House of Representatives
8 October 1943

17th Parliament · 1st Session

Mr. Speaker (Hon. J. S. Rosevear) took the chair at 10.30 a.m., and read prayers.

page 281


Return toWrit– Leave of Absence to Member.

The CLERK. - I have to announce that I have received from the Military and Official Secretary to the GovernorGeneral the return to the writ for the election of a member for the Northern Territory, which was held on the 21st August, 1943, and by the endorsement thereon it is certified that Adair Macalister Blain has been elected in pursuance of the said writ.

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

That leave of absence for the remainder of the session be given to the honorable member for the Northern Territory (Mr. Blain) on the ground of his absence from Australia as a prisoner of war.

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Presentation to the GovernorGeneral.

Mr SPEAKER (Hon J S Rosevear:

– I inform the House that the AddressinReply will be presented to His Excellency the Governor-General, at Government House, at 12 noon on Thursday next. I shall be glad if the mover and seconder of it, together with as many other honorable members as can conveniently do so, will accompany me to present it.

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Minister for External Territories · EAST SYDNEY, NEW SOUTH WALES · ALP

– On the 24th September the honorable member for Wimmera (Mr. Wilson) asked me to examine the position in Victoria resulting from the decision of the Victorian railway authorities to discontinue booking seats. I have made inquiries, and have been informed that seat bookings in Victoria have been discontinued on all State passenger trains, with the exception of the trains running between Melbourne and Mildura. This action was taken in connexion with the reduction of train services, due ‘ to shortage of coal, in order to provide for the better use of rolling-stock and the better distribution of the loading throughout the trains. It is pointed out that, with the restricted services, all trains running are very heavily loaded, and it would be unreasonable to provide for sections of the trains to be reserved for a limited number of passengers when other portions are extremely heavily loaded. The temporary suspension of seat bookings provides for a better distribution of the passengers throughout the train.

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– On the 29th September the honorable member for Flinders (Mr. Ryan) asked me a question regarding the refusal of .the Victorian Railways Department to accept empty egg cases for return to the consignors of eggs. I have now been advised that, owing to the shortage of coal, it was found necessary for the Victorian Railways Department to curtail its service, and a list was prepared of restricted goods during the period of this reduction. In it was included empty egg cases. However, a revision of this list icd to the realization that empty return egg cases, milk cans, &c, must be carried ; consequently, the order restricting their carriage was promptly rescinded. AH empty egg cases are now accepted.

page 282




– In view of the large number of regulations dealing with tenancy matters, which cause much confusion, delay and expense in interpretation and administration, and the many conflicting decisions that have been given, according to the views held by the magistrates who deal with them, I ask the Minister representing the Minister for Trade and Customs whether consideration will be given to the setting up of special tenancy courts, in conjunction with the State authorities, in order to achieve more expeditious hearings, greater uniformity in administration, and a less expensive procedure ?

Minister for Supply and Shipping · WEST SYDNEY, NEW SOUTH WALES · ALP

– I am aware that the honorable member has devoted much attention to this subject, and has had informal discussions with the AttorneyGeneral in regard to it. Perhaps the first approach might be some form of consultation in connexion with the regulations, so that a clear picture of their application might be obtained. A submission might then be made to the

Attorney-General, following which the further suggestion of the honorable member might be found to be practicable.

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Stock Vans - Supplies - Rationing - Homebush Abattoirs - -Flemington Sales– Beef Sales by Country Butchers.


– On the 24th September, the honorable member for Darling (Mr. Clark) asked whether the Victorian Government had reduced the number of stock vans available for bringing stock to the markets in Victoria, and, if so, whether I would take action to ensure that additional vans would be made available in order to provide Against any shortage’ of meat supplies in Victoria. I have made inquiries, and have been informed that- the Victorian Railway Department has increased the number of trucks utilized for the transport of stock to the markets in Victoria, particularly to Newmarket. This should improve the position in respect of meat supplies.


– I ask the Minister for Commerce and Agriculture Whether, as to-day’s Sydney Daily Telegraph reports, he said in an interview yesterday, “ There is more meat in Australia than the Government knows what to do with “ ? Is the further statement in the report - correct, that the honorable gentleman is strongly opposed to the Government’s proposals for the rationing of meat? If the facts be as stated, what exactly is the position of the honorable gentleman ?

Minister for Commerce and Agriculture · GWYDIR, NEW SOUTH WALES · ALP

– The newspaper report contains some variations from the statement that I made. Meat supplies are greater at present than they have been previously.

Mr Fadden:

– More meat is needed now.


– I agree. There are transport and man-power difficulties, but these are gradually being overcome, and I cannot see any prospect of the application of rationing immediately, although this may have to be introduced later.


– Meat is already rationed.


– The plans of the Production Executive are preparatory, and are ready for implementation when the need for rationing arises.


– In view of the honorable gentleman’s statement, as reported in the press, that meat supplies are plentiful-


– Order ! The honorable member is beginning to debate the question.


– The question that I propose to ask is entirely different from that which the Minister has just answered. Can the honorable gentleman state what steps are being taken to ensure that the Homebush abattoirs will kill to their full capacity of 180,000 sheep and lambs a week? Are steps being taken to provide additional labour to enable the whole of the mutton killing chains to function?


– The matter is somewhat complicated. More man-power is being made available at Homebush abattoirs, and reasonable assistance is given by the employees there, with the result that the position is now much more satisfactory than it was previously. Considerable improvement in the future is anticipated.


– Has the attention of the Minister for Commerce and Agriculture been drawn to the fact that yesterday the sales of cattle at Flemington totalled 827, which was the lowest number sold for two years, and was less than one-half of the number normally handled? Has the honorable gentleman also been advised that many country butchers have ceased the selling of beef, because of the irritation caused to their customers by reason of the discrimination which they have to practise? Will the honorable gentleman take steps to ensure the making of an equitable arrangement for the distribution of beef and mutton to every person in Australia, so that each will be able to obtain a fair share of the supplies that are available?


– Any quota plan is certain to contain some anomalies. The reports that I have received from all parts of Australia indicate that the beef quota plan is working very satisfactorily.

Opposition Members. - It is not.


-Retailers in all parts of Australia are quite satisfied, with the possible exception of those who are in the electorate of the right honorable member, in which sheep are not raised. Supplies of lamb and mutton are plentiful; definitely, there is no shortage.

Mr Fadden:

– That is not the position in Brisbane.

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– Has the attention of the Minister for Information been drawn to the leading article published in the Canberra Times this morning, under the title “Standardized Political News “ ? Has the honorable gentleman any information that he can give to the House in regard to the matters that are set out in the article?

Minister for Information · MELBOURNE, VICTORIA · ALP

– Following my usual custom,I have glanced at the leading article in this morning’s Canberra Times, and have noted what the leader writer has had to say about the attempt on the part of the press barons of this country to syndicate the news of this Parliament. If the honorable member wishes to know what views I hold on the subject, I inform him that I do not consider that syndication of news would be good for the nation. However, the matter has not come before me, nor has it received any attention from the Government since I have been a member of the Ministry.

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Interstate Rail Travel


-I ask the Minister for Transport whether or not certain public servants employed at Canberra have been refused permission to travel by rail to their homes during the period of their annual leave? If so, does the honorable gentleman considerthat in the circumstances such refusal is fair and reasonable? Will he further consider the matter, with a view to granting the permission that is desired?


– The matter of transport for public servants stationed at Canberra, to enable them to return to their homes during the period of their annual leave, is at present under consideration. Should the honorable member wish in future to obtain first-hand information in regard to the position, I invite him to approach the Minister, and not to obtain it from the daily press.

Mr Guy:

– I have obtained my information, not from the press but from another source.

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Visit to Territories


– I ask the Minister for External Territories whether, as yesterday’s press reported, he intends shortly to visit the external territories of the Commonwealth ? If not, can he state the source of the report?


– I am not aware as to when it will be possible for me to visit the external territories of the Commonwealth; but I am anxious to obtain firsthand information in relation to them, and so soon as matters which urgently require my attention in this country have been properly attended to I shall be able to indicate to the honorable member the probable date of my departure.

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BUDGET 1943-44

In Committee of Supply: Consideration resumed from the 7th October (vide page 279), 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 proposals before the committee have been canvassed in some degree by honorable members on both sides. I was particularly interested in the speeches which honorable members opposite made yesterday afternoon and evening. I agree with the Leader of the Opposition (Mr. Menzies) that the Parliament ought to accept the fact that certain issues were decided by the electors; that, whatever differences of opinion may exist in regard to the conduct of the affairs of the nation, it is beyond doubt that the people have indicated their desire that this country shall be controlled by a Labour Government led by the right honorable member for Fremantle (Mr. Curtin). In view of the advice given by the Leader of the Opposition yesterday, that certain political issues which were prominent during the election campaign should be regarded as decided, we should now turn our attention to the problems that confront us for the future. There must, and always will be, a variety of approaches to those problems. The greater the difficulties the more varied will be the approaches, and the greater will be the conflict of opinion as to how the problems ought to be solved. Whether this budget is a good or a bad one Ls, after all, a matter of opinion. It at least provides for no greater measure of taxation than was imposed last year. Whether it involves an undue use of national credit is also a matter of opinion. Whether there be a shortage of man-power or materials, or whether there be a shortage of money with which to purchase the good things that are to be found in this country in abundance, we always hear the story that national credit cannot safely be utilized. If, as happened during the last depression, it is said that the goods produced here in abundance cannot be distributed among the people because the necessary money is not available, and that it would be dangerous to use the national credit in order to achieve that object, we are still faced with the fact that, in the middle of a world war, Australia can find hundreds of millions of pounds for its prosecution. In the light of that fact, such an argument would appear to me to be quite illogical. The theory about the danger of making use of national credit has been exploded during the last few years. When I first entered this Parliament, the budget amounted to about £70,000,000 for the whole of the public services, including defence. When the Leader of the Opposition was in power, the total reached £100,000,000 for the first time, but to-day we have a budget, for war purposes alone, of approximately £600,000,000 ! We can find money for the destruction of life. Those who adhere to the old school of thought with regard to national finance are dying hard, but in the post-war years it will be of little use to tell men and women who have fought in this war that no money is available to purchase the things which we are able to produce. Therefore, we must bridge the gulf between production and distribution. If we do not, the political system under which we live will not survive. I am satisfied that the young people of to-day will not be satisfied with the situation which was accepted in the last depression.

I listened with interest to the remarks of the honorable member for Warringah (M,r. Spender) regarding the coal-mining industry. He submitted figures to support his contention that the coal-miners were not producing as they should. Not only did he say that coal production was being held up through absenteeism mid strikes, but he also claimed that the average production of each man had consistently declined. I am not in possession of the facts or figures in relation to coal production, but, during the war, great loyalty has been displayed by the large majority of the coal-miners in this country. When criticism such as that offered by the honorable member last evening is levelled at miners, without giving a word of commendation to those who have loyally stuck to their jobs for many years, I am rather sceptical regarding the figures cited, particularly as the honorable member laid the whole of the blame for the loss of production on the miners.

Mr Archie Cameron:

– The Prime Minister did that less than eighteen months ago.


– Last week I read in the press that a mine-owner had been fined because he had attempted to evade certain regulations and had been responsible for a hold-up of production. Whatever the Prime Minister may have said eighteen months ago I do not accept the remarks of the honorable member for Warringah as fully indicating the present position. Criticism of the kind indulged in by him against the coal-miners is not helpful. I am inclined to the view that some honorable members are not seriously concerned about the production of coal. They prefer that hold-ups in industry should occur, because they might have certain repercussions on the Government. In that event, those honorable members would not worry about the part which coal production played in the winning of the war.

A comparison was made last night by the honorable member for Deakin (Mr. Hutchinson) of income taxation in Australia, New Zealand and the United Kingdom. He was attempting to advance the old claim of the Opposition that the taxation of persons within the lower income ranges has not been sufficiently heavy, and that compulsory loans should have been introduced. I propose to cite a few figures which I regard as necessary to complete the picture presented by the honorable member. In the Sydney Bulletin of the 6th October last, the following statement appeared : -

Comparative statement of income taxes payable in three countries, prepared before the introduction of “ the greatest budget in history “ -

Included in the British totals are post-war credits. They sturt at £10 on £150. rising to £43 on £1,000 and to £G0 on £1,500 and upward.

I have never supported compulsory loans or post-war credits, although they have been introduced in Great Britain.

Mr Holt:

– In Canada and the United States of America also.


– That may be so, but I desire the cost of the war to be defrayed as we proceed as far as that is possible.

Mr Fadden:

– What about the National Welfare Fund?


– I shall come to that matter later.

Mr Holt:

– Our proportion of payment is lower than elsewhere.


– That is not borne out by the facts. The table that I have read shows that on incomes of £300 the tax imposed in Australia is £55, as compared with £66 in Great Britain and £54 in New Zealand. The Australian tax is therefore £1 higher than that in New Zealand and £11 lower than that in the United Kingdom.

Mr Holt:

– I am referring to our proportion of the total payments.


– We should not build up a burden of debt in post-war years by a system of post-war credits. I believe that taxation ought to be heavy; we should, so far as is possible, pay as we go. I do not believe in the system of post-war credits, which would have the effect of conferring benefits upon those in possession of the most money. It is a source of grievance to members of the Opposition that the workers to-day should be a little better off than usual, and they are forever complaining that the workers are not taxed enough. As for social services, there may -be some room for criticism regarding’ the method by which the National Welfare Fund is to he established, but there is no ground for any difference of opinion regarding the purpose of the fund, which is to provide social security for the people after the war. During the election campaign, the Leader of the Opposition criticized the policy speech of the Prime Minister in that 90 per cent, of it referred to the past, and only 10 per cent, to the future. I listened to the speech of the Leader of the Opposition and in it ho did not refer to the future at all. The Government is making an earnest endeavour to plan for the. future, and in this respect some members of the Opposition, particularly those who are members of the Social Security Committee, have given most valuable help in the preparation of the committee’s report to the Government.

It is inevitable that, after the war, we shall have to encourage immigration. People from other countries will be willing to settle in Australia, and most of them will become good citizens, as did the immigrants of former years. Nevertheless, we must protect the interests of o.ur native-born. Recently, I read an article on citizenship in California, in which was cited the case of a man who went to live in that State. Subsequently, he was joined by his fiancee and they were married, and two children were born of the marriage. At the time the article was written the children were fourteen years and ten years of age respectively, and it was a source of pride to them, even at that early age, to know that they, as native-born citizens of California - or “ native sons “, as they are called there - enjoyed certain rights and privileges not accorded to those born elsewhere. For instance, they are eligible to hold positions under the Government, while those born outside the State are not. We, too, should endeavour to inculcate in our people a proper pride in the fact that they are natives of Australia, and it might be worth while adopting some such scheme as that to which I have referred. I do not know whether the system obtains anywhere outside the United States of America, or even in any State other than California, but it has much to recommend it.

I have no desire to criticize the budget. I do not believe that it will produce any of the very harmful effects foretold by some honorable members of the Opposition. Of course, there must necessarily be differences of opinion as to the best way to finance national enterprises, particularly those of great magnitude. After all, they can be financed in three ways only - by taxation, by loans, or by the use of national credit. In my opinion, we should, as far as possible, use national credit. I do not mean that we should rush to extremes; we must preserve a balanced economy. The national credit should be used only to the degree that labour and materials are available. Beyond that, we must raise money by taxation and loans. In this regard, the Opposition is disposed to cling to the orthodox methods of finance, both in peace and in war, but the people have unmistakably endorsed the financial policy of the Government. I hope that when the next budget is presented peace, if not actually restored, will be within sight. * Quorum formed.’]*

Leader of the Australian Country party · Darling Downs

– As this is the first speech I have made in the House since the elections, I take this opportunity to congratulate the Prime Minister (Mr. Curtin) and the Government upon their return to power. They were given an unmistakable mandate by the people of Australia, a mandate which included the endorsement of the financial policy of the present Treasurer (Mr. Chifley), who was also Treasurer of the previous Government. We have before us to-day a budget of dimensions never previously contemplated. We are committed to the raising of £715,000,000 for the prosecution of the war, and for carrying on the internal services of the country. The Government proposes to employ taxation to what it considers the maximum capacity of the country to pay. It proposes also to raise loans from the public, and to use bank credit up to what it believes to be the point of safety. It is in regard to the use of bank credit that some difference of opinion may occur. The Treasurer is asking for £715,000,000 of which he expects to obtain £312,000,000 from taxes and other sources, leaving £403,000,000 to be obtained by loans from the people and the use of the banking system. Should his estimates of expenditure be exceeded and his anticipated receipts not be realized the gap of £403,000,000 will be increased. On a former occasion the Treasurer’s estimates were proved to be optimistic. For instance, he expected to raise £60,000,000 from small investors in war savings certificates and national bonds, but his anticipations fell short, by approximately £50,000,000, with the result that he had to resort to the use of treasury-hills to make up the deficiency. On. that occasion the Treasurer also expected to obtain £103,000,000 by the utilization of bank credit - a sum similar to that which he expects to obtain from the same source this year. On the 29th June, 1942, treasury-bills outstanding on behalf of the Commonwealth and the States amounted to £127,1S0,000. By the 30th June, 1943, that amount had risen to £298,500,000 an increase of £1.71,320,000, or over £71,000,000, more than the Treasurer contemplated. In the light of those figures it is difficult to be optimistic regarding the chances of the Treasurer’s anticipations being realized on this occasion. I shall give all the assistance in my power. Members of the Australian Country party will do all in their power to convince the public of Australia that the more money they contribute in loans the less danger there will be of insidious inflation, which -is the worst possible form of taxation. We shall emphasize that all amounts advanced to the Government by way of loan will have the security of the nation behind them. It is the duty of the investing public of Australia to stand behind the Government and see that the loans floated from time to time are fully subscribed. In my opinion, it should be possible to obtain £300,000,000 from the investing public this year. One has only to direct the searchlight of inquiry on savings bank deposits to become convinced of that, especially when it is realized that in a great many instances all money in savings bank accounts does not find its way into Government loans. In addition to taxation, the safest way to finance the nation is by means of voluntary loans, and the public must be made to realize that unless the loan raisings anticipated by the Government are realized inflation will be inevitable. The amount by which loan raisings fall short of £300,000,000 will be the extent of the dangerous field of bank credit, or treasurybill finance, for the current year. I sound this note of warning because of the possibility of the Treasurer’s expectations not being realized. What, better evidence in support of that fear could be given than that the Treasurer contemplates raising £103,000,000 by means of bank credit, that sum being part and parcel of a deficiency of £403,000,000 that has to be financed ? Of that sum he expects £300,000,000 to be provided by the investing public and the banking system, leaving £103,000,000 to be provided by treasury-bills finance, which, in other words, means the issue of promissory notes. On the 30th June, 1943, the treasury-bills in circulation amounted to £298,500,000, but on the 20th September, the amount had increased to £352,700,000, an increase of £54,200,000. Yet the Treasurer expects the maximum issue of treasurybills for the year to be £103,000,000. That shows the direction in which we are moving, and the responsibility of the public of Australia which has given a mandate to the Government. If those electors who so clearly expressed confidence in the Government on the 21st August will show the same confidence in its financial policy by contributing generously to the loan that is now being floated, there should be no difficulty in raising the amount required, thereby providing an efficient safeguard against dangerous inflation which, if resorted to, would have serious repercussions upon the very people who have supported the Government.

I wish now to refer to an aspect of finance which should be clarified. The Treasurer has mentioned that the first payment to the National “Welfare Fund, estimated at £29,750,000, will fall due this year. That sum represents one-quarter of the total estimated collections from income tax on individuals for Commonwealth purposes. He went on to say that the sum of £2,100,000 represented the estimated expenditure on maternity allowances, and that funeral benefits payable during the year would amount to approximately £230,000. The residue in the fund after meeting those commitments would be £27,400,000, Having regard to the Government’s method of finance, I now ask .the Treasurer whether the amount to the credit of the fund will be part and parcel of the £300,000,000 loan raisings, or whether he intends to use that fund as a brake, in order to provide a safeguard against the undue use of treasury-bills which may have to bc resorted to in the event of a deficiency. I hope that the Treasurer will clarify the position when he replies. As I see it, the position is that from the amount received as taxes the sum of £29,750,000 will be appropriated to the National Welfare Fund. So far, there is no legislative authority to take from that fund more than the amounts required for maternity allowances and funeral benefits, namely, £2,100,000 and £230,000, respectively. That would leave in the fund approximately £27,4’00,000. The National Welfare Fund is a trust fund within the meaning of section 62a of the Audit Act 1901-1934 which provides that certain accounts shall be trust accounts, that additional trust accounts may be established, and that all moneys standing to the credit of any trust account shall be deemed to be moneys standing to the credit of the trust fund. Power is given to the Treasurer to direct that any trust account may be closed, whereupon the moneys standing to its credit shall, after all liabilities of the account have been met, be paid to the Consolidated Revenue Fund. There is also provision that moneys standing to the credit of a trust account may be expended for the purposes of the account. Section 62b provides that moneys standing to the credit of the trust fund may be invested by the Treasurer in any security of, or guaranteed by, the Government of the Commonwealth Olof any State, or on deposit in any bank. As those moneys may be invested, section 7 of the National Welfare Fund Act provides for the payment of interest.

I desire to know whether the £300,000,000 which the Treasurer proposes to raise includes £27,400,000 from the National Welfare Fund; or does the Treasurer expect to get £300,000,000 from the investing public and to utilize the £27,400,000 against treasury-bills? The matter requires clarification, having regard particularly to the fact that there is no legislation on the statute-book, or before the Parliament, as to how the moneys set aside for the purposes set out in the National Welfare Fund Act will be utilized, with the exception of £2,330,000 for maternity allowances and funeral benefits. I hope that the Treasurer in his reply will state exactly what is the position of the National Welfare Fund. I desire to emphasize this point particularly to the critics of the post-war credits scheme which I placed before the country in my policy speech.

Mr Calwell:

– The people were not impressed.

Mar. FADDEN. - They were not; they were not impressed by a number of Opposition policy proposals, which, however, will soon be forced upon the Government. The people were not impressed with pay-as-you-earn taxation, but the stark necessities of the situation will force the Government in the very near future to bring pay-as-you-earn taxation into operation. I do not intend to go into the merits and demerits of the scheme now. I am not carried away by the suggestion that an all-party committee should investigate it, because the plan has already been thoroughly investigated by departmental officers and other com- mittees, and the Attorney-General (Dr. Evatt) reported on his return to Australia recently that he had investigated the scheme in the United States of America and had brought back the whole of its details. I repeat that whether the Government likes it or not, stark necessity, let alone justice and common sense, will compel it to accept pay-as-you-earn taxation. In order to demonstrate how necessary it is that the pay-as-you earn system be instituted I need only cite the case of the honorable member for Brisbane (Mr. George Lawson) whose earnings have dropped this year from about £2,300 as a minister to £1,000 of a private member. The tax payable in respect of the honorable gentleman’s earnings will be about £1,400 which will have to be paid during a year when he will earn only £.1,000 now that he is no longer an occupant of the treasury bench. In other words, after paying tax out of his £1,000 a year income, he will have left, approximately, £700 with which to pay about £1,100 in respect of the previous income of £2,300. That instance of the injustice of a system which demands that tax ‘on a high income earned one year shall be paid from a reduced income earned in the next year could be multiplied many times even now and, after the war, when thousands of incomes will be induced, instances will be too numerous to calculate. No less severe than the plight of the honorable member for Brisbane is that of the man who is superannuated, or of the widow who is compelled in the year after her husband’s death to pay the tax due on the income he earned in the year of his death and has not the wherewithal with which to do so. All that, however, is beside the point that I am trying to make in connexion with postwar credits. I want honorable members and the people generally to realize that the money to be set aside for the National Welfare Fund will be appropriated from and not superimposed on taxation. I did not envy the Treasurer his job of taxing people in the lower brackets of income, who had never paid income tax. Tt was inevitable, in the circumstances, that they should be taxed, but it was a hard task for the Treasurer to undertake. I lent him all the assistance that lay within my power and complimented him on his success. But we all know that in order to sugar the pill which the earners of low incomes were loath to swallow the Treasurer held out, as an inducement to them to accept the indispensability of their making a direct contribution by way of tax to the conduct of the war, a scheme of social security - a “ Kathleen Mavourneen “ scheme, to be sure, because of the indefiniteness of the date when the benefits will accrue to the people. Time alone will tell when that scheme will eventuate. Here is the crux of the matter: The Treasurer did not superimpose the cost of the social security scheme on the taxes levied upon the lower ranges of income. All he did was to tax those lower ranges of income and appropriate a part of the tax for the purpose of the National Welfare Fund. In essence that is exactly what I intended to do in the post-war credits scheme. I intended not to superimpose any charge on the taxes, but to appropriate from the taxes paid something to be set aside for the future. The difference between the Treasurer’s national welfare scheme and my post-war credits scheme is this: I intended to establish for the people of Australia assets which would be a nest egg for their future.

Mr Fuller:

– Where would the right honorable gentleman have obtained the money that would have been necessary to repay the post war credits?


– From the same source as this Government will obtain the money which it will need to pay to the demobilized servicemen their deferred pay and to repay the Liberty Loans, namely, from the resources of this enterprising nation. If we all shared the defeatist complexes of the honorable member for Hume we might as well throw in the towel now and give up all ideas of post-war reconstruction.

Mr Fuller:

– The right honorable gentleman said in his policy speech that £50,000,000 would be returned to the people as post-war credits.


– I did not. But my point is that the post-war credit scheme and the national welfare scheme are, from the financial point of view, on all fours because both involve an appropriation from taxes already imposed. The broad difference between the two schemes is that the national welfare scheme is collectivist or socialistic, whereas my scheme involved an appropriation on behalf of each individual taxpayer in order that he or she should have to his or her credit a nest egg to tide over the period of post-war reconstruction. There is the difference: the one scheme is collectivism, whereby every one in the community will be dependent on the Government’s policy of socialism, and the other is the maintenance of individual enterprise for which honorable members on this side of the chamber stand. The money that would be needed to finance either scheme would come from exactly the same source and resources - the development of Australian enterprise and potentialities through the determination of the Australian people to repay all that will have been borrowed by the time the war has ended for the purpose of maintaining their title to this country. That replies to the charge that the post-war credit scheme was inflationary.

There are three courses which the Government must follow. It must raise the maximum amount of loans; it must maintain the taxable capacity of the people in order that the maximum amount of taxation might be collected, and it must eliminate waste. He would be a smug Treasurer who was not concerned with the fact that there is in Australia to-day an enormous amount of extravagance and needless waste. I know that the present Treasurer is aware that in all parts of Australia waste and extravagance occur. I sympathize with him in his predicament, because I know that war means waste; but we have had four years of war, and the position that obtained in 1939, when we had hurriedly to convert Australia from a peace-time to a war-time footing, does not obtain any longer. Then many things had to ‘be done expeditiously, and therefore at a costly rate. The things we did then were to a great degree experimental: But the period of trial and error must end. and a national stocktaking must be made in order that waste and extravagance may be reduced to a minimum, for I am sure that by vigilant controls many millions of pound’s can be saved. It devolves upon us all as trustees for the people to ensure that we shall receive full value for the money we expend, money which is raised from the people by means of taxes and loans. The money lent to the Government is lent because the people have confidence in it and in its policy.

Mr Chifley:

– Because they have confidence in the country.


– Yes, and because they have confidence in the country; those who have no confidence in it should get out of it. On the 25th March last, I directed the attention of the Treasurer to the report of the Commonwealth Auditor-General, which revealed appalling instances of waste and extravagance and. indicated that many more instances would have come to light except for the extraordinary laxity in the accounting systems of a number of departments. What has the Government done to remedy that highly unsatisfactory state of affairs? I ask the Prime Minister or the Treasurer to make a clear-cut statement to the committee setting out what correctives have been applied. Are those responsible for the inefficiency in administration, disclosed by the Auditor-General, still occupying the positions they held when the AuditorGeneral’s officers made their investigations? If the War Expenditure Committee is to be continued, I suggest it should have as few members as possible and they should be selected irrespective of party. It should be able to co-opt the best brains in industry and have the assistance of expert cost accountants.

Opportunely, I received from the Treasurer this morning a reply to a question I asked about the amounts of income tax that were outstanding. I asked the foi lowing question : -

Will lie state .the amount of taxation, income and land, outstanding at the 30th June. 1!)42. and the 30th June, 1943, in respect of (a) the, and (6) the State? ?

I received the following answer: -

The following are the amounts of Commonwealth and Sta.te taxation, income and land, outstanding at the 30th June, 1942, and 1943, respectively : -

Whereas in twelve months the States considerably reduced the arrears of tax owed to them, arrears of tax owed to the Commonwealth increased in the same period by £5,600,000. This is a matter into which the Treasurer should look closely. The States collect taxes on behalf of the Commonwealth as well as on their own account. The Treasurer knows what is happening as well as I do : the States are collecting their own taxes and letting the Commonwealth’s arrears slide.

High taxes beget tax dodging, and there is an enormous amount of that to-day in Australia. If Peter does not pay the tax, Paul has to, because taxes are levied on the community. A worse aspect is the fact that people who buy in the black markets are those who dodge payment of taxes. They hoard their notes and spend on black market goods what they are legally and morally liable to pay to the Government as tax. Drastic action ought to be taken to compel those people to make their proper contribution to the defence of this country. It is obvious that people who evade income tax do not invest in Government loans. The position should be strictly policed. Such policing would pay for itself, as it has in Queensland. I pay tribute to the work performed in this direction by the officers of the investigation branch of the Income Tax Department in that State. All of those officers are young men of ability, and their integrity is beyond question. They have done a wonderful war job in bringing to book those people who are dodging their responsibilities as taxpayers. The Commonwealth should institute a systematic method of investigation of taxpayers’ returns along the lines followed in Queensland, and for that purpose it should co-opt the services of State officers engaged in that work. I repeat that persons who are dodging their responsibilities as taxpayers are the greatest contributors to the creation of black markets.

I come now to what is the most serious omission from the Treasurer’s speech, namely, his failure to give any information concerning the principles upon which the new and rapidly expanding Department of Post-war Reconstruction is approaching its important task. Every honorable member must realize the great concern and anxiety with which the public is contemplating the period of readjustment that must follow the cessation of hostilities. The personnel of the fighting forces, the large army of workers and artisans engaged on purely war-time production, and the primary producers who are afraid of being left again at the mercy of international price levels, as well as the managements of the large secondary industries who have been encouraged to undertake abnormal expansion to meet the needs of war-time production, are fearful concerning the future. Pioneering work in this direction should be undertaken now. In order to achieve decentralization we must ensure that men and women formerly resident in country areas shall return to those areas. We must guarantee them employment in those districts by undertaking a programme of public works such as irrigation, water conservation and reafforestation schemes; and such works must be in train when these young men and women are demobilized. In that way only shall we be able to decentralize our population. Population cannot be attracted to the country unless amenities comparable with those to which these young people have become accustomed in the cities are provided in rural areas. Otherwise, if they be able to obtain jobs in the cities, they will not return to country districts. In this respect the

Government must bear in mind the necessity for not only increasing our population, but also spreading it scientifically throughout the Commonwealth, because the real wealth of Australia is produced in the country. The demobilization of the large army of artisans now engaged on war-time production will present a most difficult problem, because, when the war ceases, employment must be found for them almost overnight. In spite of all these factors, however, the Treasurer, although he outlined the form of organization being set up in his new department, gave no indication to any of these groups of the principles upon which their particular difficulties and problems are being analysed. The time has arrived when Parliament must seriously concern itself with post-war problems. That does not mean that we should relax the war effort. It does, however, involve the integrating of our war-time organization into the master plan for reorganization of man-power and industrial potential into peace-time development channels. To-day we should turn the searchlight upon several fundamental phases of post-war organization. Post-war reconstruction is likely to become one of these meaningless slogans that will merely serve to mislead and disillusion the public unless effective machinery be provided for its development and sound principles laid down for its fulfilment. I am not satisfied that the proper machinery is .being developed. We are completely in the dark concerning the financial and organizational principles upon which the various agencies of the Ministry of Post-War Reconstruction are approaching their various surveys and inquiries.

Unless we have a virile and enterprising department we cannot hope to solve the problems of reconstruction. As I pointed out on the 17th August last, I am by no means satisfied with the objectives and personnel of the existing department of reconstruction. In establishing it, the Labour Government has relied too much upon persons with a doctrinaire outlook, upon men with little or no experience of business or industrial life or of primary production. Recently, the Treasurer supplied to me a list of the senior officers of the depart- ment. It might be an impressive list for a post-graduate course in economics. The complete absence of any personnel with any practical experience whatever of either primary or secondary industry causes me the greatest alarm. I cannot find in the list any one who has. had association with the problems of production, the handling of labour problems, marketing, transport, the economic laying out of plant, workshop management, or any other of the hundred and one practical problems that govern the destiny of industry, in which is bound up the future of employment.

There is a place for the scientist, and a very important place, in every business, but the most important science of all is that of being able to apply scientific knowledge to the solution of practical problems. That science cannot be learned entirely in a university. It is a science in which the important post-graduate experience can be .gained only in industry itself. Until we have added to the machinery of the Department of Postwar Reconstruction men with practical experience and knowledge of both our primary and secondary industries and their problems, I shall continue to feel the greatest concern for Australia’s future. The Estimates reveal that the salaries of the department, which totalled £7,337 last year, are to be expanded to £43,400 in the current year. If this department is to succeed, it is imperative that a portion of this large increased allocation should be applied to providing it with the services of men trained and experienced in production and management in both primary and secondary industries.

So much for the machinery which, I claim, is at this stage wholly defective and inadequate for the job in hand. One would have thought that the Prime Ministor’s policy speech would have contained something concrete on the subject of reconstruction. In contrast with the Opposition parties’ realistic and vigorous plans for post-war development, the Prime Minister treated the people in an exceedingly cavalier fashion. All they were told was that the Government had “ plans “. The nation was given nothing more than vague generalities. I come now to what is even more important, namely, the principles upon which this machinery is operating in laying down the blue-prints of the post-war economy. On .this subject, the Treasurer has been silent. He has not even told the House whether the post-war plans are being drawn upon the basis of increased constitutional powers for this Parliament, or whether an attempt is being made to fit them into the Constitution as it stands. The AttorneyGeneral (Dr. Evatt) is reported to have indicated that he will recommend to the Government that a referendum be taken for the transfer of additional powers to the Commonwealth. Meanwhile, the post-war planning is going ahead while the Government is trying to make up its mind what it will do. Docs this mean that Dr. Coombs and his experts are planning the post-war economy on the pre-war Constitution, or are they taking a leap in the dark and planning on the basis of constitutional power that they may never get? The House should know what is t3ie position before it votes for this department the additional money asked for. To my mind, the constitutional position is one of the fundamentals of any post-war planning. The first thing, surely, is to know what authority will be responsible for each phase of the post-war economy. Is it prudent to be spending public money on the development of post-war economic principles before it is decided where the power to give effect to them will eventually reside ? I trust that before this debate concludes the Treasurer will clarify this point.

I have endeavoured to show upon what insecure organizational foundations the Government’s post-war reconstruction facade rests. I now propose to show that, because of the Government’s unsound financial outlook, the whole expensive structure is being built on . sand. There has been talk of a mammoth postwar housing scheme, the unification of railway gauges, the development of water conservation, hydroelectric schemes and other developmental works ; but, it is only when we look behind the Government’s mind that we realize the extent to which it is deluding not only itself but also the public, to whom post-war economic security is a very real thing. The Government’s vague references to its plans for financing full employment in the post-war period makes it evident that it can visualize only wholesale inflation. This, in the long run, will lead to mass unemployment and chaos in every aspect of our national life. [Extension of time granted.] On the 8th August, the Prime Minister made the first cautious statement concerning the Government’s attitude to the financing of post-war development. I quote from the Sydney Morning Herald,, of the 9th August -

The Prime Minister, Mr. Curtin, said yesterday that in time of war money was no bar to meet the demand of work for all. His Government had given its pledge that in peace all the money would be found to provide work for all who wanted it.

Although the Prime Minister continued to speak of the degree to which Central Bank credit had been drawn upon for war-time activity, he let it be inferred, rather than said straight out, that this wa3 the method he visualized for the financing of post-war projects. The danger of such an inference was immediately obvious. It apparently caused considerable concern among the directors of the Commonwealth Bank, because the chairman, Sir Claude Beading, felt impelled to make a statement upon the subject even though, at that time, the Government was in the middle of an election campaign. Sir Claude was apparently under no misapprehension as to what the Prime Minister had in his mind. I quote from the Sydney Morning Herald of the 10th August -

The improper use of bank credit in peacetime could destroy the purchasing power of the currency and wreck the standard of living, Sir Claude Beading said yesterday. He was commenting on statements by the Prime Minister, Mr. Curtin, in Melbourne on the proposed use of bank credit in the post-war period . . . Sir Claude emphasized that the views he expressed were strictly personal and did not necessarily reflect the views of the Commonwealth Bank Board, of which he is Chairman.

There, we have the Prime Minister and the chairman of the Commonwealth Bank in conflict regarding what must be the basis of any post-war plan of reconstruction, namely, the principles upon which it is to be financed. As if to emphasize that he was not talking idly when he made his original statement on the subject of utilizing Central Bank credit in the post-war period, the Prime Minister actually participated in a controversy with the chairman of the Bank Board upon the subject. In the Adelaide News, on the 11th August, the day following the publication of Sir Claude Reading’s warning, this report appeared -

Dealing with the question of increasing population, the Prime Minister, Mr. Curtin, in Adelaide to-day, made clear the Labour Government’s inflexible determination to make extensive use of bank credit for post-war reconstruction. Use of bank credit to double the population of Australia would not be improper, hu declared. This was a pointed reply to the warning by the Commonwealth Bank Board chairman. Sir Claude Reading, of the dangers attached to the extensive use of bank credit after the war.

I shall not at this juncture enter into a discussion of the part that central bank credit will play in post-war reconstruction. The point which I desire to make is that the Government is in conflict with ‘ the Commonwealth Bank Board regarding this matter, and that a member of that board is Dr. Coombs, who is also Director of Post-war Reconstruction.

Mr Chifley:

– I remind the right honorable gentleman that the chairman of the Commonwealth Bank Board was expressing only his personal opinion.


– I expected that interjection. I direct the attention of the Treasurer to the annual report of the Commonwealth Bank Board, which was issued only three weeks after Sir Claude Reading made that statement. The report specifically endorsed the warning that the chairman had already given as his private opinion. It stated -

The use of central bank credit in war-time is unavoidable, but its dangers have been kept in check by taxation, loans and war-time economic controls. lt does, however, add greatly to the accumulation of purchasing power in the hands nf the public which will continue to increase until the end of the war.

The greatest danger, therefore, lies in the immediate post-war period, and it will be essential that controls shall be carried over into that period to prevent these accumulations from causing serious dislocation.

In such circumstances any use of central bank credit after the war must bc made with the greatest caution in the light of the governing economic conditions.

The obvious conflict between the Prime Minister and the Commonwealth Bank Board should be explained satisfactorily before the Parliament agrees to the proposed substantial increase of the

Estimates of the Department of Postwar Reconstruction. That such clarification is imperative is indicated by the fact that the Chief Executive Officer of the Department, Dr. Coombs, is a member of the Commonwealth Bank Board . and apparently subscribed to the annual report of the directors. The Treasurer cannot have it both ways. Honorable members should insist upon knowing the policy that Dr. Coombs is applying to the task of planning post-war reconstruction. Is he following the policy of “ the extensive use of bank credit “ formulated by the Prime Minister, or is he committed to the policy of utilizing that credit “ with the greatest caution “ as recommended by the Commonwealth Bank Board? At this stage, I shall not discuss the merits and demerits of proposals for the extensive utilization of .bank credit. It has to be used, and as increased resources and production become available it can be expanded. My contention is that even Dr. Coombs must be aware of the irreconcilable elements in his task, and honorable members should demand to know his attitude.


.- The new members of this chamber are naturally at a disadvantage compared with older, more experienced ones, because they are not au fait with parliamentary procedure and do not understand so well the intricacies of the budget. Therefore, my contribution to this discussion will be brief. The Treasurer (Mr. Chifley) has produced a record budget. To borrow a slogan coined for propaganda for the Fourth Liberty Loan, it is a “ back the attack “ budget. The money is required to prosecute our war effort, which has now passed from the defensive to the offensive phase. Our task, as a nation, is to press the attack with all our energy and resources for the purpose of bringing hostilities to a speedy and successful conclusion. But the attack cannot be backed alone -by a record budget and over-subscribed loans; it must also be backed by the spirit of the people. Australians must have a true appreciation of the causes of the war, the reasons why they are fighting, and what the future holds for them. We must recog- nize that this is a war of national liberation and, when hostilities cease, all peoples in all countries must have the right to choose the form of democratic government that they desire without interference from other nations. This freedom of choice has not always been enjoyed in the past.

From the military standpoint, Australia has surmounted the crisis. Our position is now infinitely better than it was twenty months or twelve months ago, when the country was directly threatened with invasion, and our troops had little equipment with which to withstand an attack. No one realized the danger more than did Western Australians. Twenty months ago, they were to have been abandoned. For that decision, they did not blame their military commanders. They realized that the troops had little equipment with which to fight. But they did blame members of the Opposition parties who had control of the legislative machine for a decade before the Labour Government took office. Pursuing a selfish and sectional policy, they were responsible for Australia’s defenceless position. Although the immediate crisis has now passed, there is no room for complacency, and we must not relax our efforts.

Whilst realizing that the demands of the war have first call upon our efforts, I trust that the Government is preparing plans for the future development of the country, because in the immediate postwar era, large numbers of munitions workers and demobilized service men and women will have to be placed in employment. Consequently, plans must be formulated well in advance for’ converting production from a war-time to a peace-time basis. During the last two years, the Government has been compelled to re-organize the economy of the country by diverting industry and workers from peace-time to war-time production. In doing so, it has had to overcome a host of obstacles as well as strong opposition from some quarters. Nevertheless, its efforts met with great success. The Government must now ensure that the reverse process, whereby industry will be converted from a. war-time to a peace-time basis, will be attended with equally satisfactory results.

Australia has now reached the stage where its reserves of man-power for the services and industry are exhausted. When the enemy directly threatened this country, the defence services naturally had a prior claim on manpower. But now that the immediate danger has passed, that policy should be reviewed, and a better balance should be struck between the- demands of the services and those o.f primary industries. For example, too many men have been taken from the agricultural industries, and our food programme requires that some of them shall be released from military service for the purpose of reengaging in primary production. The Division of Swan is neither predominantly agricultural nor predominantly industrial, but the primary producing industries within the electorate have been denuded of man-power. The time has arrived when the deficiency should be rectified.

In proportion to its small population, Australia has put forward a remarkable war effort, but, apart from the sufferings of our sailors, soldiers, airmen and nurses and the sorrow and anxiety of their relatives, the civil population has not experienced real suffering, such as the people of Great Britain, Jugo-Slavia, Greece, the Union of Soviet Socialist Republics, and China have endured. Apart from sporadic air raids in the north, the Australian mainland has not known the horrors of invasion or the terrible destruction of life caused by ruthless bombing. We must recognize that we have our part to play in liberating the nations which are now suffering those agonies. Every one can render service in this cause by striving for unity. For example, members of the Opposition could give valuable assistance. Instead of sniping at the Government in regard to the coal-mining industry, as they are in the habit of doing nearly every day, (hey should acquire an appreciation of the historical development, of the industry, particularly from the point of view of the miners. If they are not now in possession of the knowledge they should learn that coal-mining is a dirty, laborious, dangerous and unpleasant industry. It has always been a “ sweated “ industry. For many generations, the miners had to fight tooth and nail for improved conditions, and what has been the habit of generations cannot be forgotten in a day. If members of the Opposition would advise the coal-owners and mine managers, whom they represent, to cease their harassing tactics, which are calculated to foment strife in the industry, and seek the co-operation of the miners and the union leaders, the task of the Government and the union leaders would be simplified, and the country would get more coal.

Lack of adequate supplies of coal is serious, not only in the eastern States, but also in Western Australia. In the past, Western Australia has been able to augment its stocks with supplies of New South Wales coal, but the shortage of shipping now prevents that, and the State has to rely upon its own resources. Although the Collie coal deposits are extensive, Amalgamated Collieries of Western Australia Limited, in particular, has not been undertaking all the developmental work for which it has been paid, with the result that the coal position is now acute. Many years ago, the Western Australian Government Railways, which department is the biggest consumer of coal in the State, paid exorbitant prices for its requirements, and the Government appointed a royal commission to determine a fair price. Although the figure included a margin to enable the mine-owners to develop the coal-fields, very little of that money has been expended for that purpose. The secretary of the Coal Miners Union in Western Australia warned the State Government three years ago what would happen, and his prediction has been borne out by events. This could not be laid at the door of the miners at all. It could be laid at the door of Amalgamated Collieries Limited, but Messrs. Johnson and Lynn, who are Amalgamated Collieries Limited, did not care whether they mined a ton of Collie coal, because they made just as much money out of Newcastle coal imported into Western Australia as they made out of Collie coal. I trust that members of the Opposition will remember that all the fault is not on the side of the miners, just as I do not say that it is all on the side of the owners. There are certain irresponsible elements among the miners, and there are also among the owners and managers irresponsible elements who do not wish to see peace on the coal-fields. No one who has given unbiased thought to the problem of industrial peace on .the coal-fields will say that the fault lies only on one side. Members of the Opposition can help by seeing that their side of the question is frankly and fairly put, whilst we shall play our part and put our side fairly.

Another matter demanding immediate attention in Western Australia is the want of education facilities. The State is vast, with a small population, and with not much cash to spend on education, although actual figures show that our expenditure per capita is second only to that of New South Wales. Still the people in the back areas of our State are not receiving the education which they are entitled to receive. Most of the money goes in the salaries of the teachers, and little is expended on the installation of plant, or on school books, particularly for the schools in the country areas. Those in the towns are not very well equipped, but the position of the country schools is worse. Those who have to teach from 10 to 40 children in a country school, from babies up to the sixth standard, have an impossible task. The time has arrived when the Commonwealth Government must assume a certain amount of responsibility for education. A sparsely populated State like Western Australia cannot carry the burden and give to its people the education that it should give. The Commonwealth Government must assume responsibility from the kindergarten right through the primary and. secondary schools up to the university. I do not know how the Government is to evolve that scheme. It may follow the Tasmanian idea of having central schools. I am not an expert on the working out of educational problems, but I do know that Western Australia needs financial assistance to give its people a better education.

The same claim can be made in respect of medical and dental services. Children in the outback areas in particular very seldom see a dentist and they must be very sick before they can see a doctor. In parts of the Murchison, which comes into the electorate of the honorable member for Kalgoorlie (Mr. Johnson), there is no doctor for about 60 miles, so that people cannot run to him with minor complaints. They have to be on the way to the hospital before they can possibly get the attention of a doctor there. That the children never see a dentist is a tragedy from the point of view of national hygiene. In the allegedly “ good old days “ of the pioneers, when nothing mattered much except getting more gold, or working from daylight to dark for four shillings a day, that may not have ‘been considered important, but to-day when we realize that medical and dental services should be part of our everyday life we must see that people receive them. I look forward to the time when these will be socialized, or nationalized, if honorable members like that word better, when our aim will be to keep people fit and well, and not just to cure them after they fall ill; in short, when the object will be to prevent sickness, because prevention is better than cure.

Much has been said about immigration, and about the necessity to populate or perish, because of the proximity of Asiatic hordes in the north. I think we slander those people in the north when we accuse them of the intention of taking our country from us. China certainly is a huge country with an immense population, but it also has vast undeveloped areas. What it needs is development within itself. That gives the rulers of China a bigger job than worrying about us. I agree that Australia needs population, but not uncontrolled immigration, which will serve only to flood the labour market and depress wage standards, as it has done before. That is my objection to uncontrolled immigration. The members of the Opposition might like to see it, but I want to see controlled immigation fitted into the general scheme of things, with an increase of our primary and secondary industries. The quickest way to begin to increase our primary industries is to break up some of the largelanded estates which lie in the best rainfall country, not only in Western Australia but also in the eastern States. In “Western Australia farmers have been pushed out on to the fringe, into what aire called the marginal areas, where they have one good year in about seven, and need the courage of about five lions rolled into one to stick there as they have done. Many stuck it out there for 20 to 25 years before they were finally starved out.

Mr Lemmon:

– By the banks.


– Yes, in many cases. Along the Toodyay branch line there are land companies holding up to 60,000 acres, whilst other companies still hold huge undeveloped tracts within the safest rainfall areas. If we are to increase our rural population and primary production those large landed estates will have to go. In such good areas 1,000 acres would easily support a family, but back in the marginal areas 5,000 acres would not be enough. Those who put in the best years of their lives there experienced only toil, sorrow and loss.

The birth-rate has received quite a lot of attention from the honorable member for Denison (Dr. Gaha) and the honorable member for Darwin (Dame Enid Lyons). I think that fundamentally the question is an economic one. To my mind it is as simple as that, although the remedy is not so simple. I admit that there are all sorts of subsidiary issues, but the basic solution is to give the people an economic and political system which will guarantee them freedom from want. If the people are assured of social and economic security and equality for all, then the other subsidiary issues will begin to roll away, and. the birth-rate will increase. I do not think that it is such a terrible problem as is represented. Once economic security is brought about other difficulties will solve themselves. If we are to get economic and social security for all. from childhood to old age, and equal opportunity of education and general culture for all, with equal access to all the finer things of life, we must start to ask ourselves a few questions. The first and elementary one is : For what purpose are things made? There is only one adequate answer: Things should be made for man, and not man for things. Man needs food, clothing, housing, transport, social services, education, music and general culture. They all are part of our everyday life, and we all want them. To give those, and the maximum amount of safety and well-being, to every individual upon a substantially equal basis, with pay appropriate to his skill and industry, leisure after toil and social security in days of health, sickness, old age or incapacity, is the true motive and purpose of industrial production. Production, therefore, should be controlled by need. Here in Australia we have not as yet recognized that principle. Production in this country to-day is carried on. apart from the necessities of war, for the motive of private profit. It is the private profit of certain individuals, or groups of individuals, which sets the wheels of industry revolving. Coal is mined, not because the nation needs it, but because profit is made from the labour of the miners. Builders must live in hovels if no one can make a profit out of their labour. Naked men cannot enter a woollen mill and weave themselves clothes, no matter how great their need. In short, things are not made for use, but are made for profit, and capital seeks not the greatest good but the greatest profit. I do not think that Australia is politically ready for a change-over, although it is industrially and economically ready. It is only when the bulk of the people do realize what is economically necessary that they become politically ready for the change-over. Only then shall we have a system which will ensure the greatest good for the greatest number, and not the greatest profit for the few. History is moving in seven-league boots to-day, and we must take matters in hand, because we have reached in the development of our country a stage when the old systems of private control of industry and finance have outlived their usefulness and should be swept away. I agree with the previous speaker that the boys returning from the front, the girls from the services, and the workers from the war factories will not put up again with the old order. They will not tolerate the old lack of goods and services. They know that those goods and services are all around us, that we have the power to convert the wool into cloth and the wheat into bread, and that the people have the right to enjoy both. We on this side represent the worthwhile majority of the people, those who perform the socially necessary labour, but we do not claim to speak for the minority who rob the people of the benefits of their labour. It is our task to see that the lot of the great mass of the people is improved.

It is reported that when the honorable member for Kooyong (Mr. Menzies) visited Western Australia, on the last occasion but one, he called on the Chambers of Manufactures and Commerce, doing a bit of pre-organization ; he was not worrying at that time about addressing public meetings, and he told those gatherings that he, or the people whom he represented, had the means of production and had the arms. The inference was plain, to me at least, that if the people’s government was returned to power and looked like undertaking something which would be for the benefit of the people as a whole, those whom he represented would stage a coup d’étal I think that is a pretty correct account, and I am sorry that the right honorable member is not in the chamber to hear it. It came from three independent, sources, and should not be dismissed lightly, because what we have seen in other countries has taught us that, those who own the means of production will not give them up lightly.

I want to see, for a start, the control of the finances of the nation restored to this House. 1 want also to see its original charter restored to the Commonwealth Bank. There is room on the blocks of stone in the Commonwealth Bank building in Sydney to inscribe the words: “ This is to commemorate the day when the Commonwealth Bank was returned to the people “. I hope soon to see them there. There should also be inscribed upon a stone in that building, the date on which amending legislation passed by the Bruce-Page Government virtually took the bank away from the people. My desire is to see the entire financial structure of the Commonwealth Bank back in the hands of the people, because I believe that what is physically possible is financially possible. [ do not believe in the old principles of orthodox finance under which people starved in the midst of plenty. Secondly, there should be a referendum on the question of granting increased powers to the Commonwealth Parliament. I cannot see how it will be possible for the Commonwealth Government to- carry out thorough post-war planning and post-war reconstruction until it has wider authority. It is true that at a convention held in Canberra last year, the representatives of the various States agreed that specific additional powers should be transferred to the Commonwealth, but since then the reactionary upper houses of certain States - I refer particularly to Western Australia - have so mutilated the bill embodying the decisions made at that conference, that the measure is no longer worthwhile. The time has come for the holding of a referendum for the granting of these powers to the Commonwealth, and I trust that the people will have no hesitation in agreeing to the proposals. I should like to see in the hands of the Commonwealth adequate power to plan for housing, health, education and national works; power to say that all must work, and to ensure that the people shall receive the fruits of their labour; power to place in the hands of the people, if necessary, the public ownership of the means of production. I listened yesterday to the speech made by the honorable member for Warringah (Mr. Spender), and a point which struck me forcibly was this : Whilst it is true that the wealthier sections of the community contribute a large percentage of war loans, the wealth of a country is actually produced by the man on the land and the worker at the factory bench, so that, although the average working man on the basic wage has little opportunity to save money to put into war loans, in- the final analysis it is he who produces all the wealth that eventually is subscribed to those loans.

The honorable member for Bass (Mr. Barnard) has said that the lower income groups should contribute towards social security. I do not agree with that statement. I believe that social security should be paid for by taxing the profits of big industries. That, of course, is my own opinion, just as the view expressed by the honorable member for Bass is his opinion ; but I dissociate myself from any suggestion that the lower-income groups should be taxed for the purpose of providing social services. The people create the wealth of a country and they should have the benefit of that wealth.

The honorable member for Bass also favoured preference in employment being given to Australian born people. I was rather disappointed at his subsequent remarks, because I had thought that he was about to make a plea on behalf of the real Australian-born of this country, the aborigines. Our treatment of the aborigines is an absolute disgrace, and is just as bad as the treatment of nationals of other countries by Fascist administrations. We took the country from the aborigines, and in return we have given them only venereal disease, tuberculosis and other rotten diseases of white civilization. It is true that they are a primitive people, in fact a stone-age people, but if we continue to treat them as we have in the past, they will very soon be an extinct people. It is time we realized that the aborigines should be given more attention. We should send doctors to our northern areas to clear up the white man’s diseases from which our aborigines are suffering. That could be done quite easily with modern medical science, and unless it be done the aboriginal race will be killed off by disease. We should endeavour to develop their culture and make them civilized people. There is a tendency at present to regard aboriginal workers as lazy, merely because at times they revert to their racial practices and “ go walkabout “. Squatters regard them only as a source of cheap labour which can be bought with plugs of tobacco. Aborigines living under these conditions are soon poisoned by all the rotten things in white civilization. I make this plea for the preservation of our aboriginal race, and urge a wider recognition of the fact that these people have a stake in this country. I do not agree with the remarks of the honorable member for Bass in regard to native-born labour. I am a native-born Western Australian, and I belong .to one of the old pioneering families of the West, but I do not regard myself as being better than the people of other States, although my father considered Victorians as we consider rabbits to-day.

Mr Calwell:

– At least the honorable member is an improvement on his father.


– The point I wish to make is that all citizens of this country, regardless of the States in which they were born, or whether they are migrants of other nationalities are entitled to the same privileges. All are human beings, . and are equally entitled to the rights of Australian citizenship. We should not foster exclusive groups which only native-born Australians may join. We all are equal as nature has made us, and whether we be Australian-born or migrants from other countries, we should have access to the wealth of Australia, and equal opportunity to secure appointment to public positions such as in the Public Service. These jobs should not be reserved for any particular class, race, or creed. All men are equal, but owing to the unequal development of various countries, some nations are more highly civilized than others. However, just because we are more highly civilized than, say, the Chinese coolie, that does not mean that we are any more human and the Chinese coolie less human.

Sitting suspended from 12.37 to 2.15 p.m. [Quorum formed.]


– I congratulate the honorable member for Swan (Mr. Mountjoy) upon having successfully passed through the ordeal of his maiden speech. He has covered a variety of subjects, and has spoken with a directness and clarity that are refreshing in this chamber. I do not expect to see eye to eye with him in the future any more than I was able to during the course of his observations; but at least he can derive some satisfaction from having successfully negotiated his first hurdle in this Parliament.

I propose to devote the early part of ray remarks to a very brief examination of some of the financial implications of the budget. When last year’s budget was presented - a budget which envisaged a financial programme involving an outlay of £560,000,000-I expressed the rather gloomy prediction that if the then rate of increase of expenditure were maintained this country, with a population of only a little over 7,000,000, might find itself faced in the next budget with a programme involving an outlay of more than £700,000,000, representing more than £100 a head for every man, woman and child in the community. I regret that my gloomy forecast has been completely realized; that, in point of fact, the present budget proposes to call upon the Australian people to provide an amount of £715,000,000 during this year. Honorable members will have an interesting sidelight on the way in which the expenditure has grown when I remind them that on the item lend-lease expenditure alone the Government proposes to provide £100,000,000, which is £5,000,000 in excess of the highest peace-time budget this country was ever called upon to meet; the last pre-war budget totalled £95,000,000, and included what was then an all-time record in respect of peace-time expenditure on defence. In the fifth year of the war, the one item alone that I have mentioned is to cost this country £100,000,000. We gather from that what a hurculean task the Australian people have to discharge; because the proportion of producers in the community has diminished as the war has proceeded, because more and more men and women have been drawn into essential defence services, whether in the fighting forces, in munitions production, or in some other war-time activity. Consequently, only by the most rigorous control of government expenditure, the most unstinted sacrifices, and the greatest readiness on the part of the Australian people to carry their share of the burden, can we hope to fulfil the colossal task that lies ahead of us. There are three principal sources of revenue, and these have been dealt with at length in previous budget debates. Each of them will have an important part to play in the financing of the current year’s operations. They are taxation, loans and bank credit. No innovation is proposed by the Treasurer (Mr. Chifley) under the present budget; consequently, much of what one might say in relation to the general principles he has adopted has already been fully covered by honorable members who sit on this side of the chamber in the course of the budget debate last year. I should like, however, to examine those three elements of finance, just for the sake of determining how we are measuring up to the task in respect of each of them. The Treasurer has told us that in general the burden of Australian taxation is now as severe as is that of any other allied country. As a general statement, that may be true, but if honorable members will compare the tables relating to taxation in Australia with those that relate to taxation in Great Britain they will find that, on the lower ranges of income, the amount of tax collected is much greater in Great Britain than it is in this country. For example, on incomes between £250 and £500 a year, the excess in Great Britain ranges between £10 and £20 a year, compared with the collections on similar incomes in Australia. On the higher ranges of income, it will be found that the income tax collected is very much greater in Australia than in Great Britain. Let me give one illustration: On an income of £10,000 per annum, the taxpayer in Great Britain has left to him, after payment of tax, an amount in excess of £3,000, whereas in Australia it is just under £2,000. I do not wish to embark on any great criticism of the Government at this stage for what might be regarded as lack of balance in the severity with which taxes are levied on the various ranges of income; yet the point has some direct relevance when we come to consider the loan programme of this country. The Treasurer has stated that the heavy loan programme of last year is to be greatly exceeded in the current year. There is a disposition on the part of many persons to consider that wealthy individuals and companies, because of their higher incomes, are able to contribute very largely to the borrowings of governments. If such persons examine the tax figures I have given, and the incidence of taxation upon companies, they will find that that “ cow “ has been milked fairly dry. Already during this session I have heard a lot of loose talk from members opposite in regard to the Government obtaining some of the profits that are derived by big companies. Should the fact have escaped their notice, I remind them that at the present time approximately 80 per cent, of all the incomes earned by companies is returned to the Government in the form of taxes. In the first place, there are the various taxes that are levied upon the company itself. Its net income having been distributed by way of dividends to its shareholders they, in turn, have to pay tax on what they receive. When it is remembered that companies have to retain certain amounts for expansion, for meeting unforeseen difficulties, and for preparing for the post-war period, it will be gathered that they have not much opportunity to contribute substantially to the nation’s loan programme. Last year we were able to raise considerably more money by way of loans than some of us expected. The Treasurer set out to raise a large sum, and, if we include the amount obtained through the issue of war savings certificates, and by similar means, he succeeded in raising loans to the amount of £215,000,000. This year he hopes to obtain £300,000,000. I do not consider that he is over optimistic, because the figures regarding bank deposits show that substantial increases “have taken place in the amount at call to members of the Australian public. Here we must issue the same note of caution that we had occasion to introduce in connexion with the budget of last year, to the effect that the budget estimate of to-day may prove at the end of the financial year to be quite inadequate. The budget estimate of last year was exceeded by £120,000,000, the figure having increased from £560,000,000 to about £680,000,000 in the full year. If anything like the same increase takes place in the course of the present financial year, even the £300,000,000 loan-raising programme that the Treasurer has indicated to us will leave a very dangerous gap to be filled by bank credit.

Let us take an optimistic view of the matter, and start with the assumption that £715,000,000 will be our goal for the current financial year. It will he found that the business of the trading banks and the savings banks reflects a substantial increase of their holdings on behalf of depositors. The nine trading banks show an increase of deposits in the last twelve months of £74,000,000, and that is accompanied by another substantial reduction of the amount of advances. The savings banks show an increase of deposits of £92,000,000, and the deposits are increasing at the rate of £100,000,000 a year. The Treasurer sets out to get 750,000 subscribers to the present loan.. The largest number he obtained last year was 455,000, but he has pointed out that other countries, particularly Canada, have been able to get a bigger proportion of loan subscribers than we have so far succeeded in doing. I do not consider that what has happened in connexion with recent loans in this country can give any satisfaction to the people of Australia. We have discovered that the real excess of spending power at present is in the hands of wageearners in receipt of comparatively low wages; they certainly do not fall within the higher income brackets. Although, in a general sense, they now have a higher wage than at any time previously, only 8.4 per cent, of those receiving under £8 a week subscribed to ‘the last loan, and their investment represented only Id. in the £1 of their income. The direct subscriptions by all wage and salary earners totalled only £31,000,000, or only 30 per cent, of the total subscriptions. The alarming feature of the last loan was the .fact that the balance of £71,000,000 was contributed by only 735 subscribers. Those, of course, included insurance and trustee companies, savings banks and similar institutions. It will be seen from those figures that a much greater effort is required from the mass of the Australian people, if we are, in the first place, to achieve our objective of raising a loan of £125,000,000, and, what is even more important, if we are to divert to purposes of war expenditure moneys which may otherwise be in competition with the war effort in the sense that they will be making a claim for goods and services on behalf of the civilian population.

My leader has already given an assurance to the Government that the Opposition will do all that it can to ensure the success of the loans to be raised this financial year, and he has stressed the importance of the closest scrutiny over governmental expenditure. It is inevitable that at a period of greatly increased expenditure by various departments, particularly the service departments such as the Munitions Department, we shall not get full value for the money expended. These organizations are expanding rapidly, and claims for service require- ments cannot be scrutinized so closely, or on the same principles, perhaps, as is customary in other departments of State. We do not deny the fact that whatever government happened to be in power, and no matter how capably government departments were administered, some wasteful expenditure would inevitably occur; but there is good reason to believe that there is now an excess over what may be regarded as an unavoidable degree of wasteful expenditure. I believe that itwill be found that the Munitions Department is one of the worst offenders in that regard. During the last budget debate I questioned the soundness of our embarking upon an ambitious tank programme at a time when our Allies were making tanks in great quantities very much more easily than we could make them, and were able to make them available to us in return for services and goods which we could more easily provide here. At the time I was rebuked by the Minister for Munitions (Mr. Makin) for my attitude to the matter, but I understand that the Government has now scrapped the tank programme. This is a matter of great importance, because of the tremendous outlay which I understand was involved, both in capital and in the use made of men and materials urgently required in other directions. This matter should engage the attention of a War Expenditure Committee. I understand that about £30,000,000 was to have been expended upon the’ tank programme. We have not received any tangible results from it, and my information is that, the programme has now been scrapped.

I also direct attention to the system of working overtime in the Munitions Department. We have carried on throughout this war on a thoroughly unsound basis for overtime payments for men working at high pressure. Overtime rates have been fixed by the Arbitration Court, primarily as a deterrent to employers working their men systematically for longer hours than have been regarded as healthy for the men in the industry concerned. The rates were deliberately fixed on a basis that would deter employers from engaging in overtime work, except, where it was absolutely essential. In the early stages of the war it was essential that we should get the maximum output of munitions which our slender industrial resources were able to provide for us. The general practice in munitions establishments was for men to work at least five shifts, often six, and sometimes even seven, of up to twelve hours a day, in order to get the required output. The result was that in the early years of the war we certainly obtained a greatly increased output, and the men were paid the penalty overtime rate for the extra work done beyond their normal hours of employment. At that time attention was directed to the fact that these circumstances scarcely seemed to measure up to the greater sacrifices being made by the members of the fighting services. They, of course, irrespective of the number of hours worked, received no penalty rates. It was suggested then that there should be an overhaul of the basis upon which overtime was computed so that the changed conditions associated with the war might be given a more realistic interpretation in the arbitration courts. However, that was not done, with the result that overtime was worked extensively, resulting in a correspondingly increased financial burden on the people. Now, when there is a general slowing down of munitions production because substantial reserves have been established, it is found that overtime is still being worked. This is a line of inquiry which a War Expenditure Committee might well follow.

Another line of inquiry is in relation to those munitions factories which have been set up in country districts. Some have not yet gone into production, some probably never will, but there is a danger that, unless the Government ignores political considerations, activities will be carried on in those centres without any corresponding benefit to the war effort.

Another matter into which the Government should be prepared to inquire, and in regard to which it ought to develop a policy, is the evil of rising costs. These constitute a problem which may well cripple our efforts at posit-war reconstruction. It is difficult for many of us to realize what is involved in this problem of rising costs. The process is a gradual one, and may well escape our notice unless we compare present conditions with those obtaining a few years ago. In this connexion I direct the attention of honorable members to the railways accounts of the several States. For the year 1939-40, 6he total costs of all the States railway systems amounted to £35,000,000, but for the year 1942-43, they amounted to £60,000,000, an enormous increase. I know that the railways are making large profits, but their revenues have increased largely because so many members of the services have been transported from one part of the Commonwealth to another, and the improved financial position of the railways is reflected in the budgets of the State Governments. I remind honorable members that the figures I have cited refer only to one Government activity. There have been proportionate increases of costs in all industry, and when we consider how total costs throughout the Commonwealth must have increased we realize that there exists a danger which must be faced and overcome in the interests of postwar manufacturing and trading.

On previous occasions honorable members have discussed the subject of postwar credits. In view of the strength of the Government party in this House, there seems little likelihood that the Government will experience any change of heart in regard to this matter. However, I still maintain that the failure of the Government to accept the scheme when it was first advanced was one of the worst administrative blunders that have occurred in the financing of this war. It was tragic that a scheme so inherently sound should have been tied up with merely political considerations, and lost on that account. For many years to come we shall pay the penalty for this mistake.

It is not too late, however, to introduce the system of pay-as-you-earn taxation, although, by delaying its introduction, some of the advantages have already escaped us. I find it difficult to understand the objection of the Government and its supporters to the scheme. On the face of it, and on analysis, it has such value when applied to the problems of war-time finance that any government, irrespective of its political leanings, should eagerly accept it. The present method of tax -collection is unfair both to those receiving large incomes and those on small wages and salaries. I propose to give some illustrations, addressing myself particularly to honorable members opposite. Let us take the case of the tradesman who, before the war, earned about £6 a week, a common enough circumstance for those in the artisan groups. The skilled trades enjoy a margin over and above the basic wage of about 39s. a week, which brings the average wage up to about £6 10s. During the war, such tradesmen have been receiving overtime penalty rates, which bring their earnings in many instances up to as ‘ much as £12 a week, or even more. When conditions return to normal in regard to working hours, as they must for physical reasons if for no-other, those artisans will be compelled to pay tax at a rate calculated on double the income which (they will then be receiving, and this will lead to hardship. Let us turn now to the business man, who, in any one year, receives a high income. Whatever may be thought to the contrary, the fact is that even successful business men do not consistently receive the same high incomes. In one year a man may make as much as £5,000; in the next year his income may fall to £2,000 or £1,000, or he may even trade at a Joss. In the year in which his income is large he may be tempted to put his profits back into the business. If, in the following year, the earnings of the business decline, he will find himself in serious financial difficulties. Take the case of a man who retires and is expected to live on a smaller income arising from his superannuation. In the year after his retirement he will be expected to pay taxes on the comparatively high income which he earned in the previous year. Should he die, his widow might be placed in an awkward predicament, because in that year the estate would be called upon to provide money for taxes on the income earned in the previous twelve months, as well as the tax payable in respect of the year in which he died. If we follow this argument through, we shall find that, whatever the range of income may be, difficulties will be encountered if we persist with the present scheme of taxing the income earned in the previous twelve months. Let me be a little more direct in the application of this argument. At the recent elections a number of new members came into this House as the result of winning seats from members of the Opposition parties. Those new members cannot all hold those seats indefinitely. For many of them their parliamentary income may be the only substantial source of income while they are members of this Parliament. Let us suppose that in three years’ time, as the result of a swing of the political pendulum, those honorable members again find themselves outside the Parliament and looking around for employment. They may then be called upon to pay taxes based on the comparatively high income received by them in the twelve months prior to their defeat. Before the war, when Commonwealth taxes were comparatively low, this matter was not of such great importance as it is to-day, but since the war began estate duties have been doubled, and there has been a tremendous increase of income tax collections. A system of pay-as-you-earn taxation on the earnings of the year has such overwhelming advantages that I fail to appreciate the reluctance of the Government to introduce it.

I come now to what is probably the most important responsibility of this Parliament, namely, the necessity to plan now for the post-war period. I believe that the two great problems which the Seventeenth Parliament will have to face are the problems of finance and of postwar reconstruction. In saying that, I do not wish it to be understood that I have no appreciation of the need to win the war; that is our paramount obligation, and to it our best energies must be devoted. However, there is not a great deal that any individual member of this Parliament can do in connexion with the planning for victory. The broad lines of policy for the organization of this country for war purposes have already been laid down, and are being followed, and it is unlikely that they will be altered greatly during the life of this Parliament. But this Parliament has a unique opportunity, amounting to a grave responsibility, in connexion with post-war reconstruction. It is a responsibility which we ought not to regard lightly. No section of this Parliament can claim that it has the support of the great mass of the Australian people. I say that deliberately, notwithstanding that a majority of the Australian people voted for one political party at the recent elections. I challenge any honorable member to say that he honestly believes that any political party in this chamber has the support of the mass of the people. We have to recognize that the policy which was pursued in the years before the war was not such as could evoke enthusiastic support, and so this Seventeenth Parliament has a wonderful opportunity, as well as a great responsibility, if the people of this country are to show to our democratic system of government that loyalty and support which the masses of the people in some other countries have accorded to the systems in operation there. In my opinion the belief in our democratic system of government is so basic in the minds of the Australian people that they are prepared to die if need be, in order to preserve our parliamentary institutions. That is the solid foundation upon which we ‘can build. We must realize, however, that we must appeal to the younger people of this country and, therefore, we must pursue a policy which will evoke their enthusiastic and loyal support. It will not be sufficient for us to proceed along the lines that have been followed in the past. We mast recognize that, just as we have definite priorities during the war period, so there will be priorities in the period of reconstruction after the war. Our Axis enemies are clearly seen to be our enemies now ; hut we shall need to see just as- clearly the enemies of the peace, and realize that their defeat may mean as much to the progress of the nation as the defeat of our human enemies whom we so clearly recognize as enemies to-day. Our first priority must be the provision of a decent minimum living standard for every man, woman and child in the community. We must ensure that the possibilities of accident, ill-health, unemployment, bereavement, family endowment, and old-age, are provided for on a scale which will provide at least a decent minimum for the people.

Mr Mulcahy:

– The honorable member should join the Labour party.


– There is already evidence that in this Parliament there are broad issues on which honorable members on this side, can combine with honorable members supporting the Government ; but there are also cleavages. There are basic differences of opinion in regard to many subjects, including finance, which will be revealed more clearly when we come to organize our post-war society. In this connexion, I echo the sentiment expressed by the Leader of the Opposition (Mr. Menzies) when he said that the spur of individual initiative, and the incentive of individual reward, are potent forces which can be utilized for the progressive betterment of conditions in this country. In our approach to some of the problems of the future, we on this side differ vastly from honorable members supporting the Government. In the report which Sir William Beveridge presented to the Government of Great Britain some farreaching proposals have been set before the British people. That report was greeted with significant enthusiasm ‘by the British people, many of whom possibly had never studied or analysed it, hut to whom it represented a symbol of the post-war security to which they were aspiring. But it did not seek to go very much farther than to provide a decent minimum standard, substantially progressive step though that may be in itself and one which we have not measured up to in this country. We have other problems ‘to face if we are to do more than provide a reasonable minimum standard. We have enemies of the people in time of peace that can be as menacing as our enemies are in time of war. They are the enemies of want, disease, idleness, ignorance and squalor. Before any nation oan claim that it has discharged its responsibility to provide its people with a decent standard of living, it must conquer those enemies. We can conquer the enemy want by an expanding economy with good wages and social insurance; disease by a national health service and a national food policy; idleness by providing full employment; ignorance by an extended educational system open to all on a strict basis of capacity; and squalor by a national housing policy associated with town and country planning. Those benefits are well within our power as a nation, and unless we combat those enemies and provide those things for our people, we cannot claim that we have discharged our responsibility or taken the opportunity given to us by our membership of this Parliament. Even the achievement of those objectives should not represent the stopping point, if we are to have some regard for a satisfying way of life. That way of life should mean something more for people than the mere provision of a minimum standard of security or the conquering of the enemies to which I referred. Surely the working man has something more to look forward to than a life spent in toil with some short breaks- provided either by a few holidays or by periods of unemployment. lit is within our productive capacity to give people the opportunity for travel, for happy recreation, for cultural interests, and for the recreation to bc derived from the stage, literature and art. All those things should form elements in the national policy of post-war reconstruction.

I have spent some time on that matter, first, because of its importance, and, secondly, because I have grave doubts whether the Government is doing all that should be done to realize those objectives. I believe we are starting off on the wrong foot in dealing with this problem of post-war reconstruction. A serious administrative blunder was committed at the outset when the Department of Post-war Reconstruction was put under the control of the Treasurer. I say that without any personal reflection upon the Treasurer himself. As a matter of fact, if he were not Treasurer, I do not know any nian in the Ministry better equipped than he to deal with the problems of post-war reconstruction, but I remind some of the more senior honorable members and tell the new honorable members that it is notorious that the job of the Treasury is not to put forward progressive schemes such as we would expect from the Department of Post-war Reconstruction, but to scrutinize closely the proposals of other departments. Its policy is invariably one of retrenchment, and that is the mental approach of its officers in the proper exercise of their duty. I do not condemn them for it, because it is desirable that at least one department should have that responsibility. But that is its function and prime responsibility; yet the Government has placed under the control of the Treasurer this highly important agency which is to work on the problems of post-war reconstruction. (Extension of time granted.] I believe that it is the worst possible approach to place the administration of post-war reconstruction under the control of the Treasurer, and I hope that the Government will realize very early both the danger and disadvantage arising from that policy. I have some direct interest in this matter, because the first division of post-war reconstruction was created by me in the Department of Labour and National Service. I do not suggest that that is the proper place for the present department to be, but I do say emphatically that the place for it is not under the direct control of the Treasurer of the Commonwealth. I hope that the Government will give consideration to placing the department under the control of one of the most gifted of its Ministers who is not overburdened with administrative work, namely, the Attorney-General and Minister for External Affairs (Dr. Evatt).

Mr Falstein:

– He is months behind with his work.


– If that be so, what must be the plight of some of his colleagues? Important as they are and great as the responsibilities of the Minister in charge of them may be, the departments of the Attorney-General and External Affairs have never been, in my experience, regarded as making the same demands administratively as do some other departments. The Treasury is by common consent the most overworked of all departments, and I regard it as physically impossible for the Treasurer to do his own job thoroughly, as he will do it, and at the same time give the attention demanded of him to the problems of post-war reconstruction. It is my conviction that post-war reconstruction is of such importance that it should be the single task of one Minister.

Illustrative of the immensity of the problems of post-war reconstruction is the problem of housing. It is generally agreed by honorable members that there is a serious shortage of housing in this country. It has been estimated by the Victorian Housing Commission, a reasonably conservative body, that there is a shortage of 250,000 homes and that while the war lasts the shortage will be increased by 35,000 per annum. The commission predicts that if we are to moot the present shortage, clear away the worst slums and meet needs as they develop, we shall have to build 1,000 homes a week for the next eight or ten years.

Mr Frost:

– The honorable member does not suggest that we could embark on such a programme now?


No, but the Minister for Repatriation should be taking a lively interest in this problem.

Mr Frost:

– That is what I am doing.


– I do not deny that. I remind the Minister, however, that each week men are being discharged from the armed services, many of them married mon without .homes and unable ‘to secure homes. In many cases they are developing a bitterness because homes cannot be provided for them. It will not be much consolation to the men who return from war service, and who, perhaps, have married since their enlistment and have small families, to be told that so many houses are being built each year and they will be able to move into homes with their families in, perhaps, 8 or 10 years.

Mr Falstein:

– The most needy cases must be dealt with first.


– The claims of all these men will be entitled, to immediate consideration. When our present shortage of homes is so great in relation to our population of 7,000,000, it is obvious that we must regard housing as a problem of immediate urgency. I cannot indicate what percentage of our resources now being devoted to war production should at this stage be diverted to the building of homes. It may be that even so great a social disadvantage as is represented in the present shortage of homes must be accepted because of the more urgent’ needs of war; but I think that all honorable members accept the proposition that, at the conclusion of the war, we must immediately commence a programme of home building. My criticism of the Government is that, because of its failure to take action now, it will not be in a position to embark on that programme immediately the war ends. Already tb: Government h*s allowed to decline the subsidiary industries upon which the building trade necessarily depends. Many months will elapse before those industries will again be enabled to play their part in a home building programme. For instance, only two of 35 brick kilns which were in operation in Victoria on the outbreak of war are now in production. We have no reserves of bricks, roofing tiles, building timber or plumbing appliances. All of these articles are basic to a building programme, and without such reserves we cannot start to build homes. The point I make, however, is that we shall first require to rehabilitate those industries, and that will cause considerable delay.

Mr Frost:

– Is not the honorable mem ber aware that a number of brick kilns have stopped production because they have excessive stocks on hand?


– I am afraid that I cannot accept that statement. I have obtained my information from the building industry in Victoria and the Housing Commission in that State.

Mr Frost:

– The honorable gentleman is dealing with only one State.


– That is so; but in Victoria alone there is the huge shortage of 60,000 homes. The Minister for Repatriation (Mr. Frost) will concede that I am not trying to make political capital in this matter. I am simply giving facts which have been brought to my notice, and which, I believe, have not yet been sufficiently taken into account by the Government. If the Government is looking to a housing programme to absorb a great proportion of those men who will be looking for work upon their demobilization from the armed services, it must now start to put that programme into operation. For instance, it should not wait for six or twelve months to rehabilitate those industries upon which the building industry itself depends.

Secondly, I am by no means satisfied with the provision that is being made for the men who are now being discharged from the services on medical grounds. Figures supplied to me show that only 25 per cent, of these men are receiving medical treatment for the causes of their discharge. That is a most short-sighted and wasteful policy. I am quite aware of the arguments put forward in the past by the Repatriation Commission in regard to this matter. It fears that if it grants free medical treatment in all cases the concession will be used as the basis of a claim for a pension, and, consequently, it may find itself committed to very heavy expenditure. However, we shall be very short-sighted indeed if we fail to provide all of these men with adequate medical treatment and pensions. I do not care whether this is the responsibility of the Repatriation Commission or the Health Department. It is the inescapable duty of the Government to ensure that every man discharged on medical grounds, whatever the cause of his discharge may be. is entitled as a right to full medical treatment until he is able to take his place as best he can in the community.

Mr Falstein:

– In the post-war period those men will be taken care of under the proposed social security scheme.


– This matter cannot be postponed till the post-war period. Men are now being discharged daily on medical grounds, and as I have already said, the needs of only 25 per cent, of them are being recognized. At the same time, we expect the other 75 per cent, to play a useful part in the community.

Mr Frost:

– Where did the honorable member get those figures from?


– I can only assure the Minister that I place the greatest reliance upon the source of my information. The Minister can easily check the figures I have given. We must remember that if the claims of these men are not now attended to they will later be seeking invalid pensions and other social security benefits.

My final illustration is with respect to migration. All honorable members agree that in the post-war years we must bring into this country large numbers of useful and valuable migrants if we are to maintain the security of our nation, and provide an adequate home market for the products of the industries which have sprung up in this country in recent years: I do not need to emphasize the importance of that policy. It is another matter upon which we cannot afford to dilly-dally as ths Government is doing at present. I understand that New Zealand has already implemented plans for absorbing considerable numbers of British migrants. Even at this stage we could be negotiating with the Government of Great Britain about passages, and the requirements we shall expect of people before we shall admit them to this country as migrants. Thousands of people in many European countries will be war-weary when the present conflict finishes, and they will be seeking refuge and comparative security which a remote country like Australia offers. They will want to get away from the scenes of war to a new country where they can make a completely fresh start. If we fail to plan for migration now we shall deny to Australia many thousands of people of the best European stock. However, no action is being taken by the Government in this direction. I know, in outline, what the Department of Post-war Reconstruction is doing. It has appointed a housing commission, a rural reconstruction commission, and various bodies of inquiry, one of which, in conjunction with the Repatriation Department, is planning the rehabilitation of our service personnel. The Tariff Board is inquiring into the problems of secondary industries. In addition, a programme of public works is being planned. All of this work is important. However, the matters which I have touched upon now call for more than mere planning. The Government should take immediate action. This Parliament has a tremendous opportunity to ensure the prosperity of this nation in the post-war period; but in order to achieve that objective we must not only be planning now but also implementing those plans. But if we temporize or ignore our responsibilities in that regard, we shall bring down on our heads the condemnation and even the violence of ex-servicemen and persons formerly employed in munitions establishments, if we are not able to provide for them the things which they believe a country can make available to them, they will bitterly resent it. I remind honorable members of the experience of Germany in the years following the last war, where the conditions were in some respects comparable with those that may prevail in Australia after this war. The community had been highly organized, with vast numbers of men and women absorbed by the services and munitions establishments. They were displaced at the end of the war. At first, there was bitterness and disillusionment among those from the factories, leading to a sharp swing to the left, and the creation of a strong Communist party which was almost able to assume control of the country. Gradually, the Social Democrat forces were able to assert their influence and they enjoyed a brief period of political power. Then, from the disillusionment and bitterness of the exservicemen who had to wait years for homes and jobs, and who were denied the opportunities which they believed to be their right, there developed a sharp swing to the right and the creation of the Nazi Socialist party under Adolf Hitler. We do not desire that to happen in this country, but it can happen here if we deny to these men and women the things which can be given to them. They know that we expend, usefully in our opinion, the sum of £10,000 in training a young man to become a highly skilled member of an air crew. They know also that if they asked in peace-time for even one-tenth of that sum to be expended on their education for the purpose of making them useful citizens in a civilian society, the money would not be provided for them. They will not be satisfied with that. The danger exists and we must avert it. If we neglect to make provision for these useful things which are well within our capacity, the Seventeenth Parliament of the Commonwealth will have failed to discharge its proper responsibilities.


.- The appeal of the honorable member for Fawkner (Mr. Holt) on behalf of the young people interested me greatly, because it was this subject, among others, (hat induced me to enter the federal political arena. The Deputy Leader of the Opposition (Mr. Hughes) has expressed the opinion that money should be not the master but the servant of the people. Ten years ago, during the depression, it was definitely their master. When this country reached the nadir of the depression, 500,000 persons were unemployed and the Treasurer of tha day desired to expand the national exedit by borrowing £40,000,000 from the Commonwealth Bank for the purpose of rehabilitating them. But when hi3 political opponents denounced his plan as being inflationary and dangerous, the proposal was abandoned and people, instead of being usefully employed, existed wretchedly on the dole. Ever since I became interested in politics, the advocates of a policy of utilizing the national credit have been accused of lack of concern for the economic structure of the country.

During my lifetime, Australia has been engaged in three wars, and each has necessitated an expansion of the national credit. That expansion has continued for a brief space after the conclusion of hostilities, but has been followed by a period of deflation, which leads to an economic depression. Thousands of men and women are then thrown out of employment. If the national credit had been utilized, that would not have occurred. Of course, the depression was world-wide. Even the United States of America, which is the richest country in the world, had approximately 14,000,000 unemployed.

In 1929 I visited Northern Australia when the country was suffering from one of the worst droughts in its history. Conditions were deplorable. Given water conservation and irrigation schemes, the so-called “ dead heart of Australia “ would become a fertile land. The estimated cost of one project for irrigating that portion of the continent was £30,000,000. If such a scheme had been proceeded with during the depression, the benefits to Australia would have been incalculable. Ever since I was a lad, I have heard discussions on the subjects of water conservation and afforestation, but very little progress has been made with those works. If Australian governments had had the foresight to utilize the national credit, a great deal of valuable afforestation and irrigation work could have been accomplished. Unfortunately, they squandered money on the dole, and the factory worker suffered in common with the primary producers. It was most peculiar that at that time in this land of plenty, whilst the farmers produced more wheat than could be disposed of, and our granaries were overflowing, we had over-production on the one hand and unemployment on the other. “Wheat was down to ls. 5d. a bushel, or some other absurdly low figure, so that the primary producers were unable to earn sufficient for their own requirements. At the same time thousands of people in Australia lacked the very things that were being produced -in such quantities. Such a state of affairs was economically unsound, but those who controlled the monetary system did not fail to take advantage of it. I know what the conditions were then, because my own children who had just left school were unable to make a reasonable living. The same thing was true of thousands of other boys throughout the world. It was a. blot on Australian history that at that time, in one of the finest countries of the world, there was over-production on the one hand and poverty on the other.

In South Australia, and I have no doubt in other States also, people who had been induced by previous governments to take up holdings on the so-called marginal lands, did not have the necessaries of life. They even had to clothe themselves with bags. These are facts which can be found on record in the newspapers of the day. Those conditions led mc to seek to enter the political arena. Honorable members opposite said at the last elections that if a Labour government were returned to power it would extend the national credit, and 3pend in times of peace as much as could be spent in war. They have repeated here the electioneering speeches which they made on the hustings, probably to get them into Hansard, and so distribute them to the people. Whether they agree with me or not, I say that if Ave can raise money for the destruction of human life, then in all fairness we can go to the same source for money with which to rehabilitate our people in times of peace. My sous, and others who have gone away to fight for the preservation of this country, must not find here when they return the same state of affairs that we have experienced. Most of our boys, when the war broke out, had never known what it was to earn a day’s wages. All that they learned was to shoulder arms. I am here to support the Government, as I told the electors on the hustings, to ensure that such a state of things never recurs during my lifetime, or, I hope, in the lifetime of my children.

I hope that the Government will proceed as soon as possible to the implementation of the policy enunciated by the Prime Minister (Mr. Curtin) during the recent election campaign, because I believe that it is iri the best interests of the country that that should be done. I am sometimes amazed, when I read and hear about the wonderful Prime Minister of Great Britain, Mr. Churchill, that so little credit is given to our own Prime Minister for all that he has done. I give Mr. Churchill all the honour that is due to him. He has done a wonderful job in leading the British people and the Allied Nations. The same can be said of Mi-. Roosevelt, the President of the United States of America, but I ask honorable members to think as highly of our own leader in Australia. I am satisfied that the result of the elections was to a very large extent due to the leadership of our Prime Minister. I am not one of those who wait until a person has passed away before giving him credit for all that he has done. All credit is due to the wonderful achievements of the Labour Government, led by the Prime Minister. The magnificent results which have been achieved by it and by our fighting forces will form one of the brightest pages in the records of Australia.

Mr James:

– And the fighting opposition has contributed to it!


– I am satisfied of that also. At the declaration of the poll, my opponent looked across at me and said : “ I thought, when this gentleman nominated to contest this seat, that he was a very courageous man “. Be that as it may, the crisis through which we are passing calls, I think, for courageous men.

I am quite satisfied that if the Government puts its policy into effect the Labour party will be in power, not for three years, but for a considerably longer period. I remind honorable members that the Commonwealth Bank was brought into being by the Fisher Government, when, for the first time in the history of this parliament, Labour had a majority in both Houses. As that fortunate state of affairs will occur again in the near future, I hope that the opportunity will not be missed to inaugurate other much-needed reforms. There is much talk to-day of the alleged inflationary tendency of Labour’s financial proposals. I remind honorable members that when the establishment of the Commonwealth Bank was first mooted, a ad the placing of control of the note issue of Australia in the hands of that institution was suggested, the conservative minds gave expression to exactly the same thoughts that we hear expressed to-day. They raised the bogy of inflation. It was claimed that the notes issued by the Commonwealth Bank would be sold on the streets for a song. In fact, placards were seen all over the country depicting men holding bundles of these allegedly worthless notes described as “ Fisher’s flimsies “. I do not know how this country would have got on or what its state would be to-day without “ Fisher’s flimsies “. I trust that in the very near future the original charter of the Commonwealth Bank will be restored to it, and that it will be the servant of this Parliament, not its master.

Responsibility for the present shocking housing position throughout the Common wealth can be attributed partly to successive anti-Labour governments which, although aware of the gradual deterioration of housing standards, took no definite steps to ‘prevent it. I remember years ago, in the beautiful city of Adelaide, when driving to the city each day, one could not help noticing the many wonderful “mansions” situated on the banks of the River Torrens. No doubt, similar buildings abound in the other capital cities, to our eternal disgrace. The conservative element of this country, which has had control of this parliament for at least 33 years since federation, has had many oppor tunities to do something of lasting benefit by undertaking a comprehensive housing scheme but nothing has been done. In South Australia, Labour has never had simultaneous control of both legislatures, due mainly to the fact that the Upper House is elected on a property franchise. During the 80 years of the existence of the South Australian parliament, the Labour party ‘has held office for only about ten years, and during tha<t time has always been under the control of a reactionary legislative council. I hoped that with the inauguration of federation, something would be done on a Commonwealth basis in regard to housing and other necessary reforms, but I was disappointed. The housing, question should have been tackled in a comprehensive manner years ago. I realize that little’ can be done at present because we are engaged in a war, the winning of which must be our primary objective. However, there is no reason why we should not make the fullest plans for post-war reconstruction, so that a start may be made immediately the war is over. I am concerned with the plight of young married people who are unable to obtain homes, and also with the conditions under which some of our invalid and old-age pensioners live. One does not hear very much said about old-age pensioners nowadays, but I am deeply concerned with their welfare, possibly because I am becoming a little advanced in years myself. The conditions under which many of our old people live to-day is a disgrace to a country such as this. Many of these unfortunate people, who have been the pioneers of this country, are living in hovels. I recall the enthusiastic speeches that were made by the protagonists of federation when the creation of the Australian Commonwealth was first mooted. I could mention the names of some of these great men now, but no doubt they are as familiar to other honorable members as they are to me. Speaking in support of federation, they painted fine word pictures of what they conceived to be the future of this country governed by a Commonwealth parliament, and many people thought as I did, that when this national legislature was brought into being, the activities of the State parliaments would be restricted considerably ; that we would have a national parliament in the true sense of the word; but to-day we find that, in certain respects, the Commonwealth Parliament is subservient to the State legislatures. Such a state of affairs is quite wrong, and I trust that the Commonwealth Government will take steps as soon as possible to have transferred to it all the power necessary to deal adequately with post-war reconstruction. We can do all the planning for the post-war years now, but unless additional powers are transferred to the Commonwealth to ensure that these plans will be carried out, when the war is over, widespread disappointment will be caused. I believethat if the question were put to the people fairly and squarely, they would vote willingly for the transfer to the Commonwealth of all the additional authority that it requires, so that the lines of demarcation which exist to-day would disappear and chaos would be avoided. It is wrong that the Commonwealth Parliament should have to go cap in band to the States asking that this or that be done; the Commonwealth should have power to ensure that things which should be done in the interest of the country as a whole are done. Only in that way will we be able to make Australia the nation that it should be. The establishment of a mortgage branch of the Commonwealth Bank was a step in the right direction, but we have yet a long way to go. I am not satisfied with the rates of interest that it charges. It is only a competitor of the private banking institutions, and we know what their policy has been. Efforts should be made to lower the interest that is charged. If that object were achieved, the primary producers of Australia would receive a big lift economically. Every one knows that interest rates have imposed a more crushing burden on the primary producer than has any other factor. During the depression, and since, the majority of insolvencies throughout Australia have occurred in the ranks of the primary producers. That is a reflection on the Commonwealth. Action must be taken to stabilize our primary industries.

Progress reported.

page 312


The following papers were pre sented : -

Defence Act - Regulations - Statutory Rules 1943, Nos. 243, 244, 245, 246, 247, 249, 250.

National Security Act -

National Security (General) Regulations -

By-laws - Controlled area.

Orders -

Taking possession of land, &c. (223).

Use of land (12).

Regulations - Statutory Rules 1943, Nos.

232, 239, 240, 241, 252, 253, 254, 255, 256.

Superannuation Act - Regulations - Statutory Rules 1943. No. 248.

War Service Estates Act - Regulations - Statutory Rules 1943, No. 234.

House adjourned at 3.48 p.m.

page 312


The following answers to questions were circulated : -

Civilian Medical and Dental Services.

Outstanding Taxes

Mr Fadden:

n asked the Treasurer, upon notice -

Will he state the amount of taxation, income and land, outstanding at the 30th June, 1942, and the 30th June, 1943, in respect of (a) the Commonwealth and (b) the States?

Mr. CHIFLEY. - The answer to the honorable member’s question is as follows : -

The following are the amounts of Commonwealth and State taxation, income and land, outstanding at the 30th June, 1942, and 1943, respectively.

Whilst the total amount of Commonwealth Income Tax and War-time (Company) Tax outstanding at the 30th June, 1943, shows an appreciable increase over the figures of the previous year, the percentage of the tax outstanding to the total tax debited for the year has been reduced by 2.4 per cent. The amount of tax debited for the years ended the 30th June, 1942, and the 30th June, 1943, was £86,663,748, and £145,183,755, respectively. Also it should be borne in mind that a large proportion of the tax shown as outstanding at the 30th June each year is not due and payable until some time later.

Housing in Queensland.

Mr Lawson:

asked the Prime Minister, upon notice -

  1. Has his attention been directed to an article appearing in the Brisbane Courier-Mail of the 20th September last, headed “House Plan here Pigeonholed “, in which the Premier of Queensland is reported to have stated that in New South Wales and South Australia, the Commonwealth, in co-operation with the State housing authorities, has built some hundreds of homes and that, while a great deal of preliminary work has been done in Queensland, the whole scheme so far as Queensland was concerned was pigeonholed?
  2. Is the statement attributed to the Queensland Premier correct?
  3. If so, will he take whatever steps are necessary to see that the Queensland Government is given the same assistance and cooperation by the Commonwealth Government as has been given to the New South Wales and South Australian Governments, in order that the acute housing shortage in Brisbane may be alleviated ?
Mr Curtin:

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

  1. Yes.
  2. The statement attributed to the Premier of Queensland is generally true, but gives an incomplete picture of the situation. So far as Queensland is concerned, the statement refers to negotiations in regard to a special loan to the Queensland Government which took place in the latter part of 1D41. This loan was proposed for the purpose of assisting the Queensland Government to build permanent houses for war workers in Queensland. The proposal had to be cancelled, in common with proposals for similar loans to the New South Wales and South Australian Governments, following upon the entry of Japan into the war and the impossibility of making available labour and materials for permanent house building. The housing situation at that time in Queensland waB not nearly as difficult as it has become since, with the increasing concentration of defence activities in the northern areas.
  3. The Commonwealth Government is already taking all possible steps to alleviate the acute housing shortage in Queensland, and to this end has already commenced a programme of temporary construction. In addition, the Premier of Queensland, who has been advised of the Commonwealth’s intentions, was invited in a letter dated 1st September last, to assume primary responsibility for local action to secure the most effective utilization of existing accommodation in Brisbane. In this connexion, the Premier was offered every assistance that the Commonwealth Government could provide. In a reply to this letter received yesterday, the Premier indicated his belief that very little relief could be secured by efforts to use existing accommodation to better advantage, and urged the Commonwealth Government to extend the present programme of new temporary construction. Proposals to this end have already been submitted to War Cabinet, which will further consider the matter at its next meeting.

Allies Works Council. ifr. Falstein asked the Prime Minister, upon notice -

Will he make a statement in regard to the circumstances in which more than 3,000 employees of the Allied Works Council have ceased work on an important project?


– I have ascertained that negotiations which have been proceeding’ have reached the stage that the men have resolved to return to work. The reasons for their cessation of work will now be investigated.

Cite as: Australia, House of Representatives, Debates, 8 October 1943, viewed 22 October 2017, <>.