18th Parliament · 1st Session
Mr. Speaker (Hon. J. S. Rosevear) took the chair at 2.30 p.m., and read prayers.
Petitions in relation to banking in Australia were presented as follows: -
By Mr. BEALE (through Mr. Harrison), from certain electors of the division of Parramatta.
By Mr. FRANCIS, from certain electors of the division of Moreton.
Petitions received and read.
Motion (by Mr. Chifley) proposed -
That the House, at its rising, adjourn to to-morrow, at 10.30 a.m.
– I wonder whether this motion is necessary. Lf it is, I have nothing to say about it. The House usually met on Wednesday, Thursday and Friday in each week.
– That was under the old order.
– If it were necessary for the House to meet at 10.30 a.m. I should raise no objection, but I do not think that it is necessary. Honorable members have sufficient work to perform on behalf of their constituents in the mornings without being required to attend in this chamber.
.- The honorable member for Batman (Mr. Brennan) has raised, from the government side of the House, a question which has frequently been referred to from this side. Except under conditions of emergency, when the Government had to have its legislation passed through by a particular time, the practice has been for the Parliament to sit in the afternoon and evening only, except on Friday. I believe that there are good reasons why that should have been done, but in recent times the Parliament has accepted a modification of that -practice which the Prime Minister (Mr. Chifley) has intro duced because the Government has pleaded emergency in getting its legislation through. Other honorable members besides the honora.ble member for Batman and myself are concerned at the decline of the prestige of the Parliament and the way in which its proceedings have been conducted in recent years. I assert that this chamber cannot function as a deliberative assembly if its regular practice is to meet in the morning. Every member of the Parliament has a good deal of correspondence to attend to, as well as various other matters to perform on behalf of his constituents. That frequently necessitates attendance at various government departments on their behalf, and, naturally, such work can be performed only in the normal working hours of the departmental officers. The result is that when the House sits in the morning a number of members are necessarily absent from the chamber. We on this side do not object to any reasonable proposal, and should the Prime Minister say that the Government desires to have certain legislation passed by a certain time in order that it may go to the Senate, and for that reason desires the House to sit in the morning, we shall fit in with his desires. But if he-
– There is a lot of legislation which must go through..
– In other words, it would appear that what has ‘been exceptional procedure is now to become the regular practice. That is a departure from the regular custom of the past when the Parliament sat on three days each week, and .only sat on a fourth day towards the end of a session when pressure of business necessitated additional sittings. As members have many other duties besides those which involve attendance in this chamber, I believe that it is a sound practice that the Parliament should sit normally on three days each week, and only on a fourth day on occasions of emergency, or. when considerable business has to be dealt with. I warn the Parliament that if it persists in this practice of sitting in the mornings, we shall not only lose opportunities of dealing with matters of considerable importance hut, also, the Parliament as an institution will suffer in. prestige and effectiveness.
Question resolved in the affirmative.
– Can the Minister for Labour and National Service say whether it is a fact that, as the result of a strike by sheet metal workers - key men - at Metters Limited, Sydney, the production of stoves, baths, sinks and other vital household fittings is held up, seriously hampering the housing programme ? Has a spokesman for the Sheet Metal Workers Union stated that the union is not anxious for an early settlement, as the dispute can be used to enforce certain demands? Is this union Communistcontrolled ? Is it a fact that this dispute has been in the hands of three conciliation commissioners - Mr. Mooney, Mr. Morrison and Mr. Buckland - that Mr. Morrison and Mr. Buckland washed their hands of it, and that it has now been referred to Mr. Mooney? “Will the Minister state what is being done to effect a settlement, so that production of housing requirements will not be unnecessarily delayed, and so that those employees who were forced out of work against their will by the action of key men may be reemployed?
– I know nothing of the details which the honorable member for Wentworth has placed before the House; but, as he himself pointed out, the matter is in the hands of a conciliation commissioner. The new arbitration legislation makes it quite easy for either the employers or the employees engaged in a dispute to refer the matter to a commissioner, who will immediately take it in hand. As this matter has now been referred to the right commissioner, Mr. Mooney, I am quite certain that he will immediately settle the dispute.
– Has the Minister for Commerce and Agriculture seen a statement in the Adelaide News of the 25th instant, under the heading “ Australia not doing fair thing wherein the South Australian Minister for Agriculture, Sir George Jenkins, said -
Australia could well afford to reduce ment consumption to send a greater quantity to Britain. We could do it without hardship. Thousands of tons of tallow fats were being wasted in South Australian country districts because farmers could not get a price comparable with the export value, due to the way Commonwealth policy operated.
The Commonwealth Government will not allow free export of fats from Australia. They say we are short of fats for soaps - which I do not believe.
The controlled price payable for tallow is too low to cover freight costs. So, instead of being taken care of as good, clean, wholesome tallow, usable for cooking, it is being thrown out.
Is ‘this statement correct, or is it in keeping with the general atmosphere of antagonism exhibited by Sir George Jenkins towards the Australian Government ?
– I have seen a statement in one of the Adelaide newspapers attributed to Sir George Jenkins. As for his reference to meat consumption, I have no doubt that he, and others similarly placed, who are able to dine in hotels, cafes and at Parliament House, could well reduce their consumption of meat without suffering hardship, but I am not so sure that working men and their families could do so. As for the statement about fats, I cannot believe that farmers in Australia are so utterly callous as to neglect to collect fats, and to sell them at the prices fixed by the Prices Commissioner.
– What about the overseas price?
– We know that in some instances three or four times as much could be obtained for products overseas, and that includes labour, but I am not sure that the people generally would agree with the honorable member if he were to suggest that overseas prices should be applied all round in Australia. Sir George Jenkins, according to the report, stated that he did not believe that there was a shortage of tallow and soap in Australia. If he were to come to my office and see the great number of letters which I receive from people in all walks of life, complaining of the shortage of soap, his ideas might undergo a radical change as to whether there is justification for the prohibition of the export of tallow from Australia at the present time.
– I wish to ask the Minister representing the Minister for Health a question arising out of a report in this morning’s press that a passenger who had arrived from overseas by air at Darwin is a cholera suspect and that all passengers on the aeroplane are now under strict quarantine. In , view of the fact that so few of our medical officers have had any experience in dealing with cholera, apart from those who were prisoners of war in Malaya, will the Minister request his colleague to despatch one of the latter to Darwin not only to assist in diagnosing the case under suspicion but also in taking full precautions to prevent the disease from spreading?
– I shall discuss the matter with the Minister for Health this evening. However, he has already told me that his thoughts had been arrestedby the report and the news that he had received from Darwin. The honorable member can rest assured that everything is being done to keep this country as free from disease as we have succeeded in doing upto date.
Reconstruction Training Scheme - Commercial Art Course
– I ask the Minister for Post-war Reconstruction how many Commonwealth Reconstruction Training Scheme students are taking courses in commercial art, and when will these courses be completed? Where does he expect to absorb the thousands of these young artists in view of the fact that newspapers and magazines will be their main field and 60 per cent. of that field is already taken up by syndicated material including comic strips? Does he not think that the prohibition of the importation of comic strips to this country is the only solution?
– As soon as possible I shall obtain the information sought by the honorable member in respect of the number of Commonwealth Reconstruct tion Training Scheme students under training. The latter part of his question is a matter of government policy, and I shall take it up with my colleagues.
– I present the report, with minutes of evidence, of the Public
Works Committee on the following subject : -
Ordered that the report be printed.
Australian Iron and Steel Collieries - Losses
– Bearing in mind the drive that was conducted last week by the executive officers of the coal-miners’ federation for full and continuous production, has the Prime Minister seen the report in to-day’s press that trouble is likely to arise on the south coast due to the fact that the superintendent of Australian Iron and Steel Collieries has refused to co-operate . with the local conciliation committee in an endeavour to avoid a stoppage? Committees of the same kind are in existence at most mines on the northern and southern coal-fields and have proved most successful in avoiding stoppages. In view of the arrogant attitude of the superintendent mentioned in the press report, is there any way in which the Joint Coal Board can discipline, or replace, this individual who is the cause of the trouble?
– I do not know all the details of the matter which the honorable member has raised. I discussed it briefly this morning with the Minister for Supply and Shipping, the Joint Coal Board being under his direct control. He is having the matter examined. As soon as I receive the particulars, I shall supply the information sought by the honorable member. As the honorable member has said, some of these committees have done very good work. However, I am not prepared to pass judgment on this matter until I have all the facts before me.
– Having regard to the continued industrial trouble in the coal mines of New South Wales, the everincreasing losses of coal, and the difficulty of stimulating production, will the Minister have prepared a statement comparing the losses per man-hour in the coal mines of New South Wales with the small losses in Queensland, as atribute to the miners of Queensland and an inspiration to the coal-miners of New South Wales?
– Am I to understand from the honorable member’s question that he desires a statement in regard to Queensland only?
– I desire a statement containing a comparison of the position in New South Wales and Queensland.
– There is already on the notice-paper a question on this subject which necessitates some investigation. I shall ascertain whether the two statements can be combined, and so meet the wishes of the honorable member for Moreton.
– Since I asked a question in the House last week, has the Prime Minister had an opportunity to examine the reports of the Commonwealth Investigation Service regarding S. P. Lewis, who is representing the Government at Unesco at Mexico City? Is he now aware that both Lewis and his wife are members of the Communist party of Australia? Is he aware that Lewis stood as a State Labour party candidate for the electorate of Barton in 1940, when the State Labour party was the Communist party’s underground movement advocating peace with Hitler? Did the report disclose Lewis’s intention to go to Europe to visit the Communist satellite countries and the Comintern head-quarters at Belgrade, after attending the conference at Mexico City? If so, for what purpose did he intend to visit those countries? Did it disclose his previous association with the Comintern through the International Educational Workers League, a Comintern auxiliary? Is it not a fact that the Australian delegation to Unesco is entirely a government delegation which was appointed for the purpose of defining Australian Government policy on important social, scientific and educational questions? Does the Prime Minister consider a member of the Communist party a fit and proper person to define Australian policy on behalf of his Government? Will he cancel Lewis’s credentials and give an assurance that no Communists will he appointed to future delegations to act as spokesmen for Australia?
– In answer to the first part of the honorable member’s question, I have not examined the files in the office of the Commonwealth Investigation Service relating to Mr. Lewis. That is a matter for the Minister acting for the Attorney-General. As I indicated last week, I have no knowledge of Lewis’s political philosophy. I understand that he is an employee of the New South Wales Government and that he is also president of the Teachers Federation in that State. I do not know anything about the aspects of Mr. Lewis’s history mentioned by the honorable member. I was unaware that he stood as a State Labour party candidate for the electorate of Barton, or, for that matter, for any seat. If the honorable member will place the last two portions of .his question on the notice-paper, I shall furnish him with detailed replies.
– Recently, I asked a question of the Minister for Labour and National Service relating to the annual cost of wages and salaries of employees of the Commonwealth Employment Service and was informed that it amounted to £590,000. I asked what offices and shops were occupied for the service in each State and was informed that the total number was 146 and that the annual rental amounted to £49,090. The information I received relative to the number of permanent jobs secured through the service during each of the last two financial years indicated that the cost of each job secured was approximately £2 10s. In view of the numerous advertisements in the press for labour of all kinds, and the heavy expenditure upon this service, and the apparent redundancy of much of its activities, could not the work be co-ordinated into a few offices, thus allowing many shops to be re-occupied by traders, and the surplus officials in the service placed in more productive work? If not, are these numerous offices being held with a view to the introduction of labour conscription in a further socialized order?
– I shall skip the last part of the honorable member’s question. It does not do him justice. I do not admit that there is any redundancy in the staffs of the Commonwealth Employment Service throughout the Commonwealth. The figures quoted by the honorable member are correct. They are in the Estimates. The personnel of the department was reduced by 500 last year, and the special sub-committee appointed by the Government to investigate stait’ requirements throughout the Public Service is continuing its work with a view to ascertaining whether there are any surplus employees who could be placed elsewhere. The statement that the cost of placing people in employment is excessive is not admitted by any one who knows anything about the matter.
– The figures that I have quoted show the number of jobs found, and reveal a cost of £2 10s. a head.
– The officers involved have many other duties.
– What are they?
– I could give the honorable member a full list, but I should require leave to make a statement. In recent weeks, many honorable members in this chamber have asked whether steps could be taken to organize labour throughout the Commonwealth to harvest the forthcoming record crops. This has necessitated the appointment of special organizers. If the honorable member would like to have details of the work done by the employees to whom he has referred I shall have a statement prepared and forward it to him.
– In view of the alarming increase of the numbers of grasshoppers and other pests throughout New South Wales with the resultant plague threat to record wheat crops will the Minister for Post-war Reconstruction instruct the Council for Scientific and Industrial Research to co-operate in every way possible with the State Department of Agriculture in an endeavour to fight this grave menace by every modern means, including the spraying of poison by aircraft if necessary.
– I am aware that there are pests of several kinds in New South Wales, but I am not in a position at the moment to advise the honorable member of what can be done by the Council for Scientific and Industrial Research to reduce their numbers. I can assure the honorable member however that the Council for Scientific and Industrial Research works in close cooperation with the various State departments of agriculture, and if there is anything that the New South Wales department requires to be done in this direction, I am certain that the council will be prepared to give the fullest possible assistance.
– Has the Minister for Commerce and Agriculture seen the statement of the general president of the Primary Producers Union, Mr. R: C. Gibson, that the price to dairyfarmers of 2s. ltd. per lb. commercial butter basis, recommended by the Dairying Advisory Committee on Production Costs is a. 1-J. per lb. higher than the figure of 2s. granted by the Commonwealth Government? If so, in view of the widespread discouragement of dairy-farmers due to the Government’s decision, particularly haying regard to the Minister’s statement that if production costs rose or fell the price of dairy-farmers would vary accordingly, will the Minister explain his refusal to give to dairy-farmers the return considered necessary by the Governmentappointed advisory committee to enable them to carry on their activities and increase production?
– I have not seen the statement attributed to Mr. Gibson, but I did see an earlier statement in which he was reported as having said that the 2s. was “ a little light “. I am also aware that throughout Australian dairying districts the dairy-farmers are jubilant at the price of 2s. per lb. for commercial butter, which has been decided upon by the Australian Government. The committee comprised representatives of several government departments and the dairying industry. It is only to be expected that the representatives of the industry would recommend a higher price than they could expect the Government to grant.
– What an insult!
– That is the general practice in arbitration courts and other tribunals that deal with problems of the same character as that committee dealt with.
– In view of the impetus given to biochemistry and bacteriology and their effects on possible future wars, I ask the Minister for Defence whether the Government will give consideration to the making of a grant to an Australian University for the establishment of a secretariat to deal in the most expeditious manner with all developments in those fields?
– I believe that that matter is related to defence scientific research projects. “We have in London liaison officers following what the Government of the United Kingdom is doing in regard to such matters. As the result of consultations there something of the kind suggested by the honorable member may be done.
– I have received a telegram from Mr. Hawke, M.L.A., former Minister forWorks in the Wise Government, and Mr. Fernie, DirectorGeneral of Industrial Development in Western Australia, concerning the Fremantle shipyard. The Government of Western Australia has offered £20,000 for the shipyard. The Commonwealth Disposals Commission has indicated that it will not consider an offer of less than £25,000, and that it proposes to proceed with the disposal of the assets. This will mean disposal of stocks largely to dealers, removal of buildings and the loss of industry to the Fremantle district. Further, after the expenses of the sale have been met, it is doubtful whether an amount in excess of £20,000 will be realized. It would be more economical to retain the concentration of industry in the district. So will the Minister representing the Minister for Supply and Shipping ensure that the representations of the Government of Western Australia and Mr. Hawke shall be sympathetically considered ?
– The disposal of the shipyard at Fremantle is a matter which comes under the jurisdiction of the Minister for Supply and Shipping. I do not. think that if has come to the notice of the Secondary Industries Division of the Department of Post-war Reconstruction or of the Secondary Industries Commission.
– I directed the question to the honorable gentleman as Minister representing the Minister for Supply and Shipping.
– I shall ensure that the honorable member’s representations are passed to the Minister for Supply and Shipping, and that he shall be asked to do what he can to assure the best possible use of those facilities.
Sales to New Zealand
– In view of the fact that wheat to-day is worth over £1 a bushel in London and Chicago, and that the Australian Wheat Board is selling wheat to the United Kingdom and to the dominions at approximately that price, will theMinister for Commerce and Agriculture re-open negotiations with the Government of New Zealand regarding the price which it pays for Australian wheat, in order to secure a just payment from it, instead of requiring Australian taxpayers to pay an exorbitant sum so that New Zealanders may have a cheap loaf?
– The honorable member’s question will be given consideration.
-Will the Minister for Commerce and Agriculture inform me whether the Government of New Zealand, under the terms of the Australian-New Zealand wheat agreement, is entitled to use Australian wheat, purchased at 5s. 9d. a bushel, for the manufacture of flour for export overseas ? Will he also state whether New Zealand has exported flour since the delivery of Australian wheat under this agreement? If so, what quantities of flour have been exported, what is the price, and what are the conditions?
– The honorable member for Barker knows perfectly well that, just as Australia may do as it pleases with products which it imports from other countries, so the Government of New Zealand, with one exception, can do as it pleases with the products that it imports.
Grain Sorghums and Maize
– Has the Government yet made any decision with respect to the request made to the Prime Minister and the Minister for Commerce and Agriculture last Friday by the honorable member for Capricornia and myself that licences be granted for the export of grain sorghums ? Will the Prime Minister also indicate what action the Government intends to take with respect to surplus maize? Is the right honorable gentleman aware that since last Friday the grain sorghums growers have been advised that they have been unsuccessful in their application to the Commonwealth Bank for advances to enable them to carry on production?
Mr. - CHIFLEY. - As the honorable member has said, he and the honorable member for Capricornia interviewed the Minister for Commerce and Agriculture and myself last Friday regarding the granting of export licences for grain sorghum, stocks of which, they claimed, had accumulated in fairly large quantities in Queensland. They stated that there was an excess of grain sorghum owing to the fact that other grains were now coming forward. They also made a request regarding export licences for maize from, I think, the Atherton Tableland. I have discussed the matter with the Minister for Commerce and Agriculture, and I agree with the statement which he made to the honorable members, that he could see no justification for the granting of export licences for grain sorghum. It is proposed that as much wheat as possible shall be exported to countries which are badly in need of itparticularly the United Kingdom. Therefore, the Minister considers that grain sorghum should be retained in Australia for stock feed. The Minister is examining the position with regard to maize, in order to ascertain whether it might be advisable to grant some licences for the export of maize from the Atherton district, the particular area which, I think, the Minister has in mind.
– Did the Minister representing the Minister for Trade and Customs read in yesterday’s issue of the Melbourne Sun-Pictorial a statement by the President of the Master Drapers Association to the effect that clothes rationing had outlived its usefulness ? Did the Minister also read a statement by Mr. Hordern, of Hordern Brothers Limited, Sydney, . that, apart from cotton goods, clothes rationing should be abolished? Mr. Hordern stated that certain woollen goods were in ‘greater supply now than they were before the outbreak of World War II. Can the Minister give to the House any definite information regarding supplies available, particularly of woollen goods and certain furnishings? Can he say whether supplies are satisfactory? Will he give an assurance that the rationing of al! clothing will be abolished with the exception of cotton piece goods, which we know are in short supply?
– I shall answer the question. In reply to the honorable member for Deakin yesterday, I indicated that the Government proposed to continue clothes rationing for a number of reasons. First, certain classes of materials, particularly woven cloth, are in short supply, and if rationing were _ abolished, the available stocks might be inequitably distributed. Secondly, the problem- arises of the importation of certain cotton materials from the dollar area. The Government has purchased cotton good9 from Japan, for which payment must be made in dollars. In view of all these circumstances, and the uncertainty of supplies, particularly of woven cotton goods, in the future, the Government proposes to continue clothes rationing. The honorable member for Deakin asked whether the Government intends to continue the rationing of woollen goods, the supply of which has considerably increased. The Rationing Commission is now reviewing this matter. I am not aware of the precise stage which its investigations have reached, or whether it considers that the rationing of woollen goods should be relaxed. However, I shall ascertain the position, and inform the honorable member as soon as possible.
– I ask the Minister for Commerce and Agriculture whether the Apple and Pear Organization Bill, which this Parliament passed during tie last sessional period, has yet been proclaimed ?
– The board to be constituted under the act has not yet been appointed.
Agricultural Machinery - Housing
– I direct the attention of the Prime Minister to the difficulty which farmers are experiencing in procuring agricultural implements with which to increase production. Those in control of Sunshine harvester works report that that firm requires an additional 300 hands to enable it to fulfil orders, and the Australian iron and steel industry requires an additional 3,000 men to enable it to fulfil the needs of home builders. Is it possible for the Prime Minister and the Government to conduct an examination for the purpose of ascertaining whether some public works could be deferred until a later date in order that men may be released for the more .urgent and vital needs of the community?
– At the recent conference of Commonwealth and State Ministers, I indicated that governments should not press on with public works, other than those of the most urgent nature, because all available man-power is required for employment in the iron and steel industry. Firms such as Australian Iron and Steel Limited, Broken Hill Proprietary Company Limited and Lysaghts Newcastle Works Proprietary Limited, which produce iron, steel and galvanized material of various kinds, require all available labour in order to secure maximum production. On that occasion I emphasized that it was not desirable for governments to proceed with public works which would absorb more men and materials than were offering, and that works should not be commenced which would have the effect of attracting men from industries which produce essential goods. However, I shall discuss the matter with the DirectorGeneral of Works, Mr. Loder, to ascertain whether any of the works at present pro ceeding can be curtailed, in order to provide additional men and materials for essential industries.
Tariff Negotiations - Publication of Agreement
– Is the Prime Minister yet in a position to make a statement as to the outcome of the international trade negotiations which have been taking place at Geneva? This information is urgently desired because of the very widespread interest in the matter and the implications of consequence arising from it to important Australian industries. If the right honorable gentleman is not able to make a statement at present, will he indicate, for the information of interested people, about how long it will foe before some revelations as to the outcome of the discussions may be made?
– At a later hour to-day the Minister for Post-war Reconstruction will seek leave of the House to make a statement covering these negotiations which will furnish in a general way the information which the honorable member desires.
– The Prime Minister has indicated that a statement will be made later to-day on the very important trade talks that have been taking place abroad. In view of the pressure of other government business, it may not be practicable in the next few weeks to have a lengthy debate on those matters. Would it be practicable for the Director-General of Post-war Reconstruction, Dr. Coombs, who has returned to Australia, to address members of the parliamentary parties as he did before he went abroad ?
– The Government is most anxious to oblige honorable members on both sides by having these matters explained ; but I think it would be embarrassing to Dr. Coombs- at the present incomplete stage of the negotiations to address honorable members on the negotiations. Certain dates will be mentioned in the Minister’s statement. Later it may be possible to arrange for honorable members to discuss with Dr. Coombs and Mr. McCarthy, of the Department of Commerce and Agriculture, matters with which the honorable member’s question deals. I will try to arrange for a discussion to take place as early as possible.
.- by leave - I wish to make a brief statement .in relation to the tariff negotiations at Geneva in which an Australian delegation has been engaged for some time. Since April, 1947, the delegation has been conducting negotiations with the representatives of seventeen other countries for the readjustment of tariffs and preferences on a mutually advantageous basis. These negotiations have reached finality and the results are being incorporated in a draft general agreement on tariff and trade which is to be laid before the governments concerned for their consideration. The large number of countries concerned involves certain practical difficulties which have to be overcome. In the first place, it is virtually impossible to keep proposed tariff changes completely confidential for an indefinite period. Publication of the results in one country before release in another could be very embarrassing. Moreover, if the published rates differed from those at present in force complications would arise because of the desire of traders to wait for lower rates of duty. Furthermore, the several countries concerned have a variety of procedures for putting trade agreements into force. To overcome those difficulties, a method has been devised to provide for the simultaneous publication of the draft general agreement on tariffs and trade, and for the provisional application of that agreement by the governments concerned. The countries concerned may, instead of adopting the agreement outright, agree to apply, provisionally, its provisions, including the tariff schedules. Their legislatures will then be able to examine the agreement and decide whether or not it should be adopted. Provided the requisite number of governments concur and notify the Secretary-General of the United Nations by the 15th November, 1947, that they are prepared to adopt, provisionally, the draft agreement, the text will be published on the 18th Novem ber, 1947. The Australian Government believes that the proposed agreement will prove advantageous to Australia. Accordingly, it has decided to accept and apply, provisionally, the draft general agreement on tariffs and trade. The following procedure will be followed: On the 30th October, 1947, the final act of the Geneva conference will be signed for the purpose of authenticating the text of the draft general agreement.
On or before the 15th November, 1947, the Government will inform the SecretaryGeneral of the United Nations that it is prepared to accept and apply, provisionally, the general agreement on tariffs and trade. On the 18th November, 1947, if the requisite number of governments have decided to accept the general agreement on tariffs and trade provisionally, the agreement will be published simultaneously in the countries concerned. On that date, the Australian Government will lay the agreement on the table of the House, and introduce the necessary tariff motion. The new rates will become operative provisionally from that date. Later, after the conclusion of the Havana conference and within six months of the tabling of the draft agreement, the Government will decide whether Parliament is to be asked to confirm the agreement and, if it so decides, will seek Parliament’s approval for this course.
A statement on all phases of the Geneva conference will be made to the House later in this session. For reasons I have outlined, honorable members will appreciate that it is not possible, before the date agreed upon for publication, to give any details of the concessions made. However, I can assure the House that the Government is convinced that the draft agreement will create new export opportunities of great value to Australia ; that throughout the negotiations the Government has maintained the closest collaboration with other members of the British Commonwealth; that the agreement takes full account of the legitimate interests of both primary and secondary industries in this country; and, in relation to imperial preferences, that the agreement conforms to the policy enunciated by the Government from time to time in this House.
Beyond these assurances, it would he improper for me to go at this stage. Further, honorable members will realize that speculation is likely to be misleading and embarrassing to all governments concerned. The Government, therefore, invites the co-operation of the House and of the press until publication becomes possible.
– by leave - I had proposed to invite the Minister (Mr. Dedman) to move that the statement which he has made should be printed, so that there might be a debate upon it; but, having regard to its terms, I can quite see that a debate would not be useful at this stage, though a very important one must inevitably occur at a later stage. I am interested to know when that later stage will be, because the statement which the Minister has just read indicates that the Government will lay the agreement on the table of the House and introduce the necessary tariff resolution on the 18th November next. In another portion of his statement, the Minister said : “ A statement on all phases of the Geneva conference will be made to the House later in this session “. Does “ later in this session “ mean on the 18th November, when these other documents are tabled, or on some other date?
– Is the right honorable gentleman speaking of the debate on the tariff schedules?
– I am referring to two matters. An agreement is to be tabled on the 18th November. In the normal course, one would assume, that would be accompanied by a statement. But the Minister used the expression: “ A statement on all phases of the Geneva conference will be made to the House later in this session “. What I am anxious to discover is, whether that means the 18th November, or whether some other date is in mind; because 1 point out that if there is to be a useful debate in this sessional period - and this matter is of outstanding importance - then it must be on a statement that has been made in sufficient time before the end of the sessional period. Although I am not in the Government’s confidence, I imagine that the 18th or the 25th
November will be fairly late in the sessional period. What I and all other honorable members on this side of the House want to avoid is the presentation of this matter a day or two days before the end of the sessional period, when no useful debate can take place upon it.
- by leaveThe statement of the Minister for Postwar Reconstruction (Mr. Dedman) reveals a state of affairs which has been feared by many primary producers in this country; that is, that their rights have been bargained away without their having been -consulted at any time. I speak particularly of those thousands of Australians who are dependent for their livelihood on the canned fruits industry. The Minister’s statement indicates that on or before the 15th November the SecretaryGeneral of the Geneva trade organization will be informed that it is the intention of this Government to accept the agreement, and that, on the 18th November, certain tariff schedules will be tabled in this House and will become operative and binding from that moment. From time to time, as honorable members know, I have questioned the Minister as to what was happening in respect of these trade negotiations, and among the other aspects of his replies he has consistently said that nothing would be done until this Parliament had had an opportunity to come to a decision on the matter. Time and again, the Minister has given to me directly, as well as through his other utterances, the assurance, on behalf of those for whom I particularly speak, namely, those who are engaged in the canned and dried fruits industries, that nothing would be done in respect of the dependence of their industries’ upon Empire preferences, until the matter had been brought before this Parliament, and that this Parliament alone would have the deciding voice as to whether or not any agreement should become effective, and therefore of consequence to those industries. There has now been revealed a condition of affairs which I and others have feared, namely, that the rights of those industries, and the opportunities of thousands of Australians, particularly exservicemen, who, it is well known - and I play now not upon sentiment at all - were settled in hundreds and thousands in the dried and canned fruits industries along the Murray Valley - industries which receded to the very lowest depths of depression until they were stabilized by the Ottawa Agreement and the Empire preferences which ensued from them - are to be jeopardized. It is shameful that an agreement on this matter should have been reached without one grower representative of those industries having been consulted. It is true that a member of the Canned Fruits Board went to Geneva at the invitation of the Government.
– And a member of the Dried Fruits Board.
– And a member of the Dried Fruits Board, as the Minister for Commerce, and Agriculture (Mr. Pollard) reminds me.
– And a representative of the Graziers Association.
– I am particularly directing my remarks, .as I have constantly done, to the Canned Fruits Board. It has on it no representative of the canned fruits growers. The canners are middlemen. Those of them who may suffer a reduction of their prices as a result of an alteration of preferences will be able to pass on their loss by lowering the payments that they make to the growers for the fruits that they receive. The ultimate weight of .any diminution of preferences will not fall upon the canners, who have been consulted by the Government, and among whom are not only co-operative companies but also millionaire canners. Not one grower has been consulted by the Government. I protest against this practice. It is intolerable that the Government should engage in negotiations of such farreaching consequence as this, and not call into consultation one representative of the growers or of their employees, the livelihood of thousands of whom may be jeopardized by whatever decision is to be revealed on the 15th or the 18th November. The Minister may be able to say that there will be no alteration of the tariff. I do not know whether he will or not. If he can do so, let him make the statement now. That would affect no one. But we live in fear that there is to be a downward alteration of the tariff. Whilst I cannot “turn back the clock” in this instance, I protest most strongly against the Minister rising in his place in this Parliament from time to time and saying that no engagement will be entered into by the Government, and be binding upon any one affected, until the Parliament has been given a voice on the issue, and then making a statement of this character, which shows that the Parliament is not to he given a voice in the matter. Having been unable to protect the canned fruits industry, I protest, in the hope that no other Australian primary industry will be- similarly jeopardized.
– by leave - I make it clear that I do not consider that there should be a debate on this matter at this stage. The Leader of the Opposition (Mr. Menzies) indicated the desirability of moving that the statement of the Minister for Post-war Reconstruction (Mr. Dedman) should be printed, in order that there might be a debate upon it. A few moments ago I mentioned to the right honorable gentleman that a further statement would be made on the 11th November.
– Will a debate take place on that day?
– That is a matter to be decided. The general practice is to move, “ That the paper be printed “. Another statement will be made on the 18th November, when the Minister tables certain papers. The debate cannot be continued at this stage. The honorable member for Indi (Mr. McEwen) suggests that certain rights have been bartered away. The only information that the honorable gentleman will get at this stage is that it is the desire of the Government to protect the rights of every primary industry in Australia, and, if possible, to confer advantages on every industry. All I desire to intimate now is that a further statement will be made on the 11th November.
– I move -
That, in accordance with the provisions of the Commonwealth Public Works Committee Act 1913-1936, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for investigation and report, viz.: -
The erection, at Canberra, of a threestoried building to accommodate the administrative staff of the Divisions of Economic Entomology and Plant Industry of the Council for Scientific and Industrial Research.
The original design for the buildings for the Council for Scientific and Industrial Research, at Canberra, was prepared by the Federal Capital Commission. It provided for the central block and for two laboratory wings for the Divisions of Economic Entomology and Plant Industry, respectively, which have since been erected. The project now under consideration contemplates the completion of the original proposal by the erection of the central block between the existing wings. The building is required to relieve the congestion which exists in these two divisions, and to provide accommodation for the executive and clerical staff and the library. In addition, constanttemperature rooms for entomological and botanical research are included.
– Will it be a permanent building?
– Will it have some architectural merit, by way of a change ?
– That is a reflection on my officers.
– It is time we had some investigation.
– The motion provides for investigation of the proposalby the Public Works Committee, on which the Liberal party is represented.
The building has been planned to harmonize with the existing wings; the structure will be of brick with reinforced concrete floors, beams and columns. The estimated cost is £70,000. I lay on the table of the House the plans of the proposed building.
Question resolved in the affirmative.
Debate resumed from the 2Sth October (vide page 1424), on motion by Mr. Chifley -
That the bill be now read a second time.
.- Last night I listened to the honorable member for Reid (Mr. Lang) explain his financial policy. Apparently, the honorable member has forgotten nothing and has learned nothing, because the financial policy which he then advocated is precisely the same policy as that which was in operation in New South Wales during the depression years - a policy which forced the New South Wales State Savings Bank, a very good institution, to close its doors until it was subsequently taken over by the Commonwealth Bank, and destroyed the economy of New South Wales. Under the Lang regime there was a great deal of unemployment. That Government’s administration so damaged New South Wales that the State has not yet completely recovered. Fortunately, the people of New South Wales were given an opportunity in 1932 to express their views regarding that Government’s continuance in office. At the elections which took place in that year the Lang party was overwhelmingly defeated, and never again did it have a majority in the Parliament. As a democrat, I accept whole-heartedly the decision of the people on that occasion. I believe that it was a sound decision.
The bill now before the House is the most important piece of legislation that has ever been placed before a British parliament. No more vital measure has ever been debated in this chamber, nor has feeling in regard to any legislation run so high in this country as is evident in the community to-day. It is tragic that such feelings of animosity should be aroused at a time when the needs of a post-war world emphasize the necessity for all sections of the community to pull together. The measure before us has sprung from a High Court decision which, rejected the Government’s attempt to force local’ governing bodies to bank with the Commonwealth Bank. That attempt was an act of coercion,- and from it sprang this further attempt to expand that coercion to the whole of the people. But there is a wider significance in the Government’s attempt to curtail the power of local governing bodies. In season and out of season the Labour party protests that it is hostile to communism, and is fighting communism all the time. There is one effective way in which to fight communism, and that is by legislating to divert power into as many fields as possible. In the multitude of small authorities lies the power to combat the menace since communism depends for its success on the concentration of power in one central body. It is for that reason that Communists are very loud in their praise of this bill. If the measure is to be regarded as a means rather than an end, it stands for the passing of a British tradition and of institutions with which we are all familiar. An institution is something hard to define, but we frequently describe it as “the British, or the Australian, way of life “. Summed up, it can be expressed in the word “ liberty “ - the liberty of every man, woman and child in the community. Liberty is of paramount importance, but the introduction of this legislation marks a change in our way of life - not so .much in what it proposes to do, but in that it is evidence of what the Government intends to do. If we yield to temptation, and just regard this bill as another measure little different from others containing threatening possibilities, we do not really see this change for what it is. However, when we view the proposal in its true perspective and against the history of the Labour party, we are staggered by the results which will inevitably follow the passing of this legislation. Three facts are outstanding in the history of the Labour party during the last quarter of a century. The first was the adoption of the socialist objective in 1921 - adopted under the pressure of the Communists. In the same year, an all-Australian conference of trade unions scrapped the Australian objectives of the Australian Labour party, and substituted the Marxist theory of socializa tion, including the socialization of the means of production, distribution and exchange. At the same conference, the nationalization of the banks was made a vital step towards the attainment of the party’s objective. During the intervening 25 years, this proposal has been revived from time to time, but has never been revised. The honorable member for Darwin (Dame Enid Lyons) pointed out that part of the platform of the Labour party was dropped on this occasion, namely, the part which asserted the right of every man and woman to the fruits of his or her own labour. Also, at this conference, was dropped another objective, nairnely, the cultivation of an Australian sentiment. The significance of that omission was not apparent then, but it is clearly apparent now. Indeed, it was a logical step to take in view of the adoption of the objective of socialization. Socialization is completely foreign to Australian sentiment. It is completely in accord with the woolly thinking and international sentimentality inherent in the Marxist theory. As for the nationalization of banking, this was never referred to by Labour leaders except in connexion with the general implementation of the socialist programme, and that is a highly significant fact. When it was mentioned as an independent issue at a general election in the early ‘thirties, the Labour party was roundly defeated. That is why the Prime Minister has kept very quiet about the matter in the past. Noreference was made to it during the last federal elections in 1946, because the Government recognized its association with the final objective of complete socialization.
We are now considering part of the Labour plan which was devised 25 years ago. The Labour party has at last realized that it cannot implement its programme without nationalizing the banks. Labour voters have at last been taken into the confidence of the Government. At last they realize that they have been led up the garden path by Labour extremists. Labour leaders have been putting something over the country which they would not have a ghost of a chance of putting over if the people had known where they were being led. The present fight is between total socialization and enlightened democracy. I know that the cards are stacked against the Opposition, and that the Government has the numbers. When this bill becomes law the people will merely be numbers. We shall not then refer to a man as Bill Smith, but as No. 2604 on the electoral roll.
Something as personal as banking cannot be effectively carried out if associated with red tape. The farmer, who is essentially an individualist, knows only too well that he can get far more rapid and efficient service under a competitive system of banking than from a monopoly government bank. In saying this I am not attacking the Commonwealth Bank, “but merely stating a fact which is recognized all over the world. A government monopoly is far .less flexible, and renders a less courteous service, than free enterprise. ‘ A government monopoly, with the best will in the world, cannot be sufficiently flexible or elastic. Let us consider one particular instance, which could be typical of others throughout the whole community - the case of the stock and station agent, or the drover. Without having any security except his good name, his reputation, in fact, he can obtain financial accommodation from a private bank in order to buy stock. Then, after waiting a time, he sells the stock, and adjusts his account. All this is done without his having lodged any security whatsoever. Many a deal of this kind has to be settled within a few hours. A farmer may come in to a bank at 10 o’clock in the morning for financial accommodation, which must be at his disposal by 12 o’clock to enable him to buy sheep or fodder or to engage men who have turned up for harvesting. The local manager of a trading bank will say “ Yes “ or “ No “ immediately to the request, depending on his knowledge of the applicant; but the monopoly government bank will tell him to wait his turn - to get at the end of the queue. He will then have to fill in the necessary forms, and wait for a decision. By the time the decision is conveyed to him the stock may be sold, or the fodder may be sold, or the men whom he had hoped to engage may have grown tired of hanging around, and have drifted off to other jobs.
If an individual takes risks he will progress, but if he plays for safety, no progress can be made. It was the taking of risks that developed the independent, pioneering spirit which played so large a part in opening up the country and which, incidentally, produced the best fighting men in the world! That spirit would perish under regimentation and socialization. Some might say that the Germans were good fighters, but no one can deny that the Australians, considering their smaller numbers, possessed spirit and initiative which has never been equalled. That spirit and initiative will not exist under regimentation, or socialization. This measure will destroy once and for all the pioneering spirit that developed Australia. Under the socialist State, to which we are surely heading, the economic activities of the people must conform to a rigid pattern. Under socialization, improvization is not necessary. On the other hand, with free enterprise there is initiative, drive and independence of thought and action, and all those great qualities and talent, which have made Australia a great country, because under free enterprise a man is rewarded for his efforts, for which he receives the profit which honorable members opposite despise. The profit motive which they decry so much is essential to a farmer to enable him to carry on his farming. He needs profit to build up reserves, meet drought and lean times, look after his flocks and herds, maintain pasture improvement, fencing and to purchase farm machinery. He must have that profit motive no matter to what degree the Government might despise it. He needs it to maintain his family; and without it he will have to accept a low standard of living, and become a mere cog in a vast socialist machine. If this bill be passed, because it means total socialization, it will annihilate free enterprise and destroy the profit motive and make the individual subservient to the State whereas the State should be subservient to the people.
The small storekeeper is a very important unit in country centres, because in times of drought, through the credit he himself received from the private banks he is able to carry the f armers. The storekeeper is well known to the local bank manager, and, therefore-, is not required to lodge security for money which he borrows. II the banks did n’ot help him he could not help many small farmers. I do not believe that any farmer would deny that he has received help in difficult times from his storekeeper. But under a monopoly bank, farmers will have countless forms to fill in. There is no reason to believe that this system will b’e any ‘different from any other government system. Securities will have to be lodged under forms “ XYZ “ before any advances are made, because government red tape is not sufficiently elastic to meet changing circumstances. It has been said that competition does not exist in country towns between local banks. Every bank manager will admit that he has lost and gained accounts through competitive business. In any country town, bank managers will take an account from another bank for various reasons, one being that he can offer better accommodation. The fact is that competition is very keen between banks in country towns.
All of us realize that the wounds caused by the depression were very deep, and that some of those wounds will take a long time to heal. I emphasize that the depression in Australia was accentuated by our reliance upon export industries. Every one, I believe, is convinced that greater support must be given to primary industries if we are to avert another depression. One of those lessons we learned in the past is that we must safeguard primary industries. Payable prices must be assured to primary producers, and, in fact, to all producers. Such a policy^ combined with a wellplanned programme of public works, will undoubtedly help Australia to meet any future period of low export prices. During the last depression we witnessed the spectacle of the Government and the Commonwealth Bank resisting exchange depreciation, but this was eventually forced by the trading banks and proved most beneficial to primary producers and our exporting secondary industries.
No doubt, we shall be told that no great change will be felt by the community as the result of this measure. The fears of the people will be lulled, because they will not feel- the shackles immediately. Under total socialization-, primary property will disappear. Farms will be converted to collective farms, and private ownership will cease to exist. By nationalizing production, which is the declared .objective of the Labour party, and by ‘lending money to farmers through a government monopoly bank, the Government will acquire farms and property. I have heard it said that primary producers should not own land, because all land belongs to the people. The Government will acquire all farms and properties. We shall then have the Russian system of collective farming, and our primary producers will continue on the land as employees of the Government. They will just fit into a pattern of collective farming.
In the meantime, we shall have inflicted upon us a savage control over all our activities. The District Agricultural Committees which were set Up during the war put the farmer in a strait-jacket, until none could put up with the system any longer. That was the price the farmers had to pay during the war as part of their contribution to victory. Their freedom was restrained by those committees which told them how to run their farms; but when this measure is fully implemented the economic planners, with supreme delight, will embrace far more activities than ever before. The Government will have complete power over economic enterprise.
The Prime Minister (Mr. Chifley), in his second-reading speech, ‘emphasized that primary industries will have the aid of agricultural experts who, I understand, will be attached to the monopoly central bank. Agricultural experts are nothing new. The States already have agricultural experts in this field and they are doing good work. In addition, many private trading banks also employ agricultural experts whose advice and services are available to clients. However, whilst the advice of the private banks’ agricultural experts is available to any farmer, he can please himself whether he accepts it. Should a farmer prefer not to act upon the advice of one bank’s agricultural expert, and by so doing prejudice his chance of obtaining accommodation at that bank, he is free to go to another bank. Under the government monopoly bank, however, farmers will have no choice in that respect. The local bank manager, in his dealings with the farmer, will naturally be largely influenced by the farmer’s acceptance or rejection of the agricultural expert’s advice. No doubt, money will be loaned to the farmer provided he follows the advice of the agricultural expert. Under that system the farmer will be told what stud sheep he should have, whether a particular breed is suitable for this or that property, that he should change, for example, from Romney Marsh to Corriedale and should he refuse to accept the advice he will not be able to obtain financial accommodation. Under that system he will not have the choice he now enjoys. The wheat-farmer will be told that he should not be growing wheat, or that he should be growing a different class of wheat. If he does not change his plans and conform with the advice given by the agricultural expert or the manager of the monopoly bank, he will find that accommodation is not. forthcoming and he will have no other bank to approach. The bureaucrat’s idea is that the individual does not count. It would be bad enough for a rural community if nothing more happened than the slowing up of the making of advances; but as soon as banking is nationalized government rules and regulations will become the masters of any situation, and this form of control will increase as the approach to total socialization continues. The people demand that they shall be consulted on this vital ‘bill. It is of no use for ‘honorable members opposite to pretend that the petitions presented to this House against the nationalization of banking have nil been “ jerrymandered “. ‘Such a suggestion is absurd. At most, those who doubt their genuineness might disregard 5 per cent, of the Signatures as being doubtful ; the remainder are genuine expressions of opinion of the people. If the people arc to be consulted, this Government should take the democratic way and hold a referendum. We all know that there is to be a referendum on the continuance of prices control. It is only a matter of tacking on one additional question at the bottom of the form to be presented to the electors. Thus, the Government cannot, plead that its refusal to submit this matter to a referendum is dictated by a desire to save the expenditure of public money.
The war revealed to democratic governments the ease with which policies can be implemented by the use of unlimited controls. Total war against totalitarian foes necessitates resort to unlimited controls; but the very convenience of unlimited controls has found a place in the regard of governments which have made release from them more and more difficult. Those who have tasted power rarely relinquish it voluntarily.
.- It is with great pleasure that I rise to say a few words in support of this most important bill. This nation has, at last, arrived at a stage in its development which has long been the cherished objective of the Australian Labour movement. The people have for too long been held in thrall by the private banking system. I was a ‘boy at the time of the bank crash in IS 93, but I well remember the bitterness and resentment of the people against the banks. At one time, I’ did not think .that I would live long enough to see the day when a government of the Commonwealth would have sufficient courage to introduce a measure for the nationalization of banking. I make no apology for the stand I take on this important subject. Many years before I came into this Parliament I advocated the utilization of the national credit of Australia in the interests of the people generally, as opposed to the interests of the wealthy and privileged few. Almost every man, woman and child in this country has suffered bitterly as the result of the control of the financial system being left, in the hands of the private banks. Much has. been said of the dire happenings that will befall the country should this legislation be placed upon the statute-book. These dismal forebodings are not new; the same arguments were advanced many years ago, when the Labour government of the day fought hard . to establish the Commonwealth Bank. Let us, for a moment, cast our minds back to 1910, when the Labour Government saw fit to establish the Commonwealth Bank for the benefit of the people of Australia. Among the great protagonists of that proposal were the honorable member for Batman (Mr. Brennan), the right honorable member for Yarra (Mr. Scullin) and some of the great Labour men who have gone to the land whence there is no return, principally the late Dr. Maloney, formerly honorable member for Melbourne, and Mr. Frank Anstey, formerly honorable member for Bourke. Perhaps the greatest of them all is now listening to this debate. I refer to Mr. King O’Malley. What a hard fight these men waged to bring the proposal before caucus and the people of Australia. The draft legislation was first brought before caucus on the 5th October, 1910. It was the subject of great controversy. It was said throughout the length and breadth of Australia by the antagonists of the proposal that the bank would rule Australia within twelve months. What a misrepresentation of fact! The same misrepresentation is being indulged in to-day. What a sorry position would have confronted the primary producers had not the Commonwealth Bank functioned during World War I. The proposal for the establishment of the Commonwealth Bank was subjected to intense and hitter opposition. Caucus meetings were held at the homes of honorable members in Melbourne, principally those of the late Dr. Maloney and Mr. King O’Malley, at which rankandfile members of the Labour movement were given the fullest information about the proposal so that they would be fully aware of the great benefits it would confer upon the people. The draft legislation was finally approved by a majority of caucus in November, 1910. Had it not been for the valiant efforts of great Labour men the Commonwealth Bank would not have been in existence to-day. No thanks are due to members of the parties opposite for its establishment. What a great service the bank could have rendered to the people of Australia in the period between World War I. and World War II. had it not been strangled by the Bruce-Page Government. Had it been afforded an opportunity to function, as it was intended to function by the Labour party, there would have been no need, to introduce the bill now before us. . Unfortunately governments of the political colour of honorable members opposite assumed office in this country and fettered the bank in every way. Despite that, however, and despite all the hostile propaganda of vested interests throughout the years, the bank is still in existence. Though it did not progress as its propounders hoped, it is at least still in existence. My cherished wish is that it will become the sole bank in Australia.
Before this bill was introduced the people were told by honorable members opposite that if banking were nationalized overdrafts and loans would be called in, bank managers and their staffs would lose their positions, and that there would be a complete disruption of the banking system in Australia. I have great admiration for the managers and staffs of the private banks. From messenger boys to managers, they are competent officials. They have nothing to fear from this legislation. They will still carry on their avocation of banking when this bill becomes law, and they will exercise just as much authority then as they do now under the existing terms of their employment. The only difference will be a change of ownership from the private banks to the great Commonwealth Bank of Australia which will function in the interests not of a comparatively few shareholders, but of the people as a whole. I was pleased indeed to hear the Prime Minister (Mr. Chifley), in his second-reading speech, give an assurance, not only that the rights of the managers and staffs of the private trading banks would be safeguarded when nationalization has been accomplished, hut also that their privileges would be increased. That was an effective reply to the bogy raised by the Opposition that private bank staffs would be prejudiced by the change.
In the early days of World War II., we heard a lot from honorable members opposite about the “ new order “ that would be enjoyed by our service men and women when they returned. This promise was shouted from the house-tops, broadcast by. radio, and printed in the press; but now that this Government is making a sincere attempt to create a “ new order “, it is condemned by the Opposition parties. How can a new social and economic order be brought about in this country if the national Government does not have control of the national credit? The key to any new order must be control of the national finances. The sorrows of the depression are still fresh in the minds of many of us; hut too many people arc prone easily to forget the past. They claim that this measure will deprive Australian citizens of their freedom, but that is as different from the truth as darkness is from light. It is to prevent a repetition of the conditions that brought to this country hunger, unemployment, the dole, and necessitated legislation such as the Moratorium Act and the Farmers’ Debt Adjustment Act, that the Government is taking this step. In those days, the degradation of the individual mattered little to the bankers ; they were concerned only with getting their pound of flesh. These things cannot happen under Labour’s “ new order “. Questions have been asked about a “ golden age “ ; but the “ golden age “ is here, due to the efforts of this Labour Government, and, despite the misrepresentation of- Labour’s policy that has been broadcast throughout the length and breadth of the Commonwealth during the last couple of months by members of the Opposition and their supporters, we intend to ensure that the “golden age” shall remain. One often hears the expression “ Give me the good old days “, but I have many bitter memories of these alleged “ good old days “. I do not want to carry my swag again, nor do I want to see the rising generation on the dole.
The proposal to establish the Commonwealth Bank was condemned by alleged banking authorities all over the world in 1910 and 1911, but. the Australian Labour Government, then in office, persisted, and the bank opened its doors for business in 1912. World War I. broke out in 1914, but despite its comparative recent establishment, the bank was able to render outstanding national service during that conflict. Its operations were of particular value to primary producers. For the information of those honorable members opposite who would deny this, I shall quote from Australia’s Government Bank, by L. C. Jauncey, and prove to the people of Australia the magnificence of the job done by that institution. The book states -
War finance made the Commonwealth Bank a leading bank in the world. Besides offering aid to ordinary banks, it granted to the
Commonwealth Government an overdraft in London during August, 1914. of £100,000, and in September of the same year loaned £130,000 to the Commonwealth Government. It aided Australians in England and continued uninterruptedly to negotiate in London bills of exchange on Australia. It also redeemed Australian notes and silver. At the request of the Minister for Defence it arranged for the provision of funds for the purchase of horses for the Expeditionary Forces so that departmental officers did not have to wait for passage of a supply bill before purchasing and paying for the horses.
It was in connexion with the war loans, however, that the Commonwealth Bank became important. The “ Bond House which has become so prominent in the American financial structure, does not exist in Australia. Banks or syndicates of banks generally underwrite large security issues, while groups of capitalists underwrite smaller issues. The Commonwealth Bank handles the issues of the Commonwealth Government. In 1915 the Federal Government, for the first time in its existence, appeared before the public as a direct borrower. In a country that had never known a local loan of any size, when Australia’s financial resources were practically an unknown and untapped quantity, in six years its people subscribed £257,719,989.
The total cost of flotation of the ten loans was only £705,747 or 5s. 6d. per cent., which compares favorably with a possible cost of over £5,000,000 or 40s. per cent, had the loans been raised in Britain. At a luncheon in 1918, given by the Royal Colonial Society in London, in honour of Governor Miller, the guest of honour said that the six war loans issued at that time had been floated by the Commonwealth Bank at 4s. 6d. per cent. Yet loans floated between 1910 and 1915 cost £2 7s. Id. per cent. These loans were floated by private banks. Governor Miller of the Commonwealth Bank reckoned that the bank had saved Australia £3,260,000 by handling the loans.
And that is the bank that was to ruin this country and bring poverty and misery to our people! The same propaganda is being circulated throughout the Commonwealth to-day by anti-Labour forces. They say, “Don’t let the Commonwealth Bank control the finances of Australia, or you will all be ruined “. But the Commonwealth Bank will come to our rescue again. The figures that I have quoted indicate clearly that the arguments of Opposition members are not sound. The book also states -
While the war was raging, the Commonwealth Government inaugurated pools for the sale of wheat, wool and primary produce. The Commonwealth Bank financed these pools and handled on behalf of all pools over £437,000,000.
The Royal Commission on the Wheat, Flour and Bread Industries, which was known as the “ Gepp Commission “, reported in 1935 that the wheat-growers and wool-growers of Australia owed practically £300,000,000 and that other primary producers owed about £200,000,000, making a total indebtedness of about £500,000,000 to the financial institutions on which they had to pay interest. They would never have been able to meet the principal had they been called upon to do so. I claim, however, that that indebtedness never existed in actual cash lent by the banks to the primary producers. The Leader of the Australian Country party (Mr. Fadden) last night referred to this legislation as a confidence trick. It is not a confidence trick. It is the necessary measure to bring to an end the greatest confidence trick that could ever be played on the people - the private banking system. I remember as a boy at country shows trying to pick the thimble with the pea under it. I never could, the pea was never there. The £500,000,000 owed by the primary producers to the financial institutions has about as much substance as the pea that was not there. Honorable gentlemen opposite who have engaged in primary production know as well as I do that the private banks will not lend men money with which to transform bushland into wheat-fields or pastures. “No,” they say, “ come back again when you are producing and we will then see what we are able to do for you.” The assets of the primary producers on which the private banks are prepared to risk their money are those created by the toil of the farmers. That the private banking system is a gigantic confidence trick wa3 proved by the 1S93 bank crash, which disclosed ‘ that the banks had absolutely nothing behind them. The Commonwealth Bank has the entire wealth of Australia behind it. My next-door neighbour, who has now gone to the land whence there is no return, told me three years ago that he had never been repaid the money that he lost when the bank in which lie had placed his savings crashed. There are many like him. History is full of examples of the ruthless exploitation of primary producers by the private banks. The story of the settlement and development of the Goulburn Valley is a splendid instance of the way in which the bankers are prepared to enrich themselves at the expense of unlucky settlers. They worked from daylight to dark to develop their farms. They had to borrow on mortgage to make improvements. In a time of low prices they were unable to meet their commitments and the banks foreclosed. Land that the banks got thereby for £3, £4, or £5 an acre they were soon afterwards able to dispose of at from £15 to £20 an acre. Private bankers know no mercy, whether they be in this country or any other country. They have proved that by words and action. The Australian Labour Government will no longer tolerate their operations and this bill has been brought down to ensure the security of the people and, incidentally, to ensure cheap money, but that is a subject which I propose to deal with later. I want the people to remember the part played by the private banks in the financial and economic depressions that this country has suffered. Unhappily, though, people’s memories are short. Few people to-day, except those who were enmeshed in it, remember the bank crash of 1893. It will not be long before the people will have forgotten the depression of the ‘thirties. Oan any one honestly say that that depression was not man-made. The wheat-fields provided bountiful harvests and the pastures abounded with sheep and cattle, but thousands of mcn walked the roads of New ‘South Wales and other States searching for work. Jobs could not be found for them, notwithstanding the crying need for development of the country. Need existed for extension of electricity services, sewerage, homes, bigger hospitals and countless other public works. . In the midst of all that demand for works to be undertaken there was a dearth of work offering, and men were driven to bankruptcy and even suicide. How can we ever forget that. It would be amusing if it were not so tragic to hear the protestations by honorable gentlemen opposite of “Hands off the banks “. It is high time Australia had a government willing to accept the responsibility to ensure, through the control of national credit, to coming generations the prosperity that is their right. I find it difficult to credit with intelligence honorable gentlemen opposite who try to lead the Australian people to believe that the Government is not sincere in this measure, because they must recognize that whoever was entrusted with the development and administration of the country, whether it was a team or one man, the first need would be money with which to do so. It is money that we have been refused hitherto. In the depression of the ‘thirties, men were refused the right to work in order to earn money with which to maintain themselves and their families; but there is no need for me to labour that point, because everybody is aware of its truth. We were told that money could not be provided to undertake all the work that ought to have been undertaken. It is difficult to imagine any government allowing itself to be dictated to by the financial magnates, but, in the circumstances, the Scullin Labour Government had to bow to their demands. That Government was forced into the depression by Sir Otto Niemeyer, acting on behalf of the Bank of England, the Bank of France and the Bank of Germany at that time. When it wanted to secure a few million pounds, in order to give the workers of this country a chance to earn a livelihood and the wheatgrowers a chance to pay their debts, this combination of financial interests withheld its help. They said, “No, we cannot give it to you. However, if you will reduce wages and salaries, old-age pensions, and soldiers’ pensions, we might accommodate you “. And so the Government had to bow to them. Why was this so? It was because the Commonwealth Bank was not functioning then as it had functioned previously and will function again. Had the Commonwealth Bank controlled the national credit of Australia then, such a tragedy would never have been allowed to occur. The Scullin Government would have been able to obtain the funds that it needed to provide full employment for all, just as this Government now intends to do. Full employment means prosperity not only for the workers but also for people in every other class throughout the world. When a man loses his job he loses his income. When the people lose their incomes the circulation of money stops. This strikes alike at small businesses and big businesses, primary producers and consumers. The nation needs the flow of money through the community just as every man needs the flow of blood through his veins to keep his heart beating. As I have said, the financial magnates dictated to the Labour government during the depression and caused misery throughout the nation.
We have often heard it said that such, and such an investment is “ as safe as the Bank of England “. I remind the people that the Bank of England closed its doors for four days once and made a piece of white paper legal tender for the debt that it owed to its depositors. The present banking system has failed miserably on many occasions, causing suffering to people all over the world. Such a failure precipitated the world-wide depression, in which Australia suffered bitterly. It will go down in history as a standing disgrace that anti-Labour governments did not enact legislation to alter this system. Honorable members opposite say, “Don’t alter the present financial system. It has stood the test of time “. It has not stood the test of time. It has failed .under tension in the past, and it will do so again, if it is allowed to survive, because the magnates want it to fail when such an event suits their purposes. High finance knows no mercy. As the Minister for Transport (Mr. Ward) said earlier in this debate, the banks had no mercy when they took a pension from a hobbling “ digger “ who had lost a leg fighting for his country.” I have an intimate knowledge of that case. The victim lived in the Gwydir electorate. The honorable member for Reid (Mr. Lang) will remember those days, when, at the depth of the depression, he fought against the policies of anti-Labour governments and enacted special moratorium and debt adjustment legislation in New South Wales. The passage of that legislation, sponsored by the honorable member’ when Premier of New South Wales, prevented thousands of primary producers being forced off the land. As it was, 8,000 farmers left their properties - some of the best of Australia’s workers were pushed off their farms because of the recalling of overdrafts and foreclosures on mortgages ! Yet honorable members opposite want to retain the system which made such dreadful things possible ! I refer -again to the case of “ Digger “ Wilkins, which was mentioned by the Minister for Transport. This man, who had offered his life for his country and had lost a leg in fighting for it, had a flourishing business. But the financial magnates, who now talk about this Government taking away the freedom of the people, took away the freedom of this man who had already suffered dreadfully in the cause of freedom. They took away his business by means of a law enacted by an anti-Labour government, against which the present honorable member for Reid had warned the people. The honorable gentleman said, at. that time, that if this law were enacted the farmers would lose their properties. His words were prophetic. “ Digger “ “Wilkins lost a business worth £30,000. He was employing labour, the business was flourishing, and it was backed by guarantors. He was assured by the then Minister of Justice in New South Wales that his property would be safe, and so he continued to give his loyalty to the Country party. What was his reward ? He was put out of business and pushed off his farm, and his pension was seized by the banks for the payment of interest. Yet honorable members opposite talk about what the banks have done for Australia! They should talk about what the Australian people have done for the banks. They have worked for the banks, .died for the banks, and given all their production to the banks.
The findings of the royal commission which investigated the wheat and bread industries in 1935 disclosed the heavy burden of Dank interest that had to be borne by primary producers. This Government has already considerably reduced interest rates so that the farmers may have a chance to profit from their own labours. I speak with feeling on this subject, because I have had bitter experience of the burdens imposed by bank charges. I have had to pay interest at the rate of 7-J per cent, on overdrafts and mortgages. This Government has steadily reduced the rate until to-day the Commonwealth Bank will advance money on mortgage and overdraft at 4 per cent.
The finding of the “ Gepp commission “ was that an interest charge of 1 per cent, made a difference of Id. per lb. to the return obtained by the producer for his wool. Imagine that ! That was the finding of the commission, not just an opinion. At that time wool was worth between 7d. and 9d. per lb. In other words, with interest rates at the then prevailing levels, the entire profit of the woolgrowers was eaten up by interest charges. The late Mr. “Ernie “ Field, who knew the wheat industry as intimately as any man in Australia, supplied figures to the commission showing that interest charges robbed the wheat-growers in the same way. He said that interest rates represented a charge to the wheat-growers of ls. 3d. a bushel. Wheat was then worth between ls. 6d. and ls. 8d. a bushel. 1 myself sold wheat for ls. 3d. a bushel in those days. In fact, I had 300 bags of wheat which I could not sell. It had no value. One of my neighbours took a load of wheat to the yards, but carried it back to his farm because he could not secure an offer for it. That was how the banks starved the primary producers during the depression. Yet honorable members opposite oppose this bill because they say that it will be detrimental to primary producers! Nothing could be further from the truth. This Government has already reduced interest charges to 4 per cent., and I hope that I shall live to see the day when the maximum rate is 2 ner cent. We must not go back to the old conditions. We must reduce interest rates for the benefit of the rising generation. Every honorable member has a responsibility to do what he can for the baby in the cradle, for the boys and girls who are too young to think of their future. This Government has realized its responsibility and has accepted it by introducing this legislation to control the nation’s finances. I repeat that I am delighted to be associated with this Government, which has set out to honour a promise which it made to the electors in 1945.
Something has been said about the Government not having a mandate for its action. Our mandate is contained in the Commonwealth Constitution, and has existed since 1901. Of course we have a mandate ! Whenever I have spoken from a public platform, I have advocated the nationalization of banking. I make no apologies for my determination to support the bill. Honorable members opposite declare that the Government should ascertain the views of the people, by way of referendum, before proceeding with this legislation. Did they seek to discover the views of the people when they forced the unemployed to accept the dole? Of course they did not! Did they conduct a referendum when the conditions of primary producers became so desperate that they were forced to take advantage of the farmers’ debt adjustment provisions? Of course they did not! At present, however, the financial manipulators are endeavouring to mislead the people, and are disseminating false propaganda. In the circumstances, naturally they demand a referendum. On their campaign against this bill they are expending hundreds of thousands of pounds, as they expended hundreds of thousands of pounds in a futile effort to defeat the legislation that established’ the Commonwealth Bank many years ago.
I have received a number of petitions, letters and telegrams condemning the Banking Bill. But I have also received letters and telegrams congratulating the Government on introducing this legislation. The Labour party is in favour of the nationalization of banking; the Liberal party and the Australian Country party are opposed to it. “We contend that our view is right and that the view of honorable members opposite is wrong. If the majority of the people did not believe in the legislative programme of this Government, why did they return us at the last elections? When the Parliament was considering the banking legislation in 1945, the Prime Minister made perfectly clear the attitude of the Labour party. We are not here under false pretences. Therefore, I make no apologies to friend or foe for the stand which I take on this legislation. Even if, at some future elections, I am defeated, I shall still be highly delighted because I was associated with the passage of this magnificent bill. All this talk about the Government having no mandate to nationalize banking, the necessity for holding a referendum, and the threat to the freedom of the people may be ignored. I regard it as “ eyewash “ and hypocrisy of the worst kind. I make that statement intentionally, conscientiously and honestly. The people knew what they were doing when they returned the Labour Government to office at the last elections. They knew that if they did not vote for the Labour party candidates their freedom would really be in jeopardy. No one knows that better than honorable members opposite, yet they contend that under this legislation the Government will be able to deprive the people of their freedom. Had it not been for the efforts of the Labour Government the Australian people would have lost their freedom long ago. My deepest regret is that some of the men who fought in the armed services of Australia are not here to-day to see how the Government, under this bill, is attempting to provide for the welfare of future generations.
Some of the criticisms of the bill are most unfair. I have paid close attention to the various arguments in favour of the trading banks, and to the statements that when this bill becomes law the Government will be able to socialize industry and ruin many people. My retort to those assertions is to ask, When Australia was in danger of invasion, what did honorable members opposite do? In the darkest hour that this fair land of the Southern Cross has ever faced, an antiLabour government said to the Labour party in this Parliament, “ You take over “. We did so. When our freedom from aggression was assured, we decided to preserve it in future. This bill may be regarded as the means for granting to the people control of the national credit of the country. Perhaps the most important matter of all is the control of the national credit in the interest of the community. The welfare of future generations of Australians depends upon this control. The banking system based on private financial institutions has failed on two occasions in my life time, and unless the Parliament passes this bill it will fail again. The nationalization of banking is the remedy.
Before I conclude, I desire to refer briefly to an episode in the life of Abraham Lincoln, who was one of the greatest democrats that the world has ever produced. During the American civil war, Lincoln said, “ We have to fight two wars. We have an enemy at our front and an enemy at our back “. We in Australia have beaten the enemy at the front. We have still to fight the enemy within our gates. One of the telegrams which I received read -
Abraham Lincoln was murdered for preaching financial reform. Ben Chifley is a marked man. You will be a marked man if you turn “him down.
No person need fear that I shall withdraw my support of the bill. Nobody in Australia is more pleased than I am to-day, because I have the privilege and the opportunity to speak in support of this bill, which will ensure the security and happiness of generations of Australians.
– Order! The honorable member has exhausted his time.
.- It is refreshing to hear the honorable member for Riverina (Mr. Langtry) declare his faith so stoutly in his old leader, the honorable member for Reid (Mr. Lang). Everything which the honorable member said about the reductions of pensions relate to the policy of the honorable member for Reid. It was the Scullin Government that reduced social services. However, I desire to make two comments on his speech. The first relates 4o the indebtedness of the wheat-growers. If the Government will allow the wheatgrowers to receive world parity, which is now 19s. 6d. a bushel, for the whole of their crop, they will be able to discharge nearly the whole of the huge indebtedness that they now carry. I recommend the Government to do that. It would be probably the best kind of monetary reform that it could make. My second comment is prompted by the fact that the honor-, able member for Riverina read an extract from Australia’s Government Bank, by L. C Jauncey. On page 274 the following passage occurs under the caption, “ Outstanding Personalities in the History of the Bank “ : -
Four men stand out in the history of the Commonwealth Bank, King O’Malley, Governor Miller, Dr. Earle Page and Sir Robert Gibson.
On page 276, the author describes the policy which I adopted towards the Commonwealth Bank. He wrote -
Dr. Earle Page had an important role in the efforts to make the Commonwealth Bank a central bank. As Federal Treasurer he introduced the Commonwealth Bank Bill of 1924, which gave to the bank the main features of central banking. Acting on the advice of Sir Ernest Harvey, Dr. Earle Page separated the savings bank business from the Commonwealth Bank. Dr. Earle Page was also instrumental in getting legislation passed to establish a rural credits department to the Commonwealth Bank, and although this department does not yet deal with individual farmers, the Act of 1925 laid the foundation for a more extensive rural credits department in the future. Further than this, Dr. Earle Page, as Commonwealth Treasurer, introduced legislation for the establishment of the Loan Council and sinking fund provisions for the national debt.
Despite all the “ tripe “ which honorable members opposite speak about my policy regarding the Commonwealth Bank, they will find on page 18 a photograph of myself, and the letterpress describes me as “ the man who ha9 done most to stabilize financial conditions in Australia “. During my speech I shall deal with the bogus claim made by members of the Australian Labour party in regard to a reduction of rates of interest. Every financial measure introduced into this House to provide for the control of rates of interest has been opposed by them. They opposed the suggestion advanced by Mr. King O’Malley regarding handing the control of the note issue to the Commonwealth Bank and also opposed a similar proposal which I, as Treasurer, introduced and put into effect in 1924. The Australian Labour party also opposed the validation of the financial agreement made between the Commonwealth and the States, and sought to prevent the establishment of the Australian Loan Council. That council successfully negotiated the huge loan conversions of 1931, and enabled the national finances to be handled so efficiently on a unified basis during World War II. Because of these financial reforms, there was no repetition of the inflation which occurred during World War I. I consider that the Prime Minister (Mr. Chifley) has done a very great disservice .to Australia by introducing this bill. The mere announcement of the Government’s intention with regard to the nationalization of. banks was sufficient to arouse the most acute controversy and create the greatest division of feeling in the community since the conscription issue. This controversial proposal is introduced at a time when unity is required amongst our people to enable us to solve the important problems confronting us. Indeed, unity of action is even more essential now than it was during the war. This bill sets a new standard of public immorality, and it has provoked spontaneous protests throughout the length and breadth of the country of a kind never before experienced. People realize that the issue of nationalization of banking is, in itself, a vital one. That issue involves the existence of individual freedom and the right to choose the place of deposit of one’s savings and earnings. The Government’s proposals for the nationalization of banks also involve an expenditure of £100,000,000. That money is to be expended to acquire the assets of efficiently conducted private concerns at a time when money is so sorely needed for the conservation of water, the production of power, the construction of roads, hospitals and houses. Yet, the Government says, “ We do not need £100,000,000 for those purposes ; we want £100,000,000 to take over the private banks “.
The vital issue of nationalization has been obscured by the terms of the bill, and by the speech of the Prime Minister, which alternately threatened and attempted to bribe the shareholders of private banks. In the course of that speech, the Prime Minister also attacked the patriotism and public spirit of those people. This is the most unusual measure which has ever been introduced into this House, and I do not believe that any attempt to legalize government bribery has ever been made before in a British parliament. In the course of his speech, the Prime Minister said, “ These concessions, which will be given to those who make voluntary agreements, will not apply in the case of compulsory acquisition of shares “. That is flagrant discrimination and is tantamount to holding a pistol at the heads of shareholders. The Prime Minister is saying to them, in effect, “ Your money and your life “, not “ Your money or your life “ ; because he is treating them in the same way as one would treat a mob of sheep. If they agree to negotiate they are to be welcomed as Government guests to the national abattoir and despatched; if they do not, they are to be driven to the abattoir and despatched. ‘ However, they will not be slaughtered in the ordinary way; but, in true Nazi fashion, the knife is to be given an extra twist. This bill not only seeks, for the first time in history, to legalize bribery by a government, but it is also designed to repudiate the pledges given to the trading banks when the banking legislation of 1945 was enacted. That act provides that various trading banks “ shall be given licences “ ; and the names of the banks concerned are specifically mentioned in the schedule to the act. This is a bill of confiscation. Compensation is to be assessed by a court to be specially created for that purpose. I emphasize that the court which is to determine compensation is to be a new one, and that the existing courts, which were created to determine litigation, are to be by-passed. The new court which is to be created will be “packed” with the creatures of the Government. Not only is this court to be “ packed “, but litigants are also to be denied a right of appeal from it. I believe that this is the first time in history that such a proposal has been made. Individuals or institutions concerned are expressly denied a right of appeal to the highest court in the land. Why, I thought that every citizen of this country was entitled to go to the highest tribunal, not only of this country but also of Great Britain ! I always believed that one was entitled to an ultimate appeal to the Privy Council. This is the first time that I have heard of a proposal to deny people the right of access to the highest court in Australia. Of course, some people assert that no one should wish to go beyond the highest court in Australia; but, be that as it may, every one should be entitled, at least, to approach that court. The High Court of Australia is, of course, a tribunal in which every one has confidence. In removing the right of appeal the bill strikes at something which is fundamental to individual freedom.
The Government seeks to establish a monopoly of banking. If its proposals are enacted it will destroy the people’s right to choose between competing financial concerns. Later, I shall adduce instances of the practical result of imposing such a policy upon local government bodies. In one case, the development of an area under local government control was delayed and retarded because the local government body concerned was unable to obtain finance from the Commonwealth Bank, because the State Government disagreed with its policy. That state of affairs continued until it was able to obtain funds from another financial institution. Surely the word “ monopoly “ is one which is odious to every one in this country, whether . the monopoly exercised be a government or a private one. Even the housewife hates the word “ monopoly “. She knows that the operation of a monopoly of household supplies means that she must deal from a particular tradesman whether she wants to or not. There is considerable consternation in Sydney at the moment because of attempts made by the Government to continue “ zoning “ of bread deliveries. Surely a housewife is entitled to exercise the democratic right of choice between tradesmen. Democracy itself is based on freedom of choice. That freedom of choice is represented by the election of members of this Parliament; in the freedom of individuals to join political parties, and in the freedom of those parties to choose their own policies. We exercise freedom of choice in selecting our clothes. Some like bright ties and bad collars of a type which we have seen recently. But the people have always had a fundamental right to choose what they want, including even their foodstuffs. The wider our choice, the greater is our freedom; the more limited our choice, the less our freedom. Employees want higher wages and employers want greater profits. Why? Simply because they wish to exercise their right of choice to buy the things which they require.
This bill seeks to constitute a newstandard of public immorality, to create a nation-wide monopoly of banking, to destroy all competition between financial institutions, and to eliminate the right of the individual to deal with his own money in his own way. It is impossible to understand why it has been introduced so suddenly, unless one views it as part of a mature plot. By introducing it the Government seeks to make the greatest inroad on the freedom of the individual and his civil rights since the time of Stafford and the Star Chamber, and its passage will pave the way to the introduction of communism in this country.
The ostensible reasons announced by the Prime Minister are obviously false, and the alleged safeguards contained in the bill are like the promises contained in the Prime Minister’s speech; they aTe made to be broken. Indeed, the reasons advanced by the Prime Minister are absolutely misleading, if they are not outright untruths. What are the excuses advanced by the Prime Minister? Section 48 of the Banking Act 1945, which deals with State banking, has been declared invalid. One wonders that the law officers did not tell the Government that that section was invalid at the time the bill was introduced, because every one knew it was invalid. That leads one immediately to suspect the bona fides of the Government in enacting the Banking Act 1945. If sections of that act are invalid, how can the Government exercise authority to enforce them except by a referendum of the people? It can never obtain that authority by force or compulsion. Let us look for a moment at the history of that legislation. After the Melbourne City Council made application to the High Court for an injunction to restrain the Government from implementing section 48 of the act, the Government, at the direction of the Prime Minister, ordered municipal bodies and other local government authorities to transfer their accounts from trading banks to the Commonwealth Bank. The exercise of duress of that nature is the most contemptible and tyrannous action ever taken by a government of this country. The other excuse advanced by the Prime Minister is that the validity of sections 18-22 of that act might be challenged. I have no doubt that the Leader of the Opposition (Mr. Menzies) and the honorable member for Warringah (Mr. Spender), who are competent lawyers, will tell the House that those sections lie within the compass of the Commonwealth Constitution. They may be invalid because of the actual wording.
If so, they can be amended. When individuals or corporations exercise the perfect right of every British citizen, particularly those that are the trustees of other peoples’ money, by seeking an interpretation of the law by the courts, why should they be “ exterminated “ ?’ That is what is happening. Could anything more like the methods of the thug or the gangster be imagined ? The Prime Minister has admitted that the private banks have not threatened to challenge th° validity of those sections. The Government merely fears that they might do so, and on that account it proposes to “ cut off their heads “ before they can do anything. The conduct of the private banks since the 1945 legislation was passed has been exemplary.. It does not justify or excuse the dastardly, unfair, and unjust statements of the Prime Minister in regard to their patriotism, public service and. outlook. Only three months ago the Commonwealth Bank, in its official record of the war effort, thanked the trading banks on practically every page for their ready, patriotic and spontaneous co-operation. In the foreword to that publication, contributed by Mr. H. T. Armitage, Governor of the Commonwealth Bank, this was said -
Tt is appropriate to mention the extremely cordial relationships which prevailed throughout the war between the Commonwealth Bank and the Treasury and various other government, departments. The co-operation of the trading banks is unreservedly acknowledged. Their readiness to carry out the financial policy approved by the Government and administered by the bank, contributed materially to the successful operation of the system ot war finance.
Yet the Prime Minister alleged that these men are unpatriotic, and claimed to prove that, because they had made profits, their policies had run counter to the public interest. This very bill contains provisions which will permit the Commonwealth Bank to make profits. Despite these new statements of the right honorable gentleman, nothing has happened since 1945 to change the position that then existed. He said at that time that the best system for the whole of Australia was a Commonwealth Bank cooperating with the trading banks. Of course, those aTe not the real reasons for this legislation. What are they? The Government, and the party which sup-
Sir Earle Page. ports it, know that their many blunders have disgusted the people of this country. The Government is due to “feel the weight of the axe” as soon as the people can deal with it. That is the reason for its refusal to have a referendum or a general election. The Communist masters of the Government have told it to go ahead with this crucial act of socialization while it still ha9 a majority in both houses of the Parliament, even though that majority is “ trembling at the knees “ and is “ shivering all over “. The object is to commence a full-scale socialization programme on the lines that have been worked out between the Labour party and the ‘Communists since 1921. It is highly significant that Mr. Wells, for many years the arch-Communist in Australia, should suddenly forget to pay his union dues, and thus render himself ineligible to stand for re-election as president of the miners’ federation. He passed out of the Communist party, and next appeared in Hamilton as an applicant for membership of the Australian Labour party. Last .week, in the New South Wales Parliament, Mr. Arthur, the member for Hamilton, exposed him, and said that he hoped to be the next member for Newcastle in the Australian Parliament. Communist leaders who have been exerting pressure on members of this Parliament are determined that the pa’ce at which their programme shall be given effect will be accelerated after this legislation has been passed. Therefore, we should reject this, the most immoral legislative product that has ever appeared in any English-speaking Parliament. The measure openly offers bribes to certain people to do specified things, and threatens others. It proposes to establish a packed court, from which there will be no appeal to the highest court in the land. It will wipe out of existence the trading banks, which, two years ago, were specifically guaranteed by the banking legislation of that time that they would be given a licence to carry on. I do not know what the position is in the cities, but I am acquainted with the feeling in the country. There, people of all shades of political opinion, not merely those who support the Australian Country party or the Liberal party, but also those who support the Labour party, are “ up in arms “,’ and feel outraged and disturbed. They have given notice, and we endorse it, that the Communists will not he allowed to “ put a thing like this across “. We shall fight this Communist ramp against individual freedom by every means in our power - political, legal, constitutional and, if need be, physical. The people in the country are descended from British ancestors who for a thousand years fought along those lines. They say that they would sooner die than live as slaves, and that they will fight as long as there is a free man and woman left in the country. Public opinion is so outraged that we may win the fight quickly. Last night, the Minister for Post-war Reconstruction (Mr. Dedman) tried to perform all sorts of gyroscopic manoeuvres on the “ slippery ice “ of the tax concessions that are offered by the measure. His statements were not very clear, and perhaps the Prime Minister will have a talk to him about them later. Whether the struggle be long or short, we shall fight to restore the rights of everybody in this country to a free choice and the free handling of their own affairs, if they should be lost now. Flying the stolen flag of progress and reform, the Prime Minister has brought down this measure of tyranny and retrogression. He hoped to stage a surprise assault on an unsuspicious electorate. Throughout the world Communists, fascists, socialists, Labour parties, men wearing shirts of different colours - red, brown and black -some even sporting coloured ties, some smoking pipes and others cigarettes, but all fighting with weapons drawn from the one armoury, preach doctrine’s which are variations of the same theme. They go into battle singing the same tune. Their aim is the direction by force and compulsion of the- life and labour of mankind. Despotism in human affairs is not novel, but I suppose that the most inclusive and cruel tyrannies we have known in modern times have been those practised by Russia, Germany and Italy. Now, apparently, the Prime Minister and the Labour party have surrendered to the Communist gangsters, and want to drive us back to the habits of the jungle. For over 2,000 years; in fact, for more than that - at least 500 years before the birth of Christ - the main preoccupation of political thinking has been the discovery of a law which would be sufficiently supreme and high to protect the individual from the arbitrary force of authority. The people of our own race have fought to bring the sovereign and governments under a constitution. The aim of the struggle has been to establish for the individual rights that he can sustain against kings, governments, bureaucrats, magnates, majorities, and, especially, mobs. That was the meaning of the original struggle to form trade unions. Now, trade unions, because they are organized, are being used to destroy freedom. A. hundred years ago, it would have been a cause for laughter had the suggestion been made that trade unions would be used to destroy freedom in this way. That is the meaning of the struggle to protect conscience, learning, the arts, education and commerce against the inquisitor, the censor, the monopolist, the policeman, the thug and the hangman. That we are losing the fight for liberty in this country is seen in every pressure strike, and in the internal tyranny of the unions which is reported daily in the press. On every hand can be found evidence of serious decline. It is evident in the general degeneration of public morale under this Government.
Finally, under this bill, public officials are to be made masters of the people in every ambition of their lives and, only under official orders and by official permission, may the people live, work and seek their salvation. This politically administered economy is not new. On the contrary, it is as old as the hills. It is not progressive; it is reactionary. It does not belong to democracy, but it is always administered by a dictator. It halts progress. Generally, it has to be cleared away by violent means before real progress can be made. In England, Charles I. lost his head, and in France there was a revolution, in which many lost their heads before the field became clear again. This politically administered economy is not the product of modern technology; it is as ancient as original siu. and is born in the. lust for power and domination over the rest of the human race. This doctrine of universal government control and regulation had to be jettisoned 200 years ago to let the industrial revolution get on its way. Colbert, the Minister of Louis XIV., sought to codify and generalize the industrial law - to do what the regional instructors would do under this bill. The colossal task which he faced is shown by the fact that the regulations of the textile industry alone from 1666 to 1730 required four volumes of 2,200 pages and- three supplementary volumes to contain them. This system buttressed up existing vested interests and prevented new invention and development. The manufactures of one town in France had to negotiate for four years - from 1730
I’D 1734 - before they could secure permission to use black warp in their cloth. They were never allowed to use black weft. No measure of control was considered too severe where it served to secure the greatest possible respect for the regulations.
The heavy hand of governmental control, as this government banking monopoly will establish, was well illustrated in its attitude to the production of printed calicos. The French printing industry was backward, and the existing textile industries demanded protection. The French Government did its best to check the rise of the new fashion. It is estimated ‘by Hecksher, in his classic work Mercantilism, on page 173, that the economic measures taken in this connexion cost the lives of 16,000 people, partly through executions and partly through armed affrays, without reckoning the unknown, but certainly much larger, number of people who were sent to the galleys or punished in other ways. On one occasion, in Valence, 77 people were sentenced to be hanged, 58 were to be broken upon the wheel, 631 were sent to the galleys, one was set free, but none was pardoned. But even that vigorous action did not achieve the desired end. Printed calicos spread more and more widely among all classes of the population in France, as everywhere else. Naturally, the system of detailed and authoritative regulation of the national economy did not work well. There were endless lawsuits, smuggling and bootlegging. That is what we shall have in Australia if this bill becomes law. I am reminded of what happened in Grafton, in my electorate, when an attempt was made by the local count) council to sell electricity in the country at the same rate as in the town.
– The right honorable member must confine his remarks to the bill.
– I am instancing a typical case of what is likely to happen whenever there is a government monopoly. The Government of New South “Wales would not stand behind the county council, and the Commonwealth Bank adopted a similar attitude. The result was that the local authorities had to go to the State Superannuation Fund for finance. Unfortunately, the war intervened, but they have made some progress, and have been given a good deal of assistance. That was possible only because there was an alternative way of obtaining finance. That is what is needed in any community.
France was not the first country to practise this authoritative regulation of national economy. The Pharoahs practised it. Under Diocletian it was for a time the recognized method of government when they had to chain farmers to their farms. It was the practice of governments under the Hapsburgs, under the Romanoffs, under Hitler and under Mussolini. All these are dead ; but Stalin, who is still alive and has tried the system out well, is modifying it all the time - upward. By the time the Australian Communists get this system properly established here, of which nationalized bank monopoly is the first step, Russia will have abandoned the system in despair, and we shall see our Labour politicians again trying to square the circle, and chasing the mirage ever receding from their view.
What reasons does the Prime Minister give for this revolutionary and retrogressive change in our national economy? Why does he renounce the wisdom of the ages to embrace errors which the ages have discarded? Why this public change of view since 1945? In his speech on the banking legislation of 1945, the only sentence of condemnation of the private trading banks was a joint condemnation of the Commonwealth Bank as well. The Minister for Post-war Reconstruction (Mr. Dedman) said that the Government had” examined the question of nationalization, and decided that the Commonwealth Bank, working in harmony with the private trading bank system, was the best for Australia. His words were -
I consider that it ought to have at its apex a central bank, under which there should be functioning the various banks that undertake trading activities. The alternative would be, of course, to have only one bank undertaking the activities of the central bank and monopolizing the whole field of trading banks as well. That could perhaps be described as nationalization or socialization of the banking system. Tho Government has not elected that system, but proposes an alternative which it thinks is better fitted to this country . . .
To leave the banking system as it is would be to have a structure in which the central bank would continue to engage in trading bank activities in which private banks also were engaged.
The Royal Commission on Banking and Monetary Systems said that the active competition of private trading banks and government trading banks was the best way to get good service. Now the Prime Minister adduces some new reasons why the trading banks should be acquired. He makes the extraordinary statement that since trading banks are conducted primarily for profit, and therefore adopt policies which, in important respects, run counter to the public interest, their business should be transferred to public ownership. Let us examine this statement. Why does the conduct of business for profit run counter to the public interest ? The workman works for wages, which is his profit ; the storekeeper sells for profit; farmers, doctors and chemists all work for profit. In fact, the Government says, as a test for the success of the Commonwealth Bank, that it shows a profit. The Government has set up a Prices Branch, which endeavours to ensure that every industry gets a fair profit. The laws introduced by the Government to pay bounties to certain industries declare that those industries may make profits up to 10 per cent. With butter, wheat and wool, &c, the Minister says they must- be conducted for profit. Why is profit counter to the public interest? Surely the nature of the work should determine whether it should be carried on. If supplying money is necessary to enable the essential work of the community to be done, why is the making of profit counter to the public interest? Progress and civilization show that progress comes only because profits can be made. Our Lord told the parable of the talents in which the man who laid up his talent in a napkin and received no profit was condemned, whilst those who made profits, or increased their talents, were rewarded.
Why is there a general lowering of production in Australia? The answer is because there is no profit in many industries. The decline in butter production, for instance, is due to the fact that the dairying industry does not pay profits, and is therefore not so attractive as other industries, such as potato-growing, whose profit the Government guarantees, or in forestry or in other ways. -
Condemnation of the private banks for this reason is vicious, tyrannous and stupid. Will the Commonwealth Bank, and the government trading banks to be set up in place of the existing trading banks, finance men and industries which do not show a profit? I should like the Minister, when replying, to answer that question. The fact is that Australia has the cheapest, and probably the most efficient, banking system in the world.
In Australia, where the Government borrows on long-term bonds at 3$ per cent, per annum, the average man or business can obtain accommodation from any bank at a maximum rate of && per cent, per annum. That rate for loans and advances is one of the lowest in the world, despite the fact that government bond rates are considerably lower in some countries. For example, in the United States of America, where the government borrows at approximately li per cent, per annum, the average man has to pay 5 per cent, for his loan. In Canada, the average rate at which the government borrows is 2 per cent., whilst the average rate of overdraft is 4 per cent. In South Africa, where the government’s long-term bond rate is 3 per cent., the average rate charged on loans is 4£ per cent, per annum. In Australia the charge for keeping accounts is 10s. a year, irrespective of the size or the degree to which the account is operated upon.
In Canada and the United States the charge is based on the degree to which the account is used. In the latter country the minimum amount paid would be about £2 10s. a year, and the maximum might be any figure. In South Africa the minimum charge is £1 ls. a year with a maximum of about £7 7s. In Eire the minimum charge is £1 ls. a year, with a maximum of about 30 guineas. In England the charge varies according to the use made of the account ; it ranges from about £2 2s. a year to 1,000 guineas for a very active account. In this country, most ancillary banking services are free, but in Canada and the United States of America there are scales of charges for such services. This disposes of the Prime Minister’s statement that the trading banks in Australia have charged the highest rates for their services. The Prime Minister, in his speech, said -
The trading banks are imposing unduly high rates of interest: - and when the depression came the banks as a whole restricted new lending and called in advances.
However, the established facts, placed ou record by impartial men, contradict the statement of the Prime Minister. Since the foundation of the Commonwealth Bank there have been three great crises in the history of Australia - the 1914-18 war, the depression, and the 1939-45 war - and in every one of those it has been admitted that the private trading banks greatly assisted in the maintenance of financial stability. During World War I., the Fisher Government gave the trading banks the right to draw £3 in notes for every sovereign presented at the Treasury, on every two of which they were to pay interest at the rate of 4 per cent. Although the trading banks had invested large amounts of money in government securities, they never drew more than £2,000,000 under this arrangement. During the depression, the private banks took restrictive action to prevent excessive buying of goods overseas. In 1924, when difficulty arose over the transfer of balances from London to Australia, the Commonwealth Bank said to the trading banks, “ We will provide you with £15,000,000 on condition that you repay it within a year “. This money was for the purpose of handling the wool clip, but under this arrangement the trading banks drew only £2,000,000. All they desired was to know that they could draw the money if need be. They wanted to restore confidence. During World War II., the trading banks made a spontaneous gesture by lodging all their special deposits with the Commonwealth Bank. Later, the Labour government took great credit to itself for bringing in legislation requiring the trading banks to do what they had already done spontaneously.
One cannot read more than a few pages of the recently published history of the Commonwealth Bank without finding laudatory references to the private trading banks. For instance, at page 16 we find the following : -
The banks readily agreed to co-operate in applying the policy of the Capital Issues Board, but they suggested that all discussions with them should be conducted through the Commonwealth Bank. That procedure was accordingly followed for approximately a year. The voluntary arrangement worked reasonably satisfactorily, but, in 1941, it was found desirable to furnish the banks with more definite guidance.
Again, on page 19 the following occurs : -
Parallel action in connexion with interest rates was taken by agreement among the banks. Two voluntary reductions in rates of interest paid by banks on fixed deposits, each of¼ per cent. per annum, were made in 1940, and a further voluntary reduction was effected in 194.1. As fixed deposits were renewed at the lower rates, these reductions in rates of interest paid by the banks reduced their expenditure and would have raised profits. Corresponding reductions were, therefore, made at appropriate dates in the rates of interest charged on overdrafts.
I could go on almost indefinitely reading extracts pointing out the patriotic actions cf the trading banks, which deliberately cut their profits in order to help the nation, yet the Prime Minister had the audacity to say that they always charged the maximum for the services which they rendered. Some honorable members opposite have quoted a half sentence of mine, torn from its context, in an attempt to make it appear that I. have myself condemned the trading banks.
The next charge brought by the Prime Minister was that, during the depression, the trading banks restricted lending and called up overdrafts. The Leader of the Opposition (Mr. Menzies) effectively disposed of that contention. The inference to be drawn from the statements of Government supporters is that a government monopoly bank would have done better, but the truth is the action taken by the Labour government during the depression made the situation worse than it need have been. Professor Copland, who was official adviser to the Government at the time, has written as follows : - ft is not too much ,to say that the banking policy of Australia was really more enlight- ened than that of almost any other country.
The right honorable member for Yarra (Mr. Scullin), himself, declared that the depression was due to the fact that there had been a general fall of prices, and a sudden cessation of lending. This statement was made on the 6th February, 1931, at a conference of Commonwealth and State Ministers. In such circumstances, government policy should have been to keep local purchasing power high. This would have been achieved by keeping the prices of imports as low as possible, and by letting the Australian exchange rate slip so that the Australian producers would get more Australian pounds for the produce which they sold overseas. The Scullin Labour Government did neither of these things. It raised the prices of local goods by surcharges and increased tariffs, which destroyed overseas markets - such as the market for wheat in France - by discriminatory action, and it also resisted, and induced the Commonwealth Bank to resist, the slipping of the exchange rate, in order to assist the Commonwealth budget. On the other hand, the trading banks made available their gold and sterling resources in London to the Government and the Commonwealth Bank. They rationed exchange for essentials as far as possible, which corrected the balance of trade without increasing local prices. They took the lead in letting the exchange rate slip, and ultimately forced the hands of the Government and of the Commonwealth Bank. They maintained their advances to the public generally on a higher percentage ratio than did the Commonwealth Bank. Between 1928 and 1930, the June averages of advances showed an increase from £240,000,000 to £284,000,000. If we include government securities, the increase was from £265,000,000 to £305,000,000. On the other hand, Commonwealth Bank advances declined from £12,670,000 to £7,979,000 between 1928 and 1933. Admittedly, the Commonwealth Bank was doing its best for the government at the time, but the private banks were doing something better for the country as a whole. It does not lie in the mouths of Labour supporters, who opposed the slipping of the exchange rate, and who advocated high duties during the depression”, to accuse the private banks of having aggravated the effects of the depression. The Prime Minister accused the private banks of having maintained interest rates at an unduly high level. What is it that determines interest rates? It is the rate fixed by the Government for public loans. The Labour party fought against establishing the Australian Loan Council and the adoption of the Financial Agreement, yet it was the Australian Loan Council which made possible the 1931 loan conversions. The Labour party opposed every progressive reform designed to reduce interest rates. In the matter of housing, instead of allowing the Commonwealth Savings Bank to lend money direct to home builders for housing at 2-h per cent., the Labour Government insisted that the money be lent to the Commonwealth at Si per cent., and the Commonwealth then added another £ per cent, before lending it to home builders. That is the way it is done. It is time that their hypocrisy was exposed. Indeed, it is a good thing that the Government has introduced this measure, because in so doing it has aroused the people of Australia to greater indignation than would otherwise be possible. As I have nearly exhausted my time, I shall take an opportunity later to deal with the statement by the Minister for Transport (Mr. Ward) that the Labour party is opposed only to private ownership of property used for productive purposes, but not other private property. That statement will hot allay the fears of “ Dedman’s little capitalists “ - the people who own their homes - or the small, independent shop-keepers, the workers or professional men who earn their living with their own tools of trade, those whotill their own land, or those institutions which build their own schools and hospitals and carry on such beneficial work in this country. Lenin’s whole doctrine is nationalization of all land and all profit.
– Order ! The right honorable gentleman’s time has expired.
– The Leader of the Opposition (Mr. Menzies) completed his speech with a quotation from Milton. That great author is best remembered by his Paradise Lost, and the right honorable gentleman was then unconsciously humorous,because the interests that he defended are about to lose the financial paradise which they have enjoyed in this country since it was first settled. If there are angels in that paradise, I doubt whether any of them will weep over this change.
The bill proposes to transfer !o a public instrumentality exclusive control of credit. In making that change the Government has established its bona fides by adhering to principles of equity and justice; and its recognition of those principles stands out in comparison with the treatment which the private financial interests have given to those whom they have had at their mercy in the past. The Government is recognizing the principle of equity under this measure. It proposes to compensate fully the private banks. Further, provision is made to set up a Federal Court of Claims to adjudicate on matters which may be disputed. The whole manner in which the Government proposes to effect this transfer completely refutes any criticism which might he levelled against it on those grounds.
It is necessary to deal with the conditions of employees of the private banks and the effect which the Government proposals will have upon them, because of the activities of a section of the Australian Bank Officials Association who have unwittingly allowed themselves to be used by the private banks” in the present campaign against the Government. Their actions do them very little credit. I refer particularly to a section of the association in New South Wales, and I shall show that those particular members are not acting in concert, with or on behalf of, their association as a whole. From the time the Government’s proposals were announced, th’ey have waged a campaign against the Government. They did not even wait to ascertain the details of the Government’s proposals insofar as they themselves would be affected as employees of the private banks. However, we now find that the bill makes provision to safeguard adequately all employees of the private banks. Indeed, under the Government’s proposals, those employees will be given conditions far. superior to any ever given to them by the private banks. It is rather humorous that the private banks should now exhibit such great concern with respect to the conditions of their employees in view of the fact that they did so little for them in the past. My statement is substantiated by a comparison of the conditions of the employees of the Commonwealth Bank and those of employees of the private trading banks. The conditions enjoyed by the former are far superior to those under which employees of the private trading banks have been compelled to work. When this transfer is effected, they will be given ipso facto conditions far superior to their present conditions. That being so, it is a matter for regret that Mr. Card, who has taken a prominent part in this campaign against the Government, has allowed himself to be used in the interests of the private banks. He has stated, and quite rightly, that his association is a trade union; but he will have great difficulty in finding in the trade union movement, or among those who believe in trade union principles, any who will associate themselves with him in the methods he has employed in this campaign. To show that Mr. Card is not speaking on behalf of the Australian Bank Officials Association, I refer to proceedings at a meeting of the association held in Melbourne in October last. At that meeting, which was attended by over 700 members, the following motion was moved : -
That this meeting of the Victorian branch of the Australian Bank Officials Association ex-presses its grave concern against the undemocratic proposal of the present Government to nationalize the trading banks, and instructs the ‘association to take all possible steps to actively oppose this legislation.
That motion was rejected; hut, subsequently, the following motion was submitted and adopted : -
That this- meeting expresses its full confidence in the executive to date, and has full confidence in it to protect members in the future.
In that motion the association virtually expressed support for the Government’s proposals; and it proves conclusively that the campaign which has been waged in certain quarters allegedly on behalf of the Australian Bank Officials Association has not the backing of the association. The section to which I have referred endea voured to convey the impression to the public that all employees of private banks were opposed to the Government’s proposals. The motion carried at that meeting, which I have just read, disproves that claim.
The Leader of the Opposition stated that the bill was an attack on democracy. Me went to great lengths to give a definition of “ profit “. He led me to believe that the most important factor in life is the making of profit. That is typical of the philosophy that permeates the ranks of the Opposition parties. In other words, they believe that the - most important thing in life is to be successful. Even our universities teach that, although they do not over-emphasize it, whilst, at the same time, they suggest that it is better to be successful in an honest way than in a dishonest way. However, according to the system upheld by the Opposition parties, the most important thing, in life is to be successful ; and the proposition put forward by the Leader of the Opposition was that the most important thing in life is to make profits. In other words, the highest form that duty takes is to make a profit; or profitmaking is the highest form of duty of any citizen in this community. Many people will disagree with that argument. In the course of his remarks, he quoted passages from Karl Marx’s Communist manifesto. Before I proceed on this matter, I should, perhaps, make my position clear in relation to Communists. I am emphatically and unequivocally opposed to communism; but I believe that, if communism is to be combated, it must be attacked in a more intelligent manner than that which honorable members oppo site have employed. Simply because the right honorable gentleman quotes from the Communist manifesto, and says, “ This was the doctrine of Marx, of Lenin, of Stalin “, does not of necessity make it the doctrine of communism. There are works in existence which prove that the principle of nationalization was preached long before Karl Marx was ever born. My authority is no less a person, than the Englishman, Bishop Berkley, who wrote in 1735 to the effect that the nationalization of banking was in the public interest. If it be logical to argue that, simply because the nationalization of banking is to be found in Karl Marx’s work, those who advocate that policy must,, of necessity, be Communists, I ask what do people who argue in that way say tothe statement that nationalization of banking was preached by no less a person than a member of the English clergy, the Bishop of Cloyne, more than 80 years before Karl Marx was born?
– From what authority isthe honorable member quoting? Is it Berkley’s Philosophy 1
– If the honorable member doubts the authority, I refer him t’o Hollis’s work, Two Nations. Theidea that Karl Marx was the first to preach nationalization of banking has nofoundation in history. The dictatorship of the proletariat, which was also advocated by Karl Marx, was preached by the Frenchman, Le Quay, in 1779, duringthe French Revolution, long before Karl Marx was born. Karl Marx advocated a a system for the control of society whichevery rational being has refused toaccept. It is necessary to make an intelligent approach to this question. It is not sufficient to repudiate or oppose a doctrine merely because it comes from the Communists or those who support them. In the final analysis, the question we should ask is, What is its value? Just because somebody in this House, or outsideof it, may claim for propaganda purposes that the housing conditions of this country are deplorable and must be improved, have we to differ from them? Are we tooppose the suggestion that the conditions of the working classes must of necessity be improved, that the labourer in industry is, in justice, entitled to a better deal simply because the Communists advocate- these reforms? Must these things ‘be opposed simply because the Communist party is exploiting the situation to which they give rise? It is absurd to try to convey the impression to the public that the bill before us is a Communist-inspired document simply because the nationalization of banking has its counterpart in the teachings and philosophies of tha Communists.
This bill proposes to give a government instrumentality the right to control the credit of this country. It is long overdue. The present banking system had had its origin in the days of William of Orange. One of the greatest indictments that can be levelled against it is its instability. Its history is characterized by collapse after collapse. These collapses became so much a part of the existence of the private banking system that many of the paid economists of the private banks and those associated with them would have the people believe that they are inevitable, that the people must accept them because there is no escape from them. That school of thought has been consistently opposed down the years. If that is all ‘ that the present system can offer, the quicker it is changed the better for all concerned. We have witnessed collapse after collapse among banking institutions in this country. The history of bank failures in Australia is too well known to ‘ need repetition. What has happened here has happened the world over. The people have been led to believe that there is no escape from it and that they have no alternative but to put up with it. The instability of the private banking system is such as to make it impossible of intelligent and rational defence. I ask its protagonists if they can explain the recurring collapses that have characterized its existence. Another characteristic of the history of the private banking system is that these collapses have become more severe with the passing of time. Not merely did banks fail and bring about economic distress and straitened circumstances among the people; but also a feature of their collapse has been that there have always been two or more banks going to the wall simultaneously. During the bank collapse in Australia in 1930 some of the banks closed their doors and have never re-opened them. One of the institutions which failed was the Primary Producers Bank of Queensland, which has never since, opened its doors. The instability of the present system is the greatest condemnation that could be levelled against its continuance. We are in no way beholden to it, and the culture we enjoy has survived in spite of it. The part played by the private banks during the last three or four years, particularly in America, makes sorry reading. It is all very well to criticize the Communists, but not to say anything about the conditions or circumstances that have fostered communism. The stage has been reached in this Parliament when all legislation, whether it’ deals with wheat or whales, credit or corn, is linked in some way with communism by honorable members opposite. That has become their standard pattern of attack. The conditions that give rise to communism are those that private interests have maintained down the years. It is almost impossible to say anything about the Karl Marx Communist manifesto, whilst ignoring completely the conditions of life that gave rise to that work. I represent an industrial constituency in which I have lived all my life. It is always my endeavour to understand people who have never had much opportunity for betterment, even if they are inclined to favour communism. I can have a degree of tolerance for these individuals that I cannot have for other more fortunate citizens who have enjoyed all the good things of life. Listening to honorable members opposite one might imagine that all the supporters of communism were to be found amongst the working classes, but, on the contrary, many of the most powerful agents of communism throughout the world come from a class of society in which they have had every opportunity that life can offer. It is difficult, indeed, to reconcile their ideological outlook with their station in life. The endeavour to link this Government’s legislative programme with the Communists in this country is absurd.
Opposition speakers claim that this measure is an attack on . democracy, but I contend that in this country we have a measure of democracy that compares more than favorably with that existing in any other- part of the world. As a junior member of this House, I do not wish to appear critical of senior members, but I have no hesitation in saying that the statement made by the right honorable member for Cowper (Sir Earle Page) that opposition to this bill, if necessary, would be physical, does him little credit. I do not know any words of condemnation that are too strong for an utterance that is tantamount to an incitement to violence. No other interpretation can be placed on the remark. Such extravagant language reflects little credit upon members of this chamber who are assumed to be the custodians of democracy. We in this Parliament have our responsibilities and our duties. The dignity and prestige of this legislature will be only so high as we permit it to be. A threat of physical violence in opposition to legislation, passed by this Parliament is deplorable. This is a. democratic country, and two years hence, the people will have an opportunity to pass judgment upon the actions of this Government and I have no doubt that when that time comes, the electors will have no hesitation in again supporting the Labour Administration. The attitude of members of the Opposition to-day as champions of the private trading banks is in marked contrast to that adopted by them on the -hustings twelve months ago. They have assumed a role that they would, not have dared assume on that occasion.
There are two aspects of the 1945 legislation upon which I should like to comment. The first is that when that measure was before this House the Leader of the Opposition (Mr. Menzies) said, that if returned to power one of his first acts would be to repeal that bill. A few weeks ago, in the course of the debate on a motion of want of confidence moved by the Leader of the Opposition, the right honorable gentleman was challenged with having failed to repeat that statement at the subsequent elections, but he denied that he had omitted to do this. Last week, after a search in the Library of this Parliament, I found .an edition of the Sydney Morning Herald which published the right honorable gentleman’s policy speech in full, and there was no reference what- over to- any intention on the part of the Opposition to repeal the 1945 banking legislation if returned to power. I do acknowledge that one newspaper, reporting an election meeting in Victoria in the course of the campaign, stated that the Leader of the Opposition had said that if returned to office he ‘would repeal the 1945 bill, but I maintain that no such statement was made in the right honorable gentleman’s1 policy speech, nor was anything to this effect said by the Leader of the Australian Country party (Mr. Fadden) in his policy speech. I claim, therefore, that the attitude of the Opposition to-day’ in defending the interests of the private trading banks, with all the vehemence, vigor, and eloquence of which they are capable, is in startling contrast1 to their attitude prior to the elections.
This legislation will confer upon the people of this country immeasurable benefits. At least, it will remove from the minds of the people the spectre of unemployment and want that has had such a profound effect upon them. The citizens of this country who endured the bitter experiences of the early 1930’s have not forgotten those years. Not one honorable member opposite who, in a style somewhat fashionable to-day, rushes to the defence of the private trading banks, would have been game enough to adopt that attitude during the depression. What: is the alternative to this proposal? Can those who consistently advocate the retention of the present financial system give an. assurance that there will not be a. repetition of what happened during the depression? If not, the prospects of the people of this country would be very bleak indeed in ihe absence of this measure.. We are told that, despite the financialcollapses, and the consequent dislocation of trade and commerce, the presentsystem has made possible, our existingfinancial structure is the best that can be offered - the best of which the people of this country and of this world are capable. On the contrary, we of the Labour party believe that this legislation will eliminate the abuses that have characterized our financial system in the past, and eliminate much of the injustice that has disfigured our social life. We believe that it will be the means of giving to the people of this country a measure of security and confidence in the future that they have lacked in the past. We believe that it will be responsible for opening up a new avenue of development, and that it will give to the working classes of this country a sense of economic well-being that will far more than compensate them for the criticisms of the Opposition.
Sitting suspended from 6 to 8 p.m.
– The purpose of the bill is the transfer of control of credit from the private trading banks to a public instrumentality. That, we believe, will be of benefit to the country. Equity will be preserved in the transfer and the position of the employees of the private trading banks will be immeasurably improved. The minds of men have been agitated for 400 years over the question whether credit should be privately or publicly controlled. This Government intends to place credit in its proper place in the life of any community, that is under the control of the nation. We know that we shall be attacked and misrepresented by the Oppo-. sition, but we feel that by the time the next general elections are held the benefits of this legislation will have so impressed themselves on the people that the propaganda of honorable gentlemen opposite will have been lost in the mists of the past.
Honorable members opposite have indulged in a series of misrepresentations in an unscrupulous attack on the Government and its motives in introducing this legislation. They have defended interests that I could take no pleasure in defending. Throughout the centuries the private trading hanks have been defended by people who consider that the profit motive is the highest duty in life. I do not begrudge Opposition members the pleasure of defending interests that can defend themselves, but I do quarrel with the statement of the Leader of the Opposition that this measure is an attack on democracy, because it is peculiar that he should take that stand when he is campaigning on behalf of the Opposition parties in the Victorian Parliament, which forced the Labour Government in Victoria to appeal to the people on one of the most undemocratic issues on which the electors in any part of this country have ever been consulted. That Government has been forced to go to the people on an issue that is not even remotely associated with State politics by an Upper House elected on a restricted franchise. What is worse is that the instigator of the move that precipitated the general elections is no other than the vice-president of a private trading bank. Any criticism that this measure is undemocratic come9 ill from, people that support one of the most undemocratic political upsets in history.
The Leader of the Opposition also said that the private trading banks had been sentenced to death for no crime. I should be interested to learn from any honorable gentleman who argues in that way, his definition of the word “ crime “. The private trading banks may not have been guilty of crime in the strictly legal sense, but they have been guilty of economic crimes that defy imagination. They have caused the economic plights that have visited us since their inception. Instability has marked their career. They have been responsible for recurring collapses. The system that we propose will minimize the sufferings of the people that the private trading banks have imposed on them: The alternative proposed by the Opposition gives to the people of this country no hope - only expectation of even more intense collapses. We intend to change the system in order to ward off financial and economic catastrophes. We propose to give the Australian people hope for the future. In the ‘thirties, Opposition members would not have dared to make the utterances that they now make about a system that has led to economic crimes against Australia of the greatest magnitude. The system so vigorously defended by the Opposition gives the people no hope for the future. All that the fatalistic philosophy of the Opposition implies is recurring economic depressions like those that have marred the history of the private banking system, whereas we give a message of hope to the people. A government that is to maintain full employment must have some control of credit. The alternative is the status quo undisturbed.
– This is a matter of not “ some control “, but absolute ownership.
– Order! The honorable member for West Sydney has the floor.
– The policy of the Government will minimize the effects of economic depressions and alleviate the sufferings of the people in them. We are living in a world in which trade is buoyant, but we cannot predict how long that will continue, and we are determined to make the people’s welfare our foremost consideration. Their economic security is utterly dependent on the passage of this measure. It is one of the most notable steps that any government has taken in the last 400 years to counteract the evil influences of the private operation of credit. No system in the world has such a corrupt history as that of the private operation and control of credit. Anybody who sets out to defend that system has a very hard task before him.
The Opposition has attempted in this debate, >as it often has done before, to classify this measure a3 being related in some way to communism. I have already destroyed the arguments advanced by some honorable members opposite who have said that, because Karl Marx declared that nationalization of banking was essential, any organization which adopted the same policy must, of necessity, be communistic. I exploded their case by pointing out that, 120 years before Karl Marx expounded his theories, Bishop Barkley advocated the same principle. The mere fact that nationalization of banking was in the teachings of Karl Marx does not brand the proposal as communistic. The arguments of honorable members opposite on this point are tantamount to claiming, because Marx said that the conditions of the people were deplorable, that any other writer who says the same thing must be a Communist. This bill has nothing to do with the philosophy of Karl Marx. Marxian philosophy is abhorrent to everybody. It is completely opposed to everything democratic, and everybody knows that, of its very nature, it must lead to tyranny. This fact has been demonstrated by the operations of
Marxism in this century. It is a philosophical absurdity to argue otherwise. Therefore, we of the Labour party, who are of democratic origin and who are responsible for the growth of democracy in this country, vigorously repudiate any alleged connexion with Marxism. The history of Australia proves that the Australian Labour party and the trade union movement have been to the forefront in the development of democracy. The rights of the individual -as they are enjoyed by the people to-day - the rights of freedom of speech and freedom of association - have been obtained only as the result of the fight that has been made in the past by the Australian Labour party and the trade union movement. That is our answer to those who criticize this bill on account of its alleged authoritarian character. What we have obtained for the people in the past is the best indication of what we shall obtain for them in the future.
– This bill not only is without precedent in the history of the Commonwealth, but also is a revolutionary departure from the policy which the Labour party has followed since its entry into the political sphere. It has been the practice of the Labour party to recognize that, on matters of great national interest, its legislative ambit has been limited by the declarations of the party leader before the people at elections. This is the first time in the history of this Parliament that the issue of nationalization of an industry has been raised, although for 50 years, as. I can say very definitely, the nationalization of the means of production, distribution and exchange has been an objective of the Labour party. The best proof of what I say is the fact that although the people of this country’ have been approached by way of referendums on no fewer than three occasions to authorize the nationalization of monopolies, on each occasion they have rejected the appeal made to them. Clearly, the people have spoken very definitely against nationalization of monopolies, and it is very evident that, if they are not prepared to give this Parliament such power, they are much less prepared to give it power to nationalize competing industries.
This measure has come like a bolt from the blue. But yesterday we were assured by the Prime Minister (Mr. Chifley), and by the members of his party, that the banking acts of 1945 clothed the Government with ample power to deal with money and credits. Over and .over again the Prime Minister assured the House and the people that he lacked no power necessary to prevent a .recurrence of that disastrous depression which we experienced in the ‘thirties. He had ample power over all credits and all money. He had impounded, under the provisions of the 1.945 acts, a sum which the Leader of the Australian Country party (Mr. Fadden) reminded us last night amounted to £268,000,000, and, with the Commonwealth Bank’s own resources together ‘with this sum, which -was now at the disposal of the Government, .the Prime Minister declared that he had ample power to deal with crises that might arise as ,a result of inflation or deflation. He was the master of the financial destiny of this country! And when the right honorable gentleman was before the people in 1946 - which is not a matter of ancient history - not by a word or a hint did he suggest that greater power ought to be given to him. He was satisfied with the position, and over and over again he and his colleagues went out of their way to tell us so. In 1945, he said, “The Government is convinced that active competition by the Commonwealth Bank with the trading banks and other financial institutions will ensure that banking services are supplied adequately and cheaply “. Later, during the elections, he did not even hint that he intended to nationalize the trading banks. Competition between the trading banks and .the Commonwealth Bank was then an essential feature of his policy. Like master, like man. Last night we had the privilege of hearing the Minister- for Post-war Reconstruction (Mr. Dedman), who lacks nothing in versatility and resource. He belaboured the financial interests of this country to his heart’s content. But, in 1945, he said -
J consider the structure of the banking system ought to be a central bank under which there should be the various banks that undertake trading activities, which is better fitted for this country than only one bank monopolizing the whole field.
The Attorney-General (Dr. Evatt), during the last elections, stilled the raging waters by pouring on them the oil of which he has an almost unlimited supply. He said -
Under the Chifley Government, private enterprise would have greater opportunities’ than ever before.
A Daniel come to judgment! In the face of this bill, what will he say? These gentlemen, in 1946, declared themselves in favour of competition. They assured the credulous people of this country that under the Chifley Government, which was then soliciting the favour of the electors, there would be more ample opportunities for private enterprise than ever the country had known before. In the face of this bill, what do they say? They have gone round with a rapidity which, I venture to say, may be .regarded as a modern version of .the conversion of Saul of Tarsus in reverse. But yesterday, they lent the sunshine of their presence to competition, which the Minister for Post-war Reconstruction said, is “better fitted for this country than only one bank monopolizing the whole field “. Now he says he is 100 per cent, for nationalization of the banks. So we live and learn.
We are now confronted with a bill which proposes to nationalize the trading banks, and we have listened for .some time to a recital of their many and grievous blunders, their errors, and the tyranny that has masked the exercise of their great power . over the people of this country. Here I speak as the AttorneyGeneral who was responsible for the drafting of the original Commonwealth Bank Bill. I have always believed in the Commonwealth Bank. I believed, with my late colleague, Mr. Andrew Fisher, that it was desirable that there should be competition in this sphere of finance. The Commonwealth Bank was established, not to displace, but to compete with the private banks on sound business lines, free from all political control and interference. Perhaps I may be permitted to dwell on this for a few moments. I was not a member of the Government which was responsible for the establishment of the Commonwealth Bank Board,- but I say that the Commonwealth Bank, to which the Prime Minister paid a most eloquent tribute but about -whose future the pessimists of the day prophesied abject failure, has triumphantly justified itself. For 34 years this bank was conducted on the lines that Mr. Fisher laid down. It was free from political control. He selected as Governor, Sir Denison Miller, who had been trained in the Bank of New South “Wales, and in him was vested supreme control. Until 1924, he alone exercized that control. The bank succeeded without a board ; the bank .succeeded with a board. For .34 years, until 1945, the bank had been free from political control.
Then something happened. The banking legislation which the Prime Minister introduced in 1945, and which was designed .to undermine the basic principle upon, which the Commonwealth Bank had been established, provided for an advisory council. “We have listened to soft lullabies by the Prime Minister about this body. He would have us believe that the advisory council controls the Commonwealth Bank. I ask: Who composes the advisory council ? At the head of it is the Secretary to the Treasury. Now, Mr. McFarlane is a friend of mine, and is a most competent officer, but will any one tell me for a moment that he is there to act as lie pleases ? Or is he there to carry out the instructions, whether whispered or trumpet-tongued, of the Prime Minister? I should be very surprised if he were not. Does any one tell me that the other members of the advisory council, will take no note of what the Prime Minister whispers or tells in, perhaps, an indirect way what he wants done ? Or will they carry out instructions ? So, we see what is the position of the Commonwealth Bank to-day. It is directly under political control. At the head of it is the Prime Minister. Of course, he keeps well behind the scenes, but although the advisory council may issue instructions and orders the power behind the throne is the Prime Minister. The hand is the hand of Esau but the voice is the voice of Jacob. This bank is Chifley’s bank, and what he says goes. But this is not enough; something more is needed.
Mention has been made of the fact, and. I have referred to it myself, that the Australian Labour party has had as its objective for more than 50 years, nationalization of the means of production, distribution and exchange. In 1921 there was a conference about which the Leader of the Opposition (Mr. Menzies) has told us something. From what he said and what we have gathered from other sources, it would appear that some of the leading members of the Australian Labour party in this Parliament and the State Parliament of New South Wales met the leaders of the industrial movement outside Parliament, and, shall I say, conspired with them to bring about the nationalization of banking .as the first step to a new order. Under cover of that proposal, they intended ;to sweep away parliament as the basic institution of democratic government, although using it while it served their purpose but casting it aside when it was no longer useful to them. They proposed to create in the place of Parliament economic councils, which is another name for “ Soviets “. The parliamentary institution, with all ‘ its faults - and you, Mr. Speaker, are’ in a position to observe many of them - has this supreme and most precious virtue that it enables the people of Australia to remain the masters of their own destiny. If those whom they send to represent them in parliament do something wrong, they can undo the wrong at the next elections. But, once this new regime displaces the Parliament, there will be an end to all freedom and to all semblance of democratic government. For a thousand years and more the people of our race have struggled for a’ voice in the moulding of ‘ their destiny, for the right to determine their own way of life. Gradually we have achieved that end; we have climbed Mount Pisgah, and to-day we stand as free as any people can be in the world.
Something - was said, yesterday about the trading banks and the evils which they have wrought and condoned. I have never couched a lance for the trading banks or the vested interests of this country, nor have I ever cast .a vote to help them but I am here to see that all sections of the community get even-handed justice. I remind honorable members opposite that within the last 50 years, during the period when the trading banks have been exercising this baneful influence, Australia has made greater advances than any other country in the world. The material gains are obvious but there are others not less worth noting. When I first entered the Labour movement the worker was an Ishmaelite, and a unionist was one against whom every man’s hand was raised. To-day, the unionist sits in the seat of the mighty; he is no longer a by-product of the capitalistic regime, a serf or a robot. What he says goes. That has been achieved during the last 50 years under the dark shadow of these evil influences. The Government must not invent pretexts for doing these things; it should come out boldly and say, “ The private banks must go “. Circumstances, and my friends across the table, have changed. There was once a time when they were free from all outside influences ; that no longer applies.
When I referred a little while ago to the position of the advisory council I might have applied my remarks to the Parliament itself. What happens now? The caucus meets - I am quite familiar with these things, naturally! After a more or less spirited discussion, the majority asserts its weight and the Prime Minister comes in and informs the Parliament of the policy of his government. Whether that policy is the same ns it was before he went in is, of course, an “ even money “ bet ! However, the point is, who now controls the caucus? No one knows better than you, sir, that at the present time the industrial movement is running the show. Who runs the industrial movement? -Of course, the Communists have a big say in that. The people who are now exercising such a powerful influence in our public life were not there in my time. Although there was another body, strong and terrible in the land, called the “International Workers of the World “, whose one passion in life was to avoid industry of any kind. They counted for little and Labour was practically free from their influence; their voice was as that of one crying in the wilderness. To-day, however, those who reign in their stead are a power in the land.
When members of the Opposition asked the Prime Minister why he did this thing behind the backs of the people, he replied that it was because the High Court had declared ultra vires section 48 of the Banking Act 1945. What does section 48 provide? It was designed to compel municipal and shire councils and other instrumentalities of the State to bank with the Commonwealth Bank. The High Court has declared that to be ultra vires the powers of this Parliament. May I point out to the Prime Minister that there is much in the High Court judgment to commend it quite apart from its effects on our political life. Neither the Melbourne City Council nor any other shire or municipal council is a profit-making enterprise. Members of those councils are elected to function as “little governments “, and within their sphere they are, as we are, the servants of those who elect them. As such they are responsible to the community for every penny they spend. As members of those councils are in far more direct and intimate contact with their electors than we are - which many of us hope is a condition that will long continue - it follows that if the members of the Melbourne City Council had spent the ratepayers’ money unwisely, they would have been swept out of existence at the aldermanic elections. The reason therefore why they did not go to the Commonwealth Bank must certainly be that they could not obtain any better terms from that bank than they could from the trading banks. If it could have been shown at any local government election in Melbourne that they had passed over the Commonwealth Bank, which had offered them better treatment, that would have been an end to their aldermanic careers.
The Prime Minister says that the Banking Act 1945 no longer affords the power which he. desires. He says that there is grave anxiety in governmental circles that sections 18 to 22 may be declared ultra vires. From all that I can learn, there is no reason at all for that fear. It was suggested that some sinister move is contemplated against the special accounts, and that they must be up and doing to prevent this £268,000,000- -a gift from the gods - from being taken from the Commonwealth Bank. All of these things are pretexts. They are, at the best, mere shadows, phantoms. The Commonwealth has to-day all the authority and power to control absolutely the monetary and credit system of this country. We are asking that this measure, which has been brought in behind the people’s backs, which is the first measure introduced in this Parliament that has nationalization as its object, shall be submitted to the people. But the Prime Minister will have none of it. Why? Does he distrust the people? Does be deny that he is the servant of the people? Does he deny that he has done something which he had no mandate whatever to do, that he never hinted or suggested in any way that this was has intention? Do not honorable members opposite ‘generally admit that, if they went to the country now on the question of the nationalization of the trading banks, disaster would overtake them ? We are quite ready to go to the country. But what we are asking is that the right honorable gentleman shall submit the question to the people by way of a referendum. The Leader of the Opposition has made it perfectly clear that this legislation for the nationalization of the trading banks contemplates doing something which, when done, cannot be undone. If we wait until the next general elections, things will crystalize in a different pattern, and we shall not be able to do what we can now do by way of a referendum. An appeal to the people now would give us the assurance that they are either for or against it. If they are for it, there is an end of the matter; it must come. I say to the Prime Minister that he should take his courage in his hands and submit the question to a referendum. I am not- the only one in this Parliament who thinks that. Nor is there only one honorable member on the other side who thinks that that would be a wise course to take. The reasons which the Prime Minister gives for bringing in this measure will not bear examination. He says that nationalization of the banks will guard against depression. Even with the eye of faith, one cannot see any signs of depression now. Never was this country on. a better economic “ wicket “ than it is to-day. We have been told in the press that wheat is quoted at 19s. 6d. a bushel. What it went down to in the depression I do not know.
– It went down to ls. 6d. a bushel.
– I have also noticed in the press that scoured wool yesterday brought 99£d. per lb. All of our primary products are fetching record prices. Our industries are in a flourishing condition. Never in the history of this country has employment been so plentiful as it is now. There is a struggle, not for jobs but for men to fill them. All sorts of inducements are being offered to men and women to accept positions in factories. The Government is wellequipped with all the powers that would be necessary to deal with a depression should it come about. As to full employment, which was put in only to make weight : How will this measure help the Government in that respect? What does full employment mean? We could have had full employment had we’ made a craven surrender to the German. He would have seen that we were kept fully employed. That is what he went to war for - to see that other people worked while he looked on. The Government can only absorb surplus labour by providing employment, on public works such as irrigation, the making of roads and so on; and that will not succeed unless the Government is able to exercise the powers of a dictatorship. It must be able to say to Jones, “You go to Milparinka, or to Booligal, and make roads, or engage in irrigation works “. Socialism can only be effective under a dictatorship. You must have power to deal with the individual. Nationalization of the banks is the first step towards socialism and so to industrial conscription.
I want to contrast, for a moment or two, the position of the Labour party today with what it was when Fisher established the Commonwealth Bank. Fisher was a democrat. He believed in the people. He believed that democracy was government of the people, by the people, for the people. Standing as we did in 1914, when war had broken out, he pledged himself, if returned, to wage that war to a victorious end, to “ the last man and the last shilling”. He further said that it was bis intention to introduce a measure providing for recourse to the referendum upon the request, in a prescribed form, of 20 per cent, of the electors. We have given to the Prime Minister petitions from more than 20 per cent, of the people, but he ignores them. The Labour party in 1914 was returned on a policy to fight the war to a victorious finish. We had a great majority. We believed in the referendum. It was a plank of the Labour party’s platform. But when, in 1916j the armed divisions having been sadly depleted and voluntary recruiting was lagging, and I asked the Parliament, and through the Parliament the people^ to agree to conscription for overseas military service, the party expelled me, not because of the object for which the referendum, was to be taken, but because I had appealed to the people. The referendum was a plank in the platform of the party. We believed in the referendum, and we applied it. It was the democratic and obvious way by which the people could assert themselves, and express an opinion on legislation that has been passed or is in contemplation. I contrast our attitude in 1914 with the attitude of the right honorable gentleman to-day. We believed in. fighting- the war to a victorious finish. Wc all were elected on that. Because I appealed, to the people in a democratic way I was expelled.
This is not a conscription issue, but one relating to a fundamental change which ought never to have been attempted behind the people’s backs. I call upon the Prime Minister to submit this measure to a referendum.. The right honorable gentleman has turned his back on the people. He distrusts them. He fears them, because he knows that if he submitted the proposal to them at a. referendum it would be rejected. It is for that reason that he looks coldly on the proposal for a referendum on this subject, notwithstanding that in the new year he proposes to submit other matters to the decision of the people at a referendum. He is in favour of a referendum when he believes that it will evoke a certain response, but . not otherwise. We want a referendum, not for new powers, but on the right use of powers which the Parliament already possesses. That is a fundamental principle of democracy. 1 leave it at that. This bill is brought in behind the backs of the people, who have a right to express their views. I call upon the Government to allow them to exercise that right.
– The campaign being, waged inside and outside the National Parliament to defeat this bill has been described by the Leader of the Opposition (Mr. Menzies) as “the second battle for Australia”. His inference that the defence of the privileges enjoyed by a small group of banking institutionsprivileges which should never ha.ve been granted in a democratic community - is comparable with the cause for which men fought and died in the jungles of New Guinea and elsewhere, is so outrageously insulting to our fighting forces that it carries its own condemnation. The right honorable gentleman’s reference to the defence of Australia against the Japanese invader affords me the opportunity to remind members of the Opposition in this Parliament that they are where they are because of their failure, amounting to criminal negligence, to give the nation the leadership which it needed in its hour of direst peril. This nation was saved from invasion in the real and only battle for Australia by the gallantry of our fighting men, backed by the .united efforts of the Australian people on the home front, under the leadership of a Labour government. Having successfully led the nation in war, the same Labour party, which is the only Australian political party with a truly and wholly Australian outlook, will provide equally capable leadership to ensure for the Australian people the fruits of the victory they so dearly bought. It will guarantee, too, that those dreams of social justice, and of a richer, fuller, life which sustained the Australian people during six long years of war, will be translated from a promise to a living reality. It is because of our determination that the Australian people shall not he denied the fruits of their victory that we have brought this measure before the Parliament. The welter of propaganda, inspired by the- banks, and paid for by the banks, to misrepresent the motives of the Government and the purposes of its legislation may have succeeded in misleading some people, but the monstrous absurdities that characterize the newspaper advertisements, the radio broadcasts, and the speeches of Opposition members, have already defeated their purpose. Those responsible for this hysterical propaganda have even attempted to brand our legislation as totalitarian. In actual fact, it is the antithesis of totalitarianism. Surely, there could be nothing more democratic than to give the people control of their own monetary and credit-making facilities. A government that could and did marshal the full physical and material resources of the nation, so that Australia could survive as a land of freedom for this and succeeding generations, would he the last to endanger freedom in the post-war world.
The measure now before the House will promote those freedoms that really matter - freedom from fear and freedom from want - freedoms so significantly absent in the years when anti-Labour governments ruled Australia and took their orders from the trading banks. The right of those men and women who work in the factories, on the land, in shops and in offices, to the freedom from want and the freedom from fear is more precious to this Government than the privileges which are exercised by 50 or 60 people who style themselves bank directors, but which they have no moral right to possess. The Government insists that the Australian people shall have the’ right to live their lives free from the haunting fear of another depression which a small financial coterie could and would again engineer if it were able to do so. Such a depression would be even more terrible than the one from which so many hundreds of thousands of Australians emerged with scars on their souls and marks on their bodies, after a decade of chaos and confusion in the years immediately preceding the outbreak of World War II.
To-night the House has listened to a speech by the right honorable member for North Sydney (Mr. Hughes). It is pathetic that a man who, in his earlier years did .so much for Australia, should finish as an apologist for the banking institutions which tried to destroy him and the Labour party which he helped to build. We heard him say to-night that he had always believed in competition. That is not so; he did not believe in competition in August, 1910. On page 1,523 of Hansard of the 10th August, 1910, the right honorable gentleman is reported as saying-
The State has a right to be the custodian, and is the best custodian of the people’smoney.
He went on to say - this was when hewas a Labour leader, and wrote The Case for Labour -
We believe that the only method by which’ the public can be safeguarded is by putting the state - that is the whole body of the people - into the position which some few individuals occupy now.
That was what the right honorable gentleman believed in 1910; but in 1947 he says that there is nothing wrong with the trading banks, and that the Government ought not to nationalize them without first submitting the proposal to a referendum of the people. On page 1516 of Hansard of 1910, he is reported as having said, when speaking of the Commonwealth Bank, on the second reading of the Australian Notes Bill -
All the other banks carry on their business without issuing currency. It was the intention of the Bank Act-
Peel’s Bank Act of 1844- to prevent them from working as banks, but it was found that bankers carry on their transactions not with currency, but with credit
Credit they created themselves - those are my words. But on page 1515, he is reported as follows: -
Ninety-nine out of the 100 reasons offered for the .rejection of our proposal have their origin in the fact that great advantages now accrue to private persons and institutions from having the right to issue paper money.
That was a proposal to take away from the trading banks the right to issue notes so that the Commonwealth. Treasury would be the sole note-issuing authority. The right honorable gentleman has changed a lot since then.
McEwen. - Many years .have passed since then.
– Yes, many years have passed, but the right honorable gentleman held somewhat similar view3 a long -while after that. In 1930, he wrote a book. Who was it who said, “ Oh, that mine enemy would write a book!” The right honorable member wrote a book, Bond and free, and, in reference to the Premiers plan of defla-tion as applied to that time, he said -
The remedy is not to reduce wages in Britain, or in Australia, or in any other country; for it is evident that, since a reduction in consuming power of one country reacts upon all, the new level of wages will be as unstable as the old, and so the standard of living of the whole world must continue to decline, and the workers sink into a state of economic serfdom in pitiable subjection to the great financial interests who are able to control prices.
That was the right honorable gentleman’s opinion in 1930, twenty years after he made the speeches from which I quoted just now. There is a lot more that he wrote, and a lot more that be said, but I do not propose to quote all of it. However, let me recall to honorable members, and to the country, the opinion which the right honorable gentleman expressed of Sir Otto Niemeyer -
Sir Otto represents a private bank ; he represents, not the people of England, but great financial interests. And although, like most other countries, we are just now in trouble, we are not going to shape our policy as any bank or group of financiers, no matter how powerful, directs. So much he ought to have been plainly told.
I now leave the right honorable member for North Sydney, and I direct my remarks to some observations made by the Leader of the Opposition (Mr. Menzies) about the constitutionality of sections 18 to 22 of the Banking Act of 1945. There are only two matters upon which the people of Australia want to be satisfied in order to accept this bill with enthusiasm, and not with reluctance. The first point is whether there is any real reason to believe that the constitutionality of any sections of the 1945 Banking Act are in doubt; and secondly, is it” necessary that this bill should be passed in the interests of Australia? If I remember correctly what the Leader of the Opposition said, he based his statement that sections 18 to 22 of the Banking Act were not challengeable on the fact that these sections confer power to impose taxation. His view was that if those sections had been challenged in the High Court, the court would merely have held that they constituted a taxation measure, and because they were associated with another law, in defiance of Section 55 of the Constitution, they would be invalid. The right honorable gentleman added that, in such an event, those sections could then merely have been reenacted as a separate measure. He also said that, in his belief, no lawyer had yet advised the Government that sections 18 to 22 of the Banking Act were invalid, and it was his view that no lawyer had advised that they were not of doubtful validity. He said that they had never been challenged, and were not, in legal opinion, susceptible to challenge. He said that he did not propose to discuss the legal implications, adding that they were “ for other people, and for other places “. It does not appear that he specifically states his own opinion as a lawyer on the validity or otherwise of the sections, but if he believes that they are not susceptible to challenge, he is nol justified in attributing that view to other constitutional authorities. Even if a majority of lawyers believed them to be invalid, it does not follow that the High Court would accept such a view. The onlY opinion quoted by the Leader of the Opposition was the opinion of th, Chief Justice himself. There are seven justices on the High Court, who could give seven different opinions, assuming that there could possibly be seven different opinions on such an issue. What the Loader of the Opposition has said does not establish the claim that the Banking Act, is unchallengeable.
About the time the right honorable gentleman was giving consideration to this legislation, a gentleman named McConnan, associated with the National Bank of Australasia Limited, published the following statement in the monthly Summary of Australian Conditions. issued by his bank on the 10th October last-
Two years ago we took advice all over the place as to what the Act really meant, and saw then that it would be silly to talk about attacking the Banking Act.
In those days, Mr. McConnan and his advisors apparently believed that even section 4S of the Banking Act was not open to challenge, let alone sections 18 to 22. But section 48 was challenged by the
Melbourne City Council, a body of which I was at one time a member. It was challenged by a firm of lawyers which, as the Minister for Post-war Reconstruction (Mr. Dedman) pointed out last night happened, by a strange coincidence, also to be the lawyers for the associated banks. “We remember that the associated banks said that they had nothing to do with the challenging of section 48 of the act - that it came as a complete surprise to them - just as Sir Prank Clarke’s action in the Victorian Legislative Council was another remarkable example of spontaniety. However, Mr. McConnan has a different view from- others who have spoken on this subject. In the same issue of this bank journal, he writes -
We did quite a little bit in the way of expressing the hope that the. City Council would not attack sections 18 to 22, which they did not.
That ‘ indicates that there was consultation between the banks and the Melbourne City Council before action was taken. It shows that Mr. McConnan feared that sections 18 to 22, if challenged at the same time as section 48, might be declared ultra vires the Constitution, and that the whole Banking Act of 1945 would collapse, with the result that the trading banks could offer no opposition to the Government if it proposed to introduce legislation for the complete nationalization of the banking system. This was an expression of an opinion based on grounds of expediency. This action of the banks was not designed to protect the 1945 legislation. It was something which they thought would best suit their own particular interests. The Government does not intend to leave the issue in doubt. If section 48 can be challenged, then sections IS to 22 can be challenged; and no one can say that the High Court would act as the Leader of the Opposition says it would. Section 48 was declared to be invalid although it appeared to the Government to be valid, and the court in its judgment in the Melbourne City Council case made it clear - and this is most important - that a law which is clearly a law with respect to banking may be held to be invalid on other constitutional considerations. In those circumstances, no one can tell whether any law passed by this Parliament, judged by that criterion, will be held to be valid. There is only one action that the Government can take, and that is to put the issue beyond doubt. It must exercise the complete power of the Parliament in this matter, and let the High Court pass judgment upon it, should someone test it at law ; and let it go to the Privy Council, if necessary, in order that the issue can he finally settled. The Government is convinced that the Banking Act is open to further challenge, particularly in respect of sections 18 to 22 ; and the matter is too important for any one to say that it will be safe to rely on the earlier view, a view shared by the private trading banks, mark you, in 1945, that that act would withstand any challenge.
The second matter to which I wish to address myself is that we are certain that the private banks will not obey any instruction from the Commonwealth Bank unless they have to, and that they have no desire to co-operate with the Commonwealth Bank, or the Government. They made it clear in a letter addressed by one of the private banks to the Commonwealth Bank which the Prime Minister (Mr. Chifley) quoted in his secondreading speech, that they will only co-operate with the Commonwealth Bank on terms that suit themselves, and that they will reserve to themselves any subsequent action that they may desire to take to challenge this legislation. They did not say that in so many words, but the letter written to the Commonwealth Bank stated in parti -
Acquiesence or compliance on this bank’s part with any requests or directions from you is not to be taken to import any contract with your bank in the terms of the act.
S’o, the issue must be placed beyond all doubt. “We are certain that the private banks will not co-operate with us. In the last depression, the Bank of New South “Wales raised its deposit rate by i per cent, in defiance of the wishes of the Commonwealth Bank; and the Royal Commission on Monetary and Banking Systems reported adversely upon the Bank of New South Wales for that action. The banks strongly opposed the 1945 legislation, especially that section of the legislation dealing with the holding of special accounts to which the Leader of the Australian Country party (Mr. Fadden) referred, last night. The private hanks never accepted the 1945 legislation, and. neither did the Opposition. Had the Government been defeated at the last general elections in 1946 there would not now he on the statute-book the Bank? ing Act of 1945 to protect the public. There would not now be any act on the statute-book to protect; them in the event of another depression.
But we are being deluged* with protests which have been organized, and which are alleged to have spontaneously arisen from the outraged breasts of a large section of the populace on this question of banking reform. Member after member on the Opposition side, day after day, goes through the pantomime .performance of presenting petitions praying, for this and praying for that. The Leader of the Opposition once committed himself to> paper. He once wrote a book entitled The. Forgotten People; and, I trust, that he will not mind my reading from it.
– I wish the Minister would read the lot.,
– I shall quote that portion which is germane to the discussion and within the Standing Orders-. In. a chapter1 entitled “ The Four’ Freedoms “, the right honorable’ gentleman, dealing- with freedomfrom fear, discussed this very thing of people writing letters to members of parliament, threatening to oppose them at the next elections, and demanding that certain action be taken in accordance with the wishes of the signatories or else there would be dire consequences for those who refused to comply with such, demands. The right honorable gentler man wrote -
In recent years a great many people calling; themselves democrats have discovered andpractised the art of what is called “pressure politics “, the “ pressure “ taking the form of- hundreds^,, and in* some cases that I cam. remember thousands, of stereotyped letters signed, and sent to members of parliament, on some particular topic, by their constituents: the usual ending being that “ if you d’o not act in accordance with this view,. I will doall I can, to ha.v.e- you defeated- at the nextelection “..
This, was the Leader of the Opposition. He went on -
This kind of pressure, much attempted a few years ago, for example, by. the Douglas Credit people, really represents an endeavour to exploit, the instinct of fear.. The hope is that the member of parliament will be sufficiently spineless to abandon his own reasoned convictions for fear of losing 1^ seat in parliament..
– Who wrote that?
– The Right Honorable R. G. Menzies wrote it. It continues -
We may go further in this examination. It is notorious that many electors believe that the function of their member of parliament is to ascertain, if he- can, what a majority of: his electors desire, and then plump for it in parliament. A more stupid and humiliating conception of the function of a member of parliament can- hardly be imagined.
– None of it has relation to a dishonest policy.
– The right, honorable gentleman- continued -
If you want mere phonograph records or sounding boards in Pa.rliament. then phonograph records or sounding boards you shall get - and statesmanship will die; and democracy will die with it:!
– Who did you say wrote that book?’
– I am quoting, from a. book, entitled The Forgotten. People, by the. Leader, of the. Opposition. He continued -
The. true, function of. a member of parliament is to serve his electors not only, with his vote but with his intelligence. If some problem arises in parliament about which he has knowledge and1 to which he has devoted Mi’s best thought,,, how absurd, it would1 be - indeed: how dangerous it would, be– if he should allow his considered conclusion to be. -upset by a temporary clamour by thousands of people;, most of whom, in the nature- of things could not have. his. sources, of information, and have, probably in any event not. thought theproblem out at all.
I think that. that. fits-, very well the position of people who are signing petitions protesting against this legislation. Theright honorable gentleman continued.: -
Nothing can be WOrse for democracy than. to-, adopt the practice, of permitting knowledge, to be overthrows! by ignorance. If I have honestly and thoughtfully arrived at. a certain conclusion on a public question and my electors, disagree with- me, my, first duty is t’o endeavour, to persuade them that my view- is right. If I fail in this, my second, duty will be to accept the electoral consequences and not to run away from them.
That is a statement with which every honorable member . on this side of the House agrees. Then the right honorable gentleman drove home his final point with a smashing blow. He said -
Fear can never be a proper or useful, in:gredient in those mutual relations of respect and goodwill which ought to exist between the elector and. the elected.
He will still present his petitions; his followers will still present their petitions ; but we have on record now that in other years when the Douglas Credit people were attacking the banks, the right hon:orable gentleman, said that no notice would be taken of their activities. Today, when the hanking institutions. ar_e: protesting against this proposal, no notice will be taken of them either. Whatthe right honorable gentleman wrote- some years ago is perfectly true.
There has been a lot of talk about socialism from the Opposition side of the House. One would have imagined that socialism, was first heard of in 1947. I quote from a leading article in the SydneyMorning Herald in relation to an election which the Labour party was contesting. It. reads -
We call upon every law-abiding- citizen to. vote for Liberal candidates to-day, so that we may be in no danger in future of the anarchy* which lies concealed in every plank of the socialist platform.
That was not written on this day of grace in this year of grace. It was not written on the 29th October, 1947. It was written on the 13th April, 1910! And it was written at a time when the right honorable member for North Sydney represented the electorate of West Sydney and was one of the socialists whom the Sydney Morning Herald wanted to keep out of the National Parliament. The Leader of the. Australian Country Party, who talked of the evils of socialism, said that this bill is the first step in Labour’s ten-year plan of socialization. I do not. think the right honorable gentleman believes that. I do not think any honorable member opposite believes that there is any plan of socialization. No sensible person would believe it because, under the Commonwealth Con stitution, no Commonwealth government has power to socialize even a lolly shop; The statement made by the right honorable member was supplied to him by the banks. It is the sort of statement that only a moron would think up and only a. “ sucker. “ would fall for. The Australian Country party, however, has, not always decried socialism.. It believes in socialismto the extent that it always wants schemes: of. organized marketing. It believes sufficiently in. socialism to want the Com-monwealth Bank’ to finance all schemes’ of organized’ marketing. It believes- in socialism greatly enough, to want the Commonwealth Bank in time- of war to, handle all the. financial aspects of. primary production. What the Commonwealth: Bank did. for the farmers of Australia during World. War II.. is indicated by the very impressive figures which it has- compiled in. a statistical survey of. commodity, advances made from the 1st July, 1939, to- the 30th June, 1947. During that period £510,000,00.0 was advanced by the Commonwealth, Bank on rural credit terms in respect of Australian produce and tea, coffee and jute. Rural credits advances amounted to £61,000,000. There, were also advances to exporters against: commodities exported under contract with the British Ministry of Pood amounting to £16S,000,000. .The Commonwealth Bank, which was established by the Labour- party in 1911 in face of the most bitter and unrelenting opposition, provided for the farmers of Australia during World War II. an amount of. £739,000j000 by way of advances: The Australian Country party has never condemned that- form of socialism. It has never said that that is the sort of socialism to. which, it is opposed. All the members of the Australian Country party are not opposed to. the bill now before us, nor were they opposed to the 1945 banking legislation. On the 12th April, 1945, about two and a half years ago, the Country party in Victoria held a conference and discussed the subject of banking: Sir Louis. Bussau; who had. been a Country party Minister- in the Victorian Government led by Mr. Dunstan, said at that conference -
If the Bank of England had not been controlled by the British Government, Britain would have been in a bad state in this war.
The people of any nation should not be’ hamstrung by finance in the hands of private individuals. It should be in the hands of the people.
That was the opinion of a member of the Country party who remained a member of the party until he died. At the same conference, Mr. Reid, a member of the central executive of the party, one of the intelligentsia, a member of the brains trust of that organization, said -
If the trading banks had been more generous in the past, there would, not now be all the opposition to them to-day. Australia will never be developed under the present financial system because the trading banks will not give the necessary money for developing our great national resources.
Mr, Elsom, who represented Warracknabeal, which is the federal electorate of Wimmera, at the conference, said, “ Speaking as the father of a family, and as a wheat farmer, I do not live in fear of the Commonwealth Government in regard, to its rural or banking policy” He continued -
We can’t get at the private banks, but we can toss out a Government if we think it is doing the wrong thing. I’m disgusted with criticism of the Federal Government on drought.
They are not the only members of the Country party who have expressed very critical views about the banking system in Australia. I see the honorable member for Barker (Mr. Archie Cameron) sitting on the back bench. I have a few excerpts from his speeches when he was a member of the South Australian Parliament, and then a member of the Australian Country party. They make very interesting reading. On the 15th Ju’ly, 1931, the honorable gentleman was discussing the Premiers plan as embodied in the State measure termed the Financial Emergency Bill. He had then been a member of the South Australian Parliament for, I think, six years.
– For over seven years.
– I accept the amendment. He had been a member of the South Australian Parliament for more than seven years before we had the misfortune to receive him here. During a speech by the Honorable R. L. Butler, the honorable gentlemen interjected, saying -
There is no competition between banks; what are the banks associated for ?
Mr. Butler then said ;
There is no competition between them, but there may be between associated banks and the State Bank. As long as the associated banks thought there was a benevolent government institution to carry a man on whose credit was doubtful, they did not mind sending him to the State Bank.
To which the honorable member for Barker then replied, very helpfully -
They made a practice of it.
I have no doubt that the honorable member for Barker, like the right honorable’ member for North Sydney, will in due course, do the work the banks want Mm to do. Later on in that debate, in the South Australian Parliament, on the 28th October, 1931 - sixteen years ago yesterday - the honorable member had this to say -
A lot of land dealing went on a few years ago and I shall quote a case which is typical of many. A man sold a place for a certain sum and agreed to leave ?4,000 on mortgage at say 7 per cent. Bad times came over the district a.nd the mortgagor was not able to pay his interest for three years. The mortgagee went to the same bank and secured an overdraft against the security of that mortgage for say, ?1,500 to ?2,000. The bank then asked him to come in and see them in respect of the conditions under which their people were working. The bank said to the man who had a mortgage of ?4,000. “ We think you should write off three years’ interest to this man and ?500 off the principal.” He replied to the bank manager, “ I am quite prepared to do that provided you will write off three years’ interest on my overdraft and a proportionate amount of the principal. However, the bank manager said he could not consider anything like that. They wanted the mortgagee to stand the whole of the losses, and that is one of the grievous features of the banking situation in this State to-day. It is not only in regard to people dealing in land, but it is from some of the big financial and commercial interests in Adelaide that one receives the most grievous complaints in regard to what they consider the dog in the manger attitude of the banks to-day. It stands to reason there are going to be some very serious losses in regard to all sorts of securities before the depression is over.
At least the honorable member was a prophet. He concluded -
So far as I am able to gather the attitude of the banks to-day is that they expect everyone else to burn their lingers in pulling the bank chestnuts out of the fire, but are not prepared to do anything themselves.
The honorable member was as right in 1931 in that connexion as the honorable member for North Sydney was in what he said in 1930 and in 1910. Both are hopelessly wrong to-day.
I should like to quote from a very important document, marked private and confidential, issued by a gentleman named Heifer. who is general manager of the Bank of Few South “Wales. In it, he indicates where the money for the campaign against this bill is coming from, and shows who is behind it all. In a circular sent to all the Australian managers of the associated banks, he states -
When Mr. Chifley announced his intention to nationalize the banks we commenced a twoyears’ publicity campaign. Our immediate object was to inform and arouse the public so that the electors, by letters, telegrams, public resolutions and the signing of protests and petitions might force the Labour Government either to reject the bank nationalization proposal or to submit it to a referendum. Our long-term aim-
Note the use of the personal pronoun “ our “ throughout the circular - is to inform the public regarding banking and finance and to keep before the public the dangers of an extreme socialistic trend in the affairs of the country. The first phage of our campaign is now in progress and will last up to the time when the nationalization bill has finally .been dealt with in Parliament.
Then he goes on to detail the next steps. This is the very same gentleman who, in the Melbourne Sun Pictorial of the 10th September, was reported as having said at a meeting in .Sydney -
A bloodless revolution it may be for a start, but I don’t doubt that later blood will flow, because mcn will fight for freedom.
And a former leader of the Australian Country party, the right honorable member for Cowper (Sir Earle Page) is on record as having said that blood would flow in Australian streets as it was flowing in India to-day. That is not the language of criticism. It is not the language of strong criticism. It is the language of treason, and the penalty for treason is death. Quite a number of people in this country are threatening bloodshed over this bill, but it is a democratic measure, and it will be enacted. It will be enacted because the people believe that it is necessary. I say in conclusion that the history of banking in Australia is one long story of corruption, fraud and failure. Until this Go vernment passed legislation in 1945 compelling the banks, amongst other things, to accept the direction of the Commonwealth Bank on the question of credit expansion or retraction, on the interest rate to be charged on advances, and on the channels in which credit should flow in the best interests of the nation, the sole authority that determined these things was that set up amongst themselves by private banking corporations. The ghastly failures of the banks in the nineties of the last century and the callous and brutal things that they did to people’s lives and fortunes in the depressions of the 1890’s and the 1930’s are indelibly imprinted on the minds of the Australian people. The banks have blighted more lives than the most disastrous droughts; they have blasted more hopes than the most destructive bush fires; and they have broken more spirits than the most devastating floods. While they continued to exercise a power that properly belongs to the nation they enjoyed an extraordinary prosperity, but their days are numbered. Their time is up. The profits they arrogated to themselves will, like the profit made by the Commonwealth Bank, be utilized in the public interest, and the power they have so misused will, in -future, be exercised by the instrumentality set up under the authority of Parliament, answerable to the elected representatives of the people, and to no one else.
– There cannot be victory without war. The Minister for Information (Mr. Calwell) opened his speech, which was supposed to be on a bill dealing with banking, by talking about what had happened during World War II. He held up the Australian Labour party as the instrument that had forged the weapons of victory, organized everything for the defence of this country, and prosecuted the war to a successful conclusion. The Minister was not elected to this Parliament until 1940, but I am quite sure that had he been here in 1938 he would have been associated with his colleagues in objecting to the doubling of the strength of the militia by the Lyons Government, and in 1939, after the outbreak of war, he would have been associated with the attempt led by the then Leader of the Opposition, the late John Curtin, to prevent the Australian Imperial Force from going outside Australia. He would have voted also to prevent the building of the Cap.tain Cook Dock in Sydney and other essential war undertakings just as willingly as the other members of his party did. When it comes to a question of the fruits of victory, I say to the Minister that he and his party did little to prepare the orchard for victory during the time they were in opposition. They have only gathered a harvest of very good fruit where other people ploughed, planted, manured and pruned.
As I have said, the Minister’s speech was supposed to be on banking, but we heard little about the Banking Bill. Instead we heard a good deal about the misdeeds of former bankers and banking systems going back to the year 1S84. The Minister said that this was not totalitarian legislation, but, I suggest that the first duty of this Government before bringing the bill into force should be to make a pilgrimage to the tomb of Hitler. The Government should not be allowed to implement the bill until it has found Hitler’s grave. In the history of this country there was not anything in the nature of totalitarian legislation until the introduction of this bill. The Minister tore the right honorable member foi’ North Sydney (Mr. Hughes) to pieces, and read quotations to show that that right honorable gentleman, at past times in his career, did not believe in competition. I say to you, Mr. Speaker, as one who will be conscious of this even more than I am, that no commercial or financial institution in Australia indulges in competition more than the Australian Labour party does internally. There is no office in the giving of that party for which there is not, in ninetynine cases out of a hundred, the most dreadful and dire competition on the part of those in the party who think they should have it. Members of the Australian Labour party do not believe in competition in industry but they say that the competitive system is the only one suitable for promotion inside their own party. How often have we seen the House canvassed and seen members of the party welcoming new members in an endeavour to secure for themselves or their friends the votes necessary to place them on the treasury bench instead of on the back benches, where so many of them ought to be.
The Minister for Information, as I have said, went on to talk about 1884 and about the power to create credit. If the power to create credit on the part of private individuals existed in 1884, it must still exist in 1947. If this elusive thing “ credit “ can be created so easily with such advantage to certain interests, I marvel that the Australian Labour party has not created its own party bank and participated in the spoils. Why does the party, not go into that? The honorable gentleman also said that no banking legislation would have been on the statute-book if the Opposition had been returned to power, That is one of the few true statements he made, because it was made perfectly clear by the Opposition when the banking legislation went through in 1945 that, if it were returned to power at the next general elections, it would repeal or vitally alter the legisdation placed on the statute-book by the Australian Labour party so that it should accord with its views.
Then we heard the Minister talk about “pantomime petitions”. There is no pantomime about the petitions that have been presented. The people of Australia are in deadly earnest. They have been stirred as never but once before in Australia’s history, and that once was when the Australian Labour party split the Commonwealth of Australia in 1916 and 1917 over the conscription issue. The Minister can talk all the nonsense he likes about this legislation being democratic, but since, the 16th August many men of good standing and responsibility with some stake in this country told me in letters that I have not passed on to the Prime Minister that if this is the method of the Labour Government there is something to be done about it. Men on the front bench had better do a little thinking about that. Then, having quoted from a book by the Leader of the Opposition (Mr. Menzies), in which he detailed in, I think, very fair language the relationship that should exist between a member of the parliament and his constituents, the Minister went on to make it appear that the right honorable gentleman had been guilty of some devious breach of good sense in writing so. But I say that the Leader of the Opposition, when he wrote those paragraphs, was not visualizing the possibility of a government going to the people and failing to acquaint them of what was in its mind on. one of the most important issues ever raised in the country.
We have been told since the general elections a story about a blank cheque and the right of the Government, having been given a -majority, to say to the people, “ We did not give you any conditions or tell you our policy. You gave us a blank cheque and above your signature we will write any amount, terms and conditions that happen for the time being to comply with the sweet will of the majority of the caucus.” Every one knows perfectly well that the Australian Labour party was faced on the 16th August with a position very much like that of the Irishman whom I have heard the honorable member for Bendigo (Mr. Rankin) refer to once or twice, the chap with a firm grip on a leopard, crying out at the top of his voice for some one to hold it while he let it go. That was the position of the Labour caucus. Its members had before them the declaration of the Prime Minister that he proposed to nationalize the private trading banks. They had a caucus meeting. What were their alternatives? One was to repudiate the policy that stands at the top of their printed objectives - “ socialization of the means of production, distribution and exchange” - an objective that they have signed time and time again. I make bold to say that not one in four ever believed that he would be called upon in his lifetime in politics to make that effective. They dared not repudiate that. Their second course was to repudiate the Prime Minister. In my judgment, for once in their lives, they met their master. If they are prepared to have the soul of a slave and the outlook of a serf, it stands to reason that they wi:ll meet some one who will treat them according to -their deserts and according ito the .standard that they have set for themselves. I believe that the situation that confronted them when they met in caucus not many weeks ago was that they had to say meekly “ Yes “ to whatever the Prime Minister put up to them on banking. It is well-known to all of us that they knew nothing of the details of this subject. Indeed, it is fairly common knowledge that only two men in the Parliament really knew anything about it. One was the Prime Minister and the other was his heir presumptive who sits in another place but will in due course be translated down to this place for purposes that we all understand. The Prime Minister was very careful in his speech to make it particularly clear that the Attorney-General (Dr. Evatt) was privy to all this. I do not know the relationship between that right honorable gentleman and the rest of the Cabinet, but I do know his capacity for work and his capacity for sticking to the things that are immediately in front of him, and if, after his departure from Australia and arrival in the United States of America, where he was allotted the task of getting the kingdoms of Israel and Judah together and of getting the lion to lay down with the Arabian lamb, if after his job of caring for the United Nations and acting as a sort of philosopher for Asia, Africa, America, Australia and everything else-
– Order ! That has nothing to do with the bill.
– I am referring to the Prime Minister’s speech in which he inserted a special paragraph on the awareness of the Attorney-General of the terms of this measure. If after taking on all those jobs, the AttorneyGeneral is paying any reasonable attention to what must be to him a very minor matter in an Australian backwater, which is his home, I have completely misunderstood the temper, outlook and methods of the Australian Attorney General.
I suppose it is only right that on an occasion like this some one should say something about the bill before us. We have heard a good deal of debate but Very little about the bill. I propose to go into a little discussion of the bill from the viewpoint of one who is not a lawyer or a banker, but one of the lowly farming community of this country. I am very grateful to the Minister for Information for having quoted some of the things I said in the Parliament of South Australia a few years ago. If honorable members opposite are historically-minded and want to find out what my past views have been on things like this, they can look at the South Australian Hansard. I do not take away from those records one word of what I put there. Any South Australian knows that I have never been a protagonist of the banks, and that I have never gone out to fight their battles. As a matter of fact, I have not had an account with a private bank for about fifteen years. The only account that I have is with the Commonwealth Bank. Therefore, I can be acquitted at any rate of the charge of having any personal interest in the case of the private banks.
I speak here to-night in favour, not of the banks, but of the people of the Commonwealth who, in my opinion, have an absolute right to do what they wish with their own money. If they want to lodge it with the private banks, that is their affair. If they have contracted mortgages and obtained overdrafts on certain securities, and if adverse times come, then the fact remains that they have entered into contracts to Day back money which has been advanced to them by the banks. There is a very old saying amongst legal men that there has never yet been a lawyer who could devise legislation which would save a fool from the consequences of his own folly. Some people have got into trouble because they took too rosy a view of the future. They contracted to pay prices for land which future markets would not justify. They put their money into certain businesses and borrowed on certain securities, and markets, times and all sorts of things went against them. It was to cases such as those that I referred in the South Australian Parliament in 1931. I tell the Government that, if those conditions return to this country, it will be confronted with problems like those which confronted the private banks. There is a feeling abroad to-day that, if we have one all-powerful Commonwealth Bank, anything in the nature of foreclosures and seizures by that bank will not take place. The feeling is that it will be the people’s bank and that ail the people - there are 7,500,000 of us now - will be able to go to that bank aud say to the banker, “ After all, you are one of our servants and I am a shareholder to the extent of my ownership of some of the £16,392,000 which is the declared capital of the Commonwealth Bank in all accounts, which amounts to something over £2 per head of the population, and by virtue of that shareholding I am entitled to the advances that I want “. But what has been happening in New South Wales recently? In that State, the Commonwealth Bank lias taken over the firm of A. E. Goodwin Proprietary Limited and placed it in the hands of a receiver. That was done only last month.
– Who was the receiver?
– I do not know. At any rate, it was not “ Maxie the Merchant”. The Rural Bank of New South Wales stated in its report for 3945-46 that it had realized on the properties of 21 borrowers during the year and was in possession on the 30th June, as mortgagee of nineteen properties. So, whether the people go to the Commonwealth Bank or to a State bank,, it stands to reason that, if their payment? fall into arrears and they find themselves in an impossible situation, there will be foreclosures just as there will be foreclosures by any private bank in similar circumstances. The people will not gain anything in this way from the bill. If they are prepared to swallow the statements put out by the Australian Labour party on this score, then they are drinking delusion and in due course will drink it to the dregs, and will know how bitter it is.
I refer now to the bill itself as I promised to do, which is something which very few other honorable members have promised and which fewer have done. The first point that strikes me relates to clause 3, which states that the Commonwealth Bank shall be carried on “ not for private profit”. Anybody would think, after hearing members of the Labour party speak, that profit is sought only by private institutions. But what is the record of the Commonwealth Bank? That was disclosed last night by no less an authority than the Minister for Postwar Reconstruction (Mr. Dedman). I do not know whether his complete statement was of a uniform character, but I do know that the first half of it was untrue. The honorable gentleman said that the Commonwealth Bank had started without any capital at all and, over a period of some 30 years, had amassed profits amounting to over £64,000,000. If an institution in which nobody has invested a “ bean “ has amassed profits of over £64,000,000 in 30 odd years, that is one of the greatest acts of profiteering of which I have ever heard. But I say that the Minister’s statement was wrong. The original Commonwealth Bank Act provided, unless my memory serves me very badly, that there should be an initial capital of £4,000,000. According to the latest report of the Commonwealth Bank, which I obtained from the Treasurer yesterday, the total capital of the Commonwealth Bank to-day is £16,392,235. The reserve funds amount to over £1,500,000, and there is a special reserve made up of the “ premium on gold sold “ - which means the profit on gold sold.
– Which the bank has taken from the producers of gold!
– Yes, just as it has taken profits from wheat and other things. Thebank has made a net profit of over £4,750,000 from gold, according to its report, and we do not know whether that discloses everything. There are other items which I shall net discuss.
I mention these facts because, if there are people in Australia who think that the Commonwealth Bank will engage in the business of banking without making profits, they are destined to be sadly disillusioned. I turn now to clause 5, which provides that the Commonwealth Bank shall have the right to take over all rights under contracts and agreements. If I had made a contract with somebody to do something, I should consider it to be impudence on the part of the Government to step in and say, “ Well, it is just too bad, Cameron, old son, that you have agreed with Smith to do something because the Commonwealth Bank will now do it for Smith “. I might not want to deal with the Commonwealth Bank at all. The fair, honest, and moral thing would be for the Government to approach contractors and persons who had entered into agreements with private banks and ask them whether they wanted to be associated with the Commonwealth Bank under the new conditions. Clause 6 deals with “legislative intent”. This is something about which I have no doubt that the honorable member for Warringah (Mr. Spender) will have something pertinent to say. I need not do more than read it now, because it is a most illuminating clause. It is said that at one end of the’ spectrum there is heat without light and that at the other end there is light without heat. This clause certainly does not give any light, though it may engender a great deal of heat before the bill is passed. It states -
It is hereby declared to be the intention of the Parliament -
that if any provision of this actis inconsistent with the Constitution, that provision and all the other provisions of this Act shall nevertheless operate to the full extent to which they can operate consistently with the Constitution;
that the provisions of thelast preceding paragraph shall be in addition to, and not in substitution for, the provisions of section fifteen a of the Acts Interpretation Act 1901-1941; and
that this section and section fifteen a of the Acts Interpretation Act 1901-1941 shall have effect notwithstanding that their operation may result in this Act having an effect different, or apparently different, in substance from the effect of the provisions contained in this Act in the form in which this act was enacted by the Parliament.
WhenI was a member of the Parliament of South Australia, one wise old man coined the phrase, “When things are different, they are not the same “. On this occasion, the Government and its supporters will modify that, and say, “ When things are different, they are the same “. That is what it amounts to; but I shall leave it to members of the legal profession to argue the matter among themselves.
Clause 11 provides that the Commonwealth Bank shall observe the customary practices and usages of hankers. I ask: After the private banks have been absorbed by the Commonwealth Bank, what will be the customary practices and usages of bankers? Will they be anything other than whatever the Commonwealth Bank likes to determine from day to day? There will be no other bank to approach, or no other recourse to any one. It will be what the Commonwealth Bank decides. All the other banks will have ceased to exist. Therefore, “ the customary practices and usages of bankers” depends upon what the Governor of the Commonwealth Bank, instructed by the Commonwealth Treasurer, likes to determine.
Clause 13 deals with the compulsory acquisition by the Commonwealth Bank of Australian shares in Australian private banks. Here, I desire to digress for a moment. The fateful decision to nationalize the private banks was published on the 15th August. Incidentally, [ point out that from the stand-point of the church, the 15th of August was a very important day, and perhaps that had something to do with the selection of that date. However, when the proposal was announced, I met a few people who were simply staggered by it. There were repercussions on the share market. The Treasurer went on to the market, or sent his representative, or made a public statement announcing that he would purchase, or the Commonwealth Bank would purchase^ any shares that were offered to the bank at the prices which were ruling when the stock exchange closed on the 15th August. A few days later, I read in the Adelaide Advertiser a. statement that S,0S8’ shares in the Commercial Banking Company cf Sydney had been purchased. After that day, I did not see any reference to this subject. Being a curious individual, when I came to Canberra I placed a question on the. noticepaper. I asked the Treasurer to supply a little information about the shares which had been purchased and to state under which parliamentary authority the Commonwealth had the right to purchase them. The answers, which the right honorable gentleman supplied, were most illuminating. He stated that shares in five different banks had been purchased to the tune of approximately £100;000. However, although prices were quoted, honorable members were- not informed of the number- of shares in each bank purchased. In addition, I was told that the power of purchase was exercised under section 13 of the Commonwealth Bank Act of 1945. I had read that provision before I placed my question on the noticepaper, and I say that whatever the law might determine, common sense declares that no such -purchase could have been made under that section.
– Hear, hear! And the law agrees with the honorable member.
– In section 96 of the act, a differentiation is made between shares and securities. 1 believe that in many instances, what the Commonwealth Bank bought on this occasion, acting on instruction from the Treasurer, were not securities but liabilities. The fact is, that many of these shares have reserve liabilities. Some of them are paid up only to 7s. 6d. in the £1, and the Government and the Commonwealth Bank have no legislative authority for embarking upon those purchases. The transaction was utterly illegal and wrong.
This evening, I received a reply to another question. A few days ago, I asked the Treasurer whether these transfers of shares purchased, by the Commonwealth. Bank had been entered in the registers of the .private banks by the Treasurer, and, if so, did the directors of the private banks approve the transfers of the. shares to the Commonwealth Bank? I also asked whether the sharesso transferred to the Commonwealth Bank, are entered in the, register in, the name of the Commonwealth Bank. I asked, if they are not. registered in the name of the Commonwealth Bank, in whose name axe. they registered?. In. reply, I received the illuminating: information that, in accordance with, normal banking practice, the shares are; registered in the. names of officers of. the Commonwealth Bank, who have: been appointed by the governor of the bank as nominees for that purpose.. These officers, have executed a deed of trust in favour of the bank, in respect of the shares registered in their names.
– - This is a. piece of dummying.
– Yes. Now, if there’ is- one thing– which the Labour paTty- has- condemned! as- long as I have taken an interest in politics, it is the dummying of land, the dummying of shares, and the dummying of the acquisition of the assets of any person for any purposes whatsoever. Yet, on. this occasion, the Government and the Commonwealth Bank have resorted to this practice, and. I assert again that the Parliament of the Commonwealth has not given to the Commonwealth Bank or the Government the power to create any body as- trustees for them. If anything is bought on behalf of the Commonwealth, it is the property of the Commonwealth, and must be registered in the name of the Commonwealth and nobody else. That is the stand which I take on that matter. This action is one of the greatest pieces of political and admini.strative impudence that I have ever seen, and the: persons responsible for it should be impeached, for their part in it.
This morning, I received a copy of the Commonwealth Bank’s report and I examined the statement of assets and liabilities shown therein. If the information which; the Treasurer gave is correct, the. return of the Commonwealth Bank for October is a lying document. It makes no disclosure of the purchase of these shares’. They cannot be. listed under “government securities” or- under “ municipal’ securities and. they are not listed under “ other securities “: - that is>. granting that the authorities consider the shares to. be securities. So, to the extent, of £10.0,000j false and lying, information has- been given to- the people of Australia in a document issued,, as required by statute, by the bank’s statistical department. If the Government and the Australian Labour party have, decided to embark to the extent of £100,000 upon a campaign of misrepresentation, falsehood and lying to cover up. deals for which there is no legislative-, authority, what are- we to expect when this glorious, all-time, over-all monopoly is established over the people of Australia?. I leave that delicate, subject, because I have a suspicion that the Government and the Commonwealth Bank have, not heard the. last of. it..
I point out to honorable members that clause 15 and. clause 25 employ the same language. Both relate to the payment, of fain compensation. Why it should be necessary to provide for the payment of fair compensation for the shares compulsorily acquired, and later for fair compensation to be paid for property compulsorily acquired, I do not know. .1 should have- imagined, perhaps quite wrongly, that having acquired all the shares of the trading banks, the- Commonwealth Bank must have acquired all the property as well. Apparently I am wrong. So we have this duplication of the provision for fair compensation. On that matter,. I have a suspicion that a lot more will be heard in the not far distant future.
Clause 17 deals with the retirement from office of the directors of the private banks. According to clause 60, they will be held, responsible for the transfer of their institutions to the- Commonwealth Bani?. The clause provides that the directors must assist in the transfer of the business of the private banks, although apparently they will have been relieved of their office; but they will1 be liable to a fine of £1,000 a day if they do not assist the transfer to the satisfaction of the Government. I may be completely at sea on this clause, but it appears to me to be a most amazing thing that the. Treasurer may give a number of directors not more than 6.0- days’ notice,, or1 in certain circumstances, the- Commonwealth may agree to an extension, to vacate their offices; but if the transfer does- not take effect properly, they will be responsible and liable to a. fine of £1,000 a day. Obviously, the fine cannot accrue until the Commonwealth has commenced to take over ; and it cannot commence to take over until the period which, is provided in this legislation has expired. The Commonwealth must wait for 6.0’ days before it can take over, and, accord.ing to clause 17, the directors of the private banks will not have any authority or right to be in their offices after the sixtieth day. However, if the transfer does not take place satisfactorily, the directors will be fined £1,000 a day. The Minister- for Information had a great deal to say about bank directors. Strangely enough, this clause, proposes t’o appoint to run the banks the very type of man whom he condemned. However-, clause 18 contains- a very significant qualification,, and I think that sub-clause 2 is one of the funniest things in this piece of legislation. That sub-clause states -
The directors so appointed shall hold office notwithstanding any lack of qualification or any disqualification arising under any law, charter or other instrument.
If that is to hold good it seems to me that, although a director becomes bankrupt, is sent to gaol, becomes an inmate of a lunatic asylum, goes out of the country or does anything else, he is still entitled to carry on the duties devolving upon him as a director.
Clause 19 provides that the newly appointed directors shall have power -
Australia. I should think that a little more will be heard concerning that provision in the near f uture.
Clause 20 states - (2.) At any meeting of those directors, a majority of directors shall form a quorum. (3.) Questions arising at any such meeting shall be decided by a majority of the directors present and voting. (4.) In the event of an equality of votes, the chairman of directors shall have a casting vote.
I thought that the last provision would be regarded by members of the Australian Labour party as completely undemocratic. We know that they are fiercely opposed to any man exercising more than one vote. With regard to sub-clause 3, I ask the House, how could the minions ofthis Government who are to he appointed directors he expected to quarrel with the Government on anything? They must of necessity be rubber-stamps to carry out any policy decided upon by the Treasurer, and they must carry it out promptly or they will find themselves out of office.
I pass over the provisions regarding taxation, on which one could wax most eloquent. The position in that regard has been thrown up to the electors of Australia in all its stark reality and ugliness, and there is no need for me to labour it.
I refer now to the Federal Court of Claims which the Government proposes to appoint. Clause 27 of the bill deals with the appointment of judges to this court. My mind goes back to scenes witnessed in this House and to one which occurred in the Sydney Domain during the present spring, when the Speaker of this Housechallenged the right of certain judges to sit on the Bench because of their age. Possibly caucus did not “ have the say “ in regard to this provision, but to me it seems rather significant that no age limit is provided for the judges who are to be appointed. If they happen to live to the age of Methuselah, or of the famous Turk who is alleged to have lived to the age of 150 years, they will still be entitled to sit on the Bench. Having regard to what I have heard and read lately I should have imagined that the appointment of members of the new judiciary without any age limitation would have been like wormword and gall to members of the Australian Labour party. Yet, we find that that is one of the conditions contained in the bill.
The obvious intention of the Government in seeking to appoint this court is to go farther than the bill provides. Clause 33 (2) provides -
The Governor-General may, under any other Act, make regulations conferring jurisdiction on the Court to hear and determine claims for compensation arising under that other Act and any regulations so made shall have effect notwithstanding any provision of that other Act.
I submit that there are only two classes of acts which the Government has in mind. The first class relates to present acts. For instance, the Government might refer to the Federal Court of Claims arguments which arise out of the acquisition of lands and other assets. However, it seems perfectly obvious to me that the Government is preparing for the day when it will nationalize other industries. This is something about which the people are entitled to be informed. The court which is to do execution in these other cases will be one which is then functioning. The court proposed to be constituted under this bill is not intended to complete a specific function and then retire, because the bill provides for pensions for the judges and the court’s officers. Obviously, it is intended to function when other industries are nationalized. When that happens those other industries will not be nationalized by legislation as the Government proposes to nationalize the banks ; they will simply be taken over by an act of the Government. If this bill becomes a valid law, then Broken Hill Proprietary Company Limited, the Sydney Morning Herald., the breweries, the Colonial Sugar Refining Company Limited, or any other undertaking may be nationalized without any consultation of the electorate, the Parliament or any other body. The people of Australia will simply wake up one morning to find that, at no cost to themselves, they are in possession, through public ownership, of any industry or activity in the Commonwealth which the Government feels disposed to acquire.
It is quite evident from clause 34 that the Government does not propose to allow any appeal to the High Court. The court which the Government proposes to constitute is to be an infallible one. No one in the Vatican was ever clothed with the powers of finality and infallibility conferred by this clause, because it permits of absolutely no appeal whatever. That is something which should incur just retribution from any right-minded person in the community.
The matter of settlement of compensation is dealt with in clause 4!3. Here we come up against one of the most dreadful provisions in this measure. The bill contains no appropriation clause. If the trading banks’ shares are to be acquired by negotiation, and this legislation is constitutionally well-founded, it stands to reason that if just compensation is to be paid the Government must part with something which it has in exchange for something which the trading banks possess. However, that is not the procedure proposed to be adopted by this bill. What the Government proposes to do is to say, in effect, to the shareholders of the bank*, “ We are going to take your shares from you and we are going to pay you with your customers’ money “. Those banks have £240,000,000 of their customers’ money in their hands, and that is obviously the money which the Government proposes to use. I do not know anything about law, but I do know something about common sense and fair play, and a proposition of this sort would not get a hearing even in a court of canni bals. Such a proposition would have been condemned even by the late Sir Henry Morgan when he became Governor of Jamaica, and every one knows the kind of buccaneer he was on the Spanish Main.
– Even Ban-abas would not have countenanced it!
– I propose to quote from a Scottish newspaper some remarks made by Sir William Y. Darling, M.P., which he delivered when speaking to an audience at Dundee at the opening of a. unionist fete. He stated -
Don’t you know that ten years ago the capitalist class held you in their power? You could have plenty of coal, of course, but now you own the coal mines and you have no coal. Very soon you are going to own the railways, but that will not prevent you standing all the time when you make a journey in the train. The Socialist policy is to see that you own everything and have nothing. Under the more intelligent plan - a confusing plan, if you like, an ill-co-ordinated plan, but a realistic plan - other people may have owned, but you certainly did possess something.
That sums up very well the position with which we are faced in this country. The battle that is joined to-day is as to whether there shall be ownership or no ownership. We have seen this Australian Government enacting certain legislation. I well remember the Darwin Lands Acquisition Act. I also remember the statement which the Minister for Post-war Reconstruction made in 1945 on the War Service Homes Agreement, namely, that he did not believe in making “ little capitalists “. His full statement is not in Hansard. I heard that statement. I further remember the soldier settlement agreement, because under it Victoria is the only State in which an ex-serviceman may ever hope to own the block of land that has been allotted to him. That was due, I believe, to the insistence of that much maligned individual, Mr. Dunstan, a very good enemy of mine on many occasions, but nevertheless a man with many good qualities. No matter how successful a settler may become, he has to be the tenant of the Commonwealth. I have said before, and I say it again, to the Ministry and to the Australian Labour party, that the objective of that party is to ensure that in due course every man shall be a tenant, an employee, or ,a pensioner of the Australian Commonwealth. For confirmation of that, I go to the president of the South Australian “branch of the Australian Labour party, Mr. C. R. Cameron, with whom I have been confused lately. Opening a convention of the party in Adelaide last month, he said -
The next step, however, was the ownership of the land. That is the ultimate objective.
– Order! The honorable member’s time has expired.
– It is charamteristic of the honorable member for Barker (Mr. Archie Cameron), who has just resumed his seat, that he causes his listeners a lot of difficulty in following his line of argument. For example, he said that in very rare instances had the bill before the House been referred to by previous speakers. During this debate, almost, every aspect of banking and monetary control has had some reference made to it. Many “ highfalutin “ phrases have been applied to points raised by honorable members opposite, and it would be difficult, if not impossible, to deal with the subject without some repetition. However, because of the importance of the legislation, I take this opportunity of associating myself with it and of explaining to the Parliament why I enthusiastically support it.
One of the arguments used by honorable members opposite against the introduction of this legislation is that the Government has no mandate to enact it. My reply is that, ever since I have been associated with the Labour movement, banking control has been one of the really live subjects discussed in almost every Commonwealth election campaign. In the 1940 campaign, the late John Curtin, Leader of the Labour party, which then sat in opposition in this House, in the policy speech that he delivered at Perth on the 28th August of that year, dealing with the control of banking and credit, said this-
Three related monetary measures must be taken so that industrial and economic preparedness, which are the essence of national defence and security, shall be assured. They are:
National control of banking and credit to ensure its adequacy in putting to work the idle hands the Government failed to employ in peace-time and in using the full physical and manpower resources of the nation to carry on the war.
National control of interest rates to keep to the minimum the monetary and capital cost of the war and production, and industry generally.
National direction of investment, so that existing activities and proposed activities will not be permitted to follow expenditure of capital on lines not helpful to the war effort and to post-war reconstruction.
The Commonwealth Bank is the logical instrument to function for effecting these monetary measures and for providing the machinery for post-war reconstruction. Meeting the cost of the war and laying the foundation for post-war reconstruction make it imperative that Labour’s policy in regard to monetary and banking control be carried out completely. No Government can govern that deliberately excludes itself from the responsibility of determining monetary policy. We cannot fight this war without governmental responsibility of ensuring that men and materials are related, and no financial impediment to such relationship call be tolerated - let alone condoned.
– “What does that prove?
– I welcome that interjection. What I have read proves that for 25 years the Labour party in this country had no control over this Parliament. It may be suggested that the Scullin Government held office for a period. That Government, although in office, was not in power. It could not govern, because of the dictatorship of the private banks and of the other interests that were opposed to it, as well as the opposition by supporters of the honorable member in the Senate to all the suggestions which it made in order to relieve the existing position. Following the fall of the Fisher Government, the Labour party had no control in this country at any time. The Curtin Government was elected to power in consequence of the appeal that was made in the passage that I have quoted. Therefore, it had a mandate in the terms of the policy speech of our late leader. It is therefore, merely “ eyewash “ for honorable members opposite to argue that the Government has no mandate to legislate in respect of this important national requirement. Surely I have answered that charge.
At that time the Commonwealth Bank was controlled by a board appointed by the Bruce-Page Government. All the evidence available discloses that the Commonwealth Bank worked in co-operation with the private banks, thus destroying the very principle for which the Commonwealth Bank was established. That was demonstrated clearly to me during my first election campaign, when I was besieged by primary producers, particularly wheat-fanners, and asked to promise my support towards the establishment of a mortgage bank department of the Commonwealth Bank. That is borne out by the fact that one of the first speeches made by me in this Parliament was an appeal to the then Government to establish a mortgage bank department of the Commonwealth Bank. The present Leader of the Opposition (Mr. Menzies) was then Prime Minister, but he did not heed my representations. Nothing was done until a Labour government was elected. When I complained to the then government of the failure of previous governments to give substantial relief to the wheat-growing industry it was pointed out to me that the Royal Commission on the Wheat Industry had reported that the indebtedness of the farmers of Australia amounted to not less than £150,000,000, the bulk of which was in short-term loans on which the rate of interest was not less than 5 per cent., involving an annual interest bill of at least £10,000,000. Why were the farmers, whose activities are so essential to the welfare and development of this nation, so concerned if, as honorable, members opposite would have us believe, the private banks were rendering such efficient and helpful service to the farmers? Since then a mortgage bank department of the Commonwealth Bank has been established. It was created by the Curtin Labour Government. When the bill providing for its establishment was before the Parliament the then member for Hume, the late Mr. Collins - a man for whom I had the greatest respect - said, as reported in Hansard -
The present system of finance is difficult and uncertain. When money is plentiful men are inclined to speculate a little and extend their properties. In that desire they are assisted materially by the hanks. Usually the local bank manager advises a client that he cannot go wrong and the money he requires is available. The client then enters upon his new venture in good faith, but at the most inopportune times he is asked to reduce hisoverdraft and he finds himself absolutely helpless.
I remind the House that Mr. Collins was a supporter of the Australian Country party. Another quotation which might interest honorable members of that party is one which I take from a speech made by its deputy leader, the honorable member for Indi (Mr. McEwen) on the 11th April, 1935. I admit, in fairness to him, that my quotations are extracts, but that does not detract in any way from the fact that he himself was extremely dissatisfied with the then existing monetary system. As he was speaking to his own motion or a royal commission to inquire into and report on the Australian banking and monetary system, his words are of special interest. He said -
There is a doubt in the minds of an overwhelming majority of the electors of this country as to whether the banking and monetary systems keep pace with our social evolution and industrial progress. . . . There is not one of us who is not aghast at the condition of affairs in which production, increased beyond the dreams of our forefathers, exists side by side with dire want. Many of our people, even the very people who are producing in such abundance are ill fed and ill clad . . . Many trained thinkers claim that our banking system is either wholly or partly responsible for our present condition.
He then referred to many expressions of doubt voiced by persons whom we regard as financial and economic experts as to whether the system is all that it should be. The honorable member for Indi then quoted a director of the Bank of England, Sir Basil Blackett ; the chairman of the Midlands Bank, Mr. Reginald McKenna; the late Mr. Henry Ford the late President Roosevelt, and Professor Irving Fisher, of Yale University. The honorable gentleman concluded -
The increasing strength of radical thought has placed vested interests so much upon the defensive that they have been utterly stagnant in relation to any endeavour to improve the system. The inert power of resistance of nervous or selfish vested interests, and the mediums of propaganda which they control, have prevented a mandate from being received by those who have sufficient enterprise to act.
That statement was made by the honorable member for Indi, who was then a private member speaking in the interests of the people whom he represented. Such statements, coming from members’ who are to-day violently opposed to this measure, are illuminating because they commit such members to a definite change of view for which the circumstances associated with their present positions may be responsible.
These quotations take my mind back to the depression years when hundreds of thousands of unemployed men and women were thrown on the streets without even sustenance, and when the efforts of the Scullin Government to provide employment for them were frustrated by the banks supported by the Opposition in the Senate. The Commonwealth Bank Board, which was not even responsible to the authority of this Parliament, dictated the financial policy of the Government. Throughout the depression years, the control of credit was in the hands of the Commonwealth Bank and the private banks. Early in the depression years the Scullin Government sought permission to increase the note issue by £1S,000,000 in order to finance wheat-growers and create employment in connexion with a home building scheme. Its request was refused by the Commonwealth Bank Board, and instead a demand was made for a reduction of invalid and old age pensions, together with a 20 per cent, cut in wages. That resulted in forcing many of Australia’s great unions to strike against the unwarranted interference with awards, which in many instances still had two or three years to run. The Australian Workers Union was one of the unions thus victimized, because it had an award covering pastoral workers in four States which still had two years to run. Officers of the union had to appear before the court to answer an application by the graziers’ association for a 20 per cent, reduction. When the union advocate, the late Mr. Grandler, who was then general secretary of the Australian Workers Union, appealed for an extension of time of six weeks to enable him to marshal his evidence so that he could combat the application, the Chief judge of the Arbitration Court said something which was indelibly imprinted on my mind, because it led to one of the greatest strikes in the pastoral industry which Australia has ever known. The then
Chief Judge, the late Chief Judge Dethridge, said in reply to the appeal -
Irrespective of what evidence the union, may or may not be able to tender, this court is faced with the responsibility of reducing the costs in industry.
Do honorable members call that justice? That was because of the dictation of the private banks, which were in control of the country. They said that they would not, make money avail-able unless the Government used the .pruning knife on wages, and’ reduced old-age and invalid pensions, so that the conditions of the workers^ after years of struggle, became worse than they were before. I remember those depression days because I was at that time living in the town of Geraldton in Western Australia. The mayor of the town, Mr. George Houston, called a public meeting .because conditionswere so bad, and appealed to the citizensto provide work or sustenance for thoseout of employment in order to carry them, through the winter months. Surely it is a degrading thing that the citizensthemselves should have to be called together by the mayor of the town andappealed to to provide relief and employment for those in need. However, let it be said to the everlasting credit of the people of Geraldton, whether they were storekeepers, bankers or railway workers, that they carried a resolution to impose a levy on themselves, in order to tide the unfortunate people out of work over the worst of the winter months. Surely such conditions could not have existed if the monetary system of Australia had been serving the country as it should. Those events proved that the monetary system was at fault, and all the explanations and irrelevant arguments adduced by members of the Opposition cannot justify its failure. I am certain that the people of Australia will welcome this measure as an insurance against a repetition of the depression. If there is one lesson which we learned during the last war, when the very lives of our people were at stake, it was that whatever was physically possible could be made financially possible.
Those who are leading the fight against nationalization contend that it is opposed to all ideals of democracy, freedom and liberty. These people become staunch advocates of these principles only when it suits their purpose, but these are not the real reasons for their violent opposition. They are not concerned about the ordinary man whom they use for their own purposes. The real reason for their antagonism is to be found in the statement by ‘ Sir Reginald McKenna, exChancellor of the British Exchequer, ex-Chancellor of th British Exchequer, and chairman of the Midlands Bank, the largest trading bank in England. Addressing the shareholders in 192-4, he said -
They who control the credit of the nations direct the policy of governments, and hold in the hollow of their hands the destiny of the people.
In the past the private banks have completely controlled the credit of the nation. As is well known, all the large commercial and financial interests are directly connected with the directorates of the various trading banks, and as a consequence these men wield a power far greater than that of any government and are able to manipulate money matters in such a way as to bring great profits and further power to themselves. Seeing this power slipping away from them, and likely to be placed in the hands of a national bank which is responsible to the Government, which in turn is responsible to the people, these men are making a desperate effort, and using any means to safeguard their interests.
For many years, primary producers have suffered bitterly at the hands of the private banks, especially during the depression, when thousands were ruined and forced to leave their holdings. They received no consideration from, the private banks, which relentlessly foreclosed on all who could not immediately meet their obligations. To-day, it is being stated that the average Australian Country party man is opposed to the nationalization of banking. That is not correct. The primary producer has not forgotten his bitter experience with private banks in the past.
Opposition governments have not very much to their credit. When they assumed office after the downfall of the Fisher Government, they destroyed the very foundations laid by” that Government, even where it affected the defence of the country. The Commonwealth Bank was shorn of its powers. The Australian Commonwealth Line of Steamers was practically given away, and the Small Arms Factory and the Commonwealth Woollen Mills disposed of to private enterprise. Since the Labour Government took charge in 1940, much progressive legislation has been enacted. With its continuance in power, and with the monetary system under one control, working in the interest of the people, I visualize a great future for our country.
This Government is committed to a policy of full employment, and the maintenance of economic and financial stability. During the war, and since its conclusion, the Australian economy has been kept more stable than that of any other country in the world. An essential part of the machinery for maintaining that stability has been the control over the banking system exercised during the war under the National Security (Wartime Banking Control) Regulations, and since August, 1945, under the Banking Act of that year.
Section 48 of the Banking Act 1945 provides that a bank shall not conduct any banking business for a State or for any authority of a State, including a local-governing authority, except with the consent of the Treasurer. As is well known, the Melbourne City Council challenged the validity of this section in the High Court, and the court’s decision was in favour of the City Council. This decision had a very serious effect on the Government’s policy of full employment, and raised doubts as to the powers which the Government had over banking so far as the 1945 act is concerned.
It is quite obvious to all clear-thinking people that the time has arrived when the Government will need effective control over the monetary system of the Commonwealth. It is certain that the economic crisis at present apparent in Great Britain and European countries will have its effect on the economic position of citizens of this country. For this reason, if for no other, it is necessary that the Government should have complete control over the finances of the country. In order to meet any possible change in the economic position of the
Commonwealth, the Government has, therefore, decided to legislate for the control of banking in the interests of every Australian.
I am not sure that the efforts of the banks and the Opposition to stampede the people against this issue have been nearly as successful as they would like. In my opinion, the people of to-day are prone to benefit by experience, and they are not likely to be blinded by the smokescreen raised by the Opposition. Speaking, not as a monetary expert, but as one who has had full experience of the trials and tribulations endured by the masses of the people, I believe that this measure is the most progressive and valuable introduced into -this Parliament since federation. To sum up, the people have nothing whatever to lose .under these proposals to nationalize the private trading banks. Henceforth, the people will be rendered a service by the Commonwealth Bank as good, if not better, than that which they have received from the private banks. That service will be rendered to them by their own bank which will be backed by the nation’s resources. The only interests which will lose under this legislation will be those which, to-day, control commerce and finance in this country, because it will take from them the control of credit in this country.
The honorable member for Bendigo (Mr. Rankin) who, invariably, interjects when another member is speaking but rarely contributes anything of value to a debate in this House, is one of those who have enjoyed more fortunate conditions as a citizen of this country than the great bulk of Australians. I refuse to believe that the great majority of our people are not in favour of this legislation; because with the Government, they, surely, are no longer prepared to tolerate again the conditions of misery and degradation experienced in this country in the past due to the fact that the credit of the nation was controlled by interests which had no masters and could decide finally what was to be done. It is clear that the Opposition parties’ sole object is to delay the passage of this measure by every means at their disposal. If honorable members opposite believe that this legislation is not acceptable to the people, why do they not facilitate its passage and enable the people at the next general elections to pass judgment .upon it, after practical experience of its operation in the interim ? The -only fear of the Opposition parties is that the operation of this legislation will fully justify the Government’s claims in introducing it. So long as they can restrict the period of its operation they hope that the propoganda now being circulated by big business will have its effect upon the people. But, clearly, those tactics spell failure for the Opposition in its fight against this measure.
Debate (on motion by Mr. Bernard Corser) adjourned.
The following paper was presented : -
Lands Acquisition Act - Land acquired for Postal purposes - Fortitude Valley, Brisbane. Queensland.
House adjourned at 10.54 p.m.
The following answers to questions were circulated”. -
– On the 16th October, the honorable member for Reid (Mr. Lang) asked the following questions: -
The answers to the honorahle members questions are as follows: -
y asked the Minister representing the Minister acting for the Attorney-General, upon notice -
– The answers to the honorable member’s questions are as follows : - 1 and 2. The files relating to pending Prices prosecutions are not kept on a basis that renders this information readily available. For the first eight months of this year there were 3,422 convictions for breaches of the Prices Regulations or an average of 428 per month. The times between the commission of offences and their actual hearing vary so widely between States and localities that an approximate average figure would give no clear indication of the true position.
The following action has been taken to speed up prosecutions in New South Wales: -
In the other States, the position may be regarded as satisfactory.
n asked the Minister for Immigration, upon notice -
– The answers to the right honorable gentleman’s questions are as follows: -
Netherlands authorities on Dutch ships sailing direct from Holland to Australia. Unfortunately the Dutch have not to date been in a position to arrange shipping, but this question is now being further explored, and it is hoped that the present difficulties will be overcome to enable the scheme to be implemented early in 1948. The Commonwealth Government also recently completed an agreement with the Preparatory Commission of the International Refugee Organization for the admission of 12,000 displaced persons (mainly Lithuanians, Latvians and Estonians) annually from Europe. The first party of 806 will leave on the 31st October, 1947, and subsequent parties at approximately monthly intervals thereafter. Arrangements will be made for a proportion of farm workers to blincluded amongst these migrants and present indications are that 100 will form part of the first party. All migrants under this scheme will be selected by an Australian selection team now in Germany, and will be medically examined by Australian doctors. In regard to farm workers from the United Kingdom, this House will be aware from my reply to the honorable member for Capricornia on the 1st October, 1947, that the State Governments, under a procedure which has been established for some time, indicate the priority of travel which they desire should be accorded to workers in any particular category, who are being brought to Australia under the free and assisted passage schemes. If a State government indicates that it requires farm workers on a high priority, that priority will be accorded to farm workers for that State.
n asked the Treasurer, upon notice -
– The information is being obtained, and a reply will be furnished as soon as possible.
Armed Forces : Retirement of Army Officers.
s. - On the 25th September, the honorable member for Balaclava (Mr. White), asked a “question in relation to officers of the Permanent Military Forces who had been retired under the Government’s interim defence retirement scheme. I now advise the honorable member as follows: -
A number of officers of the Permanent Military Forces were retired during 1048 and 1947 as a result of a Cabinet approval to reduce the ages for retirement of officers of the Permanent Military Forces. Such officers had been paying contributions to the Commonwealth Superannuation Fund on the basis of retirement at 60 years, at which- age they would have received the full pensions for which they were contributing. The Commonwealth Superannuation Act prescribes that, where officers retire from the service prior to reaching the age of retirement for which they were contributing for a pension, they may receive thu actuarial equivalent of the pension for which they were contributing at age 60 years, and if the officers concerned had been retired on such an actuarial equivalent pension they would have received considerably reduced pen sions. These actuarial equivalents were considered inadequate, however, and a special interim retirement scheme was approved by Cabinet. This scheme provided for a percentage of the full pension rising .from 75 per cent for officers retiring at age 47 years to 100 per cent, for officers retiring at the agc pf 57 years and upwards. The’ Commonwealth Superannuation Fund met the charges1 that would normally ‘ have been incurred if actuarial equivalent pensions had been paid under the provisions of the Commonwealth Superannuation Act, but the additional payments involved in providing for the higher pensions ‘ under the special interim retirement scheme were, by Cabinet direction, made a charge to public funds. In addition to thi: increased pension rates so provided from public funds, the retired officers were given, according to age, the difference between their pension’s and half pay for periods up to two years of retirement, plus special gratuity pay to £1,000 to enable the officers concerned to pay up their contributions to the Commonwealth Superannuation Fund to age 60 years, and to provide a margin, in some cases quite substantial, for payment in cash as a charge to public funds. It will he appreciated, therefore, that the officers concerned received, under the Cabinet approval, considerably more than their entitlement under the Commonwealth Superannuation Act. Under the Superannuation Act 1947 a general 25 per cent, increase was approved for pensions payable under the act, and it is a fact that, for a short time, this increase waR inadvertently paid to officers retired under the interim retirement plan. The increase, however, was not covered by the Commonwealth Superannuation Act 1947, and payments were therefore suspended by Treasury direction, because there was no statutorY provision or other authority under which such payments could be .approved as a charge to public funds. A pension scheme is under consideration to cover all permanent per sonnel of the three fighting services who, because of the earlier retirement- ages now applicable to all such fighting services, are not adequately provided for ‘under the provisions of the Commonwealth Superannuation Act 1947, which is designed to cover members of the Commonwealth Public Service and other civil staffs with a retiring age of 60 years and over. The general question of retirement provisions for the Permanent Navy, Army and Air Forces is . now being examined by an inter-departmental committee, and the review of the pensions being paid to officers retired under the interim retirement scheme is being undertaken in conjunction with that examination.
Cite as: Australia, House of Representatives, Debates, 29 October 1947, viewed 22 October 2017, <http://historichansard.net/hofreps/1947/19471029_reps_18_194/>.