed to.
Clause 8 agreed to.
Clause 9 -
The commission shall inquire into and report to the Governor-General upon -
applications made by any State to the Commonwealth for the grant by the Parliament of financial assistance in pursuance of section 90 of the Constitution.
.Would it not be advisable to insert, after the word “ applications “, the words “ which are referred to the commission by the Governor-General “. If paragraph a is agreed to as it stands, will it not mean that any application made by a State on any subject at all will have to be inquired into by the commission? I consider that the commission should not be called upon to inquire into matters not specifically referred to it.
– The object is to provide that any application made by a State for financial assistance shall automatically be inquired into by the commission.. It is desired that there shall be no restriction on a State making an application for financial assistance in pursuance of section 96 of the Constitution.
– The application must first be made to the Government.
– But a State will have a guarantee that its application will be investigated by the commission, and the Government has no reason to anticipate that the States will abuse this privilege. If they do abuse it, it may be necessary at a later stage to amend this measure; but it is open to the States to make a general application each year for assistance for that particular year.
– I thought that it was understood that’ the basis of the inquiries would he the disabilities of States under federation. Should not that be made clear in this clause?
– I take it that the basis ofthe inquiries will be the granting of financial assistance in pursuance of section 96 of the Constitution, and that the commission will investigate the grounds upon which any application is based. Disabilities under federation may be one of the grounds upon which a State applies for relief ; but it is conceivable that assistance may be sought on other grounds. Suppose there was a State in central Australia that had suffered from a threeyears drought, and was in urgent need of financial assistance. Should it not be entitled to have its claim for assistance investigated ?
– I repeat the words of the Prime Minister (Mr. Lyons) that the object of paragraph a of this clause is to confer on a State the right to have its application dealt with by the commission, independent of any power of interference by the Commonwealth Government. If the suggestion made by the honorable member for Riverina (Mr. Nock) were adopted, and it were required that a State’s application should be founded on it’s disabilities under federation, a technical inquiry would have to be made as to whether the commission had jurisdiction, and whether the ground of the application was really a federal disability. It is desired to allow the States to make their applications on such grounds as they think proper. They will doubtless consider that they are suffering disabilities under federation, but it would be a mistake to limit the jurisdiction of the commission, I suggest, in such a way that there might, perhaps, have to be a technical argument as to whether a particular application was grounded on a federal disability. The Governmentdesires the States to be allowed to put their case in their own way, and so long as the application is one for financial assistance in pursuance of section 96 of the Constitution, it will be dealt with by the commission. If, as the Prime Minister has already indicated, this right were refused, and applications were made on matters of no substance, it would be necessary for the Government to ask Parliament to amend this measure, but it is not anticipated that responsible State governments will act in that way.
– Supposing a State got into financial difficulties through maladministration. Would it then have the right to apply for assistance, and would the commission have the right to make a thorough search into the matter?
– The commission will have no power of search. This bill does not confer a power to compel evidence, or to make such a search as the honorable member has suggested. The measure is based on the view that the States will make their own case, and if they fail to do so, it will be at their own risk.
.I fear that there is the risk that has been referred to by the Prime Minister (Mr.Lyons) and the Attorney-General (Mr. Latham). We have six States, each of which could honestly put forward a claim for consideration by the commission immediately it is appointed, and, perhaps, not one of those claims might be submitted by the Governor-General. They might be presented to the commission under the powers conferred by paragraph a of this clause.
– The claim is to be made to the Commonwealth Government, but the Government is obliged to forward it to the commission.
– Why should not the method of making application be made uniform ?
– We feared that it might be assumed that provision was being made to hold up applications.
– The commission will be empowered to inquire into matters affecting the States, and also other vital matters which are referred to. Which matters will be given precedence?
– That must be left to the decision of the commission itself.
Clause agreed to.
Clause 10 (Evidence to be on oath).
– This clause and the two which follow relate to the procedure to be adopted by the commission. Is it intended that ‘the commission shall take evidence only on oath? It seems to me that in inquiries of this kind a discretion should lie in the commission to inform its mind by other means if it so desires. I suggest that a power of discretion should be pro- vided in the clause. I have had some experience of commissions of this description, and I know that whilst formal evidence is valuable, informal inquiry is often quite as valuable. The members of such commissions are’ able to get to closer grip with the subject-matter of their inquiry if they can inform their minds by informal means. Arbitration tribunals frequently have the power to take evidence on oath, but they also have power to make inquiries by any other means they think fit. The members of this commission will need to consult State officials informally. By so doing they will doubtless get to the bottom of certain aspects of their inquiry much more rapidly than by any other means. The commission will also need to make contact with business men, and business men are, as a rule, reluctant to go into the witness box. Unless the commission is able to approach them by some other means, it may not obtain a good deal of information that it is desirable that it shall obtain. Contact will also need to be made with public bodies, such as chambers of commerce, chambers of manufacture, and primary producers’ organizations of one sort or another. I feel, therefore, that it would be wise to give the commission discretionary power to take evidence by other means than .sworn testimony. I hope that the Government will see the wisdom of accepting this suggestion, and that it will not insist that all evidence must be submitted in a strictly formal manner.
– The history of past inquiries of this nature shows that a good deal of the so-called evidence has consisted, of political speeches. The Government feels that this kind of evidence should be excluded. Parliament is the proper place for the expression of opinions of that nature. All evidence should be submitted to this commission with a full sense of responsibility and a due regard to accuracy. It is not provided that the strict laws of evidence, which apply in. a court of justice, shall apply to the proceedings of this commission. Evidence which would be inadmissible in a court of justice will be admissible before this commission. It is felt, however, that all evidence should be given on oath or affirmation. There will, of course, be opportunity for advocacy as well as for evidence. A distinction is drawn between advocacy and evidence inarbitration court proceedings, though sometimes it is not drawn as strictly as I think it should be drawn. The intention of the Government is that the evidence on which the recommendations of this commission is based shall be available to the Parliament and Government, to guide them in dealing with any legislation which may arise out of the reports of the commission. Sworn evidence will be available, but heart-to-heart talks with members of chambers of manufacture and chambers of commerce would not be available.
– Does this provision of the bill preclude the commission from obtaining information in the m’anner I have indicated?
– The members of the commission will naturally, as ordinary human beings, inform their minds by reading articles, budget papers, and the like, but all evidence will be taken on oath or affirmation. There is something to be said for both methods, of course; but the Government considers that the wiser method has been adopted in the bill.-
Clause agreed to.
Clause 11 agreed to.
Clause 12 (Penalty for refusing to be sworn or to give evidence).
– This clause provides that the penalty for refusing to be sworn or to give evidence shall be £500; but it is not indicated whether that is to be the maximum or the minimum.
– It means that the penalty shall not exceed £500. This is covered by the Acts Interpretation Act.
– Is there anything tobe gained by fixing a penalty if there is no alternative? I can visualize people being fined under this provision, and having no money to pay the fine.
– The honorable member will see that the next clause provides a penalty of imprisonment for five years for the giving of false testimony. It is thought that a pecuniary penalty is appropriate for the offences dealt with under clause 12, but that a penalty of imprisonment is desirable as an alternative in respect of persons who give false testimony.
.- I take the same point that was raised by the honorable member for Melbourne Ports (Mr. Holloway), namely, that the penalty of £500 provided in this clause is unnecessarily severe. The Crimes Act provides, in certain sections, for maximum penalties, and I understand there is similar provision in acts passed by most of the State Parliaments, as well as in the Queensland criminal code. I, therefore, suggest the advisability of stipulating in this, and in all future acts passed by this Parliament, the maximum penalty provided for any offence against the law. I realize that the AttorneyGeneral’s answer will be that the penalty fixed is in practice, the maximum penalty; but I would remind him that Justices of the Peace who are not always well informed of the law, may not be aware of this. This difficulty will not arise to such a degree in Queensland, because in the larger towns of that State Justices of the Peace arc not allowed to sit on the bench, cases which, in other States are determined by Justices of the Peace being decided by police magistrates. Unless we state definitely what is to be the maximum penalty, I fear there will be risk of injustice being done. I consider also that a penalty of £100 would be ample.
– If we were engagedin a general consolidation of the acts of this Parliament, which I should very much like to see undertaken, I shouldbe inclined to adopt the suggestion of the honorablemember for Oxley (Mr. Baker) because I have often been subjected to criticism in respect of the penalties provided in measures drafted by me. But I would point out that, if an alteration were made in this bill, and if the other acts that have been passed in the 33 years of the life of the Commonwealth Parliament were left in their present form, the risk of misunderstanding, to which the honorable member has alluded, would be very much greater. The matter to which he has referred could only be dealt with in a general consolidation of Commonwealth acts. As to the penalty, it is entirely within the discretion of the court what amount shall be imposed. If there is evidence of an aggravated offence the punishment ought to be severe. This matter may safely be left to the discretion of the court. It is conceivable that cases might arise in which the offence would warrant a heavier penalty than £100 as suggested by the honorable member.
– What is the alternative to a pecuniary penalty?
– There is no alternative, but in cases where imprisonment is provided, there may be a pecuniary penalty in lieu thereof, as the court thinks proper.
Clause agreed to.
Clause 13 agreed to.
Clause 14 (Report to be laid before Parliament).
.This clause provides that the Minister “ may “ cause any report presented by the commission to be laid before each House of the Parliament, and, before any proposed law relating to the subject has originated, “shall” cause the report to be made available. I suggest that it be made mandatory on the Ministry to present to Parliament all reports submitted by the commission. It is hardly conceivable that any government could offer good reason why this course should not be adopted.
– The normal procedure, following the presentation of a report by any such body as the proposed commission, is for the Government to consider it before taking action. This clause provides that, -if the Government so desires, it may at any time table. the report, but not necessarily until it introduces its legislative proposals based on the recommendations of the commission.
– Could not provision be made for the presentation of the report to Parliament in the event of the Government not taking action?
– I take it that we shall be dealing with applications from three of the smaller States for financial assistance, and it is hardly conceivable that any government would fail to act upon a report from the commission, because, for some years to come, apparently, financial assistance of a special character must be voted by this Parliament. Naturally, the Government will be guided by the commission’s reports.
– That may not be so, and, as a representative of one of the smaller States, I contend that, if a government does not act on a report of the commission, Parliament should be entitled to see that report, and judge for itself.
– It is true that a government may not give full effect to the commission’s recommendations, and I see no reason why, in that event, the reports should not be made available. The Government would have to justify its actions, and, if it decided to ignore any recommendation of the commission, it would necessarily submit the report to Parliament, in order that honorable members might judge for themselves.
– Under the clause as it stands, the Government need not present the commission’s report in the circumstances indicated.
– The Government may at any time lay the report on the table of the House, and it would do so before asking honorable members to vote upon proposal based on a recommendation of the commission.
– There is a certain amount of practical difficulty in providing, in general terms, that the Government shall table a report, unless a definite time is fixed within which this shall be done. The second part of the clause is an adaptation of a provision in the Audit Act to enable the Government to present the report with comments or observations, and it is, I suggest, a valuable provision. Having regard to this clause, I suggest that if we impose a strict time limit for the tabling of the report, difficulties are bound to arise. From a practical point of view, all requirements will be met by the clause as it is at present framed. In this instance, it would be difficult to provide a reasonable time limit which would enable the government of the day to give any report the attention that it should have.
.Subclause 1 of clause 14 relates to clause 9, which is one of the most important in the bill, for it specifies in paragraphs a, b, and c the whole of the matters which the commission shall inquire into, and report upon to the Governor-General. I have suggested that it should be laid down definitely in the measure that when a report is made by the commission it shall be placed before Parliament, and I fail to realize why the Government is raising any objection, or to understand why a time limit would be impracticable. All regulations and ordinances have to be presented to ‘ Parliament within a specified time. If the matter of a time limit is the only obstacle which prevents the acceptance of my proposal, it could be provided that the report should be tabled within 30 sitting days.
– This provision is similar to that contained in the Tariff Board Act, with an improvement, and is in conformity with a well-recognized system. The Government must table a report before taking action, but is not bound to table it unless it takes action in respect of it.
– I realize that the Government cannot take action unless a report is tabled, but the Government may receive a dozen report’s from the commission, and not see fit to take action upon them. There is nothing in this bill to compel it to table those reports.
– There is a political remedy.
– That, obviously, is effective only when the Opposition has a majority. Otherwise, though it could raise the matter it could not enforce its wishto have the report tabled. If the provision were in black and- white in the bill, the Government would have to give effect to it. I did not anticipate such opposition to so obviously reasonable a request. I suggest that when the Government receives a report from these commissioners to whom high salaries will be paid, Parliament should have the advantage of seeing it. Surely that is not too much to ask? If the Government insists upon rejecting my proposal I can only conclude that it has a reason for concealing reports.
– Certain bodies report to Parliament; others to the Governor-General : this commission comes within the latter category. Actually few reports are submitted to Parliament, that of the Auditor -General being one. The report that I presented to-day from the Royal Commission on Performing Rights was laid on the table as soon as it was printed. There are some reports which are very important to the public interest, and should not be tabled and become public knowledge until the Government has a practical proposal to submit in relation to them. Honorable members who have had experience in a government know that no useful purpose can be served by having reports of acute interest to individuals presented within a limited time, as a matter of course. I admit that, when in Opposition, one naturally has a tendency to claim that everything should be laid on the table; but when the matter is regarded from the point of view of the responsibility of the Government of the country, other considerations have to be taken into account. Suppose, for example, that a voluminous far-reaching report had been presented within the last 30 sitting days of this Parliament. Though the honorable member might not believe it, I assure him that it would have been absolutely impossible for the Treasurer or any other Minister to give it his attention, and no useful purpose would have been served by tabling it. Indeed, had such a report been tabled before the Government had an opportunity to develop its proposals it would have led to trouble in all directions. Of course such a practice would afford opportunity for political agitation, but from the practical point of view of assisting the Government of the country, the proposals embodied in the bill are the wisest. They have been made for the reasons that I have indicated, and are not accidental, as the honorable member seems to think.
Clause agreed to.
Clause 15 agreed to.
Title agreed to.
Bill reported with amendments.
By leave, report adopted, and bill read a third time.
– In moving -
That the House do now adjourn,
I take the opportunity to express the Government’s appreciation of the help which honorable members of all parties have given in dealing expeditiously with the business, in not very convenient circumstances.
Question resolved in the affirmative.
House adjourned at 4.20 a.m. (Thursday).
The following answers to questions were circulated: -
y asked the AttorneyGeneral, upon notice -
– The answers to the honorable member’s questions are as follow : -
Yes. I have also read the evidence given by the managing director of the Vacuum Oil Company Proprietary Limited before the royal commission, wherein he declined to produce certain documents.
n asked the Treasurer, upon notice -
What will be the position of pensioners who are mortgagors, when the present moratorium expires in South Australia in September of this year, and the mortgagees claim their loans which pensioners will be unable to liquidate, to renew, or to re-mortgage?
– The fact that a mortgagor is a pensioner does not affect his liabilities under the mortgage to which he is a party.
y asked the Treasurer, upon notice -
– The information is being obtained, and will be furnished as soon as possible. ‘
n asked the Minister for the Interior, upon notice -
– The answers to the honorable member’s questions are as follow : -
en asked the Minister for the Interior, upon notice -
With reference to the question asked some time ago by the honorable member for Kalgoorlie, as to whether the parasitic wasp Spalangia spp. (BzC) had yet been liberated at Burnside station, Brock’s Creek, Northern Territory, with a view to combating the buffalofly pest, and whether it was proposed to liberate a number in the Kimberley district of Western Australia where the ravages have been serious for many years, to which the Minister replied that “ when this objective of the experiment had been achieved, consideration would be given to the question of liberating consignments of the parasitic wasp to other portions of Australia”, will the Minister now state whether the experiments have yet been sufficiently conclusive to permit of these wasps being liberated in other districts of Australia where buffalo-fly is prevalent?
– I am advised by the Council for Scientific and Industrial Research that over 3,000 parasitic wasps have been liberated in the vicinity of Burnside station ; and that small numbers have been liberated at Derby, Western Australia, and in the gulf district of North Queensland. Further larger liberations will shortly be made in the Kimberley district of Western Australia, in the Northern Territory, and in North Queensland.
d asked the Treasurer, upon notice -
Whether he will supply, for the information of honorable members, a table showing the amount, earliest and latest date of maturity, and interest rate and option, of conversion of loans in London of the Commonwealth and’ States, and the dates when these options may be exercised?
– The following table gives the particulars required for all Austra lian issues in London on which an option of redemption is now open : -
l. - Inquiries are being made and a reply will be furnished as soon as possible to the honorable member for Kalgoorlie (Mr. A. Green) in regard to office expenses and rental costs of the Australian Broadcasting Company and the Australian Broadcasting Commission.
Surplus Military Clothing.
– Inquiries will be made and a reply will he furnished us soon as possible to the honorable member for Kalgoorlie (Mr. A. Green) in regard to the quantity of surplus or disused military or naval clothing made available to State Governments for the use of the unemployed.
On the 19th May, the honorable member for Melbourne Ports (Mr. Holloway) asked that portion of the uvuilable surplus naval clothing be issued to the exnaval members group in Williamstown, Victoria, where families of ex-naval men are in difficult circumstances.
I urn now in a position to inform the honorable member that the stocks of naval and military clothing or material held by the Defence Department and regarded as surplus to its requirements were made available, and distributed for the relief of those in distressed circumstances some time ago. The only clothing which will he available for issue from the Defence Department in future, will be condemned part-wornarticles no longer serviceable for service purposes, but the quantities are small. As regards unserviceable naval clothing, it has been found most convenient to deliver it to the Premier’s Department ineach State for distribution to persons in need of relief. It is suggested that application by ex-naval men at Williamstown be made to the Premier’s Department, Melbourne.
Cite as: Australia, House of Representatives, Debates, 24 May 1933, viewed 22 October 2017, <http://historichansard.net/hofreps/1933/19330524_reps_13_139/>.