17th Parliament · 1st Session
Mr. Speaker (Hon. J. S. Rosevear) took the chair at 2.30 p.m., and read prayers.
– Has the Prime Minister seen a report of the recommendations which the committee on ‘black marketing has made to the Minister for Trade and Customs? Has the Government decided what action should be taken upon them? If not, will the right honorable gentleman consider whether the institution of a comprehensive, equitable system of rationing of all the goods that are in short supply would not secure from the public more effective results than can be obtained from the enforcement of punitive legislation ?
– The report mentioned has been received, has been the subject of an interim statement by the Minister for Trade and Customs, and is now under consideration. The other ‘matter raised by the right honorable gentleman will be examined.
– Has the Minister representing the Minister for Trade and Customs seen a paragraph in this morning’s newspapers stating that bullocks are being driven from Queensland to other States and that the price paid for them is from £1 to £2 a head greater than the price previously paid? Will he say whether, in view of the fixing of a price ceiling several months ago, this is not a definite case of black marketing?
– I have not seen the press statement to which the honorable member has referred, but I take it that, in the opinion of the honorable member, there has been a violation of price-fixing regulations. I shall bring the question to the notice of nay colleague, the Minister for Trade and Customs.
– “Will the Minister for Information consider launching immediately a nation-wide publicity campaign against black marketeers ? If so, will he use press, poster, platform and radio publicity to the limit against these saboteurs for Tojo in an effort to rouse the public conscience in the matter?
– There is considerable merit in the suggestion of the honorable member. Because of his long and successful career in journalism, I shall be glad if he will consult -with me and the officers of the Department of Information as to the degree to which effect can be given to his suggestion.
– Do not throw too many bouquets.
– In view of the interjection of the honorable member for Warringah (Mr. Spender), I also invite the honorable member for Eden-Monaro (Mr. Fraser), who, too, has had a long and distinguished career in journalism, to join in the consultation.
– I am interested in the’ special qualities of the bauxite deposits at Mount Tambourine, Queensland. Can the Minister for Supply and Shipping inform me of the degree of their development and of the progress that has been made in connexion with the production of aluminium in Australia?
– The official files con-, tain the reports that have’ been made of tha bauxite deposits in various parts of Australia, and disclose the qualities of what are considered to be the richest of the deposits. Every factor has been examined up to that stage. It is the intention of the Government, before making a final decision as to the locality from which bauxite shall be drawn, to have an examination made of all deposits by the authority that is to be set up in connexion with the production of aluminium in Australia. It is probable that practical tests will be made of all of them.
Increased Costs - Pool Payments
– When the Minister for Commerce and Agriculture appoints a committee to inquire into the additional costs to the wheat industry which will result from the application of the rural workers’ award, will the honorable gentleman, so frame the terms of reference that they will include the increases of general costs that have been brought about by the war and other causes during the period that has elasped .since the report of the Royal Commission on Wheat and Flour was presented to this Parliament?
– The whole matter, including the points mentioned, will receive consideration.
– Can the Minister for Commerce and Agriculture give any information as to the quantity of wheat left in the No. 5 pool and when the next payment in respect of that wheat is likely to be made-? Further, can he say when’ there is likely to he payment on wheat in the No. 6 pool, and whether it is possible to make another advance of ls. a bushel immediately in respect of such wheat?
– I shall secure the information sought by the honorable member and make it available at a later period. As to the making of a further advance on wheat in the No. 6 pool, the matter will be thoroughly investigated, and, if possible, sympathetic consideration will he .given to the request.
– Has the attention of the Prime Minister been drawn to the statement in the Sydney Morning Herald this morning, that Mr. Churchill recently informed the British House of Commons that he regarded a meeting of Empire Prime Ministers as an important immediate objective? Has the right honorable gentleman received an invitation to attend such a meeting, or any advice relating thereto? Does he propose to make such a journey in the near future?
– My attention has not been drawn to any report in any newspaper concerning any statement made by Mr. Churchill. Mr. Churchill’s communications to me are direct and specific. They do not warrant my intimating what steps are being taken to ensure a meeting of Empire Prime Ministers. All that I can say is that, so soon as it is practicable for all the Prime Ministers to assemble it is almost certain that they will then meet.
Removal of Window Screens
– In view of the serious conflict between the Federal and State authorities in respect of the removal or non-removal of the window and plateglass protection provided for under air raids precautions regulations, will the Minister for Home Security define the position of those who, in good faith and with the authority of a State Government department, have removed the protective material? Are they now committing an offence against the law? If so, will the honorable gentleman instruct the State concerned to meet any penalty that may be imposed upon them on that account?
– Where protective material has already been removed from windows, the action has been taken with the consent of the State authorities; consequently, no penalty will be imposed. In one or two instances, the. State authorities ruled that such protection need not be continued. The Defence Committee, on the other hand, ruled that it would be advantageous to continue it for a further period, and that decision is .being enforced. However, as there is no indication of deterioration of the defence position, any one who has removed the protection in good faith will not be obliged to restore it.
– Will the Minister for Labour and National Service ascertain what policy is followed by the Directorate of Man Power in respect of what is termed light labour, such as the printing industry, with particular regard to men who are medically unfit for military service or for heavy labour? When asking the Directorate of Man Power to inform him on this matter, will the honorable gentleman instruct that the position in regard to light labour in metropolitan newspaper offices shall be fully explained ?
– I base my reply on my own interpretation of the policy that is followed. The reply is that there is no discrimination between any industry or service, because the test is, first, whether employment in an industry or service is, or is not, essential and, then, whether there is any surplus labour avail able. Should the test reveal that labour is available, the persons concerned are then medically examined, after which they are sent to the work for which they are most fitted, having regard to their physical and mental capacity. If that be the proper interpretation, newspaper offices would be treated the same as other businesses. However, in case there is another interpretation, I shall obtain a report dealing with the various phases of the subject.
Motion (by Mr. CURTIN - by leave - agreed to -
That, in accordance with the provisions of the Commonwealth Public Works Committee Act 1913-1930, the following members he appointed mem-burg of the Parliamentary Standing Committee on Public Works: - Mr. Conelan, Mr. Harrison, Mr. James, Mr. Mulcahy, Mr. Rankin and Sir Frederick Stewart.
– I ask you, Mr. Speaker, as the custodian of the rights and privileges of this House, whether any steps are necessary to regularize the position of the honorable member for the Northern Territory (Mr. Blain) who cannot attend in this place at present, and, if so, when those steps will be taken?
– The writ for the election of a member for the Northern Territory has not yet been returned. The position is that in the event of the election of a member who is a prisoner of war the granting of leave of absence to him would be a matter for the House to determine by resolution under Standing Order No. 45, which provides that the House may grant such leave of absence on the cause of absence being stated. The honorable member may rest assured that the matter will be adjusted as soon as possible.
– In view of the recent press reports that discussions, have taken place in the United States of America regarding the establishment of an international currency, an international government, and an international police force in the post-war period, can the
Prime Minister say whether the Commonwealth Government has been represented at the discussions, and, if so, whether any commitments have been entered into on behalf of the Commonwealth?
– The Commonwealth Government has been represented at a number of these discussions, but no commitments have been entered into, in the sense that final contracts have been made either between other parties to the deliberations or by Australia. The discussions are still largely in the exploratory stage. I assure the House that no final settlement of these matters appears to be immediately in prospect.
– Can the Minister representing the Minister for Trade and Customs say whether there is any justin.Gabon for the view expressed in dairying circles in Queensland that a further rationing of butter, probably to 6 oz. a week for each person, is possible, because of the acute position arising out of Australia’s commitments to Great Britain?
– The rationing of butter, meat and other commodities receives careful consideration by the Production Executive from time to time. Before answering the right honorable member’s question, I should like to consult that body, as well as the Minister for Trade and Customs, who is in charge of rationing.
Rationing - Shortage in MELBOURNE
– I ask the Prime Minister whether, as the Sydney Morning Herald this morning has reported, draft meat rationing plans have been approved by the Production Executive? If so, is the statement correct that these involve a ration of 2J lb. a week for every person over nine years of age, and 18 oz. a week for children under that age? How and when does the Government propose that the ration shall operate?
– -I have not seen the report mentioned. I can only say that the matter to which it relates is under consideration, and that certain preparations are being made.
– Has the Minister representing the Minister for Trade and Customs seen the statement in the Melbourne Age of the 6th October that, whilst there is a restricted supply of meat for human consumption, racing dogs in Australia consume 52,000,000 lb., or 23,000 tons, of meat a year? If so, can he say how the Government proposes to meet this position, in view of the need to make the maximum quantity of meat available for the civil population of Australia as well as for the services?
– The honorable member’s question refers to matters under the control of the Department of Commerce and Agriculture as well as the Department of Trade and Customs. The matter raised is under consideration. As I do not know why so much publicity is being given to the rationing of meat at this stage, it may be well to state that the Government does not approach any question of this kind without examining fully such points as that raised by the honorable member.
– I hope that the honorable member for New England does not suggest that sheep dogs and cattle dogs, which are indispensable to the maintenance of an adequate meat supply, should not be fed with meat.
– The question relates to greyhounds.
– “Will the Minister for Commerce and Agriculture make at an early date a statement with respect to the existing meat shortage in Melbourne, and of the action proposed >by his department to remedy the position?
– The existing shortage of meat in Melbourne has been caused by transport difficulties, which. I understand are being overcome. I shall institute a full investigation, and when advised of the result shall make a statement to the House along the lines requested.
– Can the Minister for Commerce and Agriculture give any information as to the possibility of increasing the quantities of phosphatic rock imported into this country? Further, can he supply any information regarding the prospects of obtaining phosphatic rock from deposits in Western Australia and South Australia?
– The whole position in regard to supplies of rock for the manufacture of superphosphate is being investigated, and the Government has had rather favorable reports as to the likelihood of obtaining increased supplies fromoverseas. The delivery of superphosphate from overseas is, however, contingent upon shipping being available for the purpose. So far, the prospects of obtaining supplies of superphosphate from local deposits of phosphatic rock are not encouraging, but at this stage reports have not come to hand on the deposits in Western Australia and South Australia. When they are received, I shall make the contents available to the honorable member.
– Can the Minister for Munitions say whether overtime is still being worked extensively in munitions factories, particularly those from which volunteers were recently sought to engage in food production? Has there been any recent review qf the working of overtime in munitions factories, especially where the reserves are satisfactory?
– I assure the honorable member that there is no unnecessary engagement of labour at overtime rates. There are occasions when, because of the high order of priority of certain work, or because of the extreme scarcity of skilled labour in the tool-rooms, it is necessary to ask some people to work more than the ordinary number of working hours in a week, and this involves the payment of overtime.
– Is the Minister for Commerce and Agriculture aware that members of women’s war organizations, particularly the Women’s Land Army, are at present suffering serious injustice in that they are not accorded the same privileges as women members of the services? I refer to the fact that they are not allowed post and telegraph concessions or railway and tramway travelling concessions, nor are they permitted on Sunday evenings to attend special picture programmes which are open to members of the services. These disabilities are seriously interfering with recruiting for the Women’s Land Army. Will the Minister personally inquire into this matter in order to have the injustices removed at once?
– I was not aware that members of the Women’s Land Army were suffering injustices of the nature described. I shall have the matter investigated, and if it is found that there are grounds for the honorable member’s complaint the position will be rectified. We realize the value of the work which is being performed by members of the Women’s Land Army, and how necessary it is in the interests of the community.
– In view of the fact that the Treasury allows brokerage to banks and brokers who collect subscriptions to war loans, will the Treasurer say whether expenses are allowed to municipal councils and other organizations entrusted with the raising of allotted quotas of loans?
– I shall have a statement prepared showing exactly what is done in regard to those matters.
– I desire to ask the Minister for War Organization of Industry a question regarding the effect of daylight saving upon country people. During the last two years, banks in country towns have been closing their doors at 2 o’clock in the afternoon instead of 3 o’clock. Under the daylight saving, 2 o’clock is really 1 o’clock. Work on the farms starts at exactly the same real time whether daylight saving is in operation or not, with the result that farmers coming to town after their morning’s work is done often find that the banks are closed. Will the Minister inquire whether it is possible for banks in country towns to remain open until 3 o’clock in the afternoon?
– The Prime Minister said yesterday that the decision to reintroduce daylight saving had been made after the Government had obtained all the advice it could on relevant points. The right honorable member has mentioned a special aspect of the matter.
I shall have an investigation made in order to see whether anything can be done to overcome the difficulty which he mentioned.
– In view of the widespread discontent among country residents because of the introduction of daylight saving, will the Prime Minister make a statement explaining the benefits which are derived from the scheme, including the saving of coal?
– I said yesterday that the purpose of daylight saving was to economize in the consumption of coal. That is the basic reason. Some advocates of daylight saving put forward other reasons to justify their contentions. When daylight saving was first introduced, there was a general black-out associated with home security. Now,, the black-out no longer obtains, but we are faced with the fact that coal supplies in the eastern States are not equal to requirements. The Government has been advised that, under daylight saving, the consumption of coal is reduced. I am aware that there are objections .to daylight saving, particularly in country districts. The decision to introduce it was an economic one. and when the reasons which justified its introduction no longer exist I shall be quite ready to reconsider the whole matter.
– It is not disputed that there is a saving of coal under the scheme, but people would be more ready to accept the inconveniences of daylight saving if some statistical information could he made available showing just what savings were being effected.
– I shall try to obtain that information, but there is no unanimity of opinion even on that point.
– Will the Prime Minister have an investigation made to ascertain the benefits of daylight saving to country areas compared with those derived by the cities, and also whether the benefits in respect of country areas are so small as not to justify the application of daylight saving in such areas?
– Obviously, the greatest benefits resulting from daylight saving will be in the cities which are the great consumers of coal; but the services which are reticulated from the cities to the country represent a part of the economic structure of each State. Therefore, if daylight saving is to be introduced - and the Government has introduced it in order to save coal at a time when coal stocks are falling - it must be introduced on a territorial basis; and in view of commercial and governmental factors, it must be operated throughout each State and all States that have common time.
– Western Australia has been excluded.
– I have already given the reasons for the exclusion of Western Australia. Obviously, New South Wales, Queensland, Victoria and Tasmania should be on the same time. That appears to be a matter of common sense, and there is a certain amount of common sense in what the Government has done.
– I ask the Prime Minister whether it is not a fact that daylight saving was introduced in Great Britain during the last war and has been continued there ever since? He has intimated that the Government considered only economic reasons in coming to its decision. Would he arrange, through the Minister for Health, to ascertain from the Government of Great Britain the advantages of daylight saving in respect of the health of the community, because, apparently, daylight saving has been retained in Great Britain foi- -reasons which are not simply economic?
– The questions being asked on this matter simply raise points which would be features of a discussion on the subject. It is true, as the honorable gentleman knows without asking me, that Great Britain and some other European countries have had daylight saving since the last war. The Government knows that daylight saving is of positive advantage to the health of certain sections of the community. It has reason to believe, however, that other sections of the community do not benefit from daylight saving in respect of either health or convenience. In .this matter it was considering a question of immediate import, namely, whether or not coal would be saved; and, therefore, quite regardless of all other aspects of the matter, Cabinet decided to institute daylight saving in those States to which it kas been applied for the purpose of conserving stocks of coal by reducing consumption. I hope that the reason for the introduction of daylight saving will be overcome. As to the general subject of daylight saving, I myself, after listening to what honorable members have said, hesitate to form an opinion.
– Is the Minister for Supply and Shipping aware that there is an acute shortage of plough harness in country districts? Will he have an inquiry made and take steps to remedy the position?
– I. understand that plough chains and leather harness-
– ‘Collars, particularly.
– It would be helpful if the honorable member would supply me with details. I shall be very glad to do what I can to rectify the shortage.
– In view of the Prime Minister’s repeated statement that the country is now free from the danger of invasion, will he say whether there is any necessity for continuing to make levies on propertyowners for war damage insurance, particularly in country areas?
– My statement was that I believe, as I still believe, on the strength of the advice tendered to me, that Australia is now free from the fear of invasion, but I said that we could not regard ourselves as completely free from the danger of marauding raids. Such raids might cause considerable damage, and since the basic principle of insurance is that the individual should not be expected to carry the entire risk, it seems right and proper that, so long as there is a risk, it should be borne by the entire community.
– What about reducing the premium ?
– That is at present under consideration.
– Can the Minister for Social Services say whether the Government’s much vaunted social service programme contains proposals of such a nature that the Government believes it unwise to proceed with them except in leap year?
– The real reason why the Government’s social service programme was not introduced last session was that the Opposition knew how good it really was, and so took steps to prevent its introduction. The necessary legislation will be brought down as soon as* the Government is ready to do so.
– I ask the Minister for Supply and Shipping whether developmental work is still being carried out on the Lakes Entrance oil-field and whether that work has reached a stage at which production can be commenced ? If so, can he give any indication of the quantity of the production?
– That work is progressing satisfactorily according to plan. I understand that the shaft is now down to a depth of approximately 500 feet, but as the total depth planned is 1,200 feet, sinking will .take some time yet. In the meantime the horizontal boring plant is being obtained from the United States of America and we hope to have that plant on the spot when the present, job is completed.
– On the 24th September the honorable member for Bass (Mr. Barnard) directed to me, as Ministn: representing the Postmaster-General, a. question without notice. The PostmasterGeneral has supplied the following reply to the honorable member: -
As a well-known public figure, and the first woman to be elected to the House of Representatives, Dame Enid Lyons was invited by the Australian Broadcasting Commission to broadcast a talk in the “ Guest of Honour “ session on Sunday, ]9th September, between 7.45 p.m. and S p.m. There has been no change in the commission’s policy, which provides for talks of interest from the listener’s point of view by prominent personalities in all walks of life, including members of Parliament. During the period immediately preceding an election, however, the commission imposes curtain restrictions on political broadcasts as provided in section 89 of the Australian Broadcasting Act.
– In the absence of the Attorney-General, I ask the Prime Minister whether the Government intends to introduce a bill this session to provide for the taking of a referendum to alter the Constitution in order to give greater powers to the Commonwealth?
– I remind the honorable gentleman that it is not customary to declare government policy in answer to questions. In any case, I am not in a position to give an answer at this stage.
– I ask the Prime Minister whether the extension by twelve months of the term of office of the Right Honorable S. M. Bruce as High Commissioner for Australia in the United Kingdom is a polite and gentle way of intimating to the House that Mr. Bruce will be relieved of his duties in that office at the expiration of that period? If that is not so, why has the period of his re-appointment been limited to twelve months?
– I am quite sure that the honorable gentleman has no intention to be ungracious in this matter, nor to strike a discordant note.
– I am not a member of the Advisory War Council.
– This is not a matter for the Advisory War Council, and the honorable gentleman would not know any more about the subject if he were a member of that body. But, respectfully, . I say to him that if he had listened to my statement yesterday, or had read it, even if he had not listened to it, he would know that I informed the House that by arrangement it had been decided to appoint Mr. Bruce for another year. I submit that the words “ by arrangement” cover the entire ground, indicating that the suggestion made by the honorable gentleman that the Government gave Mr. Bruce a polite hint about the termination of his office is unjustified. However, the honorable member’s remarks lead me to say that it has been a source of distinct personal gratification to me to have had the services of so capable a man as Mr. Bruce as High Commissioner in the United Kingdom. His services to Australia during the war - and I speak authoritatively of the term during which I have been Prime Minister - have been of the greatest value, and I have the highest respect and admiration for him. I am also happy to say that I have reason to believe that Mr. Bruce regards himself as being quite capable of working as well with me as he was capable of working with any other gentleman who has been Prime Minister of Australia.
Motion (by Mr. Curtin) agreed to -
That, unless otherwise ordered, Government business shall, on each day of sitting, have precedence of all other business, ‘except on that Thursday on which, under the provisions of Standing Order No. 241, the question is put “ That Mr. Speaker do now leave the chair “. On such Thursday general business shall have precedence of Government business until 9 p.m.
Motion (by Mr. Chifley) agreed to -
That leave be given to bring in a bill for an Act to amend the Commonwealth Inscribed Stock Act 1911-1940.
In Committee of Supply: Considera tion resumed from the 29 th September (vide page 168), on motion by Mr. Chifley -
That the first item in the Estimates under Division No. 1. - The Senate - namely, “ Salaries and allowances, £8,380 “, be agreed to.
– The budget presented to the House by the Treasurer (Mr. Chifley), unlike most, if not all, budgets of which I am aware, does not contain any new proposals. It can rather be regarded as a statement of accounts, a statement of the largest accounts ever experienced in the history of Australia, and produced in their turn by the greatest crisis this country has ever had to confront. I shall begin my comments on the budget by summarizing quite briefly a few salient facts that are disclosed by an examination of the budget. In the last financial year 1942-43 the expenditure of the Commonwealth Government in Australia was £670,000,000. In 1943-44, the year for which the Treasurer is budgeting, he anticipates that the expenditure will rise to £715,000,000, so that the total over-all increase of expenditure will be £45,000,000. The war expenditure, which last year was £561,000,000, is expected this year to be £570,000,000, so that the war increase is £9,000,000, and the total increase £45,000,000, disclosing the fact that of the increase of expenditure, £36,000,000 out of £45,000,000 is for non-war purposes. Of the war expenditure of £561,000,000, an amount of £59,000,000 represents reciprocal lendlease. I was very much struck, as I am sure every honorable gentleman was, by that figure. Those of us who remember the beginning of lend-lease and the beginning of reciprocal lend-lease, scarcely anticipated that in one year alone reciprocal lendlease would amount to no less than £59,000,000 in Australia. But in the year which has just begun, of an anticipated war expenditure of £570,000,000, reciprocal lend-lease is estimated to account for £100,000,000. So it will bc seen at once that the increase of our war expenditure, plus a great deal of that expenditure itself, will be on account of aid rendered reciprocally by this country to the United States of America. I refer to these facts and underline them because it may not yet be sufficiently understood among our people that Australia in this war is not merely a beneficiary of what is done by other countries; it has itself been a powerful contributor to what those other countries have been able to do. It is a remarkable fact and one giving great occasion for pride, I think, that a country of 7,000,000 people should in the course of a war of this magnitude be able to give aid to its great neighbour across the Pacific to an amount of no less than £100,000,000 in one financial year.
On the receipts side of the budget, I summarize the matter this way: last year from the revenue budget we took for non-war purposes £109,000,000. This year the amount will be £145,000,000. Last year from the revenue budget we took for war purposes £159,000,000. This year the amount will be £167,000.000. Last year from loans and war savings certificates and war savings stamps the Government raised £215,000,000. This year it budgets for £300,000,000 from those sources. The remainder last year, to bring it up to balance, was obtained: £8,000,000 from temporary’ balances, and £179,000,000 from treasury-bills, and, if the Treasurer’s estimate of what he is going to raise by way of loans be achieved, this year he will, instead of going to the bank for £179,000,000 worth of treasury-bills, go to it for £103,000,000 worth of treasury-bills. He will be the last to forget that when he goes to the bank for £103,000,000 worth of treasury-bills, that will be cumulative upon what was obtained last year and that, until those bills have been funded, their effect upon the financial structure will not be merely annual but cumulative. The Treasurer has that, I have no doubt, anxiously in mind.
Those represent the salient features in the structure of the budget. I now want to make some comments, not only upon them, but also upon other matters which are disclosed to the mind by a perusal of the budget speech. In the first place, war savings certificates and war savings stamps in the financial year just closed brought in under £9,158,000. The estimate in last year’s budget speech by the Treasurer - I admit it was put forward in a rather airy manner - was £60,000,000. Honorable members will recall that after anticipating £240,000,000 or thereabout from public borrowing, long-term borrowing of the ordinary kind, the Treasurer said -
It will leave £60,000,000 to be provided from savings bonds and savings certificates. This is about the British rate of contributions to small savings, and with our higher wages should be capable of accomplishment.
Well, we thought that the Treasurer was a little optimistic, but I do not suppose anybody anticipated that the return, in fact, so far from being £60,000,000, would be very little over £9,000,000, for the year.
– Most of those people who, it was thought, would buy war savings certificates and war savings stamps diverted their money into the bigger loans.
– I sincerely hope my right honorable friend is right, but I very strongly suspect that there are still far too many people in Australia who regard supporting public loans as a matter solely for those whom they regard as rich people.
– lit applies to all sections of the community.
– I assure the right honorable member that I am not discussing this matter politically. I am pointing out that, of all methods of investment, experience in other countries has shown that the one specifically designed for small investors is that of investment in war savings certificates and bonds. The result, as I am sure the Government will feel, has been extremely disappointing in the last twelve months. Take two years by way of comparison: In the financial year 1940-41 war savings certificates and stamps brought in £12,700,000 gross, and redemptions were £900,000, leaving a net subscription of £11,800,000; and in the financial year just closed, gross subscriptions were approximately, £11,300,000 and redemptions were £2,200,000. That represents far too high a percentage of people coming along to cash their certificates. I shall, perhaps, say a word about that at a little “later stage, but in the meantime I merely put into the minds of honorable members on both sides of the House the very salient facts that that form of investment is bringing us in £2,000,000 less than it did two years before, and that the figures disclose a very undesirable disposition on the part of the people to regard their purchase of war savings certificates, not as a real war-time contribution to. the country’s cause, but as a mere temporary investment for their own private purposes, as is shown by the recent figures of redemptions.
The last election was fought on a number of issues, one of which was, without question, that of financial policy. The people of Australia have given approval to the Government and must, in my view, be taken as having approved, broadly at any rate, of the Government’s financial policy. As I indicated a week or two ago, I do not propose to endeavour to engage in post-mortems on matters which I regard now as determined by the people’s verdict. I take the position as it is, not as it was or as it might be. Taking the position as it is, I point out that, whatever the view3 of honorable members of this House or of people outside Parliament, our prime function financially in this war is, accepting for the nonce the Government’s financial scheme, to concentrate our efforts on preventing that scheme from coming to disaster. I regard myself as having a real duty as an Australian to do what I can to make the Government’s financial policy, until it reaches a point where I can no longer accompany the Government, such that no disaster will come to this country.
This, in practical politics, means two things. It means in the first place that we must obtain, in the course of this financial year, a greater volume still of public lending to the Government of the country. When the Treasurer says, “ I am hoping to obtain by loans £300,000,000,” I am forced to the conclusion, as I said yesterday, that if that £300,000,000 could become £320,000,000 or £350,000,000 the oversubscription would bc all to the good, because what the public will give him will reduce the demands that he must make upon the Central Bank, and I regard a large volume of public lending to the Government in this financial year and in the next financial year, and until the war ends, as of the first importance for the political stability of Australia. In the securing of the greatest possible volume of public lending, every member of the Opposition will, . as I have said, co-operate to the full. The second thing that .we must do - and it is something about which we who are not of the Government can do but little - is to see that non-essential expenditure in Australia is pruned as deeply as it can be, and that war expenditure itself is subject to the scrutiny which the financial interests of the ordinary citizen would demand. I am not going to occupy the time of the committee by reciting in-, stances that have come to my ears of extravagance or waste, because I know that one swallow does not make a summer. We all could quote individual instances, and I know that there is nothing harder for a government than to secure a really close scrutiny of expenditure at a time when money seems easy, and when it seems almost a patriotic duty to spend it. I am not at this stage going to criticize my friend the Treasurer, hecause, if he is like Treasurers in previous governments from time to time, I know exactly what his experience him beon. He has been sending anguished letters round to his colleagues and to the departments saying, “I must have a reduction of your estimates “,’ and they, have met him with exquisite courtesy and a negative result. That, I know, is a not uncommon experience. But when war expenditure inside a country rises to £570,000,000^ one would need to be ve 17 optimistic not to believe that millions of pounds of it will represent money that really is being wasted. I do hope that ways and means will be found of so scrutinizing these expenditures, and so inducing in the minds of those who are in charge of them a. sense of public responsibility, that the people will begin to have the satisfaction of believing that they are getting 20s. worth of work for every 20s. worth of expenditure.
Of course, in one sense, as I think I heard somebody say across the table, all war expenditure is wasteful, but at a time when we are imposing on ordinary people all over Australia enormous financial burdens, the value of the money with which they will come out of the war is going to depend to a very large degree upon the care and responsibility with which their money was spent while the war was on. Indeed, I may say at once that I am not half so concerned with what is going to happen to us who are here now - the fathers of the people who fight for Australia - as I am with what is to happen to the people who are fighting for Australia, and what sort of financial structure they will come back to. If we in our particular time and generation have to sustain some loss of capital values, some gross reduction of income, and mounting expenses by way of taxation, what of it? It is a small enough price to pay for the . successful solution of the issues that now confront us, but it would be a terrible tragedy if the hundreds of thousands of men who will have served this country at no profit to themselves should come hack here to find the financial structure so debilitated, the currency so weakened ‘by extravagance or inflation, that they have another war to fight and another problem to solve.
I referred a moment ago to thd extraordinary result in connexion with the investments of what I assume to be the small investor.. A great loan campaign is beginning, and I urge that the Government should concentrate a great deal of attention through its publicity agents and representatives on the small investor. Indeed, it is by no means certain that war savings certificates as a means of taking up investible funds would not be still more effective if the Government reconsidered the present maximum limits. I believe that the maximum limit for an individual is still £250.
– That is correct..
– In Great Britain it is £500. No doubt there are arguments, on both sides, but I do suggest that a much greater response to the appeal te the small investor to take up war savings certificates might be obtained if thos.limits, were exceeded. I know that a very strong case can be advanced for the adoption of a limit; but I am merely discussing the amount of the limit. My reason for doing so is. that many people willingly contribute automatically a small sum every week for a war savings certificate. They can do so very conveniently. But when they reach the limit they consider that the obligation to contribute no longer rests, upon them:. From that time their interest in public loans is not very great.
In the course of his budget speech, the Treasurer made a variety of references to what we call, and what he called, the “ national income “. Sometimes that expression is rather misleading. We were told that the national income, which was so many hundreds of thousands of pounds when the war began, rose to £1,000,000,000 and later to £1,100,000,000. Then the Treasurer produced a statement which, I say with respect, is full of self-delusion, for he said, in reference to the war-time increase -
The burden of Commonwealth and State Government debt is less now in relation to the national income than it has. been for most of wm last twenty years. Total interest payable here and abroad is now about 5j per cent, of the national income, compared with 7 per cent, in 1935.
– That is true, because the value of our -money has depreciated.
– In the literal sense it is true, but it all depends on whether one fully appreciates the meaning of the expression “ national income “. Many people in the community erroneously regard it as some indication of mounting general wealth. They consider it to be almost conclusive proof that most people are better off, that great financial resources are in existence which can readily be tapped by a competent government, and that the problem has ceased to be an individual one, and has become one of those vague social problems in respect of which we can always shuffle out of our individual responsibilities. The truth is that the national income, properly considered, is far more a sum of payments than it is a sum of true profits or receipts. The greater the war expenditure, the greater is. the national .income, because war expenditure itself is income in the hands of someone. So we have the condition that we are now experiencing in Australia. So far from paying its national dividend out of profits, Australia is to a large degree paying it out of capital. No or.e can doubt that war inevitably means some dispersal of capital ; but for a company to believe that its shareholders are enjoying great prosperity because it is in reality distributing its capital to them by way of dividends is to believe the greatest of all fallacies. “We must not become too comfortable about our financial position just because on paper the national income rises and the Treasurer is therefore able to say that the proportion that the interest bill bears to the national income 13 smaller than it was. The truth is that this so-called national income in Australia can destroy its own value by setting up vast inflationary movements, unless all the safeguards against inflation are employed to the fullest degree.
– Is not the national income only the money value of the goods and services produced during the preceding twelve months?
– In one sense it is; but we arrive at all these things by taking what is in reality a sum of payments. “We cannot take the sum of payments in the community as being necessarily a sign of prosperity. I cite the simplest possible example: Although a country whose currency has depreciated by 50 per cent, may be able to el aim that it has the largest national income, expressed in units of currency, in its history, its real standard of prosperity may have fallen immeasurably. As I say we must use all the safeguards to the fullest degree.
I do not propose to give a long and amateurish exposition of what those safeguards are. The first of them that I have in order is that of substantial generous public lending to the Government. After all, it is perhaps the greatest single means of withdrawing into the hand of the Government purchasing power which, if left in the hands of the public, would set up an irresistible inflationary movement. That is why the success of a loan is of the first importance. The second of the checks is taxation. It is because people understand that a record level of income tax is vital if what we have left is to possess any value in these times that they pay their taxes, for the most part, with cheerfulness. In the last few months a good deal of discussion has taken place in Australia about a proposal to adopt what is called the payasyouearn “ system of income tax. Within certain limits, at any rate, this system has apparently been adopted, or is in the course of being adopted, in other countries. The speech of the Treasurer contains only one slight hint that this matter is being examined. I desire to make a suggestion to the honorable gentleman. The issue on the “ pay-as-you-earn “ proposal is by no means clear. It has not yet been presented, as a perfectly clear matter, to the public mind. Its advantages to the taxpayer, particularly in a time of falling incomes, are obvious, but the administrative difficulties can very well be imagined. There must he some truth to be found as the result of an investigation of all the advantages and all the difficulties. One of the problems that perplex the man in the street is that whilst some people urge the adoption of the system of “ pay-as-you-earn “, the
Government contends that it is impracticable. The man in the street is not. provided with any clear analysis either of the problem or of the reasons that led to a certain conclusion about it. If there be a real answer to the “ pay-as-you-earn “ claim, we should have it, but, above all, the matter should be clarified. For that reason I suggest that a small committee should be appointed to investigate, im close collaboration with the experts available to the Government, the problem of introducing a system of currently paying tax upon current earnings, and that committee should report to the Government and through the Government to this House, so that we may have, not an arbitrary statement that the system is or is not practicable here, but a clear exposition of the reasons why certain things can or cannot be done, and of the effect of the introduction of such a System not only upon the budget, but also upon the position of the ordinary taxpayer. In brief, let us have the matter clarified in an authoritative fashion, so that it will not be thrown around as a sort of political bone of contention but will be solved, as it ought to be solved, on it’s own pure merits.
I turn from those comments to say a few words about the future. The burden of taxation in Australia is very great, and the concealed burden of inflation, which is at present something more than 20 per cent., is in its incidence upon many people, greater even than the burden of direct taxation. All those things are patriotically borne for a war and during a war. But what about the post-war position? One of the commonest statements which one hears made to-day from the public platform and in this Parliament - it has been made here on a number of occasions since the present session started - is, in effect, this : If we can raise all this money for war, we can raise it for peace; never again must financial limits be imposed upon public policy. There we have two ways of putting a statement which is being made repeatedly and which, on the face of it, ‘has enormous attraction; but like so many of those short and attractive statements, it is only a half-truth, and we as a Parliament must give to the public a lead in clear thinking upon this matter if we are not to produce, at some stage after the war, most bitter disillusionment and perhaps most embarrassing reactions. Except under certain conditions, we cannot possibly raise and spend as much money in time of peace as in time of war, and in a moment I shall have a few words to say about those conditions. . The ingredients of progress and security,, which, after all, are the two things for which a country like our own looks, are men and. materials. In no real sense is money an ingredient of progress and security. On the one side of us, we have people who are devoted to the latest monetary theories. They see every problem in terms of money, and they believe that money will unlock all doors. Money to them is the overwhelming problem of mankind. On the other hand, we have people of rigid and conservative minds, who see money in an exactly opposite role. They see money as the limiting factor in all things. They say first of all, “What money have we?”; secondly, and only secondly, they say, “ What men and resources are available?” These people are as great a danger in the consideration of this problem as are the people who see everything in terms of money. The truth is that money is a subsidiary factor. Of itself, it creates nothing, and it solves no problem. It is the mere instrument by means of which the dynamic power of man and materials is released. Whatever may be said about the past, I believe that we have come to understand at least that one central thing about the function of money. But that does not mean that we can spend advantageously unlimited millions of pounds in a country of limited millions of people, and it does not mean that money has ceased to be something that we need discuss. All it means is this : At all times we must consider our policy of war or peace in terms of the people that we have who can work, and the materials that we have on which they can work. If we so handle our monetary policy that our expenditure will fall short of that point, then unemployment will occur; if we so handle our policy that our expenditure in terms of currency goes beyond the point at which we employ our people and utilize our resources, there will be monetary competition for men and materials, prices wall vise, and the value of the currency will fall. That I submit, is a perfectly fair and objective statement of the real heart of this problem, and I make it merely to indicate that in these matters money is to be out servant. If that servant gets out of hand great injury to our country may be caused. We can destroy our country by the abuse of money or the excessive use of money, as surely as we can destroy it by a cheese-paring and unenlightened approach to the problem of money.
In this financial year we propose to spend £570,000,000 on war. What is the first thing that the Treasurer does? In effect, he obtains a credit. Obviously, he does not obtain a credit for £570,000,000, because he will obtain a certain amount of money from income tax and other sources. However, let lis assume that he starts off by obtaining a credit for £570,000,000. He has hehind him the :bank and a capacity to discount treasury-bills, and he says, “Very well, I shall spend £570,000,000”. Everybody, with the exception of a few strange people in this country, knows perfectly well that if the Treasurer said to the bank,. “ I shall take the whole of the £570,000,000 from you, and I shall not bother the public by imposing taxes or rationing goods the entire currency of Australia would disappear in a year. Realizing that in such a policy are the seeds of tremendous inflation, the Treasurer considers how he will prevent this evil from growing, or at least keep its growth within bounds. He resorts to the various- counteracting measures that are available to him. First, there is enormous ‘ taxation. In the current financial year the Treasurer will raise by means of direct taxation alone something .between £100,000,000 and £200,000,000. Secondly, there is enormous public borrowing. People forget occasionally that before the war began,it was thought to be normal borrowing routine to take approximately £30,000,000- a year from the public. That amount was regarded as being almost the ceiling. The honorable member for Warringah (Mr. Spender) will recall that in his first days as Treasurer we were still thinking, as the people generally were thinking, in terms very close to that amount. Yet last financial year, the public contributed, approximately £215,000,000 by way of loans, and this year I hope that they will contribute £300,000,000, and- wo all must do our best to ensure that that sum is raised.
– There are more people in employment now.
– A remark like that is quite beside the point. Of course more people are employed, but the number of people employed now compared with the number employed in the best days before the war does not account for an increase of public borrowings from £30,000,000 to £215,000,000. As a matter of fact, anybody who has paid close attention to this problem knows that we have been able to raise £2.15,000,000 by way of loans from the- public only because we are engaged in a war that gives to the people a sense of urgency and causes them to realize that there is a danger to be met and that they have a patriotic duty to perform. That is why we have been able to raise £215,000,000. and before anybody starts to talk of spending £500,000,000 a year in time of peace, he should ask himself, “ Can we possibly continue raising this huge amount of income tax when the war is over? Can we continue to raise £215,000^000 a year in loans?” These are questions which must be answered before making the easy statement that whatever can he done in time of war can be done also in time of peace. I have mentioned two checks available to the Treasurer to curb inflation, namely, taxation and borrowing. There is also rationing. I am surprised constantly’ to Hear people discuss rationing as if it were something which has been necessitated’ solely because of a shortage of goods. That rationing is the most equitable means of distributing good’s that are scarce, is perfectly true. But rationing has many more functions than that. It has the function of serving, in some degree, as a compulsive factor upon people who do not adequately subscribe to the public funds; if they are not able_ to spend the money on clothes, they will have it to spend on war savings certificates or on other public investments. I believe that rationing, after taxation, is probably the best way of diverting purchasing power and man-power to the Government; because it conserves not only money which cannot be spent, but also man-power, which thereupon becomes* available to the Government for war purposes. In addition, we have prices control, investments control, and other restrictions of all kinds. “What I want to put very briefly to honorable members is this: If, when this war is over, we are to have - as I believe we must have - a much higher level of public expenditure than we had before the war began, then we must recognize that certain conditions will be attached to it. You cannot set in movement all those great inflationary forces which the Treasurer knows so well, unless you ure prepared also to put into operation the counteracting forces to which I have just made a brief reference. The Australian people must do some pretty clear thinking. It will be of no use, when we emerge from this war into a state of pcr.ce, to say, “ We have learned all about this matter of finance; we shall now be able to spend hundreds of millions of pounds on all sorts of ideas “, unless we are prepared to recognize the things that accompany such a policy.
– Give to the Commonwealth the necessary powers.
– The matter with which I am dealing has nothing to do with Commonwealth powers. I am sorry that I am conveying myself so badly to my honorable and learned friend. It has nothing to do with powers, but has everything to do with financial policy. If we really believe that when the war is over the people will continue to pay happily for an indefinite period the present income tax rates, that they will continue to subscribe over £200,000,000 a year to loans, and that, when the trade of the world begins -to stir in its sleep and revive, they will be content to continue to be subjected to clothes rationing, and to all the other limitations upon their expenditure, we are deluding ourselves. We have to realize that there will at once spring into life a powerful demand by the public for all sorts of things of which they have denied themselves in the course of the war. What I am pointing out is this : The greater that demand, and the more it succeeds, the smaller quantitatively will be the value of the checks that now exist and, ;as a result, the smaller will be the amount of central bank credit that can safely be created. That means that we have to regard this problem in the future, and after the war - if we come to discuss it at a relatively early date - not by reference to a slogan but in terms of pure realism. We shall need to adjust our demands for credit to our willingness to institute safeguards against the excessive use of credit. All the existing controls, of course, will inevitably be modified at some time after the war. Perhaps I say that unduly optimistically, but I point this out: That, in. relation to those controls, the middle course will, as usual, turn out to be the sound and sane course. If, at the end of this war, we were merely to terminate rationing, prices control, and all the other restrictions, the result, I venture to say, would be chaos; it would be the most violent blow that could be struck at the economic structure of Australia. On the other hand, if, after this war, we continue indefinitely, year after year, decade after decade, to have these controls, then, equally inevitably, the whole of the economy, and the whole of the social and political life of Australia, will become controlled, and we shall produce an authoritarian system of government in Australia.
– The Opposition parties fought the election campaign against such regulation.
– I am sorry that the honorable gentleman had not sufficient leisure to attend some of my meetings and hear some of my speeches; because it is not true to .say that this side of politics stood for the abolition of these controls. What my honorable friend .perhaps fails to remember is that there is hardly one of these controls that was not instituted in the first place in the time of my Government. Those are the commendable controls, the necessary controls. I am mot here to make windy speeches, protesting against the Department of War Organization of Industry, against regulations as such, or against prices control or investment control. All of those’ are .good in time of w.ar. I may quarrel with honorable gentlemen opposite on some point of detail, but not on a point of principle. When the war is over, the indefinite continuation of these things will be all right if you believe, as no doubt my friends opposite do, in the socialized state; because the socialized state must be the controlled state, it must be the state in which all has been sacrificed for security. But I do not believe, nor do my friends on this side of the House, in the socialized state. Nor do we believe in chaos, nor in some impossible idea of going back to 1939 or to some other time in the past. We believe that these controls, which are necessary in time of war, must be steadily reduced when this war is over. We do not believe for one moment that this country can throw them all off the moment the armistice occurs. We believe that they must be progressively reduced; because in the long run - and this is why, a few minutes ago, I made a reference to progress and security - we may discover that you cannot have progress and absolute security at the same time. That, perhaps, puts into one sentence the entire difference between the political philosophy of this Government and my own. The experience of war shows that you cannot have progress without risk. The bitter lessons that have been learned in the course of this war have shown that risks must be accepted all along the line if we are to have victory over a jungle animal. To the true socialist - I speak of him with respect; he is a man who entertains a view which I cannot share - the perfect state of life is one in which those- things that are done in time of war are done indefinitely in time of peace, in which they are increased, all industry passing steadily under the complete control of the state. He must believe that, if he .believes in the socialist thesis ; and he does so, because he believes that the one thing that matters is security. But for a country like Australia - whose existence, whose prosperity, whose spirit, are all founded upon a willingness to take risks - to say that the taking of risks is now an oldfashioned idea, and that the one thing that matters is absolute security, is, I believe, a denial of the whole genius of our people throughout their history. Whatever political party sits on the treasury bench, it must be prepared to find for the ordinary citizen every scrap of social security that can be brought to him; but that social security will mean nothing more than a false standard of living unless there is progress in Australia. There must be increasing wealth year after year if we are to have a real rise in the living standard of the Australian people. We on this side stand apart from the socialist theory because we believe that progress in this country will inevitably be based on a willingness to take risks, a willingness to be adventurous in business, a willingness to take long chances for the development of Australia’s resources, because, if you like, of a desire for large rewards. It is useless for honorable members opposite to say that they are not interested in rewards. He would be a queer human being indeed who was not interested in rewards. I have noticed that among honorable members on the other side of the House there has occasionally been competition for posts in the Cabinet and elsewhere. Of course, we all are interested in rewards. How shall we develop Australia the more quickly: by having indefinitely in the time of peace a controlled community, as though a state of war were perpetual, or by having a community in which adequate control over the use of the public credit for real public needs exists side by side with a system which gives real encouragement to enterprise - a state of affairs in which a man may not be ashamed to admit that he is in business to make a profit and to extend his undertaking? Men who have held that view have been responsible for the great bulk of the employment, progress and prosperity of Australia in the past, and I hope that such men will be able to undertake similar responsibilities in the future. I might,’ perhaps, sum up by saying that, we on this side of the Parliament believe in the rights of individuals, including their financial and business rights; but we do not believe that those rights are superior to the obligations which the individual owes to the community. I believe, and my colleagues believe, and I hope that every civilized Australian believes, that our response to the great challenge of the post-war period will be revealed if, five or ten years after the war, it can be said that we really have been able to provide, in substance, full employment for the Australian people; that we have given, in substance, a real education to every person in Australia fit to receive it; that we have given to every young person in the community, whatever his social state, a chance to do anything for which his talents have fitted him; that we have made medicine, and public health services, available to every person in the community, and have attacked the causes of disease at their source. The real question five or ten years after the war will be whether we have done those things for every person in the community. Every member of this Parliament, irrespective of party, stands for these things; but the Opposition believes that these objectives will be more quickly obtained if we take all the steps necessary to increase the real wealth and resources of Australia. That is why the Opposition believes in individual initiative, and in the reward of individual initiative. In brief, we on this side believe that all these matters to which I have referred are the great human charter of this century. We believe in the rights of the individual, not as primary rights which must be enjoyed, whatever happens to any one else, but as secondary rights, which are conditional upon the performance of his full social, economic and industrial duties. The present Government may pass into the period of peace - should that period come during its term of office - in the full assurance that every one in the ‘‘community, except a few unthinking reactionary people, will have no doubt that Australia must, for a long time, continue to have controls; that adjustments will have to be made from time to time; and that the process of returning to peace conditions will be neither fast nor easy. If, however, the Government imagines that it will have a great volume of support for a process which is designed to produce ultimately a socialized community in Australia then 1 believe, as indeed I hope, that it is doomed 1o disappointment.
– Does the right honorable gentleman absolve the State from taking part in that effort?
– I thought that, in my general thesis, I had made it clear that the State will have a great part to play. In the long run all controls will tend to be exercised through the State. The function of the State in giving orders to industry and laying down rules to be observed will not be a’ diminishing function; rather will it be otherwise. But the vital, dynamic force in industry will depend, not on government departments, or even on parliaments, but on the men who control industry. If, in order to obtain absolute security, we take away from them every incentive to progress, then Australia will at long last find that it has purchased its security at too great a price, and has brought about a standard of living lower than we ever expected to enjoy.
.- Having listened with great interest to the Leader of the Opposition (Mr. Menzies), I must congratulate ‘him on his attempt to be pedagogic at the expense of members of this House. When he, as it were, took me by the hand and led me down into that dark incomprehensible underworld in which is situated the temple erected for the worship of Mammon, of which he seems to be a devotee, I must confess that, although during the past 25 years I have discussed financial affairs with a number of distinguished men, including that most eloquent person known as Major Douglas, with resultant chaos of mind regarding financial affairs, now that I have heard the right honorable gentleman my mind is infinitely more chaotic.
– That is not the fault of the Leader of the Opposition.
– I am confident that, at the appropriate moment, the honorable member for Wilmot (Mr. Guy) also will give an equally eloquent account of the intricacies of finance as practised by himself. I am astonished to find in this National Parliament men who have gained a reputation in the public life of this country and yet know so little about the conditions that exist in Australia. It is all very well for honorable members to throw their arms around and say what they would do in the future, but, in case they do not know it, I remind them that interposed between this National Parliament and the Australian people there are six Australian parliaments which have infinitely greater powers than has this
Parliament. If Parliament wishes to achieve anything effective in the way o£ post-war reconstruction it must obtain additional powers from the sovereign States. Until honorable members on both sides of the House have learned this, they have not learned the A B C of Australian politics. Do honorable members think that the bureaucratic control which has been established under national security legislation will’ be allowed by the States to survive after the war? Of course it will not. The Commonwealth should set itself immediately to find out what powers the States are prepared- to hand over for the purpose of post-war reconstruction. If the States are unwilling to transfer the necessary powers, then plans should! be drawn up which the State- Parliaments themselves would he prepared to put into effect. Until something of this kind be done, all the eloquence which has been expended on the subject in this chamber will have no effect. I was surprised to hear statements made in this House by people who lack the most elementary knowledge of the position as between the States and the Commonwealth.
– The honorable member’s eloquence failed to convince the Tasmanian Legislative Council.
– That is true. The honorable member, in common with many others, thought they merely had to ask the States for something and they would receive it. Before ever the bill was presented to the Tasmanian Parliament I informed the Commonwealth Government that there was no chance of its being passed, and I was right, although I put the bill up three times.
– The Tasmanian Legislative Council ‘is hopelessly conservative.
– It is no more conservative than the honorable member himself, and no more hopeless. Yesterday, this House passed a bill providing for the payment of grants to certain of the States. The fact, is that Parliament has paid too little heed to the requirements of the claimant States, and therefore is ignorant of what is necessary to create a frame of mind in those States which would make them agreeable to transfer increased powers to the Commonwealth. Until the claimant States are adequately protected’ they would be foolish to hand over greater power to the- Commonwealth, which has not exercised properly the power it already possesses. This is a subject upon which I intend to say what is in- my mind. I will not be gagged by any one.
– Which of the honorable member’s propositions does he propose to support in the long run? He first said that the States should hand over additional powers to the Commonwealth, and then he said that the States would be foolish to do so.
– I support the proposition that the States should be asked to hand over certain clearly defined powers for certain specific purposes. I do not support the proposition that the States should agree to something which neither they nor this Parliament properly comprehends, thus making it almost certain that the request will be refused, and necessary alterations of the Constitution delayed for another quarter of a century. On fourteen occasions the people have been asked to confer additional powers on the Commonwealth Parliament, and on only two occasions has the request been agreed to. Do we expect the State Parliaments to cut their own throats?
– Let a referendum be held.
– I have no objection to the holding of a referendum, but I know what the result would be, unless the proposals are carefully selected, and the people educated to understand what they are being asked to do. Let us consider for a moment the position of Tasmania in relation to the other States, particularly in the matter of war expenditure. The Treasurer (Mr. Chifley) has said that between £75,000,000 and £100,000,000 of war expenditure has been incurred in the mainland States in the construction of roads, bridges, docks, &c. Normally, that money would have been borrowed by the State governments, which would have had to pay interest on it. Now, the Commonwealth has assumed responsibility for the debt, but the States will, after the war, continue to enjoy the benefits of the expenditure. Hardly any expenditure of this kind has taken place in Tasmania. The people there are aware of this, and let it not be forgotten that in a referendum on a proposal to amend the Constitution Tasmania, in spite of its small population, has the same voting power as a State as have any of the larger States. If the Tasmanian Parliament desires to undertake works of the kind which the Commonwealth has performed in the mainland States it must approach the Loan Council for permission to raise the money, and then it must pay interest on that money. I hope that the Commonwealth Treasurer will remember this when it comes to the allocation of loan, moneys. Another disability from which the claimant States suffer is that, in the matter of social services such as public health, Sec, they have to content themselves with spending 10 per cent, less proportionately than the non-claimant States. That is a matter which should be adjusted as early as possible.
In my speech on die Address-in-Reply I dealt at length, with the problem of increasing our population. I now revert to that subject in view of the interest that has been evinced in it. Australia’s doom is being sealed here and now. Our population has been on the decline for the last twenty years, and all of the proposals for the future to which the Leader of the Opposition has so eloquently addressed himself will be of no avail whatever if our population continues to decrease. It is time that the Government gave the most careful consideration to this problem, which I regard as second in importance only to the problem of winning the war. This problem represents for us a second front, and we must deal with it immediately. In order that no misconceptions may exist among honorable members on the subject - and I do not ask them to accept only my views - I urge the Government to institute forthwith an inquiry into our vital statistics. All of the information required to awaken us to a realization of the problem can be obtained from the State Health Departments and the Commonwealth Statistician. I ask that that information be collated and presented to the House. I am sure that the statistics so obtained will substantiate figures which I gave to honorable members when I spoke on the Address-in-Reply. . In that event, it will be obvious that this problem cast upon the Government a greater responsibility than many of the problems to which it is now addressing itself in the hope of acquiring by an alteration of the Constitution the requisite powers to deal with them. I do not propose at this juncture to deal with the causes of the decline of our population. Those causes can be ascertained by an inquiry of the kind I suggest. But if it be true that our population of 7,000,000 is being disturbed at one .end by the decline of the birth-rate, and at the other end by the stepping up of the longevity rate, it will not only remain static, but the proportion of young people te old people will also be varied to such a degree that it will soon become impossible for those between the ages of 20 years and 60 years to carry the nation’s economic burdens. I realize the dryness of this subject; but some of the most important subjects in our national life are extremely dry, and I suppose that population and finance rank among the driest of them. Their importance, however, has been emphasized by the Leader of the Opposition, who has painted a very gloomy future for this country, particularly in respect of our finances. Our future is infinitely more gloomy with respect to our population problem if we do not apply ourselves immediately to the solution of it, either by increasing our birth-rate or through immigration. The Government owes it to all parties within the Parliament to ascertain the facts and figures which will reveal the problem in its true light. Therefore, I ask the Prime Minister to institute an inquiry in order to ascertain the causes of the decline of our population, and that the report of the committee appointed- for that purpose be presented to the House in its next sessional period. The information which such an inquiry will disclose will enable honorable members on all sides to realize the importance of the subject. Parliament -can then proceed on the basis of that information to deal with the problem. I am aware that many people have short-cut solutions for it. No doubt some will say, in order to evade responsibility in the matter, that the Labour party will not allow this or that to be done. The Labour party is as patriotic, and as concerned for the future of the country, as is any other party, and once our members are fully informed of the facts they will attend to the problem. It the people are not fully informed on this subject, the fault can be laid at the door of past governments, because the people themselves have no means of obtaining the full facts and figures.
Much has been said concerning postwar problems. I remind the Government that it cannot attend to any problem in respect of which it does not possess adequate powers. That fact should be clearly realized. If the Government proposes, to finance the administration of the States, it will have no need, after meeting its obligations to those who have fought and bled for us in this conflict, and their relatives, to apply itself to most of the propositions which are now being put forward, and in respect of which it does not possess adequate powers under the Constitution. So long as the present position remains, the Commonwealth can escape its obligations in respect of those problems simply by saying that it is prepared to accept full responsibility for dealing with them provided that the people give to it the necessary powers to do so. Indeed, that must be our approach to many of these propositions. I again emphasize that the efforts of the Commonwealth to obtain greater powers to enable it to deal with these problems must be divorced entirely from party politics. With the swing of the political pendulum, one party has its little day upon the stage, and then gives way to other parties. At some future date, this Government may make way for a government composed of members of another party, who are, perhaps, a little more industrious and not so “ rightist “ as are honorable members opposite. However, whatever government takes office in the future, it will use just as enthusiastically as we now wish to do any additional powers which may be transferred from the States to the Commonwealth. The campaign to acquire those additional powers must be based solely on the nation’s need to meet the changing times. At best, the Constitution was only a compromise between conflicting State opinions in the period from 1890 to 1901. Being a compromise, it does not express the wishes of the more radical of the Australian people. It was only, a compromise between those who did not want to do anything and those who wanted to do everything. In any case, it is now over 40 years old, and is becoming obsolete. Our problem now is how to rectify the shortcomings of the Constitution. With adequate propaganda and concerted action by all political parties clearly indicating to the people the need for an alteration of the Constitution, I have no doubt that such powers as are. needed by the Commonwealth will be transferred to it. We must inform the Australian people of the need for such reform. It must be made clear that we are not going to abolish State parliaments.
– Why not?
– Because the States will not allow us to do so. I suggest that the honorable member himself should put his idea to the test. When he has had as much to do with conservatism as I have had, he will agree that it is impossible to defeat conservatism on this point. At one time I was the only representative of the government in the Legislative Council of Tasmania. I was the only one in my party. The numbers were sixteen to one against me and, perhaps, at times I disagreed with myself. When the honorable member has had a similar experience in dealing with conservatives he will agree that what I am saying is true. Make no mistake, they are “hard heads “ to deal with. I have seen that House in so bad a state that I have had te wake the members up in order to let them know what I was doing. I have seen the Clerk of the House frightened to wake UP one member for fear that he would drop dead if he was disturbed. They and their kind, in four of the six State parliaments, control the sovereign powers of which this Parliament seeks a greater share. That is what my honorable friend will have to contend with. It will not be so easy as he appears to think to abolish State parliaments. Let him have a try. I shall back him if he does. I shall shout as loudly as he from the hustings in support of anything he says, even if it is wrong. The only chance we have to get greater powers for the post-war period will be by some reasoned move by all parties in this chamber to ascertain just how far we should go and what we should offer the States in lieu of what we propose to take from them. But I have never yet known any member of parliament who would readily commit felo de se.. Why should he commit political suicide? He has his hide torn off him in getting into parliament, and I do not blame him for wanting to stay there. But my belief that State parliaments will not allow themselves to be abolished does not mean that I question the necessity for the Commonwealth Parliament to have more powers. I would seek for it all the powers it needs. In the Legislative Council of Tasmania I three times introduced a bill designed to extend the powers of this Parliament and tried to force it through. I could not do more. More than any other member of this chamber, I have shown, by action as well as by words, my earnest desire to give this Parliament greater authority in the national life. But, before increased powers can be got there is an enormous hurdle to jump, a hurdle which cannot be negotiated by the present method of approach. I hope that the Government will see fit to think out some other means of getting those powers, for, until we get them, we shall not be able to do anything towards postwar development, because the States will not allow us to do anything; they will not allow the Commonwealth to trespass upon their reserves any more than they will willingly hand over some of the powers they have under the Constitution. Too many people have confused the emergency powers which the Commonwealth has under the National Security Act with the real powers which are given to it by the Constitution. I am reliably informed, too, that if some of our wartime emergency regulations were challenged they would not survive the test. However, that is quite beside the point.
There is little more to be said, except to congratulate the Treasurer on having brought down a temperate budget, temperate only in the sense that it does not further increase the taxes that the people have borne since the outbreak of the war. I think the Australian people are grateful to the Treasurer and those who assisted him in the compilation of the budget for being so moderate as to propose an expenditure of no more than £715,000,000. I do not know whether that arises out of the Treasurer’s charity towards the Aus tralian people or is because his master Sir Claude Beading, will allow him to spend only £715,000,000. There is no doubt that Sir Claude Beading is the master of this Parliament. I foresee the day when he will be pleased to cut down our expenditure in the post-war period in the manner predicted by the right honorable member for Kooyong. Sir Claude Beading will dictate the policy, and like lambs led to the slaughter we shall follow his command. Until the National Parliament gets control of every national entity we shall not make the progress we should make. A conspicuous feature of the election campaign was the denunciation by the opposition press of the bureaucratic control which was instituted by its representatives when they were in power in this Parliament in years gone by. Bureaucratic control had reached the point at which it began to hurt and the Opposition supporters started to denounce the very thing they had created. To-day they would like us to eliminate all bureaucratic controls except those which operate to the advantage of vested interests. We, on the other hand, hope that the Government will have entire control of this nation’s affairs; alternatively, there must be complete bureaucratic control. Let us have one or the other. I am prepared to let the National Parliament control every national entity over which it is entitled to have jurisdiction. If we are to wipe out bureaucratic control, let us start first with the banks, because in the monetary system bureaucratic control begins. We do not want anybody outside the elected representatives of the people to dictate the financial policy of this country. L am not impressed or depressed by theeloquent use of the word “inflation”. For 25 years I have been trying to find out what “inflation” means, and I have come to the conclusion that it is a mere abracadabra. I have not fallen for it yet and I am not likely to do so. When black magic takes control I do not want to be here. I again congratulate the Treasurer. For the ultimate good of Australia, I hope that he will have that financial control that was so ably expressed by an ex-parliamentarian in a high place during the election campaign and that anomalies will be rectified in accordance with the wishes of the Australian people and the National Parliament.
.- I welcome another medical colleague, the honorable member for Denison (Dr. Gaha), to this Parliament and express the hope that the habit he formed as leader, deputy leader, Minister, whip and party in the Tasmanian Legislative Council of disagreeing with himself .and his party will be maintained in this Parliament, because it will undoubtedly assist our entertainment.
The commitments set out in the statement of the Treasurer (Mr. Chifley) on the revenue and loan side are enormous. Tho #ap between the amount that is to be raised by revenue and the total expenditure is well over £400,000,000. That money must be borrowed on short or long terms from the people of Australia, and it will become a part of the permanent debt of the nation. The amount which it is proposed to- borrow this year is greater than the whole of the debt incurred in the last war. I was interested yesterday to notice that the loan bill which was passed gives authority to borrow £200,000,000. That approximately corresponds to the total amount of money that has been paid off by means of the Commonwealth and State sinking fund in the twenty years that have elapsed since I established it in 1923. That gives some idea of our enormous expenditure. I propose, not to examine the expenditure side of the budget, but to look at the question of how we shall ever be able to pay the cost of the war. In order to do that, I must examine the whole basis of the Government’s finance. I realize that loans are simply deferred taxes. The basis of our taxation, whether it be in the form of loans, and therefore deferred tax, or ordinary and immediate taxes, must ultimately be the industry of the people. The total production of this country must in the last analysis be determined by the number of people in the country. The outstanding post-waT need for Australia must ‘be to double, or if possible treble, its population in the quickest possible time. If we can do thai and give full employment while doing it, we may by that means automatically render the burden of the cost of the war tolerable to our people by lessening its per capita incidence, and the per capita interest burden also.
I was disappointed to find that the three speeches which ought to cover the whole of the policy of the Government - the policy speech of the Prime Minister before the elections, the GovernorGeneral’s Speech at the opening of Parliament, and the budget speech which has just been delivered by the Treasurer - failed to stress the fact that the efforts which we make to win the war and to win the peace must be continuous and dovetail into one another. There must be no gap between them, because when the war is over the world will be like a very ill patient, unable to stand any more shocks, and the least little bit of extra dislocation may be sufficient to destroy it completely. We must, therefore, if we possibly can, so plan the whole of our efforts that those we make to meet our war problems can be carried on into peace-time.
For twenty years I was Leader of the Country party in this Parliament, and from time to time a member of different governments. During that period, I built up in relation to finance and primary production a system which enabled Australia to move with comparative smoothness into the rough seas of war. This was done by means of the Loan Council, which unified the governmental finances of Australia .and, by giving the control of the note issue to the Commonwealth Bank, enabled us to handle the issue of loans and the use of short-term credits. We produced an organization which enabled the whole of our surplus products to be sold en bloc on good terms to the British Government even before war actually broke out, and helped us to plunge with the least possible dislocation of our peace-time economy into the troubles of war. Before peace comes after this war, we must make certain that we have built up an organization which will enable us to carry ‘out the reverse process of moving automatically and as smoothly as possible from war into peace.
There are, in war-time, many phases of governmental activity that must go on automatically when the war ends, in order to avoid chaos, which might be just as devastating to the people of Australia as war conditions themselves. That applies to the price ceiling that has been imposed, the efforts to stabilize wages, and the subsidizing of the primary producers in order to make certain that their industries are reproductive and profitable. These things cannot be allowed to end a year after the war ends without the provision of some proper substitutes to take their place. Our war plans must all be drawn up on a basis which will enable us to go straight on into a time of peace with the least interruption and dislocation possible.
I look upon this war, terrible as it is, as only an episode of the long battle against the consequences of that mass production economy which has developed during the last 100 years - ever since machines began to bring about production in such profusion. The mischief has been caused by the failure of that economy, running at full speed and in top gear, to provide a mass consumption market which would enable the whole of its production to be absorbed by the people. Although military defeat for the Allies would destroy western civilization, we may easily find that, if . we do nothing, whether at the table of the peace conference or in these parliaments, to make certain that our mass production economy will work, unsatisfactory peace conditions resulting will destroy western civilization just as surely. The present war was really made inevitable because of the failure I have referred to. Such conditions developed as forced nation after nation into restrictive national and international policies, which finally brought about a bankruptcy of hope and faith in the future, driving people to the despairing conclusion that the world could not possibly produce universal happiness. “We in Australia, like the peoples of the other great, democracies, although we fought originally because we were attacked, are fighting now in a crusade to make certain that we shall never have to fight in the same way again. We are striving to get not merely a permanent national security for ourselves, but also individual security for everybody, free from want and other conditions that have so devastated the world in the past. We must therefore make certain that what we do in actually winning the war will not nullify that crusade, but rather ensure that all the world’s available resources shall be used after the peace to lift its living standard higher than it ever was before. We must aim at a steady improvement all the time.
To me the greatest irony of fate in this war is that military victory for the Allies, which I am certain is inevitable although it may bc several years in coming, is unfortunately going to leave us with the problem of the most intense want and starvation in many countries. We already have famine stalking through India, China and many of the occupied countries of Europe. If this evil be not ended as soon as peace comes, I fear that we shall sow the seeds of an early renewal of this great international conflict. I am satisfied that the outbreak of this war was to a large extent due to the fact that no provision was made to deal with those problems at the termination of the last war.
The provision of ample food, and the assurance of employment for all persons able and willing to work, are outstanding examples of the need for linking up many phases of governmental activity in order to facilitate the transition from war to peace. For instance, the production of food is dependent on four factors: First, governmental activities concerned with domestic problems - the Commonwealth Government itself is competent, by means of the tariff, to deal with the protection of industries; secondly, governmental activities which need collaboration between the Commonwealth and the States, as in the control of internal production, transport and power facilities; thirdly, activities which are controlled by governmental activities inside Australia, but the permanence of whose reproductive programme depends on international arrangements for the sale and distribution; and, fourthly, the volume of production depends on the standard of nutrition that consuming nations determine to enjoy. In regard to that matter, Australia of itself can do nothing.
The war has developed to a high degree of perfection international organization and co-operation among the Allies. Times of peril have brought the realization that co-operation is the price of security and freedom. “For the maintenance of peace, we need a permanent security founded on cur own strength, and not on the weakness of others. After the war, we must continue the co-operation that has been established between the great democracies in this struggle. To do so, we require better publicity for our aims and better organization than exists at present. The huge land masses of China and Russia are comparatively isolated from the rest of the world, and their people may be obliged to devote most of their energies to their own development and the improvement of their standard of living. Their great natural resources make them largely independent of other nations.
The British Empire and the United States of America, by reason of the geographical situation of their constituent parts, and their intimate and widely extended international trade relations, must exert a dominating influence on the peace of the world. During the war their advanced mechanical development in industry and their control of commercial shipping have made them the dominating factors in organizing the production and distribution of supplies. The machinery of this organization is well established and well tried. Its control is in the hands of an Anglo-American partnership. The principles of its working should be explained in simple language, by means of both the press and the radio. If such organizations could continue their functions after the war, in either a consultative or an executive form, the transition to peace-time ways would be greatly facilitated. The experience and knowledge which they have gained during the war have put them in an ideal position to advise and direct capital investment for the development of the unused resources in the backward countries. These organizations could greatly assist in the transfer of population to Australia, whose effective occupation by British stock is essential to the future security of the Pacific.
The war-time use and control of transport indicates another means of international economy. In the dire emergencies of war-time we have been forced, by the shortage of shipping, to use the shortest routes across the oceans. The routes for the transport of oil are determined not by the profits or vested interests of cartels but by the need to effect the greatest economy in the use of shipping. The winning of the war has necessitated’ the close linking of international economy in this way. Even closer linking is essential to the winning of the peace.
There are two indispensables to complete victory in peace: first, a confident faith that the resources of the world can properly feed, warmly clothe, comfortably house and provide modern amenities for all the people in the world ; secondly, the elimination of waste in the accomplishment of these systems in order to give to every individual the highest possible living standards. Wise planning and direction will ensure plenty for all. The time to begin the organization is now, while the pressure of common danger keeps us united.
A long-range plan for the production and distribution of food must now be formulated, because the preservation of human life ultimately depends upon the prosperity and expansion of the agricultural and pastoral industries. For example, the dairying industry will require at least ten years in which to breed new stock for the purpose of trebling or quadrupling herds. To the sheepraising industry, a five or seven year plan should be applied. For vegetables, which are an annual crop, at least a three-year plan will be necessary. For wheat a five or ten year plan will be needed. If this system of planning be adopted, primary producers will have faith in the future of their industries, and real progress will be made in ensuring not only continuance of the industries, but also their capacity to absorb labour. We should not have any hesitation in formulating these programmes, because one of the most urgent problems at the present time is that of increasing the output of food for export, not only to countries where the spectre of starvation now stalks, but even to the United States of America. In 1941, shortly before the United States of America entered the war, a national nutrition conference found after a complete examination that 30 per cent, of the people were suffering from the effects of malnutrition. Yet the United States of America had the biggest income and production yield per capita of any country. The readjustment of American agriculture to overcome that high incidence of malnutrition throughout the community will make the United States of America an importer instead of an exporter of food. If that is the condition of what may be regarded as one of the most prosperous countries in the world, what opportunities are there for less fortunate nations? At present, Australia has a double problem to remedy: First, it has to meet the immediate needs of its own civilians, of Great Britain, and of the Allied Forces, and secondly, it has to inaugurate a long-range plan to east the final world position. Plans to deal with both the problems should be interlocked. The present food position in Australia is due to the panic call-up in January, 1942, and to the simultaneous denial to the farmers by the Government, of labour-saving equipment. The decline was accentuated by the delay in fixing prices commensurate with the increasing cost of production. Primary production cannot be restored to its former level in a day, but immediate action can be taken to improve the position and to safeguard the future. But the future cannot be safeguarded adequately unless we have certain constitutional reforms to give permanency to our plans, and we should make certain that when the time comes it will be possible to secure these reforms. I know from long and bitter experience that there is only one way to get constitutional reforms in this country, and that is to show the public by actual trial what these constitutional reforms mean. For four years we had a voluntary Loan Council which worked within the full sight and hearing of the public. When the question of making this body a permanent institution was put to the public at a referendum, it was carried by a four-to-one . majority in every State.
There are many activities in this country which must be handled on a national basis. For instance, the control of railways, power production, and agricultural production generally, should be vested solely in the Commonwealth Government. These activities will never be administered satisfactorily unless they are Commonwealth controlled. My view is that the Commonwealth should take over those powers during the war, and exercise them so successfully that when the war is over the people will be prepared to let them rest with the Commonwealth permanently. If that were done, opponents of the centralization of such authority would not be able to raise the old bogys that have been raised at previous referendums.
The most urgent problem in Australia at present is the .immediate rationing by the Commonwealth Government of food and other essential commodities which are in short supply. The present system under which the duty of rationing commodities is thrown upon the butcher and the greengrocer is grossly unfair. After all, we cannot expect our shopkeepers to perform daily She miracle of the loaves and fishes; even that was performed only once in the life of our Lord. Rationing i3 a matter for government control. Private rationing provides no check upon the actions of customers. People who are rich or idle are able to go from shop to shop and buy a pound of potatoes here and another pound of potatoes there, but the poor and busy person, such as the worker, cannot do that, and has to suffer as the result. In Great Britain, when a rationing plan is introduced, customers are tied to certain retailers. The experience in Great Britain has been that the longer the delay in beginning rationing, the more difficult it is to administer, the higher is the price that must be reduced, the greater is the shortage of the commodity concerned, and the greater is the dissatisfaction that the whole system causes. Therefore, th, sooner a comprehensive scheme of food rationing is adopted in this country, the better it will be for everybody. I am not one of those who complain about the reduced quantities of certain foodstuffs that are available to the public. In fact, I contend that in certain directions we should bo quite willing to put up with bigger reductions. For instance, in Great .Britain, the weekly meat ration is lb. per person. The people of Great Britain are prepared to make that sacrifice, knowing that shipping is necessary to carry materials of war to other allied countries, including Australia. Surely it is not too much to ask the people of this country to make a small sacrifice to ensure that their kinsfolk in the Mother Country are able to carry on. 1 believe that it is the duty of the Australian people to make these sacrifices. That is why two and a half years ago I advocated a campaign to eat more food, first to make certain that our agricultural industries would be kept functioning 100 per cent., and secondly, to ensure that if rationing had to be introduced, the people of Australia would have a layer of fat in reserve which they could comfortably do without.
A simultaneous step must be the immediate provision of man-power to improve the situation in primary industries, although the effect of such a release would not be felt for some time. The war-time drain on rural man-power has been greater than that upon any other section of the community. Before the war, rural workers numbered 533,000, but, by June of this year, the total had dropped to 355,000- a fall of 178,000. That reduction is larger in proportion than corresponding reductions in any other industry and was allowed to take place in spite of the imperative demand for more food. Apart from the men and women engaged in the munitions industry, and the members of the fighting services, a greater burden has been placed upon rural workers by the war than upon any other section of the community. Even in industries which have been subjected” to the severest rationing, the reduction of man-power has not been ro groat as it has been in rural pursuits. In my view, the release of 15,000 men by the Army - I do not know how many others are to be released from other undertakings because no comprehensive report upon the matter has yet been made - will not be nearly sufficient to solve the problem. We shall have to do better than that, and we shall have to do it quickly. My experience, and I am sure that of other honorable members, has been that a tremendous effort is required to secure the release of any man from the Army, even when such a release has been recommended by the War Agriculture. Committee or the manpower authorities. I have received letters from Army officials stating tha’t men whose release has been recommended, and who, perhaps, are mounting guard in some remote part of Australia where danger is very slight, are indispensable to the Army. To overcome those difficulties, a changed outlook’ will be necessary. Some men who would be key mcn on the land, and have suffered minor injuries, perhaps to hearing, are still in the Army doing all sorts of odd jobs, whereas they could be far better employed in their own callings. In order to overcome man-power difficulties, the use of electricity should be immediately extended throughout the rural districts, especially those in which the protective foods that are so badly needed in Britain, such as beef, butter, eggs and pork, are being produced. Those industries must have electrical power until additional man-power is made available to them. A conference should be held between the Commonwealth and the -States with a view to planning a national electricity system. I have found that our local authorities can build the transmission equipment that is necessary, but that the generating equipment cannot yet be made here. If the Brisbane generating system were joined up with the Newcastle generating system, and the excess power were made available to the Nymboida water power system, within a year the production of the areas served would be substantially increased, because much of the decline that has occurred has been due to lack of man-power. I have placed the proposition before the Chief Commonwealth Electrical Engineer, and hope to place it before the Government in the near future. The project should be commenced as early as possible. Control of the supply of electricity ought to be in the hands of the National Government. At the present time, disputes between a number of the States are common because of the existence of State boundaries. The matter of closing a gap of 30 miles in the main electricity transmission .line between
New South Wales and Queensland has been the subject of argument Yet we are one people, and all of us are -fighting for our lives. Greater difficulty is experienced in crossing State boundaries with electrical transmission lines and railway lines than occurs in Europe with people speaking 20 ‘ or 30 different languages and influenced by centuries of . tradition and national antipathies which react against agreement in the common interest. That state of affairs in Australia has to be altered.
An alteration must be made in the policy of the Department of Munitions in respect of farm machinery. Ever since my return from Great Britain I have been at work on this matter, and I had hoped that I was making some progress. I had a fair hearing from the Minister for Munitions (Mr. Makin) and the Minister for Supply and Shipping (Mr. Beasley) who promised that the matter would .be expedited. ‘ Yet, about the middle of July last the farm machinery manufacturers of New South Wales informed me that the 4,000 engines needed for milking machines, which were promised in the previous August had not been supplied. The engine is an integral part of the milking machine. They had received a letter advising them that .there was to be a new directorate, representing six different departments, and that the needs of the Army in connexion with these engines were so great that they could not be supplied. I had the opportunity of going through most of the military camps in Australia and the adjacent islands, when I was conducting an investigation of malaria, and was unable to discern where thousands of these engines could be used. Spring-time has arrived, and production is beginning to rise. Unless action be taken immediately, the cows will become dry. Substantial reserve supplies of these engines must be available throughout the country. The Government should take such action as will enable the dairyman to be supplied with this substitute for man-power, of which they are short, out of these reserves.
There must be a definite change in the Army policy with respect to food generally, and a -greater readiness to release key mon and women from the forces. If, as the Prime Minister has said, Australia is not in danger of invasion, the Army establishment in Australia and especially in the- southern States, is on an entirely wrong basis. Consider the medical and mussing services. There are many thousands of beds allotted on an active battle casualty basis. Only 60 per cent, of them are occupied, and 80 per cent, of those by men who are suffering from complaints which in civil life would not cause them to enter ‘ a hospital. Dermatitis is a case in point. A civilian suffering from it would consult a medical man, and, having obtained his advice, would return home. In the Army, because the sufferer cannot remain in his tent, he becomes an inmate of a hospital. Such complaints do not require as much medical or nursing attention as would battle casualties. The nursing staff is on the same basis. I concede that, on the active battle casualty basis, the supply of doctors and nurses is from 300 to 400 short of requirements. I point out, however, that in New South Wales alone there is a waiting list of hundreds of acutely ill people who cannot secure admission to civilian hospitals because these are filled, not with persons suffering from dermatitis or equally minor complaints, but with those who are desperately ill. In that State the shortage of nurses is 1,500, and a further 500 trainees are needed for the nursing staff. Recently, a doctor died in Newcastle as the result of overwork, at the age of only 45 or 46 years; he had not been able to obtain any rest for two or three weeks. Yet men and women of my acquaintance are eating out their hearts in camps, on the active Army establishment, when they could be doing civil work. I know it will be said that on the basis of the active battle casualty establishment the Army is short of its requirements. My rejoinder is that, if Australia is not in danger of invasion, the establishment should be on .a very much reduced basis.
I also affirm, from personal observation, that many key land men are serving in a minor capacity in the Army. I have been endeavouring to secure a .substantial reduction of the areas in which war agricultural committees operate, and have found that one difficulty is that quite a number of agricultural instructors - men who possess university degrees and have had a lifelong training in agricultural problems - are in the Army. I have been told that these men would not mind if they were handling agricultural problems; but they are given only the duties of guards to perform. We have now been promised that a certain number of men will be released. Five months ago, I was given a similar promise. Every day’s delay is inimical to production. As the year goes on, the season passes. All my friends who are on the land know that if the season is missed the whole year is no good to them, and if live-stock are affected everything is lost. Therefore, no time can be wasted. I should like to know whether the 15,000 men to be released are to come from the Citizen Military Forces or the Australian Imperial Force. The Government should make a definite statement on the matter. I believe in equality of sacrifice. If discrimination is to be practised in regard to the areas in which men shall serve, a definite limitation should be imposed on the period of service for which a man enlists in the Australian Imperial Force. Enlistment should be for not more than four years. At the expiration of that period, a man in the Australian Imperial Force should be offered his discharge and given the opportunity to re-enlist. It is not right that members of the Australian Imperial Force should be expected to continue the fight to the Philippines and on to Tokyo, as well as in other battle zones, whilst members of other branches of the services are released from the forces after much shorter service.
Unless, during the progress of the war, the Commonwealth can show, in such matters as control of railways and production generally, better results than under control by six different States, we shall find ourselves in a position similar to that which existed after the war of 1914-18. Honorable members will recall that about a year after the signing of the Armistice, a referendum for alterations of the Constitution was submitted to the people, but was defeated; an affirmative vote was recorded in only three States. We do not want a repetition of that failure. We should make certain that under Commonwealth control things can be done without loss to the community.
In conclusion, I return to my original thesis, namely, that we must make certain that the organizations set up for the winning of the war shall be continued into the post-war period, so that the transition from war to peace conditions will proceed as smoothly as possible, and that the sick patient - a war-torn world - will not die as the result of more shocks.
Sitting suspended from 5.22 to 8 p.m.
.- On this, the occasion of my first speech in this House, I wish to say that I realize that I am here to-night because of the appreciation and admiration which thousands of people in my electorate entertain for the war effort of the Government which I have the honour to support. If. we think of the position of this country when the present Government took office, and realize that the people of my electorate would have been exposed to the first dangers of an attack upon Australia by the enemy, it is not surprising that they desired that their representative in this Parliament would be one pledged to support in every way possible the magnificent war effort of the Government. It is my duty to voice in this House the opinions of my electors and to assist, to the best of my ability, in carrying out the policy of the Government, which is to bring peace and economic security to Australia in the notfardistant future. The people of Australia have made a magnificent war effort. With all respect to the Opposition, I must say that Australia was in a condition of unpreparedness when the present Government assumed office, and the manner in which it has been organized for war is unequalled in any country in the world.
The organization of the Navy, Army and Air Force, and the securing of aid and equipment from the United States of America at a time when Great Britain was sorely tried, represented a great achievement on the part of the Government, and all the more so when we recall that it had the support of only half the number of representatives in this House. It must be remembered, also, that in carrying put its policy to obtain aid from abroad, and to place the country in a condition of preparedness, the Government had to introduce many unpopular measures. It cannot be said that it ever placed party before the national interests. At all times the paramount consideration was the welfare of Australia. The Government has been no respecter of individuals. That is the only sound policy for any government which desires to further the interests of the people as a whole. I believe that the present Government, which has proved so successful in time of war, will be just as successful in guiding the country through the troublous period of post-war reconstruction.
While the primary need at the moment, both for the people of Australia and the allied nations, is the winning of the war, we should not lose sight of the fact that we must plan even now for the post-war period. Therefore, I propose to discuss some of the problems which have to be faced, and which must receive the earnest consideration of all honorable members no matter to what party they belong. I am pleased that the Government has seen fit to. embark upon this important task even at this early stage. A Department of Post- War Reconstruction has been set up and is now functioning. That is the first step. Those who are in the fighting services, or are engaged in war industries, must be assured of jobs at fair wages when the war is over. They have a right to expect that, when they return to civil life, they shall be able to enjoy a decent standard of living. It has been said that when Mrs. Roosevelt was making her recent tour of this country, whenever she visited American troops she was always greeted with the query, “ What are we to expect when the war is over ? “. That is a question which should receive the attention of all of us. Those men who are now sacrificing everything - even their lives - in the service of their country have a right to expect a new and better order when the war is over. They have a right to ask for security when they return. It was natural that the American troops should ask one of the outstanding women of the world what they were to expect when peace came again. It is appropriate that we should be discussing this subject when the budget i3 before us. We should all realize the importance of money during the period ahead. We have to prepare for the rehabilitation of the men and women of the fighting services and those in war industries. We have to build for them a new economy, a new social order. The old one patched up will not do. We must have something new, something stable. Naturally, this cannot be achieved unless we have the money with which to do it. I listened to-day with interest to the Leader of the Opposition (Mr. Menzies) when he said that man-power and materials constituted the problem - money was a secondary consideration. When we look back over the years we recognize that money is a very important factor. During the depression, of which I, among others, had bitter experience, Australia had all the man-power and resources required, but our legislators told us that it was impossible to find the money necessary to provide employment for the people so that they might obtain food, clothing and shelter. It is a sorry commentary upon our management of affairs that to-day we can raise almost unlimited money for war and the annihilation of men, although in peace-time we could not provide enough to assure them the bare necessaries of life. Never again will the people tolerate such a state of affairs as obtained during the depression. Never again will a government dare to say to the people that it cannot raise money to do the things that urgently need doing in times of peace. I realize that we shall not need so much money in peace as we now need in war. A portion of the amount which is being expended on the war by this country would be sufficient to keep the entire population in employment and security for many years. An essential of the new order must be full-time employment for all those who are able and willing to. work. We have a country which possesses practically all the resources necessary to enable this to be done, but there must be proper organization. During the depression, men were engaged on useless relief works when they could have ‘been employed on the defence works which had later to be built as an urgent war work when the enemy was hammering at our doors. We must plan now for a national works programme. If the men and women now in the fighting services and in war industries were employed on useful public works after the war, Australia could bc developed on a scale which at one time was thought to be impossible. This war has proved just what a country can do when it is put to it. Australia is now organized on an industrial basis never previously contemplated. Aerodromes have been constructed and defence works accomplished on a scale which a few years ago would not have been regarded as possible. After the war, the labour which has , been employed upon defence works could be devoted to irrigation schemes and other national undertakings. Thus, men would be usefully employed, instead of doing such useless things as shovelling sand from one place to another, as happened in Sydney during the depression. National undertakings of .the kind which I have suggested should form an integral part of any plan for a new order and it is the responsibility of the Government to bring this about. I also believe that many of our war-time industries of the present day could be rapidly converted to peace-time activities after the waT in order to provide the things which the people will then want. It will be a big task, but not impossible. A national housing scheme is another necessity. Personally, I do not believe that we should wait even until the war is over, but, in any case, after the war the carrying out of such a scheme would provide employment for many thousands of men for years to come. In all. parts of Australia the people axe crying out for comfortable houses. The slum areas of our cities are a disgrace to Australia. In some parts of Sydney, which I know well, men, women and children are living in -squalor, while a few miles outside the city there are open spaces lying idle. Bad housing .not only affects the health of the people, but also makes decent home life almost impossible. At the present time, because people are crowding into the .cities to engage in war work, housing conditions are worse than ever before. I recognize that tho Comaraonwealth Housing Com- mission is doing a good job, but at the present time it is not opportune to build homes. I hope that the Government will, at as early a date as possible, embark upon a comprehensive housing policy. This work should be given a high priority in the post-war period. I mention these matters because I do not want to lay myself open to the charge of indulging in destructive criticism only. I wish my criticism to be constructive also. The Government should make its investigations now and have its plans ready so that they may ‘be put into effect immediately after the war.
Another important feature of any new order must necessarily be social services, which should cover every need of the community. I am pleased that the Government has seen fit to establish a National Welfare Fund, and I look forward to the time when we in this House will be passing legislation providing for the payment of unemployment and sickness benefits. In spite of the fact that we are at war, the Government has increased pensions and maternity allowances and introduced widows’ pensions. However, no one oan say that we have gone as far as is necessary in the direction of providing social services. There is much room for improvement in this regard. There is much ground still to be covered if we are to give the people effective health and medical services. I hope that in the not-too-distant future I shall be a member of this House when we can say that we in Australia have the best health and social services scheme of any country in the world. It is not too much to expect the Commonwealth Government to give to the people the best possible in this direction, because by so doing we shall not only safeguard the health of the community, but also lay a real foundation for the new order.
I have endeavoured, briefly, to summarize my views on the principal problems of the day. The winning of .the war is vital to our future, and we cannot neglect that task. At the same time, dark days lie ahead unless we give careful consideration to the problems which are bound to arise when the men and women now engaged in the fighting services and war industries return to normal life.
They are the two major responsibilities of this Government; and, for my part, I recognize my individual responsibility in the matter to the many thousands of people whom I represent. I shall do my best to carry that, task to a successful conclusion. We must do all in our power to win the war, but, at the same time, we must lay the foundation of a better social and economic order. We are only a small nation, but by our legislation we can give a lead to other nations in this direction, and by doing so Australia will play its part in establishing a new and better order in the world. It shall be my object, as a member of Parliament, both inside and outside the chamber, to see that when the war is over the people of Australia at least will live as free men and women in every sense of the word, and will enjoy social and economic security which is their right.
.- I congratulate the honorable member for Martin (Mr. Daly) on his maiden speech in this chamber. I find myself in agreement with much that he said, but, not unnaturally, I disagree with his remarks concerning the previous Government. The honorable member is a welcome addition to the Parliament, and I am certain that he impressed all honorable members by his sincerity and his method of presenting his arguments.
The budget has been presented to us in a speech by the Treasurer (Mr. Chifley) in which in traditional style he cited the economic events of the past year, and sought to place before us some of his plans for the solution of our financial problems. At this time no one could dispute the proposition that we need to call for a further war effort on the part of the community. However, the budget does not impose any additional burdens, or any further restrictions, or controls, on the people, although it must be obvious to any one who knows anything about the nation’s financial problems that the present upward thrust in the purchasing power of the community is generating forces which, if measures are not taken to arrest them, will ultimately prove to be explosive. I fail to find in the Treasurer’s speech any call for further endeavour on the part of the people. Indeed, it is last year’s speech dished up again with some minor variations. We have last year’s suit a little more shiny, but with a little more embellishment. The Treasurer has resolved the problem of the nation’s finances in the simplest terms, and to those who admire simplicity, his speech is acceptable; but I do not admire simplicity merely for simplicity’s sake. Let us see whither the budget will lead us. This is the Treasurer’s approach: he says that so much money is required, that so much can be raised by taxation, and the balance will have to be raised either by loan or central bank credit; and he adds that the Government expects to obtain so much from loans, and the balance from bank credit.
– What is wrong with that?
– What is right with it? Apparently, no honorable member opposite is paying heed to the consequences which must result from that policy. I have a clear recollection of the origin of the financial policy of the Labour party. I recall that two years ago in this chamber the AttorneyGeneral (Dr. Evatt) expounded how the finances of the country should be arranged. That was the memorable occasion when the Fadden Government was ejected as the result of an attack upon its financial proposals. In that debate the Attorney-General expounded two propositions: first, that we could not hope to create a new order in this country upon a superstructure of. debt; and, secondly, that no money should be borrowed from the people, but that all borrowings should be from the Commonwealth Bank. The Attorney-General put forward those propositions only two years ago. Of course, in the meantime Labour has learned at least something in respect of finance, but, apparently, it has not learned sufficient to be able to steer’ the country along lines which will enable it to meet, with the utmost efficiency, the problems of .the post-war period. The Government, quite properly, in every publicity statement it issues, is telling the people that further effort for the war is called for. It must be obvious to every one that the war which has still many months, and, perhaps, many years to run, requires an increasing effort: on our part. But, apart from the absence of additional impositions, or controls, is there any indication whatever in the budget of such a realistic attitude on the part of the Government? We find that war expenditure in Australia this year compared with our war expenditure last year has increased by only £17,000,000, whilst war expenditure outside Australia has diminished by £9,000,000 in the same period. Our total war expenditure this year has increased by only £8,000,000 compared with that for last year. It is true, as the Treasurer has said, that he may have to add to his estimate of expenditure for this year. I sincerely hope that he will not have to revise it to anything like the degree that he has been obliged to revise his estimates since .September last. I should have thought that he would have gained by that experience. His estimate in September last was underestimated by over £110,000,000. If the budget be intended to represent an increased war effort, it does not, in fact, do so. When we pay regard to the fact that prices and costs are continually increasing, a war effort represented by an expenditure in Australia of £500,000,000 for this year, compared with an expenditure of £483,000,000 for last year, represents in terms of money a diminishing war effort. That view is substantiated by a glance at the savings hanks deposits and Australian notes held by the public in 1943 compared with the figures for 1939. Those figures reveal a continuous increase. In 1939, savings banks deposits amounted to £244,900,000 ; and in 1942 to £282,500,000, whilst at the 30th June, 1943, they amounted to £370,300,000 which is a remarkable increase. In 1942, notes held by the public amounted to £89,300,000, whereas at the 30th June, 1943, they amounted to £126,700,000. I give those figures to show that the war effort represented by this budget is less than the war effort budgeted for last year. They show that prices are rising. That means that every service now costs more than it did last year. That fact is also substantiated by an examination of the retail prices index and the basic wages rates. In 1942 the retail prices index, O series, was 1081, whereas in 1943 it was 1143; and the basic wage shows a corresponding increase. The trend is still in that direction, because for July and August this year the savings banks deposits amounted to £24,000,000 compared with £16,000,000 for the corresponding months of last year. Therefore, the estimate of £500,000,000 to cover the requirements of the war for this financial year represents, in fact, something less than the war effort made last year. That does not reflect a realistic approach to the nation’s problems on the part of the Government. The only other conclusion we may draw from the budget is that it represents a complete miscalculation of what is required in the current financial year.
– Does not the honorable gentleman think that taxes are high enough ?
– I shall deal with that aspect. The point I am making at the moment is that at a time when it would appear that the momentum which was commenced by previous governments has substantially spent itself, and when this country is free from invasion the Government is not measuring up to its’ responsibilities to increase the nation’s war effort. When we examine the Treasurer’s figures in terms of real money, that is what the money will produce in terms of services and goods, the budget represents a lesser, and not a greater, war effort than was the case last year. The facts which I have just given cannot be disputed. That is the irresistable conclusion to be drawn from the Treasurer’s own figures.
In view of the facts which I have just given, it is extraordinary to find that expenditure for other .than war purposes is to be increased from £108,000,000 to £145,000,000. That is indicative of the attitude of the Government, and of its failure in this budget to evoke the very best that the people can be called upon to give. It is true that the expenditure of £145,000,000 includes, approximately, £30,000,000 which is to be placed to what is called the National Welfare Fund. I have had something to say about that fund before. Perhaps some one who knows something about it will be able to tell me what is the purpose of creating at this period of the war and in this financial year a fund which is not used.
Here we have a fund for which money will be set aside each year only as a book entry until such time as the war comes to an end. Then the actual money will have to be raised. The money that is supposedly going into this fund will not be immobilized in that fund, because that which is not expended on social services will be expended on the war. I cannot understand why this item enters into the budget - it is not intended to expend the money this year - unless it is there as a piece of window-dressing. If the war lasts another three years nearly £100,000,000 will have to be raised in some way or other in order to restore to the fund the money that will have been diverted from it for war purposes. This item in the budget will involve in the end a further increase this year of central bank credit, which in turn will create untold, but avoidable, difficulties in the problems of post-war reconstruction. Examination of the budget reveals two outstanding things, first, that the war effort is diminishing, and, secondly, that the Government has introduced into it an item which has no relation to the war, and which can be explained only as a piece of political window-dressing.
On the revenue side the Treasurer had a very simple policy to present. He said that taxes would produce this year £312,000,000, as compared with £267,000,000 last year. Most of that increase is accounted for by the fact that this year the Government will collect for a full year the increased taxes imposed last April. So there will be revenue from taxes amounting to £312,000,000, as against a proposed expenditure of £715,000,000. Then the Treasurer said that loans and war savings certificates would provide another £300,000,000. The fact that the Treasurer expects to borrow that much this year, when last year he borrowed only £216,000,000, is further support of my argument that the purchasing power of money has declined, and that the £500,000,000 which it is intended to expend in Australia on the war this year represents in terms of real effort less than the £483,000,000 which was expended last year.
Like the Leader of the Opposition (Mr. Menzies), I take this opportunity to remind the Treasurer of some of his remarks when bringing down the budget last year. He then said that he expected to raise £300,000,000 from public loans. Many of us said that he would not succeed. But that was the way in which the budget was balanced, if “ balanced “ is the word to employ. We said that it was highly improbable that he would raise much more than £200,000,000, and that in fact proved to be the correct figure. Had the Treasurer felt that that was all that could be raised, last year, he should have revealed in his budget speech that the other £100,000,000 was to be raised by means of central bank credit. The Treasurer also said then that he expected to raise £60,000,000 from the sale of war savings certificates. It was a-gain pointed out that it was very unlikely that £30,000,000 would be raised in that way. But facile optimism was the keynote in that budget speech as it was in the budget speech he made in this chamber last week. Far from realizing £60,000,000, the sale of war savings certificates yielded only about £9,000,000. When the Leader of the Opposition directed the attention of the Treasurer to that fact and to the task which lay ahead of the Government in raising £300,000,000, the right honorable member for Yarra (Mr. Scullin) said that the people who would have invested money in war savings certificates had no doubt invested it in loans. We shall see how much they put into the loan. Not so very long ago I asked the Treasurer for the particulars of the so-called “ people’s “ loan, on the raising of which a large sum of money was expended. I understand that the publicity department of the Labour party claimed that the loan was a. great success in so far as the response of the people to the appeal was concerned.
– I generously gave the honorable member all the information he needed.
– My request was couched in particular terms, not in general terms, and so the Treasurer had not much chance of avoiding giving me the information. I asked the following question : -
What portion of the total amount contributed was found by subscribers in amounts of - (i) £5,000 and upwards, and the number of such subscribers; (ii) ?1,000 and upwards, arid the number of such subscribers; (iii) ?100 and less, and the number of such subscribers?
I do wot suppose that many of the people whom I expect the Labour party claims as its supporters were subscribers of more than ?1,000. It was revealed that those financial institutions which are so constantly attacked by the Labour party for “having prevented the development of this country “ were the subscribers of amounts of more than ?5,000. The following table, supplied to me by the Treasurer, sets out the position :-
It is quite obvious to any one who pays regard to those figures and to the taxation imposed on the lower income groups, that a large section of the people of this country is making an insufficient financial contribution to the war. I am quite certain that if honorable members look at these figures they will find that it is idle for the Treasurer to expect to raise ?300,000,000 this year from the people, unless he first makes a particular appeal to those in the lower brackets of incomes. I suggest that he should examine his organization and the method of approach, to those people. When the last Liberty Loan campaign was in progress. I made a few comments about the method of approach then adopted. All I have to say now is that it would be a good thing if the Treasurer lived more in Sydney and less in Canberra, for he would then see more of what takes place during loan campaigns. It is beneath the dignity of the .great people that we are to employ some of the methods that arc employed to induce people to do their plain duty. I do not re: tract one word of that. I hope we shall not have any more of the pantomimes in Martin Place, with physical culture displays and that sort of thing, to persuade the people to put money into a loan which is a sound investment.
– Do not the loan organizers in Great Britain, the United States of America and Canada adopt the same practices?
– I am not concerned about what other countries do. There is too great a tendency to justify what is done here by citing what takes place elsewhere. What concerns me is my own view as to how this country should be governed. If the Treasurer wants to fill these loans his plain duty is to indicate to the community that if they will not lend their money willingly, they shall be compelled to lend it.
Mr. Mono Aif. ; Confiscate it !
– I did not say that, and I will not allow the honorable member to put that word into my mouth. If the people will not lend their money in accordance with their ability, without adventitious and unnecessary appeals, they must be made to contribute. The Treasurer must give attention to the plan of campaign in which he is engaging, because otherwise we are likely to have n repetition of the unseemly performances that marred the loan campaigns last year when investments in the loan fell about ?100,000,000 short of the budget estimate, with the result that the gap had to be bridged by a further dip into central bank credit. In addition, the Treasurer underestimated the expenditure for the year by ?120,000,000. That deficit also had to be made good by use of central bank credit. Therefore last financial year recourse had to be made te central bank credit to the extent of about ?200,000,000, which was not provided for in the budget. That occurred at the time when there was already an upward thrust of the purchasing power in the hands of the people. Unless proper precautions be taken, the same thing will happen again. The vital thing to do is to ensure .that every penny possible shall be obtained from the people. One way in which to achieve that end is by placing more emphasis, not only upon the obligation of citizenship to contribute, but also upon the value of the loan as an investment. Much will depend on the way in which the Treasurer controls his selling organization. That organization left much to be desired during the last loan campaign, which was disfigured by many features which I do not desire to see repeated.
A Government supporter asked me what taxes I would impose. I do not pretend to express a view which will bind my colleagues; 1 express iwy own view only; but I say that there are still untapped pockets of incomes in- this, country. Single men and women earning comparatively large incomes and childless married couples should be called upon to contribute more than those who have children Married people with children should be treated more generously in the matter of allowable deductions. That is my view, and I stand by it. The conditions of many people in this country have never been better. One has only to go to the cities to find large numbers of people without any sense of responsibility once their work is done and without any realization of their obligation to assist the finances of this country. In addition, excise and entertainments offer a field not yet exhausted. I am not impressed by the budget or by the total amount of expenditure which it indicates. I feel impelled to say that neither this Parliament nor the Treasurer has any real control of the finances. The Government has brought in a budget totalling over £500,000,000,. and for reasons which are repeated over and over again Parliament is given no details of it, proving that, at least so far as this Parliament is concerned, control of the finances has passed out of its hands. What control does the Treasurer exercise? Is any one satisfied that the Government imposes sufficient control to prevent gross extravagance in the war expenditure?
– Hear, hear!
– The Minister for Repatriation (Mr. Frost) had better move round,, as I have done, with his eyes open and with sufficient intelligence to understand what he sees. If he does so, he will find gross extravagance taking place in quite a number of instances. Every million pounds of extravagance in that expenditure^ - and it runs into tens of millions of pounds - increases the budget figures and, by correspondingly increasing the use of central bank credit, depreciates the purchasing power of the £1. It is time that more rigid controls were imposed upon expenditure. This Government has encouraged the idea that money does not matter very much. Ministers have said, “ What does it matter how much money is spent?’ We are only concerned with producing additional material”. They forget that they cannot permit extravagance to occur without serious consequences to the people in the end. To maintain the value of our currency wo must, as a result of tha policy pursued by (shia
Government, impose greater control in the months ahead, because when the time for post-war reconstruction comes the consequences of the excessive use of central bank credit will be revealed.
However, it seems to me that it is not of much use to preach to the Government. I have expressed my views, and Ministers will learn eventually that the central bank credit of a country cannot be used in excessive quantities, without entailing. consequences that will have their effect upon every person in the community. The Treasurer himself admits that to the extent that excessive bank credit is used the period of control after the war must be maintained. I am not satisfied that over the past two years there has been any real control of expenditure, or any sufficient attempt to get from the people the amount of money which they could contribute. I tell the Treasurer that £300,000,00.0 can be obtained by means of loans, during this financial year. The figures of savings bank deposits and of the increase of the national income reveal sufficient data to suggest that that amount can be raised, but it will not be raised unless the Government’s selling, organization is able to convince the people that it is their duty to contribute. The Treasurer will not obtain very much more from the people in the higher brackets of income, because they have not got it, nor will he obtain much more from any other section unless his selling campaign is greatly improved.
One matter which has been discussed in this debate is Australia’s war effort. Much as I admire that effort,, and pay tribute to the Government for what it has done in the last two years, it has in some respects completely, failed to do its duty with regard to some sections ©f industry:. .Some time ago I drew attention to the diminishing output of certain- industries. I gave figures: then in regard to the port of Sydney and the wharf-labouring industry, showing that from 1940 to 1943 the cost of loading in that port had increased from 3s. 6d. to 10s. lid. a ton, and that during the same period the output of loading per man had diminished from .9 to .5 of a ton. Those figures were challenged by Mr. Healy, the general secretary of the Australian Wharf Labourers Federation. He said that they were not correct. I say that they are correct. They have been placed before the Stevedoring Industry Commission, to whose records the Government has access, and they reveal that in that industry at any rate increased wages are being paid and the output per man is diminishing.
A great deal has been said about the coal-mining industry. I know that the problem is difficult, but it has not been so difficult that the Government could do nothing in respect of it in two years. Every time a question is asked about coal we have the “meanderings of Monty” from the Deputy Leader of the Government (Mr. Forde), who tells us all sorts of things that have taken place in other countries. We hear always the stock reply, emphasizing how difficult the coal industry is to handle and that coal cannot be produced by imprisoning men. I assure the Government that it can increase the production of coal by adopting a firm attitude towards the men, and that is precisely what is needed. The statement ha3 been made in this House by the Minister for Supply and Shipping (Mr. Beasley) that last year was a record year in the production of coal, the idea sought to be conveyed being that immediately the Labour Government came into power the production of coal increased to a record figure. Actual statistics reveal that there has been a diminishing production of coal, particularly in the current year. I have here figures extracted from the report of the New South Wales Department of Mines for 1937. It is known that New South Wales produces over four times the quantity of coal produced in the rest of Australia, so that the figures for that State must give a reliable indication of .the position of the coal-mining industry in the Commonwealth. I ask leave to incorporate in Hansard figures showing the total tonnage of coal produced by New South Wales mines from 1906 to 1937, inclusive, taken from the annual report of the Department of Mines for 1937.
HONORABLE Members. - No.
Leave not granted.
– First lot ma take the so-called record year, 1942, to obtain a standard of comparison. The total production of coal in New South Wales in that year was 12,280,770 tons. In 1924 the total was 11,61S,216 tons. The figures for the years from 1920 to 1927 show varying tonnages fluctuating around the 11,000,000-ton mark. The production for 1924 reveals a very illuminating picture. It was nearly 2,000,000 tons more than that of 1938, nearly 500,000 tons more than in 1939, over 2,000,000 tons more than in 1940, only 150,000 tons less than in 1941, and only 650,000 tons less than in 1942, the record year about which the Government is continually talking. I claim that for 1943 the total production will not exceed 11,200,000 tons. Compare that figure with 12,280,770 tons for last year. To show what is taking place in this industry, the total production for the six months ended 31st December of last year was 400,000 tons less than that for the first six months of last year, and the production for the first six months of this year is actually 800,000 tons less than that for the corresponding six months of last year.
I now come to the output per man. It is time something was said about that, because the general public have been given the picture of the coalminers staggering exhausted out of the mines and just getting home and flopping into bed. Let us see what the figures reveal. Those I have are for the Invincible Colliery Limited, which is well known. The average daily output per miner in 1937-38 varied from 13.45 tons to 12.6 tons, and the average daily output per employee varied from 4.53 tons to 3.9 tons. In 1938-39 the average daily output per employee varied from 4.55 -tons to 3.65 tons; in 1939-40, from 4.53 tons to 3.78 tons; in 1940-41, from 4.35 tons to 3.5’ tons; in 1941-42, from 4.025 tons to 2.937 tons and in 1942-43 from 3.65 tons to 2.99 tons. Those output figures show a progressively diminishing’ output per man. During the same period there has been a progressively increasing remuneration per man. It is quite clear from the figures which I have given that the actual position has been misrepresented by the Government when it speaks about the record production of last year, but says nothing about the diminishing output per man and the increasing wages per man for that year.
– The honorable member is quoting the figures for only one mine.
– Figures for other mines would not make the position any better from the Government’s point of view.
– Why not be fair?
– It will require more than the oratory of the Minister for Repatriation to explain to me why the production of coal decreased by 800,000 tons in the period July-December, 1942, compared with the output for the first six months of that year.
– Those figures are not correct.
– They are taken from the official records of the Department of Mines, New South Wales. Production figures for the period 1938 to 1942 are as follows: -
For this year the output will be approximately 11,200,000 tons. [Extension of time granted.] Those figures do not convince me that the Government is doing its utmost to obtain the maximum production of coal. Whenever a serious stoppage occurs, the Government issues a new set of regulations to deal with the trouble, and the Prime Minister (Mr. Curtin) makes his usual statement that the miners must “ work or fight “. The union leaders are anxious to maintain production, but certain sections of the rank and file defy them, and the Government will not support the union leaders.
– What action did the United Australia party Government take to increase the production of coal?
– Yes, answer that question.
– If I learnt nothing else from the negotiations that led to the settlement of the strike in 1940, I did at least realize that seam miners consider that it is a good policy not to accumulate stocks of coal. Their reason is that once they build up stocks, they lose the value of the strike as a weapon for gaining their demands. It is a very strange thing that stocks are low to-day, although during the last two years the Government has given one promise after another to deal with the coalmining industry. Complete confusion exists regarding provisions dealing with the terms of employment of the miners. Most of the stoppages are based upon a misinterpretation of the conditions under which they work.
As reference has often been made to absenteeism, I shall give some information about it. At the western district mine, Wallerawang, absenteeism is increasing, whilst the output per miner is diminishing. It is strange that when the miners need money for the Christmas holidays and we expect them to be exhausted after their year’s labours, the output per man rises. But immediately they return from their holidays, the output decreases. These facts are inescapable. The position at Wallerawang is revealed in the following figures : -
Those figures tell their own story. It is useless for the Government to explain to the people that the only way in which to increase the production of coal is to call conferences and extract from the men a promise to increase their output. The Government, in its dealings with the miners, should show strength of purpose. To increase production, the Government needs only to indicate its intention to assert its authority under the law.
I have been informed that if a manager of a coal-mine requires additional plant, lie is not granted a war priority to obtain it. The Government should review that position. If he must obtain the machinery through the normal channels, interminable delays occur. Plant for the coal-mining industry should be given urgent priority.
My comments on the budget reveal an absence of a realistic approach on the part of the Government to the problem of finance. A diminishing war effort is plainly contemplated, and an increasing use of central’ bank credit is obvious. The budget, whilst acknowledging the danger of that policy, suggests no additional means for controlling it. Regarding the war effort, I have drawn attention to certain industries, including the coal-mining industry, where the Government has failed utterly during the last two years to assert its authority. Gradually the public will come to realize this truth, although the electors showed on the 21st August in no uncertain terms their approval of the record of the Labour Government. Its financial policy may be summarized as follows: “We shall not increase taxation; we shall raise the additional money somehow “. We know how the Government is providing that money, but the consequences of its policy were not known to the people. I do not feel impelled to admit that, the people having given their verdict, I must hold my peace. In my view, the budget reveals no realistic approach to the problem of finance and will create problems of post-war reconstruction that will have serious effects upon, the community.
.- I compliment the honorable member for Martin (Mr. Daly) upon his excellent presentation of his views on the important’ subject of post-war reconstruction. The honorable member, I am convinced, will prove an asset to the Labour party and to the community generally.
The remarks of the Leader of the Opposition (Mr. Menzies) this afternoon upon what he described as: our “financial policy” were most interesting to me. Since the introduction of the 1942-43 budget, the course of the war has- changed definitely in our favour. The demands that it makes upon the national purse are heavy, but no matter how much money is required, the Government will provide it. The issue between the Government and the Opposition is the source that will yield it. I compliment the Labour Government for its magnificent work during the last twelve months in achieving the salvation of this country. Ansstralia has been preserved from attack and its vast resources have been denied’ to the enemy. Our potential national wealth runs into an astronomical figure, but through the neglect of successive United Australia party governments, particularly that led by the right honorable member for Kooyong (Mr. Menzies), it has never been properly developed. At the outbreak of war, the right honorable gentleman declared that we must bury the old order and introduce a new one. But his speech this afternoon was based on the principles of orthodox finance. As every intelligent person knows, adherence to those principles was largely responsible for our present plight. During the depression, anti-Labour governments could not provide sufficient money to feed many of the fine nien who to-day are driving the enemy out of New Guinea. They were allowed to starve by the roadside. The Leader of the Opposition smugly declared that money did not matter. In my opinion, money is the only thing that does matter in this or any other country. Without it a person goes without food or shelter and suffers untold misery, hardship and mental’ strain.
There is only one matter in the budget with which I do not agree. In my opinion, we are not yet utilizing the national credit of the country to the degree that we should. Even if expenditure increases to £1,000^000,000 annually, we shall provide the money. We shall create it. During the election campaign, financial experts from the Commonwealth Bank informed the public that bank credit could not be used in peace-time to the same degree as it was in war-time, but they omitted to explain to my satisfaction that obvious anomaly. What are our men fighting for on distant battle-fields? Are they to return to a country saddled with an intolerable burden of debt, which they and their children will be unable to pay? The Labour party was returned to office with such an overwhelming majority because the people endorsed its financial policy. I hope that when the next general elections are held peace will have been restored to the world and post-war reconstruction will then be the major issue.
The views which I now express are principally on behalf of primary’ producers, of whom I have had a lifelong experience. Men and women have been broken in heart and spirit because they have been unable to obtain payable prices for their produce. Their sorry plight was disregarded by anti-Labour governments. Not until the Curtin Government took office in war-time were they given a fair deal. The Leader of the Opposition was Prime Minister at the outbreak of war, and some years earlier was a member of a government which appointed a royal commission to determine amongst other things the cost of producing a bushel of wheat. The finding was that wheat could not he economically produced for less than 3s.. 6d, a bushel. Despite that determination, the Menzies Government, after the outbreak of war, acquired wheat for the No. 1 pool at ls. 5d. a bushel. The excuse which was then advanced was that the country could not afford to pay a higher price for the grain. If, as the right honorable gentleman declared, money does not matter, why did his Government treat the primary producers so badly? After years of maladministration by anti-Labour governments, the Curtin Government had the responsibility in war-time of “ pulling Australia out of the mess “ and the people expressed their appreciation of its methods in no uncertain manner. They have given to the Government a mandate to control the credit of the nation. Until we have a new financial order, there cannot be a new social order. We have been told that a complete clearance of the slums in our capital cities would require an enormous amount of money. I know of backyards of houses in the capital cities on which the sun never shines. Something must be done to eliminate these undesirable dwellings when the war is over. There has also been much talk of the falling birth-rate. What is the cause of these conditions throughout the length and breadth of Australia? They are due Solely to the rotten, out-of-date financial system which the Leader of the Opposition has said we cannot alter. However, the right honorable gentleman did not say a word about the curse of deflation which swept this country during the financial depression ten or twelve years ago. At that time our currency was deflated to such a degree that finance was not available to develop this country. It is the responsibility of this Government to see that such a state of affairs is never created again. I hope that in the near future, when the Government has a majority in the Senate as well as in this chamber, it will implement the financial policy of the Labour party, and will enable the Commonwealth Bank to be used once again in the manner contemplated by its founders. Until that is done there can be no new social order or security in this country. I’ understood the Leader of the Opposition to say that progress and security could not go together; I do not agree with that statement. Progress and security do go together, and with them goes employment. As soon as a man becomes unemployed in this country, or in any other country, progress is retarded. When all is said and done, many men cannot give more to their country than their services, and no matter what their occupation may be, if they should become unemployed, then development is retarded to that degree. Unemployment is the curse of all countries; but there is no reason why there should be any unemployment in this land of vast resources, productive capacity and potentialities. We have been hampered in the past in opening up new areas through the lack of water. God has given us the water free, but man has put a price on it. He has refused to send it through to the back-blocks of Australia, and without water man and beast will die. The people of remote districts are crying out for water for domestic use, for irrigation purposes, and for fire fighting, but they cannot get it because they are told that no money is available. I trust that that excuse will be forgotten under the administration of this Government. Irrigation should be one of the main features of our post-war reconstruction, because only by undertaking vast irrigation schemes can we make this country what it should be.
I urge upon the Minister for Commerce and Agriculture (Mr. Scully) the necessity to give immediate consideration to the payment of a higher price for wheat grown during the 1943-44 harvest. Wheat-farmers fought hard to secure 4s. a bushel for the first 3,000 bushels produced; but since then the cost of production has increased considerably, and I contend that they are now entitled to 4s. Gd. or 4s. Sd. a bushel for the first 3,000 bushels. I am not concerned with the price paid for wheat produced in excess of that quantity. We on this side of the chamber represent the small wheat-growers of Australia. There is no doubt that primary producers generally are better off to-day than they have been for many years, due wholly and solely to the passage in war-time by the Labour Government of legislation which previous governments refused to pass in peace-time. I do not ask for 5s. 3d. or 5s. a bushel, as do certain organizations which are supposed to represent the wheat-growers of Australia. The cost of production has not risen to that degree; but I consider that it has increased by about 8d. a bushel, and the growers are entitled to receive that 8d. They ask only for a fair price that will enable them to pay their way; for the right to live and to receive a reasonable return for the work they do.
Conditions in the dairying industry also have improved under the administration of this Government, but they could be improved even further. It is a standing disgrace that any primary producer should be asked to carry on with slave labour, but that is the position on many dairy farms to-day. Women and children are working in cow yards up to their knees in mud. That is a job for men receiving an award wage, but before such a wage can be fixed a reasonable return for dairy products must be established. I realize that our first consideration is the winning of the war, and I believe that we are progressing well towards final victory, hut I hope that this Government will be big enough and strong enough to take control of the credit of this nation before the next budget is brought down, and that that credit will be used to a greater degree than ever before, in the interests of the country as a whole. After all, that is why the Commonwealth Bank was established, and that is the purpose for which I hope it will be used in future. Up to the present there has been no opportunity to do so. I regard the vote at the last elections as an expression of the people’s approval of the Labour party’s financial proposals, and I trust that when the time comes every member of this chamber will fight determinedly to ensure that all sections of the community get that to which they are justly entitled. This country must be the master of its own finance. The old system of international control of our fi nance must be abandoned. Why should the Australian £1 be worth so much in New Zealand and so much in the United States of America, which, after all, are members of the Allied Nations in this war? Let us have the same value throughout the world for the currency of every nation! The men and women who are fighting this war for us must not return to a country shackled with debt, but that will be the case unless international control of finance is broken. I say, too, that every man who fights for his country is entitled to receive a £1,000 bond from the Commonwealth Bank by way of a gratuity. Surely that is little enough to pay for the salvation of our country. Our returned soldiers are entitled to expect security when’ they return, but without money they will have no security.
In conclusion, I express the hope that when the next budget is tabled in this Parliament we shall be once again living in an atmosphere of peace.
– I gather from the speech of the honorable member for Riverina (Mr. Langtry) that the budget does not altogether meet his views, and I think that it can be said with every truth that it does not breathe, to any great degree, that new order for which honorable members opposite have been hoping. It is, in fact, a completely orthodox document. It savours more of the old and tried medical practitioner rather than of the new first-year student. In many respects, it is not a budget at all, and it could be described more truthfully as a financial statement.
Some weeks ago, when I heard from our talented friends, the press, that the budget was to be brought down earlier than had been expected, I formed the opinion that it would contain few surprises. It is, as I have said, more in the nature of a financial statement.
– Does not that apply to all budgets?
– To some degree, yes, but a normal budget includes some new financial measures; some new principles which members of this House may discuss. This budget does not do that. It merely states the financial position. To take the budget in proper perspective one has to go back to the taxation measures introduced in March last, providing for the raising of an additional £43,000,000 by way of increased income taxes imposed mainly upon the lower income groups. If honorable members will cs.st their minds back to that period they will realize that there was something peculiar about those taxation measures. It will be recalled that in 1942, just prior to the flotation of a Commonwealth loan, the Prime Minister (Mr. Curtin) made a statement to the effect that no new income taxes would be imposed in that financial year. Yet in the following March, lo and behold! from the skies came the new taxation measures providing for the raising of an additional £43,000,000, and to , become operative from the 1st April. Obviously that action was a breach of the promise given by the Prime Minister. The excuse given by the Government was that the new proposals related to the ensuing financial year, and actually would be taken into consideration in assessing income tax for the year 1943-44. Therefore, when we look at this statement of accounts we must bear in mind the additional taxes imposed in April, and if Ave do that we must arrive at the conclusion that for 1943-44 additional taxes amounting to £43,000,000 have been imposed almost exclusively upon the lower income groups.
The budget provides for a total expenditure of £715,000,000 in the current financial year. That is an enormous sum for a country whose population is 7,000,000 people. Of that amount, £570,000,000 is to be spent on the war, apart from which ordinary expenditure will amount to £148,000,000, which is roughly double our total expenditure under ‘ the 1932-33 budget. In other words, when I first became a member of this Parliament, Commonwealth expenditure amounted to approximately £70,000,000. Although we have been passing through a war period, in which we have been threatened with grave peril and there was every necessity on the part of the people to provide as much money as was required for its prosecution, our domestic budget has doubled. One can justifiably ask, is this wise? Is it right that, having to meet an abnormal war expenditure, we should also have to provide for an abnormal expenditure for domestic purposes? The budget is open to challenge on that ground. There is, of course, the factor that, whatever may be the increase on the domestic side, the money circulates among our own people. The simple result is that we ourselves have to provide a larger amount. The revenue to be raised by taxes totals £273,000,000, of which income tax collections will amount to £120,000,000. That £120,000,000 has to be considered from a comparative viewpoint, when one recalls that in the last pre-war year only £8,000,000 was raised by means of direct taxes ; in other words, direct tax collections have risen during the war period from £8,000,000 to £120,000,000.
In considering this document, it is right that we should restate its main points. Having stated them, the financial story of the war years may well be told. It was clear to whoever had the task of financing the war, that three factors had to be considered. The first was that enormous revenues had to be raised. No one section could tear the total impact, just as no one section could provide the man-power needed for the prosecution of the war. Secondly, it was necessary to curb civilian expenditure; because, as thousands were called into the armed forces and into munitions production, necessarily consumable goods had to be in short supply, and unless steps were taken to curb civilian spending inflation would become the order of the day, because the impact of money on a lessened volume of consumable goods would have the effect of causing prices to rise. There were three methods of achieving the end of government finance during the war period. Quite obviously, the first method was that of direct and indirect taxes, the second that of voluntary and compulsory loans, and the third that of bank credit. The amounts required for war purposes were so large that it was impossible to raise all of them by direct or indirect taxes. It was also obvious that an attempt to meet the position entirely by means of voluntary loans would fall short of the objective. Therefore, some infusion of bank credit was necessary. The problem was to determine the method by which the war should be financed. An equitable method had to be adopted. It had to be one that would be just to all sections and which did not entirely savour of voluntarism, but compelled every individual, as far as possible, to bear a fair share of the burden. As honorable members know, the Fadden Government two years ago proposed to meet the position by a method which had a certain degree of compulsion, yet would have spread the burden evenly between all sections and kept to the minimum the creation of bank credit, thus helping to stabilize price and wage levels. It proved unacceptable. The Fadden Government was overthrown, and the Curtin Government came into office. For something like fifteen or sixteen months, the position was allowed to drift. No new taxes were imposed, and treasury-bill finance became the order of the day. To the masses, unaware of its likely effect, it appeared to be an easy method ; but whilst the people did not contribute their proper dues to the Government, either directly or indirectly, yet they were subjected to a subtle method of taxation through the depreciated value of their money. It is interesting to realize the degree to which treasury-bill finance was adopted in this period. In June, 1941, the issue of treasury-bills amounted to approximately £1,750,000. In June, 1943, it had risen to £259,000,000. In the present year, an additional £103,000,000 will be raised by this method, making the total at the end of June next £362,000,000. This assumes that the budget figures relating to expenditure and receipts will be realized. If the expenditure should exceed the estimate, then the amount will have to be increased. In considering the treasury-bill position, the amount of treasury-bills held on behalf of the States must be taken into account. Under this head, treasury-bills amounting to £39,000,000 have not been redeemed. Therefore, the grand total of outstanding treasury-bills in this country to the end of June next will be no less than £401,000,000 - Money which has virtually been created out of nothing. It is true .that the £39,000,000 unredeemed by the States goes back to the depression period. It can, be stated with truth that for many years this money has been accepted as a part of the volume of Australian credit. It is equally true to say that it is 3till circulating among the people of Australia. The States which, in the main, to-day are enjoying the benefits of buoyant revenues, and are adopting different subterfuges in order to cloak them - such as setting aside amounts for railway depreciation - are making no effort whatsoever to redeem any of these treasury-bills. Therefore, generally speaking, it is correct to say that by June next, assuming that £300,000,000 is raised by means of voluntary loans and the expenditure does not exceed the budget estimate, no less than £401,000,000 will have been provided by means of treasury-bills, or inflated credit. This money is circulating throughout the community at a time when consumable goods are in short supply. It is a constant menace to the price levels and to the value of the currency in this country. But it is something more than that; itcreates what I call a wrong psychology in regard to public finance - a subject that was touched upon briefly this afternoon by the Leader of the Opposition (Mr. Menzies). It involves the creation in many minds of an almost complete irresponsibility in respect of public finance. The statement is often heard in Australia to-day, “ If all this money can be raised for war, it can also be provided in peace-time “. There is generated in the minds of many Australians the idea that ahead lies no difficult period, but something approaching the millenium, when employment will always be found and there will be a period of plenty. It is wise to look at every aspect of this subject. I am afraid that very few people do that to-day. We must take into consideration the number of controls that have been instituted in order to conform to this new method of war-time finance. People frequently forget that to-day there is an almost, complete lack of economic freedom, that world trade no longer exists, that interchange of goods between country and country has almost disappeared, that civil development is circumscribed, that business is in a straightjacket, that norma] life has gone, that it is no longer possible for the people, whether or not they have the money to do so, ,to purchase those things that make for a real standard of living. It is no longer possible for a person to build his own home, even if he has the money to do so. Goods of various kinds are rationed, and loans are being floated on a scale unthought of a few years ago. These are new factors in this country; they are not associated with normal peace-time activities. The great majority of the people want to live normal lives, and therefore it is wise for us in this Parliament to emphasize the difference between present conditions and those of normal peace-time periods, so that the people may know that what is happening to-day cannot continue on the same scale in normal times. As we look forward to the day of victory and the return to more or less normal trading conditions, we are forced to the conclusion that the soundness of our financial system during the war, and in the transitional period following the war, is a matter of vital importance. I shall give some examples of the effect of treasury-bill finance on the different income groups in this country. For the year 1939-40 the national income of Australia was estimated at £750,000,000. Of that sum, the earnings of persons in receipt of less than £400 represented £525,000,000. They paid taxes amounting to £10,000,000, leaving them with £515,000,000. Persons in the class with incomes between £400 and £1,000 shared £135,000,000. Of that sum £13,000,000 was taken in taxes, leaving £122,000,000 for distribution. The group with incomes over £1,000 shared £90,000,000 of income.
After paying £28,000,000 as taxes those in that group retained £62,000,000. Due in great measure to the issue of treasurybills, and also to the fact that more people were working and receiving overtime payments, the national income in 1942-43 was £1,060,000,000. In his address at the opening of the Fourth Liberty Loan last Monday night the Prime Minister (Mr. Curtin) mentioned £1,223,000,000 as Australia’s gross income, but the figure which I have given is the income in the hands of individuals in this country. It will be seen that the national income in the hands of individuals increased from £750,000,000 in 1939-40 to £1,060,000,000 in 1942-43. Of the latter sum persons with incomes under £400 a year shared £725,000,000, out of which they paid £50,000,000 in taxes, leaving £675,000,000 for distribution. The income group between £400 and £1,000 shared £230,000,000 of which £39,000,000 was taken by direct taxes, leaving them with £191,000,000. The group consisting of persons with incomes of over £1,000 shared £105,000,000. Of that sum £52,000,000 was taken as taxes, leaving them with £53,000,000. These figures show a progressive increase of wealth in all groups with the exception of that consisting of persons with incomes of more than £1,000 per annum. The net income of the under £400 group rose from £515,000,000 in 1939-40 to £675,000,000 in 1942-43- a clear gain of £160,000,000. This group contains the greatest number of taxpayers. The group with incomes between £400 and £1,000 a year received £191,000,000, or £69,000,000 more than in 1939-40 when their total incomes amounted to £122,000,000. In other words, the group with incomes of over £1,000 a year is the only section which shows a diminution of the money in circulation, its net income having fallen from £62,000,000 to £53,000,000, a reduction of £9,000,000. These figures show conclusively that the war has meant a clear gain to the great majority of Australians. That gain is due, in the main, to treasury-bill finance. Even if we deduct from these figures the amount represented by the depreciation of money due to that system of finance, the fact remains that the great mass of incomeearners in this country have, as the result of the war, received larger incomes than formerly. It is frequently overlooked that the issue of treasury-bills, although leading to an apparent increase of the amount of money in circulation, has created a fictitious standard. It means also that sooner or later, either by the lessening of controls or by the ultimate resumption of normal trading conditions, treasury-bill finance can no longer be resorted to in the same measure without the people of this country having to face stern realities. It is well that this point should be understood by the people, because I fear that there is prevalent among them the idea that Father Christinas has arrived, and that a new era, in which there will be continuous prosperity, has dawned. It is obvious that unless the people of Australia realize that present-day conditions are abnormal, and act accordingly, they will be forced to learn the rudiments of finance in a hard school. The figures which I have given lead, naturally, to the question whether taxation has reached saturation point as stated in the Treasurer’s budget speech. I say that saturation point has not yet been reached. The mere fact that more money is circulating among those in various income groups indicates that additional taxes could be levied if deemed wise. It is equally true, however, that taxation in this country has reached so high a level that it would not be nationally advantageous to increase it to any considerable degree. A comparison of taxation in Australia with that of Great Britain, Canada and New Zealand is interesting and reveals some startling facts. For some years Great Britain has had in operation a system of part tax and part post-war credits - a system which when advocated by the Fadden Government was rejected. A comparison with Great Britain reveals that, including postwar credits, direct taxes on single men in Great Britain are higher than the direct tax on single men in Australia. There is very little difference between what is paid there by single men in the middle income group and that paid in Australia, but taxation on those in the higher income groups is greater in Australia than in Great Britain, However, taxation upon the married man with two or more children is much heavier in Australia than in Great Britain, despite the fact that we have heard so much recently of the need in Australia for a higher birth-rate and an increase of population. There should be a complete review of our scale of taxation so as to ease the burden on the married man with a family. As the result of such a review more revenue could be obtained, and if the system of post-war credits were introduced, even single men could obtain some benefit. I cannot understand why the Government has been so reluctant to introduce the system, unless it he simply that it was first proposed by the party on this side of the House. The system of post-war credits has many obvious advantages. In the first place, it facilitates the raising of revenue and provides some reward for those who are required to make increased efforts in the prosecution of the war. This would have an important bearing upon industrial relations, which are undoubtedly affected by high taxation. Moreover, the system would have tremendous advantages during the transitional period from war to peace.
When increased purchasing power is placed in the hands of the community at a time when goods are in short supply, there must always be a tendency for prices to rise. Every country which had experience of the 1914-18 war has made efforts during the present war to stabilize prices and wages. This Government has attempted to do it by fixing a ceiling price for goods. It can be argued that, had a wiser method of finance been adopted, prices might not have tended to rise. However, it was found necessary this year to take steps to stabilize prices at the level of a few months ago. In Great Britain, the ceiling price was applied only to those basic commodities which entered largely into the standard of living. The prices of all other commodities are allowed to fluctuate as they will, the necessary corrective being applied in the form of an excess profits tax. Thus, traders find that there is not much advantage to be derived from increasing prices. In Canada, on the other hand, the method was adopted of fixing a ceiling price for practically every article manufactured or retailed. [Extension of time granted.] That is the method which has been adopted in Australia also. If a trader, or manufacturer finds that his costs have risen because of freight or wage increases, he makes application to the Prices Commissioner. He has to put before the Prices Commissioner the facts of his case, and ask that the difference between his old cost and the new price at which he is obliged to sell to the public be met by means of a subsidy. That subsidy, of course, must be met by taxes. That is the procedure which has been forced upon the business community to-day. Most people in touch with the business world know that it is strangling trade. It is easy to imagine the inconvenience which such a procedure causes to a business house which is selling a variety of goods. The system is intolerable. It imposes upon the business community a burden which must react upon our internal economy. This system exasperates the business community. The Government thus fails to achieve any objective by this system because no business in Australia to-day is making excessive profits. The system slows down industry, and consequently the pool upon which the Government relies for revenue in order to carry on the war effort is being reduced. I urge the Treasurer to abandon that method and to adopt the British method of fixing ceiling prices for basic commodities only, leaving the remainder of trade completely free of restrictions of this kind. The Treasurer would find it difficult to show that any business is making excessive profit. In any case, the Government has complete power to curb excessive profit making. The British method is preferable to the Canadian method, and its adoption in place of the present system would free business generally from the strait-jacket in which it is now encased, and, in addition, would tone up morale in the trading community, as well as ensuring the stability of the pool from which the Government derives much of its revenue through taxes.
My survey of the budget leads me to the conclusion that room exists for the raising of a limited amount of additional revenue. This should be raised partly by taxation and partly by post-war credits.
At the same time, I admit that no very great amount of additional taxes can be imposed. Therefore, the financing of the country’s effort in the concluding stages of the war will depend upon the raising of loans and the elimination of wasteful expenditure. Time does not permit me to deal with those subjects as fully as I should like.
I now turn to a matter which I suggest the Prime Minister should take the first opportunity to clarify. The Prime Minister in his policy speech during the election campaign stated -
The Army will be maintained a.t the strength necessary for providing for an army corps for offensive operations in accordance with the plans of the Commander-in-Chief, South west Pacific Area.
In an interview which the Prime Minister gave in Canberra to Mr. Frank Kluckhohn, a representative of the New York Times, on the 3rd October, and which is reported in the Melbourne Age of the 4th October last, he said -
Australia is prepared to provide its share of troops for a campaign to recover the Philippines if the United Nations deems it advisable. “ Australia’s strong man says Mr. Kluckholm, “ made it clear he was not suggesting strategy, but gave his first public assurance that Australia was prepared to send masses of men beyond her own immediate defence zone for the first time since Australian divisions were withdrawn from the Middle East.”
These two statements are not in agreement. The Prime Minister, in his policy speech, referred to an army corps for offensive operations, yet in the interview which he gave to Mr. Kluckhohn in Canberra, only a few days ago, he talked about sending masses of men outside Australia’s immediate defence zone. They might be sent, if necessary, even to the Philippines. The Prime Minister also gave some illuminating figures in his policy speech. He said that the total number of men in the services to-day was 820,000, of whom no fewer than 530,000, who were in the Army, Navy and Air Force, had enlisted for service anywhere in the world. It would appear that the other 290,000 must be in the Militia Forces, namely, men who have enlisted for service within certain areas. Allowing for the 80,000 men in the Volunteer Defence Corps, that would mean, on a basis of 15,000 men to a division, that we have about fifteen divisions in the Militia Forces. What role are these men to play ? The Government should clarify that point. We have a clear statement in the policy speech of the Prime Minister that for offensive operations only an army corps is to be used. An army corps can be anything from two to five divisions; in the British Army it normally consists of three divisions. To the best of my knowledge - I shall be glad if I hear something to the contrary from the Government - there are in the Australian Military Forces to-day only three divisions, namely, the 6th, 7th and 9th Divisions of the Australian Imperial Force, capable of offensive action in any part of the world. I know of no other divisions that have been formed for offensive action in any part of the world. I know that thousands of men have joined the Australian Imperial Force. No new Australian Imperial Force divisions have been formed, but men have been incorporated in divisions with militia units. It cannot be said, therefore, that it is within the power of Australia to-day to send on offensive operations outside the zone fixed by the Defence (Citizen Military Forces) Act other than the 6th, 7th and 9th Divisions of the Australian Imperial Force.
– What is wrong with that?
– I shall tell the honorable member what is wrong with it. Those three divisions have borne the brunt of the fighting wherever our troops have fought. Only last week our newspapers told us that Finschhaven fell to the glorious 9th Division, which won renown at El Alamein and is heaping further laurels upon itself in New Guinea. Does the honorable member suggest that for offensive operations outside our statutory defence zone Australia will use over and over again only those three divisions, whose members fought in Greece, Crete and the Middle East and are now fighting in New Guinea? Will the men of the Australian Imperial Force have to stay at the battlefront while thousands of other men in the Australian Imperial Force and the Militia will remain in the homeland? Are the fifteen or twenty divisions I mentioned to play no active role in this war? Do the men of the 6th, 7th and 9th Divisions have to serve for months and months with neither leave nor rest? Is that the Government’s intention? It would appear that it is. Or is there some explanation behind the Prime Minister’s words to Mr. Kluckhohn that if necessary masses of men will be sent outside the Australian zone, to the Philippines ? [Further ‘extension of time granted.^ These questions are exercising the minds of thousands of people in Australia to-day. In the last war, Australia put into the field and maintained five divisions.
– And the cavalry.
– Yes, but in this war we are to put into the field only three divisions, which have already seen much hard fighting and have suffered great numbers of casualties. If that is the Australian conception of global war, it is a pretty poor conception. If that is Australia’s reward to men who joined those divisions, it is a shocking reward. This position must be clarified. Either the Prime Minister meant what he said in his policy speech or he did not mean it. If he did mean it, he must be called upon to substantiate his case before the people of this country. Before this debate ends I hope that we shall hear from the Minister for the Army (Mr. Forde) about this matter. The parents and friends of the men in the 6th, 7th and 9th Divisions and the men themselves want to know the situation. If it is not elucidated, an honorable member on this side of the chamber may move the adjournment of the House in order that we may specifically discuss the matter. On this side of the House there are certain honorable gentlemen who are members of the Advisory War Council. I shall want to know from them whether they agree that only three divisions shall embark upon offensive operations outside Australia. I shall want to know from them whether the 6th, 7th and 9th Divisions are to be used over and over again, and whether hundreds of thousands of other men in the Military Forces are to remain in Australia perfectly safe in camps as lines of communication troops and as supply troops. Ishall want to know from them whether they agree with such a policy. If they do not, I shall want to know why they continue as members of the Advisory War Council.
The following papers were pre sented : -
Australian Wool Board - Seventh Annual Report for year 1942-43.
Lands Acquisition Act - Land acquired for Commonwealth purposes -
Forbes, New South Wales.
National Security Act - National Security (Land Transport) Regulations - Order - New South Wales (No. 5).
Primary Producers Relief (Superphosphate) Act - Report for period March- June, 1943.
SuperphosphateBounty Act - Returnfor year 1942-43.
House adjourned at 10.20 p.m.
The following answers to questions were circulated : -
n asked the Minis ter for Commerce and Agriculture, upon notice -
– The answers to the honorable member’s questions are as follows : -
Meat Industry : Werribee Beef ; Supplies in Brisbane.
n asked the Minister for Commerce and Agriculture, upon notice -
Department, during the periods the 13th-31st August, and the1st-18th September, respectively, of this year?
– Inquiries are being made, and the necessary information will be obtained for the honorable member.
y asked the Minister for Commerce and Agriculture, upon notice -
Mr.Scully. - The answers to the honorable member’s questions are as follows : -
Apples and Pears.
n asked the Minister for
Commerce ; and Agriculture, upon notice -
With regard to fruit sold under the Apple and Pear Acquisition Scheme, particularly in the last year in which Queensland was involved, will he state -
whether growers can obtain information regarding their own crop sales;
whether the Government intends to withhold from them the full realization of their crops;
whether there was approximately 3s. a case profit; and
whether it is a fact that these realizations of their crops are the growers’ wages, and, if so, why part of such wages should be withheld?
y. - The answers to the honorable member’s questions are as follows : -
In connexion with this question, the honorable member is referred to a general statement on the subject of the acquisition of commodities made in the House on the 18th March last by my colleague, the honorable the AttorneyGeneral.
– On the 6th October the honorable member for Darling (Mr. Clark) asked a question, without notice, regarding the method to be adopted in releasing labour for primary production. I desire to inform the honorable member that on the 1st October, War Cabinet decided that up to June, 1944, 20,000 men are to be released from the Army in addition to routine releases and 20,000 are to be diverted from munitions and aircraft production for the purpose of strengthening the basic industries of the Commonwealth upon which the effectiveness of the direct war effort depends. These men will be released for specific purposes approved by the War Commitments Committee and the committee has already recommended and Cabinet has approved of securing 15,000 men for rural industries as an urgent priority.
The principal objective is to step up the production of dairy products, vegetables, meat and eggs, and priority will be given to releases for these industries. The genera] administrative procedure which will be followed is that the individual farmer will make application to his local national service officer or District War Agricultural Committee giving full details of the particular person or persons required on his farm. Where district war agricultural committees and butter factory committees are functioning all applications will be reviewed by them and a report submitted to the national service officer, who will forward the application to the Deputy Director of Man Power in each State. The latter will take up the matter with the services or the Departments of Munitions or Aircraft Production with a view to securing the services of the nominated person provided that it is not possible to obtain suitable labour by other means.
While it is not to be accepted that all men nominated can, in fact, be secured by virtue of restrictions upon relief which the Army must apply in individual circumstances where the person is vital for operational needs, and while there will be various impediments to the transfer of former rural workers from the munitions and aircraft industries, all authorities concerned will do their utmost to facilitate the return of men to high priority rural production. As only limited numbers are available, district war agricultural committees will exercise close supervision over applications to ensure that man-power is not returned where it would not benefit materially the national effort, and the individual farmer will similarly serve the national need if he makes every endeavour to utilize the labour made available as effectively as . possible.
y asked the Minister for PostWar Reconstruction, upon notice -
– The answers to the honorable member’s questions are as follows : -
The Rural Reconstruction Commission will, on the basis of its investigations, recommend measures for increasing the efficiency of methods of production, distribution and marketing of primary products; for conserving, maintaining and developing the natural resources of Australia; and for promoting the general welfare and standard of living of, and amenities available to, dwellers in rural areas. The commission may accordingly investigate and report upon any matter relating to rural reconstruction, including -
Should the, occasion arise, the commission may be directed to investigate and report or to advise upon any matter affecting the rural economy.
y asked the Treasurer, upon notice -
– Inquiries are being made and a reply will be furnished as soon as possible.
British Parliamentarians in Armed Forces.
n asked the Prime Minister, upon notice -
– An endeavour will be made to obtain the information sought by the honorable member.
Cite as: Australia, House of Representatives, Debates, 7 October 1943, viewed 22 October 2017, <http://historichansard.net/hofreps/1943/19431007_reps_17_176/>.