House of Representatives
5 November 1941

16th Parliament · 1st Session

  1. House of Representatives
  2. 16th Parliament
  3. 1941

Mr. Speaker (Hon. W. M. Nairn) took the chair at 3 p.m., and read prayers.

page 64

DEATH OF SIR DAVID FERGUSON

Mr CURTIN:
Prime Minister · FREMANTLE, WESTERN AUSTRALIA · ALP; FLP from 1934; ALP from 1936

– I desire to make mention in this House of the death of Sir David Ferguson on Sunday, the 2nd November, at Sydney.

Most honorable members will know that Sir David Ferguson, as an ex- Justice of the Supreme Court of New South Wales, was appointed by the Commonwealth to act in an honorary capacity as chairman of the Royal Commission on Taxation, and that he was associated with Mr. E. V. Nixon, C.M.G., on that commission during the years from 1932 to 1935 inclusive. The work did not actually terminate then, because, as a consequence of the commission’s reports, various conferences were held by the Commonwealth and State Commissioners of Taxation, at which Sir David Ferguson was good enough to preside. Also several conferences of Commonwealth and State Ministers were held as the result of the commission’s work, and these led to the passage of uniform taxation legislation by the Commonwealth and all of the States. That this has been a boon to the commercial world and the tax-paying public generally, as well as to the various taxation departments, has been admitted in all quarters, and the deep indebtedness of this House must be earnestly expressed for the outstanding and devoted Work of Sir David Ferguson in this connexion. As a member of the Board of Management of the National War Memorial, the deceased gentleman rendered further public service, for which the Commonwealth Parliament and the whole of Australia are grateful.

I should like Lady Ferguson and the other members of Sir David’s family to know that this House pays tribute to his public services, deeply regrets his passing, and expresses to those who are bereaved its deep sympathy.

Mr FADDEN:
Darling DownsLeader of the Opposition

– I associate the Opposition with the reverent sentiments expressed by the Prime Minister. The valuable work of Sir David Ferguson on behalf of the Commonwealth in connexion with principles of taxation generally will be a lasting monument to his capacity. The resultant reforms are greatly appreciated by those who are closely concerned with the operation of taxation laws. To the bereaved family we offer our sympathy.

page 64

WAR-TIME (COMPANY) TAX BILL

Mr JOLLY:
LILLEY, QUEENSLAND

– Will the Treasurer consider the appointment of a parliamentary committee to study and report upon the provisions of the War-time (Company) Tax Bill before the introduction of that measure, as was done last year in connexion with proposed legislation on the subject?

Mr CHIFLEY:
Treasurer · MACQUARIE, NEW SOUTH WALES · ALP

– Consideration will be given to the honorable member’s suggestion.

page 65

QUESTION

TOBACCO AND CIGARETTES

Mr ROSEVEAR:
DALLEY, NEW SOUTH WALES

– I ask the Minister representing the Minister for Trade and Customs whether that Minister’s attention has been drawn to the fact that last week there was an acute shortage of supplies of tobacco and cigarettes in Sydney, and that supplies greater than havebeen offering for months past were made available to retailers last Monday, when prices were increased? Were these facts responsible for the Minister countermanding the sanction given by the Prices Commissioner to the increases that were made? In view of the ease with which this tobacco “ ramp “ was “ put over “ the Prices Commissioner, does the Government intend to allow the present occupant of that position to continue to hold it?

Mr BEASLEY:
Minister for Supply and Development · WEST SYDNEY, NEW SOUTH WALES · ALP

– Anticipating a question along these lines, I approached the Minister for Trade and Customs in order to ascertain the reasons which had actuated his decision in this important matter. He has informed me that action for the suspension of Professor Copland’s order that the prices of tobacco and cigarettes should be increased respectively by ls. 4d. per lb. and 4s. per lb., equal to 480 cigarettes, was taken by the Minister for Trade and Customs primarily because the whole of the impost was being placed on the consumer. The new excise under the budget provided for an increase of ls.1d. per lb. on tobacco and 3s. per lb. on cigarettes, numbering 480. It is obvious from these figures that not only was the actual excise increase passed on to the public, but also, by the Prices Commissioner’s declaration, the consumer was being asked to carry in excess of the excise impost an amount of 3d. per lb. on tobacco and ls. per lb. on cigarettes. The Prices Commissioner is at present reviewing the position, and when finality is reached an announcement will be made.

I prefer that the Minister for Trade and Customs should answer that portion of the honorable member’s question which relates to Professor Copland personally.

page 65

QUESTION

COMPULSORY MILITARY TRAINING

Mr JOHNSON:
KALGOORLIE, WESTERN AUSTRALIA

– Has the attention of the Minister for the Army been drawn to the fact that at a public meeting which was representative of the Australian Workers Union, mine managements, and townspeople of Youanmi, Western Australia, grave concern was expressed at the effect which the military call-up, and the sending of recruits to distant parts for training, are having on the mining activities of the district, and at the possibility of the permanent closing of local mines because of labour shortage? Will the honorable gentleman give urgent consideration to a drastic alteration of the militia scheme, in order that recruits may receive local training, with minimum interruption of industries which are vital to the well-being of country centres?

Mr FORDE:
Minister for the Army · CAPRICORNIA, QUEENSLAND · ALP

– I shall obtain a report of the meeting referred to, and give immediate consideration to the matter.

page 65

QUESTION

POWER ALCOHOL DISTILLERIES

Mr MARWICK:
SWAN, WESTERN AUSTRALIA

– Will the Minister for Supply and Development state whether an inspection has been made by experts of the various sites in Western Australia which have been recommended for the establishment of a power alcohol distillery? If not, when may we expect such an inspection to be made and a decision to be reached?

Mr BEASLEY:
ALP

– The previous administration handled the matter of the selection of sites for the erection of power alcohol distilleries, in collaboration with the State Governments, which were requested to supply information concerning the most suitable localities, having in mind requirements in respect of water supply, the disposal of effluent, and other services. The different State Governments have forwarded to the Commonwealth their views on the subject, and I intend to ask Cabinet to make the selections.

page 65

QUESTION

LOAN CONVERSIONS

Mr FALSTEIN:
WATSON, NEW SOUTH WALES

– I ask the Treasurer whether a commission of 2s. 6d. per cent. is payable to brokers, bankers, and agents of personsmaking application for loan conversions ? If such a payment is made in respect of the present loan conversion operation, will the Commonwealth be liable to the payment of sums totalling £125,000? Are the majority of the applications lodged by an office boy? Will the Minister see that this practice is immediately discontinued, and that a merely nominal commission is allowed in return for the work done by these agencies?

Mr CHIFLEY:
ALP

– I shall have the matter investigated, and shall furnish a reply to the honorable member as soon as possible.

page 66

QUESTION

WAR SITUATION IN THE PACIFIC

Mr McCALL:
MARTIN, NEW SOUTH WALES

– In view of the deterioration of the war situation in the Pacific, and also the evidence of further incitement of Japan by Germany to invade Australia, does the Government intend to abideby the decision reached by its predecessor to send Australia’s partially equipped mechanized division abroad, or is consideration being given to that matter?

Mr CURTIN:
Prime Minister · FREMANTLE, WESTERN AUSTRALIA · ALP

– The whole matter is under consideration, and the Advisory War Council and the Leader of the Opposition will be consulted before any decision reached by the previous Government in this regard is changed.

page 66

APPLES AND PEARS

Report of Committee

Mr SCULLY:
Minister for Commerce · Gwydir · ALP

– I lay on the table the following paper -

Apples and Pears - Report, together with minutes of evidence, of committee of senators and members of the House of Representatives appointed by the Government to report upon matters connected with the Apple and Pear Board and the disposal of the apple and pear crop. and move -

That the report be printed.

The committee recommends that an apple and pear acquisition scheme should remain in operation for the duration of the war, but submits, for the considera tion of the Government, certain suggestions for the more efficient and economical control and administration of the scheme. The Government has not yet determined the policy to be adopted for handling the forthcoming season’s crop, but it is anxious to make a decision in that regard at the earliest possible moment, so that growers and the industry generally may be informed of the arrangements for next season.

Question resolved in the affirmative.

page 66

QUESTION

COAL SHORTAGE

Mr RYAN:
FLINDERS, VICTORIA

– Is the Minister for Supply and Development aware of the present unsatisfactory state of the coal reserves in certain States of Australia, particularly Victoria? Does he know that the present level of those reserves may have a serious effect on our industrial activities, and on the functioning of our railways in time of emergency? If so, will he take steps to see that those reserves are brought to a satisfactory level as soon as possible?

Mr BEASLEY:
ALP

– The Department of Supply and Development has been closely watching coal stocks throughout Australia. In Victoria steps have already been taken to increase the quantities on hand, and dt is expected that the stocks in that State will reach a most satisfactory level by the end of December. Similar action is being taken in South Australia, and I can assure the House that the position is improving.

Mr BERNARD CORSER:
WIDE BAY, QUEENSLAND

– In view of the shortage of stocks of coal, and the necessity for replenishing them immediately in Victoria and South Australia, will the Minister give full consideration to the large supplies of coal of excellent quality available at Burrum, which is within easy distance of shipping facilities ?

Mr BEASLEY:

– My department intends to take every possible step to increase coal supplies. It is already providing for a dump of 100,000 tons at Newcastle, in order to makethe necessary preparations, and I shall be happy to have the suggestion submitted by the honorable member investigated.

page 67

QUESTION

AUSTRALIAN IMPERIAL FORCE

Interest on Unpaid Assurance Premiums.

Mr BAKER:
MARANOA, QUEENSLAND

– ls the Minister for the Army aware that life assurance companies are still permitted to charge interest at a rate not exceeding 6 per cent. on the unpaid premiums in respect of life assurance policies of members of the Australian Imperial Force overseas?

Mr FORDE:
ALP

– That matter is being investigated, and I shall furnish a definite replyto the honorable member within a few days.

page 67

QUESTION

MUNITIONS PRODUCTION

Mr HOLT:
FAWKNER, VICTORIA

– In the absence of the Minister for Munitions, will the Minister for War Organization of Industry state whether it is a fact, as alleged by the general secretary of the Arms, Explosives and Munition Workers Union, that many men are leaving munitions works to work in private establishments, because of the more favorable wage rates and conditions operating there? Is it a fact that at one important annexe in Victoria, which was previously operating for three shifts a day, only two shifts a day are now being worked on account of the departure of employees? Are these departures having a serious effect on the munitions production programme, and is the Minister in a position to announce whether the Government proposes to take any action to restrict the departure of employees from munitions establishments?

Mr DEDMAN:
Minister for War Organisation of Industry · CORIO, VICTORIA · ALP

– I shall bring the honorable gentleman’s question to the notice of the Minister for Munitions.

page 67

QUESTION

WAR CONTRACTS

Royalties on Patents.

Mr MORGAN:
REID, NEW SOUTH WALES

– Some time ago I asked the previous Government for information regarding royalties paid in respect of patents used in connexion with war contracts. I did not obtain a satisfactory answer to my question and I raise the matter again, because I believe that improper practices are being indulged in by which persons not entitled to such royalties have received substantial sums of money. Will the Attorney-General investigate the whole position and make an early report upon it to the House?

Dr EVATT:
Attorney-General · BARTON, NEW SOUTH WALES · ALP

– The important matter to which the honorable member has referred is giving some concern to my department. Under the National Security Regulations the Government has the right, in the time of war, to use any patent, subject to agreement with the contractor, and subject also to a right of appeal to the Attorney-General in the event of a dispute. In several instances that have come to the notice of the department recently it seems that payments have been made for a patent which has no validity in Australia. The departments concerned have been requested to assist in controlling the matter so as to avoid the necessity for the Commonwealth having to pay moneys which should not be paid at all ; in other words, we desire to prevent the Commonwealth from being defrauded. It we can find proof of cases of the kind, we shall take the strongest action to punish fraud. I shall have a full investigation made, and later I shall inform the honorable member and the House generally of the result.

page 67

QUESTION

SIR BERTRAM STEVENS

Mr SHEEHAN:
COOK, NEW SOUTH WALES

– Does the Prime Minister consider that Sir Bertram Stevens is a fit and proper person to represent the Commonwealth Government on the Eastern Group Supply Council? If not, does the honorable gentleman intend to make any change in that appointment?

Mr CURTIN:
ALP

– I shall give some thought to the qualifications of Sir Bertram Stevens, and, in due course, shall inform the honorable member regarding the matter.

Employment on Civilian Duties.

Mr BARNARD:
BASS, TASMANIA

– Has the Minister for the Army received any complaints from Darwin in regard to the employment of soldiers side by side with civilians on the same work, thus giving rise to serious discontent? If he has not, will he make inquiries with a view to learning what is the position?

Mr FORDE:
ALP

– ‘There were some complaints, and the Government despatched Mr. Arthur Blakeley to Darwin as Conciliation Commissioner. I understand that a satisfactory settlement Las been reached, and I shall furnish to the honorable member particulars regarding it.

page 68

QUESTION

RESERVED OCCUPATIONS

Mr DUNCAN-HUGHES:
WAKEFIELD, SOUTH AUSTRALIA

– Is it a fact that an order has been issued that no government employees are to be allotted to duties with military units? Does this apply to State as well as to Commonwealth employees? If so, is it intended that all government employees shall he in a block reservation?

Mr FORDE:
ALP

– I am not aware that there has been any departure from the policy of the previous Government in this respect.

page 68

WHE AT INDUSTRY

No. 4 Pool: 1940-41 Crop - Poultry

Feed - Stabilization - Plebiscite of Growers - Excess A creage - Gutting for Hay - Stacking Restrictions.

Mr SCULLY:
Minister for Commerce · Gwydir · ALP

– by leave - The Government has approved of a furtheradvance of 3d. a bushel on all wheat in No. 4 pool. This covers the 1940-41 crop, of which receivals by the Australian Wheat Board totalled 63,646,000 bushels. Arrangements will be made with the Commonwealth Bank for the provision of the sum of £800,000 to pay the advance. Growers to date have already received two advances in respect of wheat in this pool. The further advance of 3d. will bring the total advances to growers to 3s. 7d. a bushel, less freight, on a bagged basis. Appropriate adjustments have been made in respect of bulk wheat. The advance now approved, will not be the final payment in respect of this pool, as a considerable quantity of wheat remains unsold. It is expected that when the accounts of the pool have been completed a further small distribution will possibly be made. Payment of the advance to growers will be made by the Australian Wheat Board after the arrangements have been completed for the provision of the necessary funds by the Commonwealth Bank.

Sir CHARLES MARR:
PARKES, NEW SOUTH WALES

– Although the price of wheat to the farmer has been stabilized at 3s. 7d. a bushel, poultry- farmers have to pay from 4s. 8d. to 4s.10d. Will the Minister take steps to ensure that they are enabled to obtain their supplies at a reasonable price?

Mr SCULLY:

– I am aware of the great disparity between the price paid to the growers and that charged to poultryfarmers, and I shall take the matter up with the Australian Wheat Board with a view to obtaining an adjustment. I recognize that it is practically impossible for poultry-farmers to continue to pay the present excessive prices.

Mr CLARK:
DARLING, NEW SOUTH WALES

– Will the Minister for Commerce arrange to have a plebiscite taken of wheat-growers registered under the stabilization scheme with a view to the appointment of a farmers’ representative on the Australian Wheat Board? Will the honorable gentleman alter the stabilization scheme from an acreage to a bushelage basis?

Mr SCULLY:

– Action will be taken along the lines suggested by the honorable member as soon as possible. The Australian Wheat Board will be reconstructed, and wheat-growers in the respective States will be asked to elect their representatives for appointment to the board. The policy of the Government in regard to the basis of the stabilization scheme will be determined as early as possible.

Mr WILSON:
WIMMERA, VICTORIA

– Will the Minister for Commerce take into consideration the possibility or practicability of permitting some of the excess acreage of wheat, which, under the terms of the stabilization scheme, should be cut for hay, to be harvested for grain in the ordinary way, the grain either to be stored on the farms or taken charge of by the Wheat Board? I make this suggestion because of the acute shortage of labour and because of the many requests that I have received from wheat-growers.

Mr SCULLY:

– This undoubtedly serious problem must be grappled with immediately. Whilst the present scheme is in operation there is a difficulty. I appreciate from advices I have received from practically all over Australia that there is an alarming shortage of labour to deal with ordinary harvesting. A greater quantity of labour is necessary for hay cutting than for normal harvesting. Therefore, I am giving earnest consideration to the matters raised in the honorable member’s request, and I am investigating the possibility of devising some scheme whereby wheat-growers will he relieved of the obligation to cut excess acreage of wheat for hay and will be allowed to harvest as they desire. I hope at an early date to be able to make an announcement as to future policy.

Mr BREEN:
CALARE, NEW SOUTH WALES

– Has the attention of the Minister for Commerce been directed to the statement published in the October Bulletin of the Australian Wheat Board that no wheat will be stacked within five miles of an existing stack? Does that restriction apply to New South Wales, and, if so, will the Minister inform the House whether it is the intention of the board to receive bagged wheat, other than low-grade premium or under standard wheat, at silo stations in New South Wales?

Mr SCULLY:

– I do not know what are the intentions of the Australian Wheat Board in regard to bagged wheat. I shall inquire into the matter and convey an answer to the honorable member as soon as possible.

page 69

BARLEY POOL

Advance on 1940-41 Crop.

Mr. SCULLY (Gwydir- Minister for

Commerce). - by leave - It has been decided that a further advance will be made to growers in connexion with the barley held in No. 2 pool, that is, the 1940-41 crop. The advance, which is subject to an approach to the Commonwealth Bank for the necessary funds, will absorb £78,000. The advance now projected will be at the following rates for two-row and six-row varieties of barley : -

It will be noted that there is a difference between the rates paid in the various States. This is to preserve the normal peace-time variation. The advances which have already been approved for barley-growers in respect of this pool are as follows : -

All these advances are less freight. Because of the drought last year, the barley crop was small, and the quantity of barley acquired by the Australian Barley Board was 4,173,000 bushels, as compared with11,000,000 bushels for the previous harvest. The sales to date have been satisfactory, and whilst a fair quantity of the barley sold has not yet been delivered, the unsold stocks are now only about 60,000 bushels. Whilst there is still an overdraft with the Commonwealth Bank in respect of the pool, the Government has decided that a further advance can now be made, and growers will thus receive the greatest amount which can be paid at the present time. This is in accordance with the policy that advances shall be made on barley immediately the financial position of the pool concerned justifies it.

page 69

QUESTION

FIVE-SHILLING NOTES

Mr CLARK:

– Will the Treasurer consider the issuing of a 5s. note to take the place of the 5s. coin which was minted some time ago?

Mr.CHIFLEY.- I understand that this matter has been under consideration, but I shall look into it again.

page 69

QUESTION

TINNED PLATE

Mr FRANCIS:
MORETON, QUEENSLAND

– I understand that arrangements have been made with the Government of the United States of America for the supply of a quantity of tinned plate for use by manufacturers in this country. I am now advised by representatives of the industry that large quantities of plate are available from Great Britain, but the Department of Trade and Customs, or the Minister, will not agree to issue the necessary import licences. Having regard to the fact that tinned plate Ls needed for the processing of foodstuffs, not only for consumption in Australia, hut also for export to our forces in the Near East and Malaya, will the Minister take steps to have licences issued for the importation of plate from Great Britain?

Mr BEASLEY:
ALP

– It is true that the need is great, and I shall be pleased to look into the matter and see what adjustments can be made.

page 70

OIL FROM BROWN COAL AND SHALE

Mr WILSON:

– As it has been demonstrated that motor spirit and other oils can be produced from brown coal, of which there are large deposits in Victoria which can be cheaply mined, will the Minister for Supply give directions that this source of supply be investigated.

Mr BEASLEY:
ALP

– I shall be pleased to give the matter my immediate attention.

Mr MORGAN:

– A few months ago the Government of New South Wales applied unsuccessfully to the former Commonwealth Government for a grant of £80,000 in order to investigate the shale oil deposits in that State. In view of the importance of developing our own resources of oil, and the need for closer co-operation between the Commonwealth and State Governments in this matter, will the Treasurer favorably consider the request of the Government of New South Wales?

Mr CHIFLEY:
ALP

– The whole matter of the production of oil from shale is receiving the close attention of the Government. My colleague the Minister for Supply and Development (Mr. Beasley) is now investigating the best methods of producing as much oil fuel in Australia as possible. Unfortunately the results of the expenditure of Commonwealth money in the production of oil have not so far been entirely satisfactory. As Treasurer I agree with my colleague that until we are assured that government moneys will be expended to the best possible advantage, further grants of this kind should be deferred. It is hoped that decision as to how the money can best be used will be reached at an early date.

page 70

QUESTION

MAN-POWER AND RESOURCES

Mr ARCHIE CAMERON:
Minister for Aircraft Production · BARKER, SOUTH AUSTRALIA · ALP

– Will th Prime Minister take an early opportunity to have made to this House an authentic statement on the subject of man-power, in order that honorable members may debate the Government’s proposals with some knowledge of what it has in mind in respect of man-power?

Mr CURTIN:
ALP

– Yes.

Mr SPOONER:
ROBERTSON, NEW SOUTH WALES

– Will the Prime Minister consider the advisability of making available to the House the reports on the subject of man-power and resources which were furnished to the previous Government by the committee appointed to investigate those matters? If the honorable gentleman considers it inadvisable to make the reports public, will he make available to the members of the committee any replies that have been furnished by departmental officers to ite recommendations ?

Mr CURTIN:

– The whole problem of man-power is causing the Government very serious concern, and I am in a position to know that it was also troubling our predecessors in office. We fight ware with men; we also equip the fighting forces as the result of the employment of man-power. The proportions of the total manhood of the country which shall be used in various ways were investigated by the committee appointed by the previous Government. I have studied in part the reports which have been submitted. I believe that it is necessary that there should be a careful examination of the whole matter by the Executive before there is any undue revelation of ,the actual position. It was for that reason that I gave an undertaking to the honorable member for Barker (Mr. Archie Cameron) that, as this matter of man-power is related to the discussion on the budget, I would do my best to make available to the House such information as I think it is desirable that the House should have. I do not wish to be at cross purposes with the House, but there aire aspects of this question that are not matters for public discussion.

page 70

QUESTION

MATCHES

Mr ROSEVEAR:

– Has the attention of the Minister for Supply and Development been drawn to the fact that in some Sydney suburbs housewives are allowed by grocers only three boxes of matches a week, and that supplies of matches to retailers are severely restricted? Will the Minister, if necessary, forestall the match combine’s attempt to work a price ramp similar to that which was attempted in connexion with tobacco by commandeering or controlling the available stocks of matches for distribution to the public?

Mr BEASLEY:
ALP

– I shall bring the question under the notice of my colleague the Minister for Trade and Customs. pomeroyexplosivebullet.

Mr RANKIN:
BENDIGO, VICTORIA

– Has the attention of the Minister for the Amy been drawn to a report in the press that the Pomeroy explosive bullet, which was invented by an Australian, is being manufactured in large quantities in the United States of America? Can he say whether it is a fact that the bullet was offered to the Australian Government and, if so, will be make inquiries in order to ascertain why the Inventions Board rejected it?

Mr FORDE:
ALP

– I have noticed the press report on this subject. It is true that some time ago it was stated by those whose function it is to judge these things, that the bullet was not suitable for use in Australia. I am assured that the bullet is being used in the United States of America. I shall order an immediate investigation of the matter and supply full information to the honorable gentleman later.

page 71

QUESTION

BREN GUN CARRIERS

Mr BADMAN:
GREY, SOUTH AUSTRALIA

– Can the Minister for

War Organization of Industry say whether it is a fact that after the various Government munition factories have satisfactorily produced 1,100 Bren gun carriers the production is to be handed over to a large motor car manufacturing company? Further, can he say whether it is true that the whole of the machinery and machine tools necessary for the production of these carriers will be transferred to the company, and that a contract amounting to £6,000,000 has been let to such a company for the production of gun carriers?

Mr DEDMAN:
ALP

– The honorable member seems to be under some misapprehension about the department which I control. It is a department for the war organization of industry, not the organization of war industry. The question of the honorable member will be placed before the Minister for Munitions, and I hope that a satisfactory answer will be available at an early date.

page 71

QUESTION

INTERNATIONAL POSITION IN THE FAR EAST

Mr FALSTEIN:

– In view of the disturbing reports which are appearing daily in the newspapers in relation to the position in the Far East, will the Prime Minister make an early statement to the House, either publicly or in camera, with special reference to the likelihood of Australia being involved in war in the Pacific and its capacity to resist an aggressor?

Mr CURTIN:
ALP

– I shall consider the propriety of making such a statement when the situation warrants it.

page 71

QUESTION

CAMOUFLAGE

Dr PRICE:
BOOTHBY, SOUTH AUSTRALIA · UAP

– In view of the grave developments in the Pacific, can the Minister for Home Security say whether the Government has given consideration to the camouflaging of certain munitions factories near the coast, and also certain oil depots which are most conspicuous from the air and some of which are visible from the sea?

Mr LAZZARINI:
Minister Assisting the Treasurer · WERRIWA, NEW SOUTH WALES · ALP

– Immediately on assuming office I. took up the subject of camouflage with officers of my department. The department is well ahead with plans although the whole work of camouflage was delayed - in fact, shelved - by the previous Administration

Mr Spender:

-Nonsense !

page 71

QUESTION

ABBCO BREAD COMPANY

Mr ROSEVEAR:

– Has the AttorneyGeneral yet had time to peruse the report of Mr. Justice Maxwell on the Abbco bread case, and if so, can he say what action is contemplated by the Government?

Dr EVATT:
ALP

– In connexion with, the Abbco Bread Company’s contract, criminal proceedings are being taken against the companyand one of itsemployees.

Mr ROSEVEAR:

– In view of the pending legal proceedings against the principals of the Abbco Bread Company, will the Minister for Supply examine the report of Mr. Justice Maxwell as it relates to his department, particularly the very caustic criticism of high departmental officials for their neglect properly to police this contract? Havingarrived at a conclusion, will the Minister inform the House of the action that he intends to take against the high officials who left the door wide open for corrupt practices?

Mr BEASLEY:
ALP

– I understand that the question has some reference to the Contract Board, which was entrusted with the examination of the contracts. The honorable member mentioned the matter tome about a week ago, and I have asked the department to submit to me a report upon the subject. So soon as it is available, I shall advise the honorable member.

page 72

PETROL RATIONING

Mr GUY:
WILMOT, TASMANIA

– Is the Minister for Supply and Development aware that: - (1) Owing to the Liquid Fuel Control Board refusing to issue sufficient petrol to carriers in Tasmania, dairy farmers’ cream cannot be picked up at the dairy, and that such farmers are frequently obliged to waste petrol in motoring their cream to the roadside; (2) because of this procedure many wives of soldiers who are endeavouring to continue the dairying industry during the absence of their husbands serving abroad, are suffering much inconvenience, unnecessary expense and hardship, as there is no man-power available to do this work; (3) this method is not universal, and that at least in Victoria farmers are not obliged to convey their cream to the roadside; and (4) that the same restriction was insisted upon early last season, but was subsequently relaxed.

Mr SPEAKER:

– Order ! There is a limit to the number of statements which the honorable member can make when asking a question.

Mr GUY:

– Will the Minister inquire into the complaint with a view to adopting the same method as that which operated last year of allowing to carriers sufficient petrol to enable them to collect cream at dairies instead of at the roadside?

Mr BEASLEY:
ALP

– All honorable members are aware of the hardships which petrol rationing has caused-

Mr.Brennan. - To some people!

Mr Guy:

– Hear, hear !

Mr BEASLEY:

– None of us is unmindful of the effect of petrol rationing, particularly in country districts.

Mr Guy:

– And particularly on primary producers.

Mr BEASLEY:

– The duty of the Government is, first, to restore stocks of petrol to a safe level.

Mr Guy:

– But the policy of the Government should be equitable.

Mr BEASLEY:

– I agree that the distribution should be on an equitable basis. The honorable member will be happy to know that, regarding a case which he brought to my notice personally this week, I directed at once that action should be taken.

Mr McCALL:

– Can the Minister for Supply make a statement about the production of shale oil at Glen Davis? Is it a fact that additional tankers are already operating on the Australian run, and that our petrol stocks have substantially increased? Does the Minister intend to relax petrol rationing in the near future?

Mr BEASLEY:

– Regarding the production of oil from the shale deposits at Glen Davis, discussions took place last Monday between the general manager of National Oil Proprietary Limited, representatives of the department, and myself. We did not carry the discussions beyond a preliminary examination of the problem. The Government now proposes to discuss the subject with the Government of New South Wales in order to arrive at a common policy as to the best course to pursue with this project. Concerning the second part of the question, every possible step has been taken to restore stocks of petrol to a safe level, and the results have been very satistory. As to whether the presentscale of petrol rationing can be relaxed,

I repeat my previous statement that the duty of the Government is first to restore the stocks of petrol to a safe level, and, secondly, to maintain them at that level. In the light of present development in the Pacific, I cannot forecast what the outcome will be.

page 73

QUESTION

INCOME TAX DEDUCTIONS

Mr JAMES:
HUNTER, NEW SOUTH WALES

– Is it the policy of the Treasurer to continue the harsh policy of his predecessor in refusing to allow the deduction of £50 to persons in the middle and lower income groups when they are maintaining in the home an adult child who is required to nurse an invalid member of the family? Can the Treasurer hold out any hope of relief to these people, who through no fault of their own ave suffering this hardship?

Mr CHIFLEY:
ALP

– Although the matter has received consideration, the Government feels that at this juncture, in view of all the circumstances and the administrative difficulties that would be involved, it, cannot allow the deduction. I shall be glad to give further consideration to the subject.

page 73

QUESTION

DILUTION OF LABOUR

Mr HOLT:

– I desire to direct to the Minister for Labour and National .Service two questions arising out of the regulations which he issued recently. The first question relates to the decision to award full tradesman’s rates to fifth-year apprentices in the engineering industry. Will the Minister say whether the matter had been previously referred to Judge O’Mara for arbitration, and whether his decision had been received by the Government ‘before it took this action? Secondly, has the Minister entered into any negotiations with the Sydney branch of the Boilermakers Union for the purpose of securing its acceptance of the principle of dilution? I f so, what are the results of the negotiations ?

Mr WARD:
Minister for Labour and National Service · EAST SYDNEY, NEW SOUTH WALES · ALP

– The matter of the payment of the full tradesman’s rate to fifthyear apprentices was, I understand, referred soma time ago to Judge O’Mara. Although I am not aware whether he arrived at any decision regarding the matter, or submitted to the Government any opinion upon it, I know that the subject was of urgent concern, because it was causing a great deal of unrest among certain trade unions. The Government, being anxious to maintain production and to prevent stoppages in industry, immediately granted to the trade unions what it considered to be a reasonable request regarding the payment of the full tradesman’s rate. But this decision applies only to fifth-year apprentices who work in shops “where there are “ added “ tradesmen. As many of those apprentices were required to give further instruction to the “ added “ tradesmen, or the trainees as they were taken into the workshops, the Government considered that it was unjust that they should receive less than those whom they were instructing. Regarding certain objections on the part of the Sydney branch of the Boilermakers Union to the dilution scheme, the Government has been negotiating with the organization and I believe that, at an early date, the difficulties will be overcome and the scheme will be put into operation.

Mr ROSEVEAR:

– Is it a fact that the Commonwealth Man-power and Resources Survey Committee, composed of representatives of all parties in this House, unanimously recommended to the last Government the payment of full award wages to fifth-year apprentices? Will the honorable gentleman have an investigation made to discover whether his predecessor consulted Judge O’Mara or any other judge prior to the issue of the regulation granting the 6s. war loading which was used as a means of bringing about industrial conscription?

Mr WARD:

– A recommendation concerning the pay of fifth-year apprentices was made by the committee, but like many other recommendations made to the last Government it was shelved. The incoming Government immediately gave attention to the matter, because it believes that, besides inquiring into matters brought to its notice, prompt decisions should be made if industrial peace is to be maintained. I shall be glad to inquire into the other matter referred to by the honorable member and shall advise him of the facts as soon as possible.

page 74

QUESTION

BAUXITE DEPOSITS

Mr FRANCIS:

– Some time ago, I asked the Government to obtain for me a report upon the availability in Australia of supplies of bauxite, with particular reference to the deposits at Mr Tambourine, in Queensland. Bauxite is an important constituent ofmany munitions, and 1 was greatly concerned lest the increased demand for aluminium, which is made from this ore, should cause a shortage of supply. Has the Minister for Supply received a report on the inquiries which were made at my instigation and, if so, will he lay it upon the table of the House?

Mr BEASLEY:
ALP

-Before the possibilities of local deposits of bauxite were investigated, about 100,000 tons of this ore was imported and is now located around Port Kembla. Since then, the potentialities of Mount Tambourine have een examined. I believe that other deposits exist in Victoria, South Australia and Tasmania. The reports indicate that the quality of the bauxite is of the standard required for the manufacture of aluminium. The problem which now arises is the setting up in Australia of plant to make aluminium, and members of the previous Government; I think, are aware of the serious difficulty which has to be overcome. At present, the Government is discussing the matter with the Department of Munitions, and later I shall advise the honorable member of the result.

page 74

QUESTION

INDIRECT TAXATION

Statement Attributed to Minister for Labour and National Service

Mr COLLINS:
HUME, NEW SOUTH WALES

– Is the Minister for Labour and National Service correctly reported in yesterday’s Daily Telegraph. as having stated, when addressing a street meeting at King’s Cross, that “indirect taxes included in last Wednesday’s Federal Budget are unfair and place a disproportionate burden on the workers “ ? If so, was the honorable gentleman speaking on his own behalf or on behalf of the Government?

Mr WARD:
ALP

– Of late I have not had a great deal of time to read newspapers owing to the fact that I have been too busy clearing up the congestion that existed in my department as the result of the inaction of the last Government. Not very much reliance can be placed on many of the reports that appear in the press, and I assure the honorable member that, in this instance, the fact that I was wrongly reported is nothing exceptional.

page 74

QUESTION

PAY-ROLL TAX

Mr JOLLY:

– Will the Treasurer re view the application of the pay-roll tax imposed on denominational schools? Under the existing system certain schools are exempt whilst others are subject to the tax.

Mr CHIFLEY:
ALP

– The matter will be considered.

page 74

QUESTION

VOLUNTEER DEFENCE CORPS

Mr DUNCAN-HUGHES:

– Is the Minister for the Army aware that much dissatisfaction exists in the Home Guard in some States with a consequent fallingoff of the numbers drilling, through a lack of the necessary officers, of uniforms, of up-to-date equipment, of instructions, and of army interest in their work? Lf the honorable gentleman is not aware of this, will he cause himself to be fully informed in regard to the matter?

Mr FORDE:
ALP

– It has come to my notice that there is some cause for complaint. I have issued instructions that the necessary equipment and rifles be provided, and that everything possible be done to show appreciation of the spirit that prompted the members of the Volunteer Defence Corps to offer their services to the country.

page 74

QUESTION

GENERAL SIR THOMAS BLAMEY

Return to Australia

Mr RANKIN:

– In view of the hints in the press and the many rumours in circulation that General Sir Thomas Blarney is to return to Australia in order to discuss with the Government the return of the Australian Imperial Force to this country, will the Prime Minister make a statement on the subject in order to allay the natural anxiety of many members of the public?

Mr CURTIN:
ALP

– The return of General Sir Thomas Blarney to Australia is purely for the purposes of consultation. lt arises from a recommendation Wy Sir Thomas himself that he should return for that purpose. The Government considers it desirable that such a consultation should take place. Tho return of Sir Thomas Blarney has nothing whatever to do with any suggestion that the Australian Imperial Force should be recalled, and the Government has no intention of recalling the Australian. Imperial Force

Mr ARCHIE CAMERON:
ALP

– I ask the Prime Minister whether he now endorses the opinion which he expressed as Leader of the Opposition, namely, that it would be a good thing if Lieutenant-General Sir Iven Mackay attended this House in order to give to honorable members first-hand information on operations in the Middle East? If so, will the Prime Minister be good enough to invite General Sir Thomas Blarney to attend this House so that private members may obtain some first-hand information about how things arc going in the Middle East?

Mr CURTIN:

– I, as well as all members of the Advisory War Council and the War Cabinet, have since had the opportunity to consult Lieutenant-General Sir Iven Mackay and I see no point now in his being brought to the Bar of this House in order to make explanations. With respect to General Sir Thomas Blarney, after I have had consultations with him I shall give an answer to the honorable gentleman.

page 75

QUESTION

WAGE INCREASES

Effect on Prices.

Mr BEASLEY:
ALP

– Last Wednesday the honorable member for Fawkner (Mr. Holt) asked a question relating to the effect on prices of wage increases. In answer to the honorable member’s question I desire to make the following statement on behalf of the Minister for Trade and Customs: -

Subsequent to the discussions with the Minister to which the honor-able member refer red in his question the Commonwealth Prices Commissioner submitted the following memorandum to the Minister as indicating the policy adopted by the Commonwealth Prices Commissioner with respect to increases of wages under awards of the Commonwealth Arbitration Court or other industrial tribu nals, under conciliation arrangements and under other agreements reached between employers and employed: -

The Prices Commissioner has recognized thu right of employers to include in their costs any increase in wages embodied in an award of the Arbitration Court, unless the court in making tho award expresses the view that the industry concerned, or industry as a whole, can afford the increased rate of wages. To this extent wages costs are in the samo category as costs of materials and other costs. They are allowable costs in determining prices under Prices Order No. 100, subject always to the Prices Commissioner’s right to review in the event of profits being unreasonably high.

The Prices Commissioner takes a different view of increases in wages and labour costs embodied in agreements reached directly between employers und employed without reference to the Arbitration Court or any other duly constituted tribunal. There is a clear case for doing this. With labour in short supply in many industries, arrangements could be made between employers and employed that might benefit both parties immediately at the expense of tho community. Moreover, there would bc an increasing tendency for industrial relations to be determined by such arrangements without regard to the fundamental policy of the Arbitration Court or other industrial tribunals.

There are three typea of cases between the direct award of the court on the one hand and the direct agreement between the two parties on the other hand. First the parties may reach agreement as a result of the intervention of the court using its conciliation powers. In these cases the parties are in effect sent into conference by the order of the court and any agreement reached is subsequently confirmed by the court. Such an agreement would have the status of an award of the Court and would be dealt with by the Prices Commissioner as outlined in paragraph 1. Secondly, tho parties may reach an agreement outside the court and secure the consent of the court to such an agreement. Where the court gives its consent without reservation, such a “ consent” award would also be treated as an award of the court for the purposes of price control. Thirdly, there arc cases in which the parties reaching an agreement outside the court and the court in approving a “ consent award adds a reservation to the effect that the order of the court “shall not bc regarded as an assessment of wages by the court nor that the court would necessarily grant a loading on the. facts placed before it if the parties had not consented to such order “. In these cases the employers may make an application to the Prices Commissioner for an increase in prices on account of higher labour costs, but the onus is on the employers to show that they are under some hardship in continuing to pay higher labour costs without a rise in prices. This in no way interferes with the conciliation powers of the court or with the desire of employers as far as possible to concede the reasonable demands of labour. If an industry is highly profitable during the war labour will naturally seek to obtain some of the profits, and it is the duty of the Prices Commissioner to consider whether the employer can absorb part or whole of thu increases in casta before he is permitted to raise his prices.

Instances have come under notice where employees in non-essential industries, whose training fits them for work in munitions production,have been given additional pay as an inducement to remain in such industries. Recognition of an employer’s right to pass on these increased costs in higher prices would be cutting across efforts being marie in other directions to mobilize labour for munitions work.

lt may be contended that in the interests of a speedy settlement of disputes employers should be given the right to regard increased wages in all cases as allowable costs in determining prices. A moment’s reflection will show that this would be a most disturbing practice, It would mean that big industries which have made increased profits on account of higher turnover and without any rise in price would automatically bc given a reasonable ground on which they could raise their prices. Labour might get some benefit by obtaining increased wages, but the industry would also receive a benefit in protecting its high profits at the expense of the public. The net effect would be to encourage labour in such an industry to ask for still higher wages and soon to build up a pocket of very high wages at which workers in all other industries would aim. The practice adopted by the Prices Commissioner is a deterrent to this and an indication that he is endeavouring to uphold the authority of the court as the ultimate determinant of wage rates.

page 76

QUESTION

SEAMEN AND SHIPPING SERVICES

Mr HARRISON:
WENTWORTH, NEW SOUTH WALES

– In order to clear up a misunderstanding, I ask the Minister for Labour and National Service whether, in view of his reply to me on the 29th October, that he was unaware of any published appeal made by him to seamen to refrain from taking any action involving an interruption of shipping services, he is prepared to deny a statement published on page 12 of the Melbourne Age of the 18th October that an appeal to seamen to refrain from any step which would involve interruption to shipping services had been made by the Minister for Labour (Mr. Ward) after a meeting of Oabinet that night? Is he also prepared to deny a report in the Brisbane Courier-Mail of the same date that an appeal to seamen concerned in a threatened strike on the Australian waterfront had been issued by the Minister for Labour (Mr. Ward) on the previous day when hp had said that he was making the appeal as the result of urgent consideration that had been given to the matter by Cabinet? Or has the Minister again been wrongly reported ?

Mr WARD:
ALP

– I have not seen the reports mentioned by the honorable member, but I assure him that there has been no need for an appeal to be made to the seamen. They have been happy to cooperate with the Government. As proof of the co-operation between the Seamens Union and the Government, I cite the fact that no ship is detained in Australian waters. Whatever difficulties have been placed in the way of the Government in regard to the movement of shipping, the fault has not been with the seamen’s organiza tion.

Mr Harrison:

– Why does the Minister not answer my question?

Mr WARD:

– If the honorable member will supply me with the reports I shall be pleased, at my leisure, to peruse them.

page 76

QUESTION

LEATHER SHORTAGE

Mr MORGAN:

– I ask the Minister for Supply and Development whether it is a fact that there is a considerable shortage of leather in Australia and that, in the near future, the Government may have to contemplate importing supplies? Is it also a fact that large quantities of footwear are being imported from Great Britain? If so, who is responsible for the position and who authorized the export of best quality hides in the last two years during the regime of the previous Government?

Mr BEASLEY:
ALP

– The leather position in Australia is certainly acute and has given rise to many complaints, but. I am happy to be able to say that the Deputy Prime Minister of New Zealand. Mr. Nash, with whom we have had consultations in the last few days, is about to arrange for parcels of hides in excess of New Zealand’s requirements to be made available to Australia. We are most grateful to New Zealand for its assistance. In regard to what happened in the past. I must say to the honorable member that we shall not be assisted very much by resurrecting the past.

Mr Morgan:

– But the same people may be still in control.

Mr BEASLEY:

– We shall be guided by past experience. I shall take whatever steps are necessary to ensure that advisory panels shall supply the best advice, and, if necessary, alterations of personnel or organization willbe made.

page 77

QUESTION

BUDGET 1941-42 (REVISED)

In Committee of Supply:

Consideration resumed from the 29th October (vide page 81), on motion by Mr.Chifley -

That the first item in the Estimates (Revised) under Division No. 1 - The Senate - namely, “ Salaries and Allowances, £8,470,” be agreed to.

Mr.FADDEN (Darling DownsLeader of the Opposition) [4.8]. - ‘Six weeks ago, on behalf of the then Government, I presented a budget which required the raising of £217,000,000 for war purposes alone and £322,000,000 for all purposes constituting in those respects a record for the Commonwealth. That budget was presented after serious consideration and a thorough survey of all resources, existent, possible and probable, available to the Government. The then Government’s financial policy was contained in that budget, which aimed at diverting from civil activities and civil spending sums of money needed for war and defence purposes. It also provided means of controlling and policing that diversion and sought to employ the most equitable means of spreading the inevitable sacrifices which the Australian public would be called upon to make. That budget was calculated to meet the realities of the war position in which Australia finds itself. It spread the burden equitably over every section of the community. We recognized, of course, that our budget was not popular; we never expected that it would be popular. The Government of that day looked to the national security. It compiled a budget that would produce the maximum all-in war effort. It faced squarely, honestly and honorably the conditions in which it found itself. However, that budget was rejected, and my Government was rejected with it. Consequently, the Opposition of that time is now in charge of the financial responsibilities of the nation, and the then Government is now the Opposition in this House. The then Leader of the Opposition, who is now the Prime Minister, moved this amendment to my budget -

That,while agreeing that the expenditure requisite for a maximum prosecution of the war should ‘be provided by Parliament, the committee is opposed to the unjust methods prescribed by the budget, declares they are contrary to true equality of sacrifice, and directs that the plan of the budget should be recast to ensure a. more equitable distribution of the national burden.

Such an amendment might very properly come from this side of the House to-day, because I think that every discerning individual who studies the budget that has been brought down in substitution for the budget that was rejected by this House some weeks ago will agree that it does not measure up to the principles enunciated by the Prime Minister (Mr. Curtin) when be was Leader of the Opposition. The plan of mybudget has not been altered. The plan of the revised budget is the same as that of the budget which I brought down; but the specifications, the bills of quantities and the materials are decidedly different. The Government has adopted the Opposition’s financial policy. In order tofinance this war it has adopted the basis used by governments which have been in charge of war finance since 1939, namely, taxation, loans from the public, and borrowings from the banking system. We can appreciate the enormous difficulties that confronted the Prime Minister (Mr. Curtin) and the Treasurer (Mr. Chifley) in persuading some of their colleagues to accept such a budget. When oneremembers the speeches that were made by their associates in this House during their term in opposition, one must appreciate the difficulties they experienced in converting their colleagues to their way of thinking, as expressed in the budget now before us. The Treasurer has at least converted the honorable member for Werriwa (Mr. Lazzarini), the honorable member for Maranoa (Mr. Baker), the honorable member for East Sydney (Mr. Ward), the honorable member for West Sydney (Mr. Beasley) and the honorable member for Corio (Mr. Dedman), to mention only a few. He has brought them round to a sane realization of the fact that production mustbe the basis of all finance, and that, as the Treasurer himself said, no number of entries in the Commonwealth Bank’s books will accomplish the task of switching over a large proportion of production from civil to war needs. War needs must come from the collective resources of the community. So we find that the basis upon which this budget is framed is exactly the basis upon which my budget was framed, except, as I said before, in respect of its quantum andcer tain details. The Prime Minister and his colleagues have added to the financial problems of the country, because they have increased expenditure by approximately £6,000,000 and, at the same time, have refused to measure up to the inevitable necessity for obtaining a greater amount from the spending capacity of the community. Consequently, they are obliged to bridge a gulf of approximately £137,000,000 compared with the gulf of £122,000,000 which confronted my Government. It may be argued that the basis of any comparison in this respect must be between the amount of £137,000,000 and the amount of £122,000,000 plus £25,000,000 which my Government proposed to raiseby way of compulsory loans.

Mr FADDEN:

– That submission will not stand the light of day. The amount of £25,000,000 which my Government proposed to raise by way of compulsory loans represented a definite diversion from the spending capacity of the community to assist in the financing of our war effort. Therefore, no comparison between the gulf to be bridged in this budget and the gulf to be bridged in the budget which I brought down can include that amount of £25,000,000. The comparison must be. between the amount of £137,000,000 still to be found by this Government, and the amount of £122,000,000 that was to be found under my budget rejected by Parliament some weeks ago. It follows, therefore, that an additional £15,000,000 must be found by this Government. That is equivalent to a difference of12½ per cent., and to that degree a greater strain is placed upon the capacity of the country to (find the finance required for the successful prosecution of the war. I also ask honorable gentlemen to appreciate that four months, or one-third, of the current financial year has already passed, and assessments have not yet been sent out. Consequently, considerable difficulties must yet confront the Government Whilst, as I have already said, the basis of this budget, except as to quantum - the difference in quantum being £15,000,000, or12½ per cent. - is the same as that of the budget rejected by Parliament some weeks ago, the Government proposes to adopt different means of finding the revenue it needs. It has very conveniently entered the field of indirect taxation. Having regard to the field of direct taxation that remained to be tapped, it has departed entirely from its past policy. Honorable members opposite have always been opposed to indirect taxation. I recognize, and it must be generally appreciated, that indirect taxation must be part and parcel of the fiscal policy of this nation. It has been so ever since Federation; but, I submit, indirect taxation should not be used until all means of direct taxation have been exhausted, or at least wisely and successfully exploited. Under this Government’s budget indirect taxation will be increased by approximately 12s. a head of the population. To a family man with a wife and three children that increase represents an additional impost of £3, but, although such a family man will be obliged to carry that extra loading, a single man will be asked to carry an extra impost of only 12s. Consequently, we should not delude ourselves in the belief that this impost will not place an additional burden on the family budget, or that it will not increase the costs of production in industry. I agree entirely with what the Minister for Labour and National Service (Mr. Ward) is reported to have said at King’s Cross recently that the indirect taxation provided for in this budget is unfair, and places a disproportionate burden on the workers.

Mr Forde:

– The Minister said this afternoon that he had been misreported.

Mr FADDEN:

– He was reported to have said it and he did not deny it publicly, or through the press. I have little doubt that he said it. In considering this budget we must ask ourselves whether it provides the direct, straightforward and honest means of obtaining the requisite finance to wage this war. I shall quote also what the Prime Minister, then Leader of the Opposition, had to say about the 1939-40 budget, in September, 1939 -

  1. . these indirect taxes are not related to the capacity of the people to pay them. but this is the central truth: that the resources of this Commonwealth Government to discharge the obligations of government have been built up as the result not of increased taxes on the rich but of taxes which, in their incidence, are unrelated to the capacity of the people to pay them, and which, by and large, have to be paid at the same rate by the great mass of the people, even though they have low incomes, as is the case with those other sections of the community that have high incomes.

I could also quote views on indirect taxation expressed by several honorable members opposite. I do not quarrel with indirect taxation, except when it is resorted to in order to avoid direct taxation.

The Government’s direct taxation proposals will place a severe impost upon a single section of the Australian taxpaying community. The Prime Minister said that he objected to my budget because it was contrary to the principle of true equality of sacrifice, and that a more equitable distribution of the national burden was required. Consider the incidence of direct taxation under this budget. Let us analyse the capacity of the community to bear taxation. On incomes of £1,500 a year or more, the field of taxation is £67,000,000. On incomes ranging from £1,000 to £1,500 a year, the field of taxation is £28,000,000”; from £400 a year to £1,000 a year it is £145,000,000, and under £400, it is £560,000,000. Therefore, of a total taxable capacity of £800,000,000 incomes of under £400 a year represent £560,000,000 or 70 per cent. Yet from that huge reservoir the Government proposes to obtain only 8 per cent, of its direct taxation revenue. Can that be regarded as an “ all-in “ war effort ? The field of taxation on incomes of over £1,500 per annum is £67,000,000, or 8£ per cent, of the total taxable capacity, and from that field the Government proposes to obtain 59 per cent, of its direct taxation revenue.

Mr Dedman:

– What proportion of the population is earning income below £400?

Mr FADDEN:

– I am not championing the cause of the man whose income exceeds £1,500 per annum. What I wish to emphasize is that, if we are to have equality of sacrifice and an equitable distribution of the taxation burden according to the capacity to pay, full regard should be had to the interest of every section of the Australian community. Only recently the Prime Minister himself stated that the wage fund of Australia had increased by £150,000,000 since the outbreak of war. Yet not a single penny of that increase has been called upon to finance our war effort, despite the fact that the entire increase has been brought about by war expenditure. That aspect has been ignored or overlooked in the framing of the financial policy to which the nation has to measure) up. Why should there be such discrimination? Why should people whose incomes aggregate £67,000,000 be forced to contribute by means of direct taxation £26,000,000 or 59 per cent, of our taxation revenue? People in that income group also pay £6,000,000 annually in State income tax, and if we deduct from that £67,000,000 the £26,000,000 which is to be extracted by this Government, and the £6,000,000 paid by way of State taxation, the remainder is £35,000,000, which is the gross amount available to the income-earners concerned for all activities of life, including the payment of municipal rates, estate duty, investments, and employment. The kernel of the nut is that there are comparatively few people in that field of taxation. Of 3,000,000 income-earners in Australia, only 23,000 earn £1,500 a year or more, and a similar number earn between £1000 and £1,500 a year; 2,709,000 earn less than £400 and 245,000 earn between £400 and £1,000. That is the whole story. This is a good vote-winning budget, but it is not a good war-winning budget. It is not a good budget to finance this war adequately and equitably. The Government has failed to measure up to its responsibilities. It has failed to distribute the inescapable burden in accordance with, the capacity of all sections of the community to bear it. Why should an increased wage fund of £150,000,000 which has been brought about entirely by the war, be entirely ignored when endeavouring to solve the paramount problem of financing the war ? The crux of the situation -is the number of people affected, and therefore the number of votes affected. The parties now in Opposition framed their budget without regard to such political considerations., but the Government now in office apparently is not prepared to do that. We recognized that the circumstances in which the nation was placed transcended all political considerations, and for that reason, and that reason alone, we brought down a budget which we considered to be equitable, and which called upon every body in the community to bear a fair share of the inescapable burden.

The ‘Government seeks to obtain £22,000,000 by way of additional revenue f rom taxation, compared with £32,000,000 under the rejected budget, or a decrease of £10,000,000. Why does not the Government try to obviate, so far as practicable the possibility of inflationary effects . on the financial structure of the community, by obtaining the finance required directly from trie pockets of the people? Why does it .r educe the revenue by £10,000,000, and thus increase the deficit which has to be financed to £137,000,000.

Mr Curtin:

– We did not do it.

Mr FADDEN:

– The Government has, in fact, increased the gap from £122,000,000 to £137,000,000. The argument concerning compulsory loans, or post war credits, is quite beside the point because the £25,000,000 of compulsory loans was, in the very nature of things, an amount of income that would have been withdrawn from the pockets of the people and so would not have been within their spending power. ‘This Government proposes to depend entirely upon the whim -of the people in regard to the raising of the money that is necessary to satisfy the needs of the situation. It apparently considers that it will be sufficient to rely upon the speeches that Ministers make and the appeals from public platforms, by radio and through the press to people to subscribe volun tarily, so that the Government may obtain the £137,000,000 which is necessary in order to balance the budget and prevent inflation.

Let us examine the prospects by comparing savings bank deposits and purchases of war savings certificates for these will be some guide to us in forming a judgment. How can we possibly expect to finance a war of the magnitude and gravity of this war merely by voluntary appeals to people to curtail their spending? The fact is, of course, that the volume and rate of spending in .the community are increasing, -and the rate of increase is also increasing. Psychologically the policy of the Government must discourage .the voluntary investment of money, not only by individuals but also by public companies. Such companies are the largest employers of labour apart from the Government itself. By the severity of its taxation of the profits of the big companies, and of the incomes of persons in receipt of more than £1,500 a year, the Government is necessarily discouraging voluntary investment.

The record of the deposits in the savings banks was pointed to with pride by the Treasurer, who, in the course of his budget speech, said that such deposits had increased so greatly during the past twelve months that, lately, they constituted a record. He thought that that was an encouraging sign. I take just the opposite view. I cannot see how the Government can depend with any confidence upon voluntary investment as a means to prevent inflation. At the end of September, 1941, deposits in the savings banks increased by £20,368,000, compared with September, 1940 achieving the record referred to by the Treasurer. The amount of the deposits at the end of September was £262,000,000 which is equivalent to £112 for each employed person in Australia. Let us relate these facts to the campaign for the sale of war savings certificates. It might reasonably be expected that the patriotism of a people who could make such substantially increased savings bank deposits would be reflected in the purchase of war savings certificates, but, unfortunately, the record in this regard is rather pitiable. In the financial year 1940-41 war savings certificates were purchased to a value of £11,280,000, if we take the records of the Commonwealth Statistician, and not £12,000,000, as stated by the Treasurer. For the year ended September, 1941, war savings certificates were purchased to the value of £8,280,000. Purchases for the September quarter of this year totalled £2,193,000, which is equivalent to £8,750,000 for a full year. The sales of war savings certificates for last September had a cash value of £659,000.

Mr Curtin:

– No wonder there was a change of Government.

Mr FADDEN:

– It will be seen, therefore, that whilst savings bank deposits for September last totalled £20,368,000, purchases of war savings certificates totalled only £659,000. This relatively low expenditure in the purchase of war savings certificates was not due to lack of organization by Mr. Banfield or his capable staff, for they have worked strenuously and conscientiously to increase the sales. The fact is that the savings of the people are going into the savings banks. In the light of these facts I consider that if the Government relies, as it proposes to do, on voluntary subscriptions to provide the funds it needs it will be sadly disappointed. ‘Such optimism is not justified.

The Government, of course, has been consistent in its inconsistency. It believes in compulsion in certain matters but it pins its faith to the voluntary system in other matters. How much money would be received from taxation if the Government depended upon voluntary contributions? Of course taxation measures must be compulsory. If we are to have an all-in war effort, and if every body is to pay fairly according to capacity to pay;, compulsion is necessary. We must reduce the dangerous spending capacity of the people, and we shall have to do it by compulsory measures, for voluntary provisions to achieve this end are doomed to failure. I wish I could subscribe to the view that voluntarism would prove satisfactory, but I cannot do so. The Government has rejected compulsory contributions from incomes in the lower ranges, but it has stood by the com pulsory principle in respect of incomes in the higher ranges.

I come now to banking policy. The Government which I had the honour to lead entered into a very satisfactory arrangement whereby the banks, by virtue of an honorable understanding, gave the Government control of their deposits under certain definite conditions. I remind honorable members that the Royal Commission on Monetary and Banking Systems emphasized, in its report, that it was far better to have co-operation and voluntary effort in this matter than to apply compulsion. I venture the view that to compel the banks, under the provisions of National Security Regulations, to do certain things which we understand the Treasurer has in mind will be prejudicial to the economic welfare of the people and to the financial fabric of the nation. The banks may be relied upon to do the fair thing. If, after such reliance has been placed in them they are found not to be doing the fair thing, then it will be time enough to introduce compulsion. Lot us compare the position which will obtain under the ‘Chifley budget with the position that would have obtained, had the licensing recommendations of the royal commission been adhered to in their entirety. We have been told that under the regulations that are proposed to be issued the banks will carry on their business under licence. That is provided for in paragraph 666 of the report of the royal commission. It is stated in the budget, however, that the conditions under which licences will be issued to the trading banks will include a provision that -

A licensed bank shall hold on deposit with the Commonwealth Bank its excess investable funds on a basis to be determined by the Treasurer.

We have also been informed that the Government intends to provide that the Commonwealth Bank, with the Treasurer’s consent, may require the trading banks to hold with the Commonwealth Bank a percentage of their deposits. That percentage is to be within limits fixed by the Treasurer. There is a material divergence at that point from the proposals of the royal commission. I say, with due respect to all concerned, and without any personal reflection upon the Treasurer, that to place the banking system of this community, in time of war, and in the circumstances in which we find ourselves to-day, in the hands of one man, the Treasurer of the Commonwealth - for that is what it would amount to - would be a very bad mistake which would be reflected in a grave lack of confidence among the investing community of Australia. We are fighting dictatorships to-day and we should not constitute the Commonwealth Treasurer a dictator of the financial policy of this country. Such a step would cause a grave weakness in our financial system. The Parliament should give the most careful consideration to that aspect of the subject. If there was ever a time when we required the fullest confidence in the banking institutions, and in the financial structure of the nation, having regard to the nature of the budget before us, that time is surely now. I know that the Treasurer is a man of discretion and will not b« stampeded into implementing any wild scheme, but I have reason to know also that treasurers have no security of tenure in their ministerial and parliamentary positions. In explaining the provisions relating to banking, the Treasurer stated -

These powers will be exercised to prevent expansion of credit by trading banks arising out of the increased funds due to war activities.

What sound reason is there to justify this harsh treatment of the banks - this regulation which could have been brought about by other methods?

Mr Morgan:

– The honorable gentleman intended to do the same thing.

Mr FADDEN:

– I arranged for it to be done voluntarily. The trading bank advances have actually fallen. The quarterly averages in September, 1939 - the date of the outbreak of war- totalled £296,000,000. A year later, the total was £287,000,000, and in September of this year it was £283,000,000. In two years the banks’ holdings of treasury bills have increased from £19,000,000 to £33,000,000, at an interest rate of1½ per cent. Their holdings of Government securities have increased from £23,000,000 to £63,000,000, the average interest rate being about 3 per cent. The banks’ profits for the last year, as disclosed by the Commonwealth

Bank itself, represented 4.2 per cent. on capital - one of the worst investments, comparatively, in Australia. Nevertheless, the banks are to be hamstrung at a time of danger such as this! I believe that the operations of the banks should be controlled. There should be a method of controlling deposits, and such a method was clearly outlined in the budget which I presented. If this Government is sincere in its endeavour to finance the war effort by means of voluntary contributions, it has started in the wrong way by imposing harsh regulations upon the banks and placing control of the nation’s financial system in the hands of one man. It is making a grave mistake; the passage of timewill prove that.

M,r. Chifley. - The honorable gentleman wants the war effort to be voluntary for the banks and compulsory for every body else.

Mr FADDEN:

– No. I proposed to implement the report of the Royal Commission on Monetary and Banking Systems. The Treasurer has merely taken that portion of the commission’s report which suits his policy, and has ignored the majority report, which stated that co-operation with the banks was the best method of achieving the Government’s objective. If that statement was logical in peace-time, its logic must apply to-day with even greater force, particularly having regard to the Government’s financial policy, which, being based upon confidence, asks the people to contribute voluntarily to the war effort.

In view of the fact that it must obtain £137,000,000 by means of voluntary loans and contributions from the banking system of the Commonwealth, the Government must take careful stock of all of the measures and safeguards that can be used in order to ensure that every avenue leading to inflation shall be closed. The dangerous feature of the Government’s financial policy, as it appears to me, is the amount of spending power that it proposes to leave in the hands of people in the big group of lower-range incomes totalling £560,000,000 a year- a total which is constantly increasing. Income earners in the higher ranges will automatically reduce their spending; they will have no option; That group is not big enough to provide the means of prosecuting our war effort to the full. Other fields must be tapped in order to finance defence activities and stabilize our financial policy, which in turn should guard against inflation. The Government has announced that it proposes to bring down, a supplementary budget early in the New Year. But for the fact that we are engaged in a bitter war and that many important problems are in need of urgent attention, I should suggest that the committee should prolong this debate in order that it might be linked with the debate on the supplementary budget. I am curious to loam what the supplementary budget will be like, because I am anxious to know how courageously the Government will face the difficulties with which it will bo called upon to deal by tho end of the current financial year.

There were many reasons for my proposal to introduce a system of compulsory loans, or post-war credits as they were euphemistically termed. It provided a means of diverting the country’s finances from civil activities to war activities; it was a method of making the people accustomed to saving; and it envisaged post-war reconstruction, the Government having foreseen the problems that will confront the nation at the end of the war, when there will be a sudden change, from war activities to civil expansion. We considered it advisable to have such a fund available for the use of whichever Government may be in power when the time for this sudden transition arrives. The scheme also provided for uniformity of contributions by taxpayers of the various States. The present Prime Minister stated, in the course of his speech on the budget which 1 introduced -

Parliament, at this juncture, is not obliged to adjust differences which exist in State tax os unless that adjustment can Iki effected without impairing the physical standard of the community as a whole.

I submit that my proposals did fulfil that condition. But the honorable gentleman went on to say -

The right remedy for having seven taxing authorities is to substitute one taxing authority.

Then, in answer to an interjection from me, the honorable gentleman said that my Government could “ take the requisite steps if it had the courage to do so “. Where is the honorable gentleman’s courage in the retreat he is now making? His Government has totally ignored tie opportunity to institute a method of securing uniform contributions from residents of every State. One of the biggest disadvantages of our economic system is the inequality of taxation burdens as between the States. The compulsory loan system provided that residents of the lower taxed States should make a just and proper contribution to the war effort, and that residents of the Australian Capital Territory also, instead of paying only Commonwealth taxes, should devote their surplus spending power to the establishment of post> war credits in order to help the war effort and lay a foundation for post-war reconstruction.

Mr Rosevear:

– How would those loans have been paid back?

Mr FADDEN:

– Am I to understand, from that interjection, that the people of Australia are to be asked to subscribe voluntarily £137,000,000, which the Government has no intention of repaying? If not, why ask me whether the Government that I led intended to repay £25,000,000? The suggestion is ridiculous. Unfortunately, persons, whom I class as fifth-columnists, stated that postwar credits would not be liquidated. Of course, the Commonwealth Government will fulfil its obligations, as it has always done.

Honorable members interjecting,

The CHAIRMAN (Mr. Prowse).Order! Unless honorable members pay due regard to calls to order, the Chair will have to exercise its authority. I presume that the budget will be debated for three or four weeks. Unless a degree of harmony prevails, the position will become intolerable. I warn honorable members that they must be obedient to the (Chair, and observe the requirements of the Standing Orders.

Mr FADDEN:

– The Government has lost a unique opportunity to adjust a too long existing financial disability, namely, varying rates of taxation in the different States. Every Commonwealth Treasurer has had to mould his financial policy, and construct his taxation proposals, in such a way as to pay due regard to the varying capacity of the different sections of the Australian public. That is an obstacle which should definitely be removed when we are confronted with the gravest financial problems with which this nation has ever had to deal. The Government has neglected to adjust that financial disability. I have been chided with having lacked the courageto make the adjustment. I called together representatives of the different States, and asked for their cooperation in connexion with this particular matter. When they refused to give it, I resolved to make the adjustment through the medium of the post-war credits scheme. It is a shame that that opportunity has been neglected. I predict that a scheme of post-war credits will be put in operation before this Government is many months older. In due course the Government will find that the voluntary appeal has not borne fruit and that it has not been able to obtain the finance that it needs. It will, therefore, be reluctantly compelled to apply some form of compulsion, whereby spending power will be diverted from civil and extravagant purposes to the indispensable and inescapable needs of war.

The Treasurer is dealing very harshly with companies, in asking them to contribute £8,500,000 during the present financial year. He will thus encroach on funds from which are drawn voluntary contributions to loans; because he will not be able to obtain revenue from such taxes aswell as from voluntary loans. The reduction of the war-time profits tax base from8 per cent. to 4 per cent,, with graduations up to the percentage mentioned in the budget, will have a very detrimental effect. Quite apart from the injustice and the inequity of the proposal, I doubt whether the Government will raise the revenue that it anticipates receiving. The proposal that no company in Australia shall be allowed to make a return of more than 4 per cent. on its capital outlay withoutbeing liable to the payment of an excess profits tax is ridiculous and inequitable. An all-party select committee of this branch of the legislature, of which the right honorable member for Yarra (Mr. Scullin) was chairman, proposed 8 per cent. as a base.

Mr Scullin:

– It did not.

Mr FADDEN:

– The whole of the subject was investigated. Another special committee also has thoroughly surveyed the subject of taxes and profits. The proposed legislation could easily have been deferred until the report of that committee had been presented. That waa my intention, and I stated it in the budget that I introduced. Ample safeguards exist against war-time profiteering. Any company which is making undue profits out of the war should certainly be obliged to increase its contribution; but it is unduly harsh to include in a general reduction to 4 per cent. every company in Western Australia, Tasmania, Queensland and other States whose profits have not been increased as the result of war-time operations. I trust that during the discussion of the various taxation measures the Government will give consideration to constructive criticism that is offered in this regard. I do not envy the Treasurer, who is faced with the problem of obtaining a huge sum and has to survey the different fields from which it may be raised, but I object to the methods that are being applied, because I do not think that they are equitable, or that a fair share of the burden has been placed on sections of the people which should, could, and, I am sure, would bear a just proportion of it.

I disagree with the budget, also, because I do not think that it measuresup to the problems with which we are confronted. The Government has not accepted the responsibility of a nation at war. This is not a war-time budget. We have been told that we must have an all-in war effort. A financial policy which over- taxes one section, and leaves untouched a large taxable capacity in another section, in order to obviate diversion from civil to war needs, cannot be described as a proper war-time budget. It does not meet the realities of the position, or face the faots fairly and squarely.

Mr LAZZARINI:
Minister assisting the Treasurer · Werriwa · ALP

– The Leader of the Opposition (Mr. Fadden) is somewhat irritated by the specially warm reception of the budget by the people, and the general agreement with the principles enunciated by the Treasurer (Mr. Chifley) last week. I do not intend to deal with that portion of the honorable gentleman’s speech which was in advocacy of his own budget. That budget is dead ; this committee rejected it, consequently discussion of it would be useless. I remind the honorable gentleman, however, as well as other honorable members opposite, that the budget we are now debating makes provision only for the balance of the financial year 1941-42, and is not a pronouncement on banking and general financial policy. It Ls a statement of the accounts of the nation, and a recital of the means proposed for raising and expending revenue. The honorable gentleman will be given sufficient opportunity to examine any of the alterations or adjustments which the Government proposes to make now, and a.s time goes on, iri respect of what may be described as the monetary policy and the banking system of the nation. He has waxed indignant because, for the first time for many years, this budget has followed what have been laid down as correct principles of taxation the world over, in that it places the burden on those who are best able to bear it. I was completely unaffected by the gibe concerning the financial policy which other Government members and I have advocated in the past. When the honorable gentleman sat in the Country party corner before his inclusion in the Ministry, lui was one of the loudest applauders of some of the speeches that I made on financial policy, and on one occasion interjected that the Government had no answer to the statements T was making. This budget is a temporary expedient. The present Administration t-ame into office almost in the middle of the financial year, after its predecessor had expended certain sums and had committed the nation to other expenditure. The budget cannot, and must not. be analysed ns if it were a financial statement, which would be made at the commencement of the financial year, laying down the whole plan of revenue and expenditure. The Treasurer has said that he may have to bring down further proposals in March next. The Leader of the Opposition appeared to take exception to that intention; yet he made a similar statement in each of his budgets, and it appeared in every budget that has been brought clown since the war started. Nobody can say what our commitments are likely to be in the near future, consequently, supplementary expenditure may have to be incurred. This practice is inevitable in circumstances of war, and has been adopted by all Treasurers. The Treasurer practically had to go without sleep in order to bring down this budget in three weeks. Although the Leader of the Opposition, when Treasurer, had been in office for some considerable time, and had all the details of administration at his finger tips, he took more than three months to perforin a similar task. The present Government did not waste its time in wrangling and fighting, leaving the work to pile up.

The Leader of the Opposition referred to Labour’s policy in respect of banking. Since the war started, through the instrumentality of the bank, credit issued through the Commonwealth Bank, without any check on secondary inflation, the investable funds of the associated banks have increased by £43,000,000, directly as the result of war expenditure. The last Government did not make any attempt, nor did it intend to do so under its so-called gentleman’s agreement with the private banks, to curb the secondary inflation which those institutions had carried on, and which they would have continued to carry on had the present Government not determined that the practice should be stopped. Yet. the Leader of the Opposition indignantly declared that the action of the present Government is detrimental to the financial interests of the Commonwealth.

The Leader of the Opposition has complained bitterly because the present. Government proposes that the scale of rates of the war-time company tax is to be increased to provide for a statutory percentage of 4 per cent, instead of 8 petcent, on the capital employed. It is proposed tha t the commencing rate of tax shall be 6 per cent., increasing by steps of 6 per cent, until a maximum rate of 78 per cent, is reached on the taxable profit in excess of 16 per cent, on capital employed. The tax introduced1 by the Leader of the Opposition, when he was Treasurer, is a commencing irate of 4 per cent., progressing by 4 per cent, steps for every 1 per cent, in excess of the statutory percentage of S per cent on capital employed, until the rate reached a maximum of 60 per cent, on that portion of the total profits in excess of 22 per cent, on capital employed. In attacking the present budget, the Leader of the Opposition supports war-time profiteering by big companies. The profit nhat companies like the Broken Hill Proprietary Company Limited make on their watered stock hardly reaches 8 per cent., and it would have to reach practically 12 per cent, before those companies would be called upon to pay any war-time profits tax at all. Therefore, the present Government decided that it would go after the profiteers. The Leader of the Opposition seemed to take some comfort from the fact that, during the last month of his term of office, tie public lost so much faith in his Government that it refused to buy war savings certificates. We had the spectacle of unstable government, constant bickering between members of the parties in power, and a feeling on the part of the general public that a dry rot had set in, with the result that nothing effective was being done to mobilize the resources of this country. But the Leader of the Opposition, having quite recently vacated the position of Treasurer, should not have been pleased, as he apparently was, with the decreased purchases of war savings certificates. He told us that the deposits in the savings banks had increased. Apparently the people preferred to put their savings into the savings banks, and receive l£ per cent, or 2 peT cent, interest on the money, rather than get an additional 1 per cent, from war savings certificates.

Reference was made by the Leader of the Opposition to the compulsion that the Government proposed to bring to bear upon the private banks. Eoi- the larger part of his speech he declared that a voluntary effort on the part of the public would fail to attain the necessary response in the way of contributions to the war effort, and that the Government would not obtain sufficient money unless it resorted to compulsory loans, as proposed in the budget brought down by him. He said that the present Government was foolish to entertain the possibility of being able to raise the necessary funds without compulsion. Ho declared, in effect, that compulsion must be used in order to reduce the purchasing power of the poorer sections of the community. Then he spoke of co-ordinating the taxation proposals of the Commonwealth and the States, and providing for funds for post-war reconstruction ; but he suggested no provision for the post-waT period in those States where the highest State taxes are imposed. Although the Leader of the Opposition was willing to apply compulsion to the poorer sections of the community, he was not prepared to apply it to the private banks. He said, in effect, that they were the loyal people who would do the right thing by the nation in all circumstances. I remember the “ gentlemen’s agreement “ that was made with the private banks in the depression years. At least 90 per cent, of the people lived up to that agreement, but the banks themselves refused to do so. Does the Leader of the Opposition desire the same thing as happened in the last war to be repeated in this war? Does he wish to give the banks the free hand that they had in the last war? When the Empire was fighting for its existence, the private banks demanded £2 7s. 6d. per cent, for the flotation of loans - a service which the Commonwealth Bank rendered for 7s. 6d. per cent. The history of private finance is one of profiteering, and even of the doubling of its resources in war periods and at all other times of national trial. The present Government will see that the operations of the private banks in that regard are well restricted. Private finance should not have an undue grip on the economic life of the country as the result of war. The budget merely announces that certain regulations will be issued; later, certain legislation will be brought down, which Parliament will be invited to approve. The Leader of the Opposition objects to the financial control of the Commonwealth being placed in the hands of one man, but I point out that the Treasurer in exercising control over hanking will be responsible to this Parliament. He will function merely as an instrument for giving effect to the policy of the Government. The suggestion that the Treasurer will be made a dictator is so much hocus pocus

Provision has to be made to meet the huge financial burdens arising from our war activities. Our men are fighting overseas, and some will possibly have to fight on the shores of Australia, but we cannot expect the members of the forces and their dependants to do all the paying. If big companies are left with their possessions after the war, and are able to carry on their investments and industries in a free country, they ought to be well satisfied. Most citizens say that they will be content if, after the war, their present property is intact. Then why should the big companies be allowed to get away with their present gains as the result of wartime profiteering? If one traced the financial history of the Broken Hill Proprietary Company Limited, one would find that its paid-up capital does not exceed £5,000,000. But its present capital amounts to £25,000,000 and is it to be allowed to make a profit of 8 per cent, on £25,000,000 before war-time profits tax is imposed? Yet small companies which began operations only a few years ago were to have been taxed by the Government of which the Leader of the Opposite was the head, whilst .big companies were to escape the tax.

Mr DUNCAN-HUGHES:

– Australia is fortunate at present to have companies such as the Broken Hill Proprietary Company Limited. The small companies are not of so much importance to the country.

Mr LAZZARINI:

– I expected that retort from the honorable member, who, perhaps, regards himself as one of the “big” men.

The Government has tried in its budget to do what the Labour party has all along said that it would do. We must maintain the morale of our people, and therefore we must maintain the standard of our social services. Nothing has been so favorably com mented upon in this budget, by Labour supporters and others, as the increases which have been granted to soldiers and their dependants. I trust that this is but the beginning of that new order of which we hear so much, but to which many people are prepared to give no more than lip service. Whenever a practical suggestion is put forward for the improvement of social standards, honorable members opposite protest that the time is not ripe. We say that the time is ripe now. Therefore, we shall proceed step by step with our programme for social betterment and banking reform as outlined by the Treasurer in his budget speech. No one expects that we shall be able to transform the whole monetary system in 24 hours, though the Leader of the Opposition seemed to suggest that we were failing to honour our promises because we had not done that very thing. The budget has the approval of the great majority of the people of Australia, and I am confident that it will be accepted by this committee. The Government is faced with serious problems, as was the last Government, but in this budget an attempt has been made to face our difficulties courageously. The Government’s proposals will be revised, extended, or amplified as the needs of the country, and the general war situation, demand.

Mr HUTCHINSON:
Deakin

.- I was interested to hear that this budget was regarded by the Government supporters as a temporary one only. I am sure that they are correct in that. So temporary is it that, before many months have passed, it will have to be recast entirely, if it is to meet the war situation as we on this side of the House see it. We, who now sit in opposition, have been the realists ever since the war began. A little over six weeks ago, the Fadden Government introduced a budget, which represented its ideas of how the war effort should be financed during the succeeding twelve months. I said at the time, and I still believe, that it was a practical budget. I believe that the present budget is utterly impracticable. The Fadden Government was defeated, and honorable members on this side of the House naturally assumed that, whatever differences of opinion might exist as to how the war was to be financed, the incoming Government would at least give some indication that it possessed a national outlook when it set about framing its budget. This war concerns every body, because every section of the people has a great deal at stake. Therefore, any financial proposals, it was expected, would be on a graduated scale that would ensure that the burden would be spread equitably over all so that the rich would pay the most, but with some regard to fair play and the obligations of each section. When the Leader of the Opposition - now the Prime Minister - moved his amendment to the Fadden budget, he used the words “ True equality “, and “ ensuring an equitable distribution of the burden “. His whole objection to that budget was based on the allegation that it did not distribute the burden equitably. Now, however, when he and his party are in power, they make no attempt to distribute the financial burden equitably. Instead, they have taken a miserable, party view; they have attempted to achieve popularity, and have failed entirely to face the realities of the situation. So far as direct taxation is concerned, all increases have been placed upon those receiving the higher incomes, and the effect will be to hamper initiative and to destroy the basis of voluntary lending. The natural tiling for a treasurer, when considering the framing of his budget, would be to ask for data regarding the distribution of Australia’s national income. Any treasurer who did so would discover that persons in receipt of incomes of over £.1,000 a year receive £95,000,000 of the national income. Those earning between £400 and £1,000 a year receive £145,000,000, whilst those earning less than £400 a year receive £560,000,000. It is apparent from those figures that the money needed tofinance the war effort cannot be obtained from any one section of the community. Even if the Government were to take all of the income of those receiving over £1,000 a year, and all of the income of those receiving between £400 and £1,000 a year, it would still not get enough. Obviously, therefore, unless we are to embark on wholesale inflation, those classes which receive in the aggregate the largest share of the national income must, sooner or later, be called upon to contribute. The national income of Australia is probably better distributed than that of any other country. The number of persons earning in excess of £5,000 a year is only 2,100. Those who earn between £2,000 and £5,000 number 11,500, whilst those who earn between £1,000 and £2,000 number 32,000. Therefore, it should be plain to any treasurer that a limited number of persons who earn only a small proportion of the national income cannot finance the war without disturbing their fixed obligations, and this, in turn, must necessarily disturb other fixed obligations throughout the whole economic structure. Yet it is this small group that the Treasurer proposes to hit so hard, while entirely exempting those persons with incomes below £1,500 a year. Even if we admit the argument that persons earning £200 a year and less ought to be exempt, surely it is only reasonable to expect that those who earn from £500 to £1,500 a year should be called upon to make some additional sacrifice. Unfortunately, the aim of the present Government has not been to achieve equity, but to further party interests and to gain cheap popularity at a time when the people of Australia are looking for a high degree of statesmanship. On the first page of the budget statement presented by the Fadden Government these words occur - . . to promote the diversion of resources from civil to war purposes.

In the budget presented by the present Treasurer there is this statement which contains almost identical words -

Labour’s war policy is to expand the war effort to the maximum, and to do this by using all unemployed who are physically fit, and diverting labour and resources from civil to war purposes for the balance.

At a time when hundreds of thousands of men and women are engaged upon war production - upon the creation, if you like, of the means of destruction - it is necessary to devise methods to ensure that civil goods will not be bought in such large quantities as at present. Only in that way can we release man-power for war purposes. The Fadden budget provided for the levying of compulsory loans. The purpose behind this was not only to raise money to assist the war effort, not only to provide a fund upon which thousands of people would draw for the purpose of post-war reconstruction, but also to curtail purchasing power among all sections of the people, and thus divert labour and material resources to the more active prosecution of the war effort. The present Government professes to have the same object in view, but even a superficial examination of the budget convinces us that it cannot possibly achieve this end. The Government cannot achieve its proclaimed purpose when only a few thousand people in Australia are penalized, and the great bulk of them are left free to spend as they like, although the national income will, in all probability, be again increased by £100,000,000, the greater proportion of which will find its way into the hands of the masses. The Government is giving additional purchasing power to the people at the very time that it advocates a diversion of resources and man-power to the purposes of the war. We know that during the last eight months the retail turnover in all capital cities has increased tremendously, in some instances by almost 50 per cent. In order to satisfy this increased demand for civil commodities, there must be increased factory activity, and a greater number of men engaged in production for civil consumption. This must necessarily retard the war effort, and I defy the Treasurer to prove the contrary. Sooner or later, the Government must face the situation, and realize that it can no longer continue to work for party interests. It must set an example of statesmanship for which the people are waiting.

The Government has said that it will rely upon the voluntary system for raising loans. I remind the Government that we cannot win this war by applying the methods of 1914. We must adopt the methods of 1941. It is pure humbug to suggest that we can finance the war by voluntary methods which were adequate during the last war. Before long the Government and the public will realize that the system of voluntary loans has been a failure. There is a gap of £137,000,000 to be bridged. The Government proposes to expend £324,000,000 during the year, but the revenue which it expects to raise will be short of that amount by £137,000,000. Expenditure will be greater next year because the Government contemplates increasing the rate of the invalid and old-age pension. It expects to bridge that gap by means of voluntary loans. If that method should prove inadequate the only alternative will be inflation by the extension of bank credits. At the same time the Government proposes to hit as hard as possible the investing public. People in the higher income groups constitute the major proportion of those who contribute to voluntary loans. The Government cannot have it both ways. If it hits the investing public hard it cannot expect them to contribute towards voluntary loans as in the past. I am extremely doubtful that from the masses of the people, where the bulk of the national income really lies, the Government will be able to obtain anything like the additional £137,000,000, because as it goes down the income scale, it gets away from the investing group and enters the spending group. The Government may stage its great displays; Ministers may speak over the radio; voluntary loan campaigns may be organized ; rallies may be held in Martin-place, Sydney and in Collins-street, Melbourne; but I believe that the appeal to the people to bridge the gap by voluntary subscriptions will be in vain. This is not the time to resort to the methods of twenty years ago. We are faced with a new situation. In this war Australia has to find not only men with rifles, but also a multitude of other things. To-day a man may be placed in charge of an aeroplane which costs £40,000, or he may be equipped with a gun which costs, not a few pounds, but £8,000 - double the price of a Rolls Royce motor car. The expenditure on war under modern conditions is enormous, yet the Government believes that by the methods of 1914 - voluntary loans - it will get the money it needs to prosecute the war. I say that it will fail. I prophesy that the Government will fail to” close the gap between income and expenditure and that eventually it will be forced to admit the need for either a scheme of compulsory loans or the introduction of inflation on a scale hitherto unknown in this country. I predict that the Government will eventually be forced to adopt the Keynes compulsory loan plan. I prophesy that the Fadden budget will be vindicated, and that these things will come to pass, not in the distant future hut within a few months. As a result of its experience the Government will be forced either to adopt the Fadden Government’s plan or to resort to wholesale inflation. When the Fadden Government’s compulsory loan plan was before this chamber, the honorable member for Barton (Dr. Evatt), who is now Attorney-General, said that it contemplated piling up postwar debts. I am sorry that the honorable gentleman is not now in the chamber, but I hope that when he speaks in this debate he will again refer to this subject. His idea is to raise money by voluntary means and, I presume, to pay market value for that money, or else to induce the people to expend their savings in purchasing war savings certificates. The Fadden Government’s idea was to establish post-war credits and to pay simple interest on them at 2 per cent. That may be called creating post-war debts if the honorable gentleman so desires, but does not the method now contemplated also mean the creation of post-war debts? Whether the money be obtained compulsorily or voluntarily, it will constitute a post-war debt. The only difference is that under the present Government’s proposals the rate of interest will be greater than under the methods of the Fadden Government. Therefore, the charge made by the honorable member for Barton applies with equal force to the proposals now before the committee, apart altogether from the higher rate of interest involved.

The national income now in the hands of the masses is, as I have said, about £560,000,000. It will grow as the months pass. Nothing, however, is contemplated in this budget to tap directly that enormous purchasing power, or to redeem the promise of the Government to divert man-power and resources from civil to war needs.

The budget now before the committee contemplates increased sales tax and excise duties. Experience teaches that sooner or later indirect taxation leads to rising prices. The Government cannot penalize companies and individuals by means of heavy direct taxation and also unload on them additional taxation in the form of sales tax and excise, and expect them to bear the double burden. They cannot do so, and therefore I say that by adopting the methods proposed in this budget, particularly in respect of the sales tax, the Government is encouraging an inflationary process which, indeed, is even now apparent. If this vast amount of money is to be left in the hands of the masses of the people, and if additional indirect taxation is to be imposed, it must have an effect on prices. What will happen if thousands of Australians are withdrawn from producing goods for civil consumption? The system of price control will not achieve its objective, because if the quantum of goods for civil consumption declines, and if prices be fixed at low levels, there will be a shortage of goods at a time when the purchasing power of the people is greater than before. Therefore, I say that before many months have passed, the Government will have to face the prospect of rationing. As the Government will presently discover, a system of rationing which will inflict no undue hardship upon any particular section of the community is most difficult to put into practice. Although petrol rationing has operated since October, 1940, honorable members have had ample experience to convince them that the plan is not yet functioning smoothly and with reasonable equity. At question time they still bring to the notice of the Minister instances of the hardships caused by petrol rationing, and he assures them that he will examine the problems, and endeavour to perfect the scheme. If the Labour Government be forced, as it must be forced, to ration a wide range of goods, tremendous problems will have to be overcome in an endeavour to make the system operate equitably, and administrative costs will soar. By the methods which it has adopted in the budget, the Government has made the rationing of goods a certainty. It is serving not the needs of the nation but political ends.

Generally speaking, post-war reconstruction is spoken of more by honorable members opposite than by honorable members on this side of the chamber. Personally, I take the view that we should first win the war before we grow expansive on this subject, but we believe that we shall win, and we foresee immense problems in the post-war period. In the Fadden Government’s budget, the compulsory loan plan provided moneys for postwar reconstruction. The proposal was to take, as loan, 20 per cent, of the money which companies allowed for depreciation, or what was left as undistributed profits. That money would have been returned to them after the war, in order to enable them to adjust themselves to the altered circumstances. .But all of the methods outlined in the Fadden budget to achieve that worthy end have been eliminated from the Chifley budget. Post-war reconstruction has evidently become a problem to be tackled at some distant date. In penalizing the investing public, by taking from them the wherewithal to cope with postwar problems, the Government has committed a grave error. It will add immeasurably to the difficulties of the post-war era, when unemployment will again demand the attention of governments. For those reasons the budget is not a good one. It has failed in almost every respect. If the Government sought to win cheap popularity, perhaps it has succeeded; but the budget fails to face up to the realities of the war situation and its many shortcomings will become evident to the public during the next few months. It is not equitable. It contains no provision for the diversion of man-power and resources from civil to war industries. Its reliance upon voluntary loans to bridge the gap of £137,000,000 is definitely a mistake. The money will be found either by resort to inflation through the Commonwealth Bank, or by the method proposed by the Fadden Government.

All honorable members and the public agree that the big financial institutions of Australia should be not permitted to make exorbitant profits out of the war effort. The Fadden Government reached an agreement with the trading banks which ensured that they would not make undue profits out of the war.

One of the principal clauses of the agreement provided that the trading banks would make available by way of deposits with the Commonwealth Bank all surplus investable funds accruing in their hands. The deposits were to be made at such low rates of interest as would preclude the trading banks from making excess profits out of war conditions. The rates were to be fixed by the Commonwealth Bank from time to time. If honorable members read the various proposals for control which were contained in that agreement, they will find that the Commonwealth Bank was to be the dominant factor in ensuring that the Australian people would receive fair play at the hands of the private banks. As the people’s bank, the Commonwealth institution was to be the overriding and guiding authority. The object of the Commonwealth Bank is to play fair at all times with the people, and to provide and retract credit according to national needs. The present budget, which also proposes to control private banks, contains phraseology almost identical with that of the Fadden budget. The ‘Commonwealth Bank is to hold all excess investable funds belonging to private banks; but the important difference is that the deposits with the Commonwealth Bank are to be on a basis to be determined by the Treasurer. There lies the great danger. I invite honorable members to study this proposal as set out in the Fadden budget, and in the Chifley budget. Under the Fadden budget the Commonwealth Bank and the trading banks agreed to proceed in a certain manner for the duration of the war on a basis to be determined, but the supreme authority was always to be the Commonwealth Bank. The Chifley budget provides that the Commonwealth Treasurer shall wield supreme power. Banking is not such a simple business that anybody who steps overnight into the position of Treasurer of the Commonwealth can become instantly familiar with all its ramifications. Banking is a highly complex business, and the Commonwealth Bank employs officials who, over the years, have been carefully trained in banking practice. In deciding to leave this control in the hands of the Commonwealth Bank, the Fadden Government acted wisely. Unfortunately, the Labour Government refuses to profit from this example. The Labour party is anxious to introduce its wonderful system of socialization, which, according to its disciples, will usher in the millennium. Socialization reduced the people of Russia to conditions of utter poverty, from which they emerged only by deviating from the principles of socialism. The Labour Government is placing the banking system of Australia in the hands of the Treasurer of the Commonwealth, a man with no wide knowledge of banking or business methods. That is a strange method to adopt.

Mr Harrison:

– It is a strange party.

Mr HUTCHINSON:

– It is a strange party indeed which suggests that the Treasurer, whoever he maybe, and regardless of his qualifications for the position, can direct the banking system better than the men who control the Commonwealth Bank. In this new proposal lies a definite danger to the people, because banking policy may be interfered with by the Treasurer. Such a policy has not been contemplated by the people, who know its dangers. Most decisively, they rejected in the past the political control of banking. A large section of the Labour caucus believes that all one has to do in order to obtain money is to take it from the Commonwealth Bank; but nothing can damage the individual or the community more than any act to rob the banking institutions of the confidence of the people. The Labour party, which is now walking on dangerous ground, must be careful how it proceeds. I trust that it will exhibit qualities of statesmanship, instead of pandering to large sections of the people in order to gain cheap popularity. This chamber had already pronounced its decision as to whether the Labour party or the coalition of the United Australia party and United Country party should present the 1941-42 budget. From the press honorable members have already learned that the Government has the numbers to secure the passage of the budget. It is not the object of the Opposition at the present time to arouse party strife.We have had enough of that already. But we believe that the methods of the Government are wrong and that the fundamentals underlying war finance have been deliberately avoided. For that the Government must take full responsibility. The Opposition does not. If the Government wishes to gain political popularity at the expense of the war effort it is at liberty to do so. The Opposition will not. If the Government chooses to face the present situation in an unrealistic manner, it can do so. We shall not.

Mr Francis:

– We caution and warn the Government that its methods are wrong.

Mr HUTCHINSON:

– That is so. Sooner or later, the Government will be forced to admit the wisdom of the Fadden budget. We sincerely hope that the Government, in its attitude towards other matters, will exhibit more statesmanship than it has with its budget and will appreciate that reality and courage are the two qualities most needed to-day if Australia is to emerge successfully from a period without parallel in its history.

Mr ARCHIE CAMERON:
Barker · ALP

– A few unusual happenings have taken place in the Australian Parliament during the last twelve months.After a long period in opposition Labour is at last occupying the treasury bench. It is true that Labour is about twelve months late in taking office, but better late than never. Having assumed office on the defeat of the infant Fadden Government - which did not survive its first bath by thenurse preparatory to being placed in the cradle - the new Government has signalled its accession to office by bringing down a number of measures which embody Labour’s financial policy. Many honorable members on this side of the chamber cannot but believe that there was a certain amount of reluctance on the part of the Labour party during the last twelve months to assume the responsibilities of office. What sticks in my mind pointedly is the fact that when the Swan by-election was held in December last no effort was made by the Labour party to secure the Swan seat. Honorable members opposite did not then desire the responsibilities of office. The present Prime Minister (Mr. Curtin), knowing at that time that the gain of one additional seat would give Labour a majority in this chamber, was unwilling to assume the reins of office and to accept responsibility for the control of this country.

Mr.Marwick. - It was a wellorganized by-election.

Mr ARCHIE CAMERON:

– It was the worst organized by-election that Labour has ever fought. This budget is important; the present military situation is without precedent in the history of this country and the best test that can he applied to the budget is to examine how it squares up to the needs of the military situation overseas and the needs of the defence situation in Australia.

Mr Sheehan:

– It meets those requirements very well indeed.

Mr ARCHIE CAMERON:

– With great respect to the honorable member, it does not. The whole foundation of this budget is voluntaryism - we may enlist if we like, we may save if we will, we may work if we want to, and we may do this or that if we choose. This is not the first time I have had to tell the committee that we shall not get through this war on the voluntary system, whether it be applied to borrowing, to enlistment, or to anything else. Since the outbreak of the war the whole basis of our industry has had to be changed, and here, quite clearly, I came up against the policy of a former government of which Iwas for a short time a member.

Mr Hutchinson:

– A distinguished member.

Mr ARCHIE CAMERON:

– Not distinguished except, perhaps, by the number of occasions on which I disagreed with what was being done; but I still stand where I stood then, and I repeat that we cannot get through this war on the voluntary principle. The Treasurer (Mr. Chifiey) may plead as much as he likes, but he will not get out of the spending power that he leaves in the hands of 70 per cent. of the people the voluntary loans he requires. The money can be got only by applying the principle of compulsion. The last government proposed to get it by what it was pleased to call post-war credits. I was not enamoured of that proposal. From the Government’s point of view it was a post-war debt. It was never a credit as far as the taxpayer was concerned ; it was merely one of those little political artifices which, to some people, mean a lot,but do not mean much to the a verage elector, who is not so stupid as not to know the difference between something which is owed to him and something which he owes to somebody else. In principle the compulsory savings scheme of the last Government had much to commend it, but I doubt very much whether it would have run the gauntlet of the High Court. I believe it was utterly unconstitutional. If plain English and the law coincide, one section of the Constitution means that the people of one State may not be treated differently from the people of any other State. The whole basis of the compulsory savings plan was that, for the purposes of arriving at the national contributions of the taxpayers of a State by way of tax and post-war credit, regard was had to the taxes imposed by the State, which were not a Commonwealth but a State responsibility. In plain English, it meant that the lighter the taxes imposed by a State the more the taxpayers were to be “ socked “ by the Commonwealth. Although we have got over the difficulty in connexion with the compulsory savings plan for the time being, the present Government, if it remains in office - and I do not think any honorable member on this side of the chamber wants to play party politics in this matter - will have to find the means to undertake the military responsibilities and obligations that confront it. The test that we have to apply is whether the war organization of this country is assisted by the present budget. I am sure that it is not. Certain features of this budget are, to my mind, not indicative of a very happy future. We have seen a desire on the part of the Labour party to increase social services in time of war. Before the outbreak of the war I said from my place on the other side of this chamber that in time of war social services should not be increased. I said, further, that, in time of war, we would not be able to maintain arbitration court awards and conditions. I put it to the committee that if things go wrong, as they may do in the Far East in the near future, the Government will he up against conditions that will cause it to alter its methods and plans in regard to the internal conduct of the life of this community.

Mr Falstein:

– The Imperial Government has increased social services since the outbreak of the war.

Mr ARCHIE CAMERON:

– I am not condemning the Imperial Government. Unlike Marc Antony, I am not here to bury Caesar; I am here to deal withthings as they are in Australia. The Government which believes that it can go ahead blindly andgaily increasing the rate of pensions and widening the field of pensions and at the same time organizing munition works, building navies and’ air fleets, has a lesson to learn.

Sitting suspended from 6.15 to 8 p.m.

Mr ARCHIE CAMERON:

– We should look at this budget from the viewpoint of the war in which we are engaged, and from the beginning of this war it has been understood by everybody in this country - or, at any rate, it ought to have been - that we are engaged in total war, and it is only by total war organization that this country will beable to meet the onslaught which it must meet sooner or later. We have seen the excellent example over the last four or five months of two total powers at total war against each other, Germany and Russia, in each of which countries total war organization has been the rule. We have also seen the excellent examples, and tragic ones too, of Germany at war against countries which did not believe in total war organization. Whilst from our point of view the Russian war might not be a particularly good one, the Russians having not yet won a major engagement, nevertheless Russia has been able, on account of its total war organization, to put up a more prolonged and stiffer resistance than was put up by Poland, Denmark, Norway, Holland, Belgium or France. In every consideration of this budget, we must view it from this standpoint: Does it assist in producing that total war organization which is necessary in this country? Does it produce more men for the Army? Does it produce more men for the munitions factories? Does it produce more munitions? Does it produce more and better supplies ? Does it produce a better transport system for this country? Those are things that are vital to the Commonwealth of Australia to-day, and I say that the only answer to each of those questions that one can give is, “ No “. Much as I regret having to say it, I must tell the Government and the country that this budget does not provide more of those things which are necessary. It does not provide for more men, more munitions, more supplies or more transport.

In any total war effort, we have to pay some regard to equality of sacrifice. Like the Scriptures, equality of sacrifice is something of which we have heard before ; that is nothing new in this country; but my understanding of the political foundations of democracy is that there must be equality of opportunity and responsibility, and, when called for, equality of sacrifice. Up to date, we have not had a proper application of any one of those principles. All that this budget does is to ask the maximum sacrifice from one section of the community, but from 70 per cent. of the people no income tax increase is asked for at all. When it comes to a question of equality, let me tell the committee, there is no equality of sacrifice when we compare men on increased wages in munitions factories and other factories and transportation services, and so forth, not engaged in the munitions industry, with the men in the Middle East, prisoners of war in foreign lands, men who are standing up to the tropical conditions of Malaya, and at the outposts at Darwin, New Guinea and the islands. There is no equality whatever between the sacrifices that the men overseas are making, and the sacrifices which the Government should ask the men in Australia to make.

Mr Pollard:

– The honorable member says nothing about profits.

The CHAIRMAN:

– Order ! The honorable member for Ballarat (Mr. Pollard) must cease interjecting.

Mr ARCHIE CAMERON:

– I do not want to restrain the honorable member because out of every mill we have to get bran, flour and pollard. My friend is very vocal and I know that there will he two-way traffic between us. He can look after himself, and I do not wish to restrain him. Indeed, I give to him and his party the political advantage of this : no government, whether it be formed from this side or that side of the chamber, can go on inflating wages as they are being inflated to-day particularly in connexion with the manufacture of implements of war and commodities which are not of permanent benefit to this community. Shells and guns and things of that sort made during the war are not worth a rap to the community after the war is over. They represent expenditure which does not offer the least benefit beyond the protection of the country’s interests and standards. I said here, when the national man-power register legislation was going though, that in time of war the tendency would be to increase wages, profits, interest and expenditure, and that was a tendency that had to be checked. The time was not far distant when the Government of this country would be obliged to tackle the question of everrising rates of wages.

Mr Sheehan:

– Is the honorable member preaching socialism?

Mr ARCHIE CAMERON:

– Before I answer that question, my friend and I would have to agree on what socialism means, and we may not be able to reach that agreement. A budget which exempts 70 per cent, of the community from paying additional revenue is not a good budget. So far as that section is concerned, the Government says, “You need not pay any more. This is a country which supports voluntary principles. You may fight if you like, or you may take a job, which, under the manpower regulations, would exempt you from fighting. You need not pay more taxes or make sacrifices. Go your own sweet way.” The people of this country cannot go their own sweet way and win this war. It is totally and physically impossible for them to do so. Surely to Heaven it must be recognized that there are certain principles on which taxes are levied. We are not dealing with times of peace; all that lies ahead is stark war, and we want every penny of taxation that we can get, and just as we must face total war we must also face total taxation. The Government has got very close to that in regard to a certain section of the community, but it has hardly touched 70 per cent, of the community. Taxation should be distributed over the widest field. That is the first thing. In time of peace the Government would ask for the load to be the lightest because all it would need would be to meet its commitments, but in time of war the Government has to go to the other extreme, and ask itself what is the total amount of taxes that it can get from all classes of the community towards financing the war, and paying for it as we go. Believing that to be the test of this budget, we have to say that it does not stand up to the requirements of the Opposition. It goes without saying that we cannot get out of taxation the whole of the money that we require for war finance. So we are forced to resort to borrowing. I referred to this matter before the suspension of the sitting, and I do not want to go over the ground again, but certain provisions were made by the previous Government. I simply say to the Treasurer that before he is through, he will have to apply some form of compulsory saving, because there are several avenues of taxation which he has not attempted to open up. The one closest to my mind at the moment is an amusements tax. I have read that at the Melbourne Cup meeting yesterday, totalizator takings were a record. I have no doubt that if the bookmakers’ receipts were known, it would be shown that the gentlemen with the (bags also had a record day.

Mr Martens:

– Was the honorable member on the winner?

Mr ARCHIE CAMERON:

– No. I am not interested in horse races. The only race in which I am interested is the human race. In my own electorate, I have visited one or two country shows. At one big town there was a record show gate. I have been guilty of going to moving picture shows, not very often, because after going to one I am generally cured for six months. But I do see the gazettes occasionally.

If one walks around the streets of Melbourne and Sydney, one will see hundreds of people lined up waiting to see moving pictures in the daytime. Something is wrong with the state of Australia when that sort of thing goes on, and something is wrong with the Government when that source of taxation is not tapped. I said that to the previous Government.

Mr Martens:

– It was in office for a a long time and did nothing.

Mr ARCHIE CAMERON:

– The honorable member does not know all that I told to the previous Government. His ears would be quite pink, and he would have been delighted if he knew some of the things that I did say. Borrowing by voluntary means is not sufficient. No one would be such a foolhardy optimist as to believe that by voluntary means the Government will borrow every pound required in its borrowing programme. If the Treasurer and his colleagues in the Ministry think that by the 30th June next the voluntary borrowing programme will have been fulfilled, they are the greatest optimists that this country has ever seen.

In regard to taxation, there are other points that I could make, many of them minor points. For example, I do not think it worth whole to handle the mining and forestry calls as the Government proposes. I know that a new principle has been introduced in regard to married couples. The Book of Genesis says that they shall be one flesh, but this budget provides that they shall have one pocket. In that respect the Treasurer has gone a little further than the Scriptures. I am not sure that that is desirable.

Then there is the question of the banking system. This budget, whether we try to conceal it or not, is dovetailed into the banking system of Australia. The first thing that we have to require of the banking system is that it will ensure the stability of the financial structure of the nation. The Treasurer, I think, will agree with that. Before that can be assured, it will have to be recognized that national financial stability in relation to the financial system depends on the personal confidence of the people in the banking system. Being one of the hard-headed conservatives on these benches, I am one who thinks that we shall have to have a close scrutiny of the banking regulations which are to be brought down. There is no desire to obstruct the Treasurer in his duties, but there is an obligation on us to see that the financial stability of the Commonwealth Bank and the private banks of Australia is not interfered with in a way which would render their capacity to serve this country less than it should be. The Government requires the maximum amount in the form of taxes. If we put the test to the Treasurer: Have you submitted a budget which endeavours to secure the maximum amount of taxation? - the answer must be “ No “. The Government has not done that. Then there is the aspect of savings. The Government has asked the people to save. The Prime Minister himself has done so. Has the Government done everything necessary in order to secure the maximum amount of savings? The answer to that test when applied to the budget must again be “ No “. Then there is the important aspect of economy in expenditure. To the test: “Does the budget provide for the greatest possible degree of economy in expenditure “ ? - the answer must again be “No”.

Mr Rosevear:

– How can the honorable gentleman expect economies to be effected in three weeks?

Mr ARCHIE CAMERON:

– Five honorable gentlemen opposite have been closely associated with the Advisory War Council. I have never believed in that institution, and I do not believe in it to-day. Indeed, it would be a good thing if it were abolished forthwith. But, those members of the Government who were members of the Council have had a pretty fair idea of the financial structure of this country. I think that there are honorable members opposite, like the honorable member for Dalley (Mr. Rosevear), who, if they were on this side of the House, would not be 30 minutes in putting their finger on certain economies that could be made. I accept the statement of the Treasurer that as it is shown that economies can be made, they will be made. Economies have already been effected in two instances. The first is the saving of advertising expenditure by the Department of Commerce. I thoroughly agree with that economy. I am a primary producer, and I represent country interests. The advertising campaign indulged in by the Department of Commerce early this year was not justified; it was ill-timed, and the least said about it the better. The second economy which has already been effected, is the reduction of the vote for the Department of Information for the current financial year by £80,000. I am confident that our war effort could be conducted more effectively if that department were wiped out altogether. My candid opinion is that it is an absolute menace to this country. I say that after a close scrutiny of what it is, and what it does. Let us apply another test to the budget. Does the budget provide for the maximum degree of change-over from peace to war economy? Again, whether we consider land, machinery or men, the answer must be “ No “. The maximum changeover is not provided for. Very big problems will confront the Government in the immediate future. They must be pressing on certain Ministers to-day. For instance, there is the problem as to how best we can divert machinery, men, money, land and supplies from civilian objectives to war objectives under our present economy. Very big changes will have to be made. I do not intend at this juncture to deal with post-war problems. It is not for the reason that I am unable to go into that problem, but for the very good reason that this National Parliament must stick to the war problem and clean that up first. Then, it will be in a better position to tackle post-war problems.- Our war activities and our post-war problems cannot be dealt with simultaneously. We are going to have a few good hail-storms before the millenium arrives, so let us deal with the hail-storms first. At this moment Australia’s choice lies between social services or war services. I am convinced that we cannot attend to both at the same time. I was convinced of that fact before war broke out. In the course of war we cannot go on improving social services and, at the same time, provide the wealth, material and mcn required for the prosecution of war. Therefore, regardless of what political conditions may exist, or the repercussions of such a statement, I feel bound to say that I am not one of those who is enamoured of or over joyed at the increase of invalid and old-age pensions under this budget. Honorable gentlemen opposite can take whatever political advantage of that statement they wish. We must face up to the facts of war. Democracy can be led up a tree; but, sooner or later, we come to a dead-end, and then we have to face up to a few very awkward questions. It is rather interesting to look at the Government’s activities in respect of pensioners. The visit of Mrs. Huntress to Canberra recalls to my mind the story in Greek mythology of Diana, the Divine Huntress, who always got her stag. This time it seems, from what we have read in the press, that the Minister for Labour and National Service (Mr. Ward) was the barb that was used on that welldirected shaft. That incident, along with others in which the honorable gentleman has got himself entangled, make subjects for interesting comment; but I shall not go into them at this juncture. Later, perhaps, I shall .take an opportunity to do so. Whether this Parliament likes it or not our choice is between pensions and privations. The Government is increasing pensions. This House will agree to its proposals. The honorable member for Wimmera (Mr. Wilson) and the honorable member for Henty (Mr. Coles) have already said that they will support increased pensions and the Government has their unlimited backing. Australians must realize that, quite apart from being singed or scorched, we have not even yet been warmed by the fires of war. We have not had a breath of the flames of war in this country. To talk of improved social services, as foreshadowed in the budget, which builds up an expectation in the minds of hundreds of thousands of people which the Government will find great difficulty in fulfilling, is, to say the least, very unwise. It may not be popular at present to say things of that kind; but I have never worried about popularity in my political career. Popularity comes and goes. Usually one is popular when one least deserves to be, and unpopular when one deserves to be most popular.

I should like to make one or two observations on the war situation. According to press reports a German, Admiral Luetzow, advised the Japanese to invade this country. Admiral Liietzow is not altogether a babe in the wood. If he had any intimation to make to the Japanese he would have made it by other methods, most probably by cable. That message was not directed really to the Japanese nation; it was addressed to the Government and people of Australia. It was a try-out in order to see whether the Australian Labour Government would react favorably, from the German view-point, in one or two directions. First, Admiral Liietzow desired to know whether the Australian Government could be bluffed into bringing back the Australian Imperial Force to this country; and, secondly, failing a favorable reaction in the first instance, he wanted to know if the Australian Government could be bluffed into failing to send reinforcements to the Middle East and Malaya. I hope that there will be no weakening on the part of the Government in that direction. It was a tryout, and I hope that the Government will answer unequivocably that nothing that Admiral Liietzow, or any other German or Italian officer or statesman says, will deter the Commonwealth Government, or Parliament in its clear duty; that we shall maintain to the fullest possible degree the strength of the Australian forces in the Middle East and Malaya; and that we shall put into effect every measure that may be necessary in the immediate future to provide the reinforcements, munitions, supply and transport needed to keep those forces up to full fighting strength. To the Japanese people I think that there are some things which even private members of this Parliament are entitled to say. So far as I am concerned, every square inch of this country will be defended against any invader, no matter who he be; and I shall be in favour of using every bit of our wealth and man-power to resist any aggressor. We have heard very much lately about Russia’s “ scorched earth “ policy. Let me tell this Parliament that a real scorched earth policy was not carried out in Russia. If we are confronted with military attack in this country, I hope that a much more successful attempt will be made to carry out the scorched earth policy here than was the case in Russia. The budget is a glorification and entrenchment of the voluntary principle in this country so far as war service is concerned whether it be in the army, the munitions factories or in the field of transport Whether the Government likes it or not, it will very shortly be obliged to come face to face with the fact that its present methods will not produce the reinforcements it needs. The present lack of control of labour in industry will not keep men in the munitions factories where they are needed. They will be spirited away by better conditions and pay to other avocations which are not necessary. Honorable members opposite can call it what they like, complete control, conscription or compulsion, and they can damn me for advocating such a policy; but whether we like it or not we must face facts if we are to extricate ourselves from our present difficulties. Every man will have to be given his job to do. That will be the Government’s responsibility. I shall not throw any bricks at any government that implements such a policy. I shall give every ounce of my support to any government which goes to the country and says that it recognizes that our existing method is wrong, that there should not be three recruiting departments. Consider the waste. We have the Army competing with the Air Force.

Mr DUNCAN-HUGHES:
WAKEFIELD, SOUTH AUSTRALIA · UAP

-hughes. - And consider the waste of time.

Mr ARCHIE CAMERON:

– Recently, I attended a recruiting meeting at Mount Gambier. The hall was so crowded that one could not get standing room; but those present did not include ten men eligible for enlistment. The crowd consisted of elderly people and men who had served in the last war. For effect, the recruiting authorities had on display two Bren gun carriers and several motor lorries which had been sent down from Adelaide, and a young man who had returned from service in Malaya was featured on the programme. Alongside the hall where that meeting was held was a recruiting depot for the Royal Australian Air Force. The position to-day is that thousands of men are offering for the Air Force, and most of those who are rejected do not offer for the Australian Imperial Force. Those men are being lost to our military forces.

Mr Pollard:

– That system of recruiting was planned by the late Government which the honorable member supported.

Mr ARCHIE CAMERON:

– I know that. I am not condemning this Government on that score. I am simply indicating where improvements could be made - improvements which I remind the honorable member for Ballarat (Mr. Pollard) did not come to my notice only yesterday. So far as military service is concerned, there should be only one recruiting depot to which men could go for drafting to the Navy, the Army, the Air Force or wherever they are most required. If a recruit is a tradesman or has a certain degree of skill he should not be allowed to enlist in any branch . of the services unless there is a job for him to do in the class of work for which he has been trained. We are too short of skilled mechanics to have them drafted into ordinary infantry units. Their job is in the repair section, keeping work up to the mark.

Mr Brennan:

-Conducted and manned by over-age profiteers!

Mr ARCHIE CAMERON:

– The honorable member for Batman (Mr. Brennan) could, no doubt, nominate many of his friends for that job. He should be able to form the biggest repair squadron in Australia.

Sooner or later the principle of a central recruiting depot will have to be adopted. The Government will shortly inaugurate an eleven days’ recruiting campaign, but before that campaign starts I can inform honorable members opposite that its effect will not be worth mentioning.

Mr Pollard:

– That is subversive talk. Statements like that have a bad psychological effect on recruiting.

Mr ARCHIE CAMERON:

– The honorable member for Ballarat may call it subversive or anything else that he likes.

Mr Rosevear:

– The Chair should take action against honorable members making such statements.

Mr ARCHIE CAMERON:

– The Chair may do what it likes. I am not concerned about that. I have never been bluffed out of saying what I have wanted to say by the threat of action.

Mr Pollard:

– The Government of which the honorable member for Barker was a member wanted to put people behind bars for saying such things.

Mr ARCHIE CAMERON:

– There are some people who should be behind bars, but on the other hand some who are now behind bars should not be there.

Mr Pollard:

– The honorable member for Barker should be behind bars.

Mr ARCHIE CAMERON:

– I know perfectly well that some of my friends opposite think that I would lookvery well indeed behind barbed wire, and no doubt if the opportunity arose they would have their way, but as I have said on one or two occasions, I shall take a little catching.

We have to face up to the question of where we are heading in this war. Whether we are dealing with taxation, finance, banking, munitions, or menwe get back to the fact that we shall not get anywhere by pleading with people to do their duty. To achieve success in this war the Government must be able to command the man-power resources of this continent. Until that is done, it cannot make the grade. Therefore I say that from my point of view this budget - I concede that it has been hastily produced - does not measure up to the requirements of the situation. Threats have been made, largely by the Minister for Labour and National Service, that in the supplementary budget which is to be brought down in the near future there will be some good things which will be very pleasing to some of his friends, but not so pleasing to me and some of my friends. We shall have to wait for that eventuality, but sooner or later the Government must face up to its responsibility. The issue cannot be burked or avoided. It can be met only by stern, strong, and uncompromising measures. There is one final word of advice which I should like to tender to the Government. I say emphatically, do not compromise. I have too keen a regret over some of the events of the past few years, and I say to honorable members opposite, as I have said more than once io honorable members on this side, that a government which gives in on a question such as this ceases to govern. “What we need in this country to-day, whether it be from this side of the chamber or from the other side, is a government that knows its mind, knows its objective, and is prepared to go ahead.

Mr Collins:

– It must also have authority.

Mr ARCHIE CAMERON:

– It has the authority; if it has not, there is one excellent way to get it. I hope that it will not be necessary to go to that extreme yet, and that the degree of dependability of two members will measure up to the expectations of the Prime Minister. I trust that provision will be made in the supplementary budget for the conscription which I have advocated.

The CHAIRMAN (Mr. Prowse).The honorable member’s time has expired.

Mr BARNARD:
Bass

.- We have just listened to one of those excellent although somewhat temperate speeches by the honorable member for Barker (Mr. Archie Cameron) . At least the honorable member is consistent in his arguments, in some directions at any rate. There can be no doubt that he is a conscriptionist of man-power .and material, but it is questionable - he has never made it quite clear - whether he is a conscriptionist of wealth. There Ave see in the honorable member himself, one of the inconsistencies with which he charges honorable members on this side of the committee.

In his very effective reply, given on the day following the broadcast, the Prime Minister (Mr. Curtin), adequately answered statements made recently in regard to Australia by a German admiral. Those who have not read the Prime Minister’s statement should do so at the earliest opportunity. It was published in full in the press.

I do not wish to speak at length on the budget, but I may state that in general terms I agree with many of its excellent provisions. I refer particularly to the increase of soldiers’ pay and invalid and old-age pensions, and also to the extension of the scope of payments to invalid pensioners. I realize that the budget contains several severe taxation provisions. After all the criticisms by one section of the community that taxation is too high and by another section that sufficient use is not being made of bank credit, are only points of view. The honorable member for Barker criticized the Government because he considered that taxation was too high in some directions whilst certain people escaped their fair share of the burden. I suggest to the honorable member that that is not the case. Taxation on the lower incomes was increased substantially some time ago, and that increase has not been removed or reduced. After all, the more the workers earn at present, the more they have to pay. The merits or demerits of what a budget contains depend entirely on the method of approach. Labour’s approach is from one direction, and the approach by my friends opposite is from another. Therefore, it resolves itself into a matter of argument as to the proper type of budget, and its suitability to the occasion’ - peace or war. However, I. would say this: People generally are very wary of the views expressed by some honorable members who oppose the Labour party, to the. effect that we cannot afford to do this, and we cannot afford to do that; that we tax too highly, use too much credit, or indulge in inflationary practices and the like. Too many people have a clear recollection of the last war, and the depression which followed it to accept the worn-out bogy that it is dangerous to use the credit resources of the country. During the depression which followed closely upon the war of 1914-18, the workers were told that they had to tighten their belts because the national income had fallen and the nation could not afford to do certain things. We had the men, materials and all the necessary human facilities for doing whatever was considered necessary, but we were told thai certain projects could not be undertaken because they could not be financed. Now. however, we are in the midst of a war, and there is no question of a limit being imposed on the extent to which we can go in the use of men, materials, and the natural wealth of this country, in order to bring about the destruction of the enemy. In the face of such a contradiction the old theories can no longer be applied. I have the honour to be a member of the Joint ‘Committee on Social Security which has visited several States in recent months, and has heard many views expressed on social problems. The questionnaire which was sent to prospective witnesses asked, inter aiia. whether certain social reforms should be undertaken now or after the war, and we have been agreeably surprised at the number of people - ‘a very representative crosssection at that - who have strongly urged that important measures be introduced immediately. At least we should be planning for the reconstruction which must follow the war. We should be preparing for the time when our industries will once again be engaged in peace-time production. I agree with the honorable member for Barker that we shall probably have to encounter many severe hailstorms before we reach the millennium, and whilst I do not think that we can talk about the millennium at this juncture, we should be preparing for the day when the rehabilitation of our men returning from overseas, and the absorption in other activities of men and women now engaged in our munitions factories, will have to be tackled. That planning must be undertaken now if we are not to have a serious state of affairs after the war. It is no use trying to beg the question. I hope that the Government will give consideration to this matter now, and not wait until after the war. I agree with the necessity for an “ all-in “ war effort, but that does not necessarily mean that we can ignore entirely the fact that when the war is over we shall have to undertake immediately the immense task of transferring men and women back to their peace-time avocations. So, to those who are critical of the budget, severe as it might be, and to those who in the depression years said that we should have to tighten our belts, I say that they cannot have it both ways. Surely it cannot be argued by any process of reasoning that conditions to-day are the same as those which necessitated a tightening of our belts in the depression years. In those .days reduced wages and living standards were the bone of contention. To-day, we are faced with rising wages, yet honorable gentlemen opposite desire to apply the same process of tightening belts. What the previous Government was giving away with one hand it wished to take back with the other. After all, we must bear in mind that in peace-time it is the workers who produce the wealth of the country, and in war-time it is the workers who fight the battles of the country. We are told, on occasions, that certain individuals are doing organizing jobs at the top. An examination of the facts often reveals that even those individuals are workers who have risen from the ranks, and are now directing the planning and production programme of the country, so that its resources may be used to the best advantage. The time has passed for telling bogy stories about what should be done and what we can afford to do. The honorable member for .Deakin (Mr. Hutchinson) repeated this afternoon the old tale about the dangers of inflation, and suggested that the Government was about to embark upon a policy which would infringe the rights of the financial institutions and banks. He said that these institutions should be regarded as sacrosanct. The people are .sick and tired of listening to such remarks which, in my view, are often made with the object, of inflaming the public mind. Those who speak in this strain must think that the public has a very short memory, or is blind. People to-day are thinking about such subjects, and they are not unaware of the manner in which the huge expenditures of Germany, Italy, Japan and Russia are being financed. As they think on these matters they naturally compare financial procedure in those countries with similar procedure in this country. When the people begin to think the Labour party comes into its own., for it appeals to reason and not to fear.

I wish to deal now with the subject of rents, particularly for premises occupied by Commonwealth Government departments. This is not a new subject with me, as honorable members are well aware. I am reminded that many of the figures which appear in the revised Estimates now before us are identical with the figures which appeared in the Estimates introduced by the Fadden Government, and some of them require explanation by this Government, just as they would have required explanation by the Eadden Government. The Commonwealth is expending huge sums of money in rents. A great deal of this expenditure could have been avoided had the development of Canberra been proceeded with in a proper way. In this connexion I was glad to notice in an article which appeared in yesterday’s Melbourne Herald under the heading “ A new deal for Canberra “. It was written by a journalist in the Canberra press gallery, and I have no doubt that a good deal of the material in it was supplied by the Minister for the Interior (Senator Collings), acting in his official capacity. It is refreshing to know that we have a Minister for the Interior who is intent upon developing Canberra in a proper way. In that article Senator Collings is reported to have said -

I will admit the problem presents difficulties. The first is to find office accommodation. Every part of every public building is closely congested already. Still we are squeezing them in. Some properties are already being rented. We are pushing on with the completion of Melbourne buildings at Civic Centre at a cost of £00.000.

He also observed -

Canberra is probably the only city in the world which shows such a return on its capital cost. The “ white elephant “ is, in fact, paying some £350,000 on its fourteen millions - a matter of 2$ per cent. - and this from essential services: water, electricity supply, sewerage and rents.

If the development of Canberra had been proceeded with reasonably, a great deal of the money now being expended in the rental and maintenance of premises in State capitals could have been saved. Following is a list of some of the items which appear in the Revised Estimates under the heading “Maintenance and Rent” for various departments: -

I hope that the Assistant Treasurer will take careful note, mentally or otherwise, of these details, for I expect to have an explanation furnished to me in each case when the detailed estimates are under consideration. The large increase of expenditure in respect of the Department of National Service is a particularly glaring case, though it may be that a satisfactory explanation can be made. We have been told that severe pruning will be applied to the proposed expenditure of the Department of Commerce and the Department of Information. I suggest that there is probably justification for severe pruning in several other departments. I desire to know where and why the amounts that I have mentioned are being spent? Not long ago there was a storm in a teacup concerning a proposal to provide certain additional temporary office accommodation in Canberra. Objection was taken to the Government’s proposals because they were not in harmony with the Griffin plan.

Mr Martens:

– And the Government of the day ran away from the issue like a lot of school kids.

Mr BARNARD:

– The honorable gentleman has aptly described what happened. It was said that the buildings to be erected were to be of a temporary character, but an architect stated that they would last for 100 years. The Public Works Committee brought in an adverse report on the Government’s proposals and I knew nothing more of the matter until I read the report in the Melbourne Herald yesterday that the Melbourne Block group of buildings at Civic Centre was to be completed at a cost of £60,000. Had the recommendation of the Public Works Committee been adopted, building operations would now be under way on the foundations of the proposed permanent administrative block not far from this (building which are to-day a kind of enclosure for the growing of wattle trees and the harbouring of lizards. I am sorry that the Public Works Committee’s proposals was not accepted by the Menzies Government, but I hope that this Government will give far more attention than its previous predecessors have done to the development of

Canberra. The honorable member for Fawkner (Mr. Holt), who is sitting at the table, is not without blame in this connexion, for as the Minister for Labor and National Service he consented to that department being moved to Melbourne.

Mr Holt:

– There were not enough tents to accommodate the department in Canberra I

Mr BARNARD:

– The fact remains that as soon as the Labour Government came into office one department that had been transferred to Sydney was brought back to Canberra.

Mr Holt:

– What personnel was involved ?

Mr BARNARD:

– I do not know, and I do not care, particularly, whether the number was 10, 30 or 300. I am not concerned about the controversy between Melbourne and Sydney, and I would not be concerned even if Launceston were involved; but I am concerned about the true development of Canberra. The fact is that the department was located in Sydney, and the Labour Government transferred it back to Canberra. The Department of Trade and Customs sent members of the staff of its Lease-Lend branch to Sydney in order to establish head-quarters there. Yet we read in the newspapers that about £70,000 is to be expended at Canberra by the Government of tho United States of America on the provision of a legation for that country. Canberra should be like Washington. That city is not the national capital of the United States of America in name only; it is also the capital in fact. I am pleasantly surprised to learn that, despite the coldness of honorable members opposite towards Canberra and their opposition to its development when they were in power, the population of the city has now increased to nearly 14,000. I acknowledge that Ministers cannot always be in Canberra, because the nature of their business obliges them to visit other parts of the Commonwealth, and I shall have no complaints bo make so long as the Government treats Canberra as its head-quarters and conducts most of its cabinet meetings here. Unfortunately, the development of Canberra to-day does not depend only on the provision of money. The difficulty of obtaining materials and skilled artisans to perform developmental work has become acute. Work could have been undertaken in Canberra during the years of the economic depression, and funds could have been provided, as they were for other important public works. In spite of recent development, 400 people are still waiting to obtain homes in Canberra, and this Government is left with the problem of satisfying their needs.

The subject of voluntary loans for war purposes has been mentioned in this debate. I am aware that it is difficult to divert the flow of money in the community from normal peace-time channels to the channells necessary for the prosecution of a vigorous war effort. The Leader of the Opposition (Mr. Fadden) said this afternoon that the number of war savings certificates purchased during September was far below normal, although deposits in savings bank accounts had increased recently. He claimed that this proved that the voluntary system could not maintain an adequate flow of funds into the war effort. The honorable gentleman’s argument was unsound. During September, people were facing the threat of the compulsory savings scheme proposed by the Government then in power. Naturally, the sale of war saving certificates declined. The honorable gentleman said that residents of Canberra paid no State taxes. That is true. But he also said that they were not contributing as much money as they should to the war effort through the purchase of war savings certificates. I point out that during last week - since this Government’s budget proposals have been announced - war savings certificate groups in Canberra have doubled the amount of their weekly subscriptions. If that spirit can be inculcated in the minds of the people who are able to purchase war savings certificates, the gloomy forecast of the honorable member for Barker will not be realized, and the result achieved will be much nearer that contemplated by the Labour party than the one which the honorable member fears will materialize. The honorable gentleman is a conscriptionist. He wants to conscript man-power and impose compulsory loans on the lower income groups. He complains that the taxes to ‘he levied on the higher-paid people are too great.

Mr Archie Cameron:

– I did not say anything of the sort.

Mr BARNARD:

– Already there is an indication that people realize that all money that they can reasonably spare should be devoted to the purchase of war savings certificates or to contributions to Government loans. A very healthy sign of their outlook is the sudden increase of the rate of contributions by war savings certificate groups.

I support the new budget, and I hope that we shall not hear any more talk about inflation and about pressure being exerted upon the banks in order to take away their liberty and impose political control on them. Honorable members opposite apparently desire to create an atmosphere unfavorable to this Government.

Mr Holt:

– To suggest that we oppose the Government’s proposals in time of war merely for political purposes is im pu ting treachery.

Mr BARNARD:

– I do not wish to impute motives, but I have a vivid recollection of what the honorable member for Deakin said this afternoon on the subject of financial policy. If the honorable member for Fawkner (Mr. Holt) will read the report of the honorable member for Deakin’s speech, he will see how subtly it tended to create such an atmosphere. The honorable member for Deakin had a special motive - a motive that has always been apparent in the attitude of honorable members opposite whenever pressure has been brought to bear upon the banking institutions. I say deliberately that there is a growing opinion in the community that greater use should be made of bank credit, and that action to this end must be taken by the Government. The people have come to the conclusion that the banks have no right to continue to operate as they have been doing in the past. I hope that this Government will use national credit properly so that the community will no longer suffer from the machinations of the private banking institutions. The exchange of goods and services should benefit the people generally instead of the comparative few who have reaped profits from our economic system in past years.

Mr HOLT:
Fawkner

.- The committee is asked to make record budgetary provision for the war-time needs of Australia. When we on this side of the chamber first heard the terms of this budget, we considered that it was a. bad one. The more we investigate it, the worse it appears to us. On any impartial analysis it must be held to be a bad budget. I say this for three principal reasons. In the first place, it is a political budget. In the second place, it is an inequitable budget. In the third place, it shirks the basic problem of war finance - the problem of efficient production and the effective organization of the community for war.

It is a political budget because it sets out, at the expense of a comparative few, to provide favours for the great mass of people in the Commonwealth. It does not impose any increased burden upon this multitude, save by way of indirect taxes. When it comes to finance, the was effort is seen by this Government as a class war effort. It is an inequitable budget because it seeks to impose a financial burden, by means of increased taxes, upon about 20,000 individual taxpayers and upon companies which have played an important part in the nation’s development. Governments can reach a point - and this Government has already done so - at which they remove the incentive which has induced people to accept economic responsibility and create and develop business. We have made a bad approach to the problem of controlling the operations of companies when we have approached it from the viewpoint of profits. The proper approach is from the viewpoint of prices. The Governmentshould determine what is a fair price for a company to charge for its products. Then, if such a company can, by raising its efficiency and applying greater skill and energy to its problems, increase its profits, whilst at the same time maintaining a fair price to consumers, the Government should encourage its activities instead of endeavouring to stifle them. In time of war we look to industry for large contributions, in the form of loans and taxes. This budget shirks the basic problem of war finance - the diversion of civil production to war needs - because it makes no definite provision for the more effective organization of the community for the prosecution of the war and the production of munitions. In fact, in some of its aspects, it has increased the difficulties of solving the problem.

The problem which confronts this Government to-day is very different from that which we had to face during the war of 1914-18. This can be observed from a brief survey of the man-power requirements which we have set ourselves to fulfil to-day, in contrast with our obligations then. In 1914-18, Australia maintained five divisions of the Australian Imperial Force throughout the war. But in those days we had no home defence force of any consequence. In fact, the only home defence personnel were the permanent garrisons stationed around our coast. To-day, in addition to the Australian Imperial Force, we have accepted the obligation to maintain a force of about 250,000 men for home defence. In 1914-1S we had an air force whose numbers were negligible by comparison. To-day we have set ourselves an objective of about 70,000 men for the Royal Australian Air Force. 1’u 1914-18 we had a comparatively small naval establishment. To-day that establishment requires about 30,000 men. Similarly, in 1914-18 our programme of munitions production was of little consequence. About 2,000 men and women were engaged in munition production in Australia in those days., and, during the concluding phases of the war, Australia actually sent men and women to Great Britain in order to work in that country’s factories. To-day we have embarked upon the most ambitious industrial programme that has ever been contemplated in Australia.

Mr Menzies:

– Thanks to the efficient companies of the Commonwealth.

Mr HOLT:

– That is a major factor. We are accustomed to hear the Broken Hill Proprietary ‘Company Limited condemned and derided in this chamber. With some knowledge of the facts, I say that that company represents the backbone of our industrial production in this war, and has made possible the tremendous programme that we have accepted and are successfully prosecuting. Clearly, the problem becomes one of the diversion of our resources of both materials and manpower to the purposes of the war. That process has been proceeding very sucessfully since the outbreak of the war. In 1938-39, the number of wage and salary earners in the Commonwealth wac 2,126,000. In July, 1941, the figurewas 2,300,000, an increase of 174,000. *Ii** neither case does the figure include enlistments for the various services, or those serving in the Militia. With that addition, the total increase of persons working on war needs, whether in the fighting services or on munitions production, becomes approximately 450,000 persons. That is a remarkable achievement in a population of 7,000,000, approximately 3,000,000 of whom are of an age or in a domestic situation which enables thom to work; and it has been accompanied by comparatively slight dislocation of, or effect on, our ordinary civil life. Why has that been possible? Because we were able, in the first place, to absorb the great bulk of the unemployed. There was a decline of civil consumption in certain directions, due to the restrictions imposed on imports and exports and the rationing of particular commodities, which had the effect of diverting some labour to war needs. Because of the favorable industrial conditions operating, a number of retired and self-employed persons was attracted to war work. There has been, also, a movement of rural workers to war work - which has become really unhealthy. Then, too, a considerable number of women workers has been attracted. The natural increase has been in the neighbourhood of 34,000 persons a year. These different causes have enabled us to achieve this enormous expansion of man-power with comparatively little interruption of our ordinary civil life. It is clear now, however, if one examines the statistics and uses the evidence before one’s own eyes, that a really critical stage has been reached in the man-power situation in this country. This is due principally to the fact that, with the exception to some extent of New South Wales and Queensland, the unemployed have been almost entirely absorbed, and the movement into industry of retired and self-employed persons, and women workers, is not now proceeding at the earlier rate of progression. At the same time, our future needs of man-power are very considerable. It has been estimated that, if civil industry be permitted to expand merely at the same rate as that at which it expanded last year, the total man-power requirements for this year for the fighting services, war production, and civil production, will be in the neighbourhood of 240,000 persons. It is clear to one who makes correct deductions from the facts, that unless very rigid economic control be applied to the community in the very near future, the rate of expansion of private industry in the course of the next twelve months will be greatly in excess of that which took place during the last twelve months. There is evidence, to which attention has already been directed in this debate, of a greatly increased purchasing power in the community. This is stimulating private enterprise and industry, in order to satisfy consumer needs. Uncontrolled expansion of this kind might increase the maintenance man-power requirements to 300,000. We have been told that retail prices have advanced by 46 per cent. in Melbourne, 35 per cent. in Sydney, and 26 per cent. in Brisbane.

Mr Menzies:

– The honorable gentleman is referring to turnover.

Mr HOLT:

– Yes ; but there has been a considerable increase of prices. I believe that I have seen the figure 34 per cent. applied to retail prices.

Mr Curtin:

– Not over the whole field; it might be true in relation to clothing.

Mr HOLT:

– I have read that there has been an increase of 34 per cent. of the price of clothing in Melbourne.

Mr Dedman:

– In the general price index, covering all commodities, the increase has been very little.

Mr HOLT:

– I believe that 10 per cent. is the figure which the Prices ‘Commissioner released recently. There is other evidence of increased activity in civil production. One of the effects of this is already being experienced quite seriously in those establishments which are devoted to munitions production; because, with the decline of the manpower available for private industry, a degree of competition has developed for the resources of labour available. This manifests itself in the offer of more attractive wage rates or conditions. The result has been quite a dangerous movement of labour from munitions production to private industry. The Minister for Munitions (Mr. Makin) in reply to a question that I placed on the notice-paper recently, in which I asked to be told the number of employees in Commonwealth factories who had terminated their employment in each of the months July, August, September and October, advised me that the total figures for all States were, July 837, August 1,039, September 1,107, and October 1,273.

Mr Rosevear:

– Is the honorable gentleman aware that the movement was greater than that nine months ago?

Mr HOLT:

– If that be so, I take it that any reduction is the result of the policy put into effect by the previous Government, which restricted, by regulation, the movement of labour, prescribed the form of advertisement which employers could use, and required employers to notify the Department of Labour of any movement of labour to themselves in certain stated categories of craftsmen.

Mr Rosevear:

– All that I say is that that movement is lessening.

Mr HOLT:

– I shall not debate that particular point with the honorable member. The figures that I have quoted speak for themselves; they show that there has been a progressive increase in the months that I have mentioned. I do not think that the honorable member needs any assurance from me in order to be convinced that the trend already indicated by the figures I have given is likely to develop very much more rapidly in the future, because of the drying up of the resources of labour to which I have referred.

Mr Wilson:

– Would enlistments account for some?

Mr HOLT:

– From munitions establishments, only to a very small degree. I have mentioned the figures 300,000 and 240,000, depending on the rate at which private enterprise expanded. It must be clear to those members of the Government who are studying the problem that private industry cannot bc permitted to expand at anything like the rate which prevailed last year; because it is apparent that the effect must be a movement of labour to the detriment of the war effort as a whole.

Mr Dedman:

– Does the honorable gentleman consider that the budget of the Government of which he was a member would have prevented private industry from expanding?

Mr HOLT:

– Our budget, in conjunction with measures which the Government had in contemplation, would certainly have begun that trend. Certain aspects of policy were in operation which present Ministers display a tendency to either relax or eliminate altogether. At the request of the previous Government, the Tariff Board conducted an inquiry into certain industries which might he classed as less essential, having regard to wartime requirements. The newly-formed Department of War Organization of Industry also conducted investigations. I have no doubt that the present Minister in charge of that department is able to take advantage of a good deal of the data which was accumulated by his predecessor in that office. I am not approaching this particular problem from a party view-point. It is a very grave problem of administration, which has to be faced by whatever Government is in power if it is to administer the affairs of this country effectively in time of war. The object of my remarks is to bring home .to the members OI the present Government, if that be necessary, the gravity of the problem, and to indicate my view3 as to the means best calculated to deal with it. Assuming that rigid controls are applied to private industry, T understand, that the minimum figure which would represent the needs of the fighting services and munitions establishments in the year 1941-42 is 150,000. How are we to supply that number? If the widest estimate were made of the number of unemployed who remain to be absorbed, the result would be approximately 30,000. It might be possible to obtain from the ranks of the self-employed and retired persons another 20,000. The natural increase of the working population would probably produce a further 34.000, making the total approximately 84,000 persons. The only principal recourse which could be had, apart from those sources, would be to the ranks of female labour. At present there are approximately 280,000 unmarried women between the ages of 15 and 55 years. Only the gravest emergency would induce 70,000 of those to engage in work of the type that is offering, which is mainly factory work. An optimistic estimate might be in the neighbourhood of 20,000 or 30,000, leaving us with approximately 50,000 to be obtained from some diversion from civil production to war needs. How does the Government shape up to that problem? I mentioned earlier that in certain aspects of this budget it has accentuated the problem with which it is faced; because some of its measures will have the effect of stimulating purchasing power and thereby increasing tho pressure on the community for the supply of labour to meet consumer needs. The abandonment of the policy of compulsory loan3 will have that effect directly, and the provision of extra pay for soldiers also will have it to some extent. I aru not challenging that provision, other than to say that most of those men in this Parliament who took part in the last war, and thus had some experience of the matter, very strongly hold the view that the interests of the soldier would best be served by placing to the credit of his deferred pay the amount which the Government now proposes to add to his current pay.

Mr Curtin:

– Will the honorable gentleman concede that the increased yield of taxation will have the same effect as the proposed compulsory loans would have had, assuming the amounts to be identical?

Mr HOLT:

– I cannot concede that, for the reason that it is clear from a survey of the economic situation that the pressure is coming from the purchasing power of those persons who are in the under £400 a year group.

Mr Curtin:

– They are purchasing the necessaries of life. It was not proposed to curtail that expenditure, was it?

Mr HOLT:

– I understand that prior to the outbreak of war, tlie class receiving under £400 a year had an annual wage fund of £490,000,000. The amount has since been increased to £560,000,00. In our budget, of the increase of £70,000,000 we proposed to take approximately £10,500,000, £6,500,000 of which was to have been taken by way of compulsory loans. I do not think it could be fairly argued that there would be any serious reduction of the standard of living in the Australian community by a policy which took from an increase of £70,000,000 the sum of £10,000,000 for war purposes. I repeat that the failure to do that must accentuate the difficulties of the Government, in diverting labour and resources from the supply of consumer goods to the provision of war needs.

As to the invalid and old-age pension, all I have to say is that the increase of the pension may be good social justice, but it is bad war-time economics, because it stimulates the demand for consumer goods at a time when our attention should be directed to diversion, the necessity for which I have emphasized.

Now I turn my attention to one or two aspects of policy regarding which I consider that the Government, because of the action it has taken, has shown a failure to realize the significance and gravity of the problem which we have before us. The Minister for Trade and Customs (Senator Keane) a day or two ago reversed an item of policy which had been in operation under the last Administration in regard to the attitude of the Prices Commissioner in watching wage agreements between employers and employees. The last Government adopted a policy providing that where employers and employees caine to an agreement on wages, and where the employers sought to pass on to the community the additional cost incurred because of that agreement, the Prices Commissioner would permit them to pass it on only if the wage increase had received the approval of a judge or a conciliation commissioner of the Commonwealth Arbitration Court. The reason for that policy was to keep wages in line with the general industrial policy of the court and the Government, and to prevent employers and employees from exploiting the community to their own advantage.

Mr Holloway:

– That is only half the story.

Mr HOLT:

– I have no quarrel with the policy of the Prices Commissioner. I received in this chamber recently a memorandum from him which he had addressed to the Minister, and, regarding the policy set out by him, I make no challenge whatever. It is the policy which the last Government put into effect. But I understand, according to a statement published in the press, that the Minister has varied that policy in order to reach a settlement in two disputes, one affecting the brick, tile and pottery workers, and the other affecting clothing trade employees. I shall be very glad to hear that the Minister haE not reversed the policy adopted by the previous Government. A moment’s reflection would show the danger of such action, particularly in view of the fact that in the months ahead competition for labour will become progressively more acute than it is at present.

Another matter which 1 raised at question time to-day with the Minister for Labour and National ‘Service related to his decision to permit payment of the tradesmen’s rate to be made to fifth-year apprentices. The effect of that decision will be that youths aged nineteen and twenty years, in the fifth year of their apprenticeship, will receive £6 5s. as a minimum rate for a standard week’s work, and, in addition, payment at the rate of time and a half for overtime. That will mean an increase of their wage from £4 2s. to £6 5s. a week, exclusive of overtime.

Mr Holloway:

– That has been in operation for a long time.

Mr HOLT:

– I reminded the Minister for Labour and National Service to-day that this matter had been referred by me v.- hen I was Minister to Judge O’Mara with the request that he should act. a.a private arbitrator and give to the Government the benefit of an inquiry by him. Matters of this kind are not always as simple as they appear on the surface. The Minister preferred to twit me with the statement that he was able to make speedy decisions in such cases, but I point out that it is sometimes wiser to make sound decisions than quick ones. In my view, this particular matter required expert investigation, and the attention of somebody who had more time to give to it than I had. As one who has had some painful experience in these matters, I suggest that insofar as the Minister departs from the firm policy of having them considered and determined by the Arbitration Court, he will create industrial turmoil rather than industrial peace.

Mr Conelan:

– Did not the honorable gentleman see the report of the Manpower and Resources Survey Committee?

Mr HOLT:

– No; hut I discussed this question with the chairman of that committee, and he told me that it desired that fifth-year apprentices should be given training for work as tool-makers. I am not so much concerned with the actual decision, but the criticism I make is that there is a trend towards a policy of control other than through the Arbitration Court, and that such a policy is full of dangerous possibilities for the future. I say to members of the present Government that rather than relax any of the control 3 that were applied by the previous Government, it will be found essential to increase and indeed expand them. Those controls were comparatively simple, and were restricted to a relatively few members of the industrial community. The Government with which I was associated fixed a maximum rate of wage for the duration of the war, in respect of the skilled and other workers in the metal, trades group, subject, of course, to cost of living fluctuations. It also imposed certain restrictions on the movement of those classes of workers, because it was found in practice that that movement had a serious effect on production. I have read that approaches are to be made to the Government to have the present controls eliminated, but I consider that the Government will find itself driven to the point of having to make them generally operative throughout industry. Just before the demise of the previous Government, I had asked that the Financial and Economic Committee should investigate the desirability of recommending to the Government a general policy of maximum wage rate fixation, in order, not only to curb inflationary trends, but also to prevent movement of labour from war to civil production. All the evidence since that time confirms ray view that a control which will put a ceiling on wages will become imperative. Such a policy has already been inaugurated in Canada, and I believe that some form of control and regimentation over wage rates as well as over the movement of labour is unavoidable. The Prime Minister will only have his difficulties increased if his followers are to apply such political catchcries as “ Industrial Conscription “ to any action recommended to cope with this problem. There are other controls that the Treasurer will be exploring, and some of them have already been exercised through the Capital Issues Advisory Board. The previous Government intended to tighten up this control, and the present Ministry will no doubt also find it necessary to do that.

With regard to reserved occupations, there must be an early review of the present practice. Australia is, I think, the only Dominion which, since the outbreak of war, has introduced the policy of reserved occupations. It followed the British schedule, and was modified to meet our own requirements. The intention, in the event of mobilization in this country, was to see that there was no undue interference with industry. as a whole. Whilst reserved occupation schedules have had a useful effect in exempting skilled workers, they have provided a reservoir which has not necessarily been used in the national interests. This system reserves workers falling within certain categories, irrespective of the work being carried on by the persons in the reserved list.

Mr Holloway:

– Quite a wrong basis.

Mr HOLT:

– I agree that the present basis is wrong, having regard to the need for the diversion of many of these men to war work. If a man cannot be diverted to war production in the class of work in which he is skilled, some effective use should be made of his services for war purposes. Trends described as poaching and body-snatching are already observed in some of the States where the supply of unemployed has almost entirely dried up. Unless effective control can be exercised we shall bp brought to the point where the war effort as a whole must .suffer bv the departures of men now engaged in war production for employment outside, where they can get better wages and conditions, which will be paid at the expense of the consumer. The Treasurer said some time ago that he could control his credit policy if he could keep an iron hand on prices. I maintain, however, that preceding any such policy there must be an iron hand on wages. Wages are an important element in prices, and all the price control in the world will not have the effect of keeping prices down to a proper economic level unless wages are subjected to the same iron control. I make this comment, not with any desire to deprive the workers of a proper return for their labour, but in the best interests of the workers themselves. In their interests wages should be kept stable, so that the money they receive may represent a fixed claim on goods and services, not one that is subject to an inflationary economy which would deprive the worker of a proper return for his labour. It is obvious that the controls which I suggest will call for measures unpalatable to many sections of the community. It will require the wholehearted, patriotic co-operation of the industrial . movement itself, and the Government is in a position to command that co-operation. If the Government is prepared to adopt and put into effect those measures, however unpalatable they may be, that are necessary to the successful prosecution of the war, it will find us on this side of the committee ready to support it. We intimated that we would support the Government in any measures which would have the effect of increasing the security of the country, of providing for the welfare of the troops, and of making more effective the organization of this country for war. We were genuine in that offer. We meant that if the Government brought in the necessary measures, no matter how unpopular they might be, we would not attempt to make political capital out of any sectional discontent caused by them. Wc stand by that offer. The Government will be required to make an effort, not on behalf of the Labour party, not on behalf of the industrial movement, but on behalf of all sections of the community. Honorable members opposite have been charged with the responsibility of governing this country during the greatest crisis through which it has ever passed. We are facing, as Australians, a common peril, and it is our common duty to take such action as is necessary for the proper support of our comrades who are fighting our battles overseas. Any measure, the purpose of which is to make that policy effective, will have the full and sincere support of honorable members on this side of the chamber.

Dr PRICE:
BOOTHBY, SOUTH AUSTRALIA · UAP

.- Before dealing with the subject of this debate, I wish to make some remarks on the general war situation in the light of which we may properly regard the budget. During the last few months, Australia, in common with other members of the British Commonwealth of Nations, has been experiencing a lull in international affairs. Russia has been taking the knock. We have won successes in Syria, Iran and Iraq. The United States of America has been helping us more and more definitely. The position in the Atlantic has improved. The result has been to create a wholly unjustified “ don’t worry “ attitude in Australia, which has been reflected in our national life. What is the real position? Hitler is gambling in Russia for immense stakes, political, military and economic. He has already conquered a large part of Russia, including some of the most important industrial areas. It is believed that he plans to destroy communism, and to place on the throne of Russia a Gorman prince with a royal Russian wife. Then he will call a conference to establish a new European order. He will seek the co-operation of countries like Prance, which are wobbling, and like Spain, which detested the NaziSoviet alliance. If that conference is successful, he will bring the whole vast industrial resources of Europe against the British Commonwealth and the United States of America. Whatever our views may be of Hitler’s policy in the future, it must be admitted that he has already won successes so great that during this winter, or in the coming spring, we must expect fierce fighting in Libya and Syria, and possibly in Turkey, Iran” and Iraq. We have made preparations to defend India. The war is approaching us from the north-west and also, probably, from the north-east, lt is of no use blinding our eyes to the fact that Japan must have oil, and in order to secure oil from the Netherlands East Indies, Japan will make further aggressive moves at the most suitable moment. Turning to Australia, we find that the lull of which I have spoken has created a popular misunderstanding of the true situation, and in some respects a slackening of the war effort. One admits, of course, that for a country with a small population our war effort has been in many respects magnificent, but it has been rightly said that Australia is still half at war and half asleep. The fighting forces, their families, many of the workers in the factories, and many other helpers have done magnificently, but there are still thousands of people who simply will not realize that our national existence, our lives, our property and everything we value is at stake. The deficiencies in our war effort are having a disturbing effect on members of the fighting forces. One soldier, who has been fighting for months in the Middle East, wrote as follows, and his letter is typical of hundreds of others: -

The chaps here are tremendously fit and confident, but they almost spit blood when they read of strikes and demands for higher wages and of the inability to get recruits for the Australian Imperial Force.

That was written by a man in the ranks, a man with a wife and family in Australia. He was not worrying whether he would get an extra ls. a day, or whether it was to be in cash or in deferred pay. The great concern of such men is whether we have here in Australia a united nation and a united parliament engaged in putting forth a maximum war effort.

I propose to say a word now on the difficult subject of political co-operation. The Opposition has promised to give general support to the Government in regard to matters relating to the war. Had war broken out in the Pacific I think that the danger would have driven the parties closer together. There is no doubt that that is the desire of the Australian people, of our Allies and of members of the fighting forces. One of our soldiers recently wrote from Tobruk-

What can we expect when there is so much squabbling in that holy of holies, Canberra. The atmosphere would be less nauseous in a morgue.

It is for that reason that political cooperation in this Parliament is desirable, and that is why we hoped for a really inspiring and non-party budget. It is with these thoughts in mind that one turns to examine the budget. We have in mind the gravity of the overseas position, the need for a maximum war effort, and the need for a united and determined nation to engage in that effort When one examines the budget, however, one is conscious of some disappointment. It does not reflect the dangers of the position overseas. It does not assure the finance for a maximum war effort, and it. disregards the principle of equality of sacrifice. Hence one is afraid that it may not help to unite this nation or this Parliament at a time when the world is given over to total war, and. when the war is simply galloping towards Australia. With the example of France and a dozen other democracies before our eyes, the new Government has produced what I think it is fair to say is an unprogressive and rather lopsided budget. I am not exaggerating. The Government proposes to secure seven-eighths of the new money required for the war effort by a voluntary system which nearly all other democracies have abandoned under conditions of total warfare. The system is breaking down in Australia, yet the Government proposes to raise £22,400,000 by compulsory means, and £138,000,000 by voluntary means. With a disregard for the urgency of the situation, and the need for a maximum war effort, as well as a policy of equality of sacrifice, this budget almost ‘ completely conscripts the small part of the national income in the hands of those in receipt of incomes of more than £1,500 a year, while applying the voluntary system of contribution to the vast part of the national income which is in the hands of small recipients. In peace-time we could fairly congratulate the Government upon having brought in a very shrewd political budget. It is shrewd in its promises; it is. shrewd in its vote-catching features; it is shrewd in what it does mot say - in what it covers up. I think that it will probably go down in history as Labour’s beg, borrow and appeal budget, but one can hardly say that it shows leadership and inspiration in view of the grave position in which we are placed. One realizes, of course, that members of the Opposition are helping. Some are on the platform, and will help with this voluntary appeal for the immense sums of money that are required. One realizes, too, as I know from what I have heard from South Australia, that those who are going to get the main kick from this budget will take it with a grim smile as part of their contribution to the war effort. Nevertheless, one suspects strongly that the Government does not really think that this budget can be a success, and it is for this reason that it has told us to expect a supplementary budget. The intervening months will be the test of both the Government and the voluntary system. They will show whether the nation trusts the Government by making voluntary contributions to tlie war loans, by the voluntary elimination of strikes, and by voluntary enlistments in the Australian Imperial Force. In my opinion, reliance on the voluntary system at the present moment makes the budget dangerous. In the greatest crisis of our history the Government proposes to conscript £22,400,000 of new money for the war effort, leaving £13S,000,000 to be raised in response to voluntary appeals. I understand that we must add another £20,000,000 for what is required for loans to the States. However let us take it at £138,000,000. The present Prime Minister (Mr. Curtin), speaking on the budget last year, called even the sum of £130,000,000 a “staggering” sum. For the sake of the nation, one hopes that the Treasurer will prove right when he said : “ My Government relies on the willing co-operation of all classes of incomes to make full contribution to saving and lending.” On the whole, one doubts very much whether, under the voluntary system, we can continue a sufficiently vigorous war effort. That system has been scrapped in Great Britain and New Zealand under the weight of a total war. We have to remember that 80 years ago Abraham Lincoln condemned the volun- tary system when he said that it was ground from the choicest corn of the nation. What do we see here in Australia under the voluntary system? Enlistments for the Australian Imperial Force are becoming insufficient and they include too many elderly men and men with large families. We know that the Militia officers are working overtime dealing with applications for exemptions. What would be the size of the Militia to-day, with war likely in the Pacific zone, if we had to rely on the voluntary system? Subscriptions to loans have not been satisfactory. Although the population of Australia has increased by 50 per cent, since the Great War, the number of contributors to loans in this war is fewer by 50 per cent, than in the years 1914-18. We know, too, that strikes are almost continuous. Yet, in spite of that, the Prime Minister said on Sunday night, “ The voluntary system for which we are fighting can be defended by voluntary sacrifice. Australia does not ask you to do more; no Australian should do less.” Can the Government procure this staggering sum of £138,000,000 by staggering round with the hat? This will depend primarily on overseas developments. If war comes in the Pacific zone, if our coastal cities are bombed, then that half of the people who are now asleep will not only be ready to lend ; they will also be willing to give their shirts to the Government in the cause of national defence. But, if war does not come closer immediately, I am afraid that these appeals of the Government will merely beat the air in competition with horse racing, pony racing, dog racing, picture theatres, beer, and other types of perfectly legitimate peace-time amusements. The Treasurer has said that he has great hope in war savings certificates, by which means £12,000,000 was contributed to the war effort last year. Up to September, 1941, New South Wales, which is the most populous as well as the richest State, had contributed 34s. 6d. a head of the population to war savings certificates each year, the total last year amounting to £4,750,000. ‘Contrast with that amount the record sum of £18,000,000 spent on alcoholic liquors in New South Wales last year. That it was not the extra, price which gave rise to that increase is show by the fact that they drank 2,600,000 gallons more of such liquor than in any previous year. The per capita expenditure on alcohol in New South “Wales was £6 Ils. 6d., yet the Statistician’s figures show that in that State the contribution of the people in respect of war savings certificates was only 34s. 6d. a head compared with 131s. 6d. for only one type of luxury spending. The voluntary system in wartime is grossly unjust. Like the principle of voluntary enlistment, it asks the more generous and the more patriotic of the people to carry the burden for the less generous and the less patriotic. Although New South Wales has a population exceeding that of Victoria by 900,000, the number of subscribers to this loan is 5,000 fewer. In spite of its larger population and greater wealth, New South Wales is per capita next to bottom in the list of contributions to war savings certificates. One can only wish the Government good luck in its appeal; but when it fails - as fail I believe it will - to raise the staggering sum of £138,000,000, what means will it adopt to obtain the money? That is the real test of the budget. The Government can then resort to extension of credit, additional taxation, or compulsory loans farther down in the taxation field,or to rationing consumption in order to force voluntary loans from the money which cannot be spent. Probably the first measure that it will adopt will be credit release. Probably it will be attempted soon, judging by the difficulty that is being experienced in connexion with the present loan, and the vigorous appeals that members of the Government are making for contributions. On the subject of credit release one appreciates the sound outlook of the Treasurer although one wants to know what lies behind the proposal for the control of banking. But I warn honorable members that evidence which the Joint Committee on Profits heard recently was to the effect that no system of price control could withstand really serious inflation. I need not describe what inflation would mean, and the suffering that it would bring to persons in receipt of the lower fixed incomes.

The second method that the Government could adopt is that of additional taxation. It would be interesting to see whether the Government puts the welfare of the nation before party considerations and election objectives and does., in its Supplementary Budget, increase taxation on incomes in the middle and lower groups. Under the present proposals of the Government to raise the wholly inadequate sum of £22,400,000, people in receipt of more than £1,500 a year will pay tax far in excess of the heavy rates imposed in New Zealand, whilst people receiving more than £3,000 a year will pay infinitely more than the terrific rates which are being levied in Britain. I am not grumbling about the taxation of higher incomes. I am not trying to protect the higher incomes. What I do criticize is the fact that Nne Government, having put its hand to the plough, has turned back. Although it will completely furrow up our few tall poppies, those with incomes of £1,000 a year -will pay only £282, compared with £307 in New Zealand and £441 in Britain. The manner in which the views of the Government have changed since it took office is rather remarkable. In his speech on the last budget, the present Prime Minister said that the Labour party did not object to the greatest possible taxation of incomes exceeding £500 or £600 a year; hut now he shelters incomes of £1,500 a year and less from any additional taxation for war purposes. Even more remarkable is the attitude of the Minister for Labour and National Service (Mr. Ward). A few months ago, we heard him declaim in the House that no one in Australia should receive more than £500 a year. Now that he has ministerial responsibility, he shelters from additional taxation not only those in receipt of £750 and £1,000, but also those receiving up to £1,500 a year. Truly, some of the sincere members of the Labour party must be saying to themselves, “ Oh, what a fall was there, my countrymen, when I and you, and all of us fell down”.

Honorable members should not think that, in making this statement, I advocate the protection of the high incomes. I believe, as the British and German Governments have discovered, that every class in the economic scale in war-time has to be assured that the class above has made a relatively heavier financial sacrifice than it has. My complaint is that the Government, having put its hand to the plough, has side-stepped part of the issue, and scrapped the principle of equality of sacrifice. I wish that the Prime Minister could have heard the remarks of some young, unmarried South Australians in reference to has persiflage when he spoke about such people, without any responsibilities, being unable to contribute £11 a year to the war effort out of an annual income of £156. They wanted to know whether he really thought that they were Australians.

When the Government is forced to curtail the consuming power of those in receipt of the lower and middle incomes, I hope, in all sincerity, that it will adopt the principle of compulsory loans, even though the honorable member for Barker has raised objections to it. Leading modern economists recognize that that principle is the fairest and most effective method of war finance, and that verdict is accented by the British Labour party and by the International Labour Bureau at Montreal. The unprogressive character of the Government is shown by its failure to grasp two important facts in this respect. First, that the system of compulsory loans and liberal releases in the case of marriage, illness and so forth, create the least possible hardship in war-time. Secondly, that the system does provide for a redistribution and levelling of wealth after the war, when the loans can be repaid, either from national capital or from income. Undoubtedly, this levelling would be in the direction of socialism, and that is why I cannot understand the attitude of the Labour party on this matter. One feels that the Labour party is cutting off its socialistic nose in order to spite its socialistic face.

Several indications show that when the Government fails to secure £138,000,000 by voluntary loans, and perhaps even before, it means to resort to rationing. In his budget speech, the Prime Minister spoke very favorably of rationing, and since the Labour party took office, the honorable gentleman, the Treasurer and the Minister for War Organization (Mr.

Dr. Price

Dedman) have .referred on several occasions to this subject. I agree that rationing is the fairest method of reducing consumption in war-time, and I may welcome the rationing of luxuries. One greatly admires the manner in which the Minister for Supply and Development (Mr. Beasley) is now defending so strenuously the present scale of petrol rationing, which he attacked so bitterly a few weeks ago. But evidence before the Joint Committee on Profits indicates that if we are to ration, we must ration a wide range of commodities, otherwise income will simply swing from rationed to non-rationed channels. Germany, which has been successful in applying the system of rationing, pegged prices and wages. I assume that the Labour Government of the Commonwealth does not wish to peg wages. Germany has also used with very great vigour the terrible Gestapo to secure wholesale rationing. I feel that if the Government descends to this crude and clumsy method before it becomes absolutely unavoidable, its blood will be upon its own head, because the people will prefer Fadden’s fair finance to Chifley^ coupon queues.

One experiences difficulty in understanding how the Labour party manages to reconcile its doctrines of voluntaryism and equal rates of pay for men and women with the proposal to conscript the incomes of wives by treating them as the same individuals as their husbands. Such a suggestion would discourage marriage and even encourage immorality. There was trouble in the United States of America when the Government of thatcountry, during a period of depression, issued an order that all female Government employees would be dismissed on marriage. Some men and women continued to earn their independent salaries and lived together without legal union. Speaking for oneself, one thoroughly approves of the indirect taxation of luxuries, and congratulates the Government upon adopting a course which the Prime Minister opposed so vigorously in speaking on the 1940-41 budget, when he said - “ I decline to regard beer and tobacco as luxuries.” I only wish that the Government had gone further and had imposed taxes on gambling, moving pictures and other luxuries, which are responsible for so much spending at present Speaking again for oneself, one does not wholly condemn increased taxation of companies where a field for political and socialist blitzkrieg obviously lay open. The evidence before the Joint Committee on Profits indicates, however; that company taxation is largely political and psychological in character. If the Government adequately controls prices and undistributed profits then it is much cheaper and more economical to allow companies to earn high dividends through their efficiency and to get the higher returns by slugging the shareholder through his dividends. Although I do not attack the proposed legislation, I give three warnings. The first is that undue company taxes may cripple industrial and war organization. Great Britain has discovered that and is lowering company taxation. My second point is that the methods proposed by the Government will definitely penalize small shareholders, whom, one imagines, it wishes to protect. If company taxation halves the dividend now paid by a company it will reduce by one-half the dividends paid not only to the wealthy man who draws £10,000 a year, but also to the widow who relies on receiving £200 a year. Some Labour members fail to grasp that fact that our banks and companies are largely owned by thousands of small shareholder?. For instance, the grossly slandered Broken Hill Proprietary Company Limited, which is the basis of our industrial war effort, is owned by something like 20,000 shareholders. Hence, the Labour party, in its blindness, proposes to penalize one of the greatest assets in the community, the small saver who is trying to safeguard the future rather than become a Government pensioner. My third and last point is that in its taxation proposals the Government cannot have it all ways. One hopes that the Government and its advisers have made ample allowance for the fact that through the fleecing of the companies the returns from income tax may show a substantial decline.

In conclusion, I hope for the sake of the nation that the Government succeeds in this voluntary appeal. The budget is disappointing because it fails to measure up to our very grave situation, because it fails to assure the maximum financial effort, and because it fails to give adequate leadership, inspiration and unity to the nation. I wish the Government success, but I feel that in the voluntary system it is flogging a dead horse and that in a total war effort it should get a younger and better steed if it wishes to lead. The hour in which Australia requires a Churchill-Bevin inspiration and vigour to save it is no time for any party to protect sectional interests, or to offer the moon and thestars to its supporters. Unless the Commonwealth Government leads a united nation to duties instead of rights, and to sacrifices instead of selfishness, it will find that behind the moon is the rising sun of Japan, and behind the stars is Hitler’s crooked cross.

P rogress reported .

page 115

ADJOURNMENT

Defence Contracts:granville Road

Construction - Bankstown Council Diesel Tractor

Motion (by Mr. Forde) proposed -

That the House do now adjourn.

Mr MORGAN:
Reid

– I wish to raise a matter of importance in regard to certain aspects of our war effort. The Clyde Engineering Company Limited at Granville is engaged on essential war work, including the construction of collapsible boats for the Army. That section of its work was specially set up to assist the Departments of the Army and Supply and Development. Although the company pioneered the construction of these boats, it has been unable to get regular orders from the Department of Supply and Development and, asa consequence, has not been able to lay down a proper programme for the future in connexion with this important work. It now has only sufficient orders to keep that section of its works going for a few days. There are 45 men engaged in the construction of collapsible boats at the company’s works, and in the course of a few days a number of them will have to he put off. It appears that the construction of these boats is being farmed out to other organizations. I understand that General Motors-Holdens Limited has a copy of the plans of these boats and is engaged in their construction. If no definite contracts are made with the Clyde Engineering Company Limited for the future supply of these boats, it will be forced to close down that section of its works, or to divert it to the production of non-essential goods. Such a policy as has been pursued by the department in this connexion does not seem to be in keeping with our conception of an all-in war effort. The Government is vitally concerned in this matter inasmuch as a previous government guaranteed the company’s overdraft to an amount of £150,000. The people of Australia are vitally interested in the continued operation of these works, because not only will the employees be thrown out of employment if a section of the works is closed down, but also the war effort will be seriously impaired. I hope that the Minister for Munitions (Mr. Makin) will take action to prevent the closing down of a section of the works.

For several months I endeavoured, on behalf of the Granville Municipal Council, to persuade the previous Government to facilitate the construction of a road from the works of Australian Aluminium Company Proprietary Limited in Granville to the Parramatta-road, a distance of a few hundred yards. Only £12,000 would be involved, and the council is asking for a grant of £6,000 and for permission to raise the balance of £6,000 itself. I was not able to get any satisfaction from the previous Government. Correspondence suggests that the present Minister for Supply and Development (Mr. Beasley) has directed the council to apply to the State Government which would, in turn, apply to the Commonwealth Government for the grant. That seems to be a roundabout way of dealing with a matter which should be dealt with expeditiously. The output of the company which is essential for war purposes has to be transported to other works in the locality for which purpose the suggested road is necessary. I hope that the Treasurer (Mr.

Chifley) will cut the “red tape” and make the grant immediately.

Another matter which I took up without success with the previous Government is the request of the Bankstown Municipal Council for a diesel caterpillar tractor held by Waugh and Josephson. The Government does not require the machine, and the council merely desires it to be released to complete the purchase already agreed upon. The council is engaged in the construction of a feeder road which might be vital to our defence and I cannot understand the delay over this simple matter. I have now been referred by the present Minister for Supply and Development to the Minister for Munitions. Whoever the responsible Minister may be, I should like to have the matter settled quickly.

Mr MAKIN:
Minister for Munitions · Hindmarsh · ALP

– I am aware that the Clyde Engineering Company Limited is engaged in war production and has done valuable work, and also that the staff includes skilled technicians capable of undertaking farther valuable production. I assure the honorable member for Reid (Mr. Morgan) that I shall make an immediate investigation in order to ascertain what further work can be allocated to those works in order to prevent retrenchment. I have been to the works of the Australian Aluminium Company Proprietary Limited and I know the locality through which the proposed road passes. I shall investigate the position in order to discover what authority I possess to forward the project. If I can do anything to meet the situation I shall do it. Nothing will be left undone that my department is capable of doing.

Mr BEASLEY:
Minister for Supply and Development · West Sydney · ALP

– The honorable member for Reid (Mr. Morgan) referred to the fact that correspondence from department suggested that representations in connexion with the road in the Granville municipality should be made to the State Government which should then pass to the Commonwealth Government a request for whatever funds are required. The Commonwealth does not possess the organization necessary for road-making, whereas in New South Wales there is a Department of Main Roads which has all of the machinery and staff necessary for that purpose. The method suggested in the correspondence may seem to the honorable member to be a roundabout way of handling the subject, but it may be that in the long run it would he the best way, and I urge the honorable member to take the steps suggested in the correspondence and have the State Department of Main Roads measure requirements.

Mr Morgan:

– It is not a main road, it is a. by-way.

Mr BEASLEY:

– If the Department of Main Roads cannot do it, then perhaps the local government authorities could measure its needs. I have an open mind on that point. The Commonwealth Government has no technical facilities at its disposal whereas the State Government has. I understand the urgency of the proposal, and I shall be glad to discuss the matter further with the honorable member in order to smooth out the difficulties.

Question resolved in the affirmative.

page 117

PAPERS

The following papers were presented : -

Arbitration (Public Service) Act - Determinations by the Arbitrator, &c. -1941-

No.29- Commonwealth Foremen’s Association: and Amalgamated Engineering Union.

No. 30 - Amalgamated Postal Workers’” Union of Australia, and others: Commonwealth Storemen and Packers’ Union.: Commonwealth Naval Store- housemen’s Association : and Arms. Explosives and Munition Workers’ Federation of Australia.

Australian imperial Force CanteensFund Act - Twenty-first Annual Report by the Trustees, for year 1940-41 (includingtheSir Samuel McCaughey and P. S. Watson Bequests).

Gold Mining Encouragement Acts - Regulations - Statutory Rules 1941, No. 243.

National Security Act - National Security (General ) Regulations - Orders -

Control of lights and traffic (5).

Taking possession of land. &c. (50).

Use of land (12).

NorfolkIsland Act - Ordinances - 1941 -

No. 3- Child Welfare.

No. 4 - Child Welfare Agreement.

No.5 - legitimation.

Patents Act - Regulations - Statutory Rules 1941. No. 240.

Trade Marks Act - Regulations - Statutorv Rules 1941. No. 241.

House adjourned at 10.38 p.m.

page 117

ANSWERS TO QUESTIONS

The following answers to questions were circulated : -

Secret Funds Royal Commission

Mr Blackburn:
BOURKE, VICTORIA

n asked the AttorneyGeneral, upon notice -

  1. Is there any objection to submitting to the Royal Commission, on Secret Funds the documents given or shown by Mr. J. Winkler to the Prime Minister? If so, what is the objection ?
  2. Will these documents or either of them be submitted to the royal commission?
Mr Evatt:
Attorney-General · BARTON, NEW SOUTH WALES · ALP

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

  1. The Government raises no objection to the submission to the royal commission of the documents referred to.

  2. The Royal Commissioner will himself decide ‘whether such documents should be submitted to him. or placed in evidence before him. The royal commission is fully empowered -

    1. to require the production of the documents referred to (which are in the custody of the Solicitor-General) ; and
    2. to admit in evidence before itall relevant documents.

Wheat Industry : Commonwealth Grant

Mr GUY:
WILMOT, TASMANIA · UAP; LP from 1944

v asked the Minister for Commerce, upon notice -

Concerning the grant of £1,000,000 made by the Commonwealth Government to Australian wheat-growers will he state (a) the specific amounts allocated to and distributed in each State of the Commonwealth, and (b) *the* method employed in allocating the amounts.

Mr.Scully. - The answers to the honorable member’s questions are as follows : -

  1. The amounts allocated to and paid to each State for distribution are as follows: -
  1. The allocation of £1,000,000 granted by the Commonwealth for drought relief to wheatgrowers was discussed by the Minister for Commerce with State Ministers at the meeting of the Australian Agricultural Council held on 29th January, 1941, . recommended by the council.

Commonwealth Bank

Mr Calwell:
MELBOURNE, VICTORIA

l asked the Treasurer, upon notice -

Will he use the powers under the National Security Act to direct the Commonwealth Bank Board that the Commonwealth Bank must accept transfers of overdrafts from the private trading banks?

Mr Chifley:
ALP

– The general question of the Commonwealth Bank’s activities in at present the subject of consultation.

AustralianConsolidated Industries Limited.

Mr.Calwell asked the Minister representing the Minister for Trade and Customs, upon notice -

Will he publish immediately it is received the report of the investigation, made by the Prices Commissioner into the alleged excessive profits made by Australian Consolidated Industries Limited?

Mr Beasley:
ALP

y. - The Minister for Trade and Customs has supplied the following answer: -

The question whether this report will be published will depend upon whether any confidential information is contained therein.

Mr Calwell:

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

Will he lay on the table of the House the reportof the Prices Commissioner on the projits madeby Australian Consolidated Industries Limited?

Mr Beasley:
ALP

y. - The Minister for Trade and Customs has supplied the following answer: -

The question whether this report will be laid on the table of the House will depend upon whether any confidential information is contained therein.

Aluminium Industry: Commonwealth Copper and Bauxite Committee; Tasmanian Deposits

Mr Guy:

y asked the Minister for Supply and Development, upon notice -

  1. When is it intended that the Commonwealth Copper and Bauxite Committee will visit Tasmania?
  2. ls thepurpose of the visit to examine the bauxite deposits there or merely to examine the data already collected locally?
  3. If the aluminium industry is to be established in Tasmania, what authority will determine what deposits are to be worked and the site of the necessary factory?
Mr Beasley:
ALP

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

  1. It is intended that the Commonwealth Copper and Bauxite Committee should arrive in Tasmania on the 18th November, 1941.
  2. The committee will inspect deposits of bauxite, examine samples and study data already collected by the Department of Mines of Tasmania.
  3. The Government is at present giving consideration to the whole question of the establishment of the aluminium industry in Australia and cognate questions and it is expected that questions of future policy will be determined at an early date.

Flax Production: Tasmanian Mills

Mr Guy:

y asked the Minister for Supply and Development, upon notice -

In view of the urgent need to deseed and scutch the flax crop and the estimated 300 per cent, increase in the crop for the coming season, will he make every endeavour to expedite the establishment of the proposed new millsand the extension of the existing mills in Tasmania in order to treat tha flax before the winter season begins?

Mr Beasley:
ALP

– Plans have been prepared and a programme mapped out for the selection of new mill sites, the acquisition of land, the erection of buildings and the manufacture and installation of new machinery where required to process the increased crop of flax. Plans for extensions to some existing mills have also been completed. The programme is a heavy one and the Flax Production Committee has found it necessary to arrange for the installations to proceed in the order in which the mills will be required to deal with the crop. Every effort is being made to expedite the work.

Mr Guy:

y asked the Minister for Supply and Development, upon notice -

  1. Has he any information concerning a proposal by private interests to establish a flax weaving mill in Tasmania?
  2. If not, will he endeavour to ascertain if there is any foundation for statements that such an industry is likely to commence operations in Tasmania?
Mr Beasley:
ALP

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

  1. The matter hasbeen mentioned in general discussions from time to time, but I have no knowledge of any specific proposal to establish a flax-weaving mill in Tasmania.
  2. Inquiries are being made.

Service Pensions.

Mr Morgan:

n asked the Minister for

Repatriation, upon notice -

Will he give early consideration to the question of liberalizing the provisions of the Australian Soldiers’ Repatriation Act in regard to war pensions and instituting a more generous administration of the act, especially in relation to the placing on the Repatriation Commission of the onus of disproving that disability is due to war service, similar to the procedure in operation in Canada?

Mr Frost:
Minister for Repatriation · FRANKLIN, TASMANIA · ALP

– I shall give consideration to the question Taised by the honorable member, but would point out that the Australian Soldiers’ Repatriation Act already provides that the onus of proof in regard to applications for war pensions shall lie with the commission and not with the applicant.

Apples and Pears:Committee’s Report; Acquisition Scheme.

Mr Prowse:
FORREST, WESTERN AUSTRALIA

e asked the Minister for Commerce, upon notice -

  1. Has he received the report of the committee inquiring into the operations of the Apple and Pear Board?
  2. If so, can he state what the Government proposes in respect of the ensuing year’s apple and pear crops?

Mr.Scully. - The answers to the honorable member’s questions are as follows : -

  1. The report of the committee on apples and pears is to be presented to Parliament to-day.
  2. The policy to be adopted in respect of next season’s apple and pear crop is at present under consideration by the Government.
Mr Guy:

– Asked the Minister for Commerce, upon notice -

  1. Is it a fact that failure to announce the re-introduction of the apple and pear acquisition scheme for the approaching season is causing great inconvenience and a feeling of uncertainty amongst orchardists as to whether they should make arrangements for the cultivation, picking and marketing of their fruit?
  2. When will he make a statement to the House intimating whether the scheme is to be continued, and, if so, under what conditions?

Mr.Scully. - The answers to the honorable member’s questions are as follows : -

  1. I am aware that growers are anxious to know whether the apple and pear acquisition scheme is to be continued next season.
  2. A statement in regard to the Government’s policy will be made as soon as a decision has been reached.

Petrol Rationing

Mr Guy:

y asked the Minister for Supply and Development, upon notice -

  1. Is it a fact that primary producers generally are complaining that they are not receiving as favorable consideration in relation to the petrol rationing scheme as are people residing in the cities and those engaged in secondary industries?
  2. Will he give immediate consideration to a suggestion that a more equitable distribution of petrol be made in the case of those engaged in rural industries?
Mr Beasley:
ALP

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

  1. Complaints have been received from primary producers in common with other users of petrol.

  2. The fullest consideration has already been given to primary producers, who enjoy the following concessions: -

    1. . Country residents are allowed sufficient petrol for travel between residence and railhead or market town, and as a result more than 70,000 licences have been transferred from the private users class to a class with a higher ration.
    2. Special licences are granted with a currency up to six months allowing purchase in accordance with the licence at any time during the six months period at the convenience of the consumer.
    3. Under the drastic rationing scale from the 1st August last, State boards were instructed that they could allow up to 85 per cent. of previous ration for primary producers’ vehicles and farm machinery when good cause waa shown. In any case sufficient petrol was to be granted to allow carriage of primary produce to nearest railhead, factory or market.
    4. Primary producers are exempted from the order prohibiting the purchase of petrol in containers.
    5. Under the census of stocks held by consumers at the 4th August last, primary producers were allowed to use without restriction 44 gallons or two months’ ration, whichever is greater, compared with 44 gallons or one month’s ration for other consumers.
    6. . Local committees have been formed throughout the States, in order that fullest information with a knowledge of local conditions and requirements is available to State boards when making assessments.

Government Factory Employees

Mr Holt:

asked the Minister for Munitions, upon notice -

What number of employees in Commonwealth Government factories terminated their employment in each of the months of (a) July, (b) August, (c) September, and (d) October?

Mr Makin:
ALP

– The answers to the honorable member’s question is as follows : -

Total figures for all States are as follows: - (a) July, 837; (b) August, 1039; (c) September, 1107;(d) October, 1273.

Man-power.

Mr Guy:

y asked the Minister forWar Organization of Industry, upon notice -

In view of the serious position associated with the man-power problems and the inability to secure man-power to work rural industries, some of which are engaged in national services, will he make a statement to the House setting out what consideration he has given to the matter, and what precisely is the position?

Mr.Ward. - This question has been referred to me by the Minister for War Organization of Industry as falling within the jurisdiction of my department. It has been given the closest consideration by the Department of Labour and National Service. The Manpower Priorities Board has given the matter attention, and has taken certain action as a result. As was announced by my predecessor some weeks ago, alterations were made in the list of reserved occupations as it affected agriculture, dairying, pasture, &c, and the following additional occupations were reserved: - Leading hands in charge of three or more men reserved above the age of 25; and farm-hands, not seasonal workers, reserved above the age of 30. In addition the age above which farm-hands singly employed were reserved was lowered from 25 to 21. The military authorities issued instructions that militia-men, except those called up for full-time duty, and universal trainees could be given leave without pay for appropriate periods for harvesting. A considerable number of applications for leave have been granted, and more frequently the call-up of men required for rural seasonal work is being deferred till March, 1942. Representations have also been made to the military authorities as regards universal trainees, and in many cases these authorities have been able to accede to the requests.

Department of the Interior.

Mr Calwell:

asked the Minister repre senting the Minister’ for the Interior, upon notice -

  1. Is it a fact that there was a balance in the votes of his department at the end of the financial year 1940-41 ; if so, how much was it?
  2. Was the fact that such money remained unexpended due to the department being overburdened and lacking facilities to turn out the work required in the preparation of plans, &c?
  3. Would the speed of production of such work be increased if portion of the work of the department were given out to architectural firms in the capital cities of Australia?
Mr Lazzarini:
ALP

i. - The Minister for the Interior has supplied the following answers: -

  1. Yes, £3,914,983. The total appropriation was £23,221,648 and the total expenditure £19,306,665. 2 and 3. No. The assistance of State governmental departments, private architects and engineers and quantity surveyors has been availed of for a considerable time. The volume of work being placed with the Department of the Interior can be kept well in hand with the existing organization and by the continuance of the existing arrangements. orbost-bombalarailway.
Mr Calwell:

asked the Minister representing the Minister for. the Interior, upon notice -

  1. What is the estimated length of a railway joining Bombala, New South Wales, and Orbost, Victoria?
  2. What would be the approximate cost of constructing such a line?
Mr Lazzarini:
ALP

i. - The Minister for the Interior has supplied the following answers : -

  1. One hundred and thirteen miles, of which 34 miles are in New South Wales and 79 miles in Victoria.
  2. No estimate has been compiled; buta: the route traverses very heavy country, construction would be very costly.

Cite as: Australia, House of Representatives, Debates, 5 November 1941, viewed 22 October 2017, <http://historichansard.net/hofreps/1941/19411105_reps_16_169/>.

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