18th Parliament · 1st Session
Mr. Speaker (Hon. J. S. Rosevear) took the chair at 3 p.m., and read prayers.
Nation alization : Petitions; Appointment of Directors; Overseas Capital ; Migration.
. -I present a petition which is signed by 2,520 electors of a part of the Mascot subdivision of the division of Cook. The petition asks the Government not to proceed further with the banking legislation, upon the ground that the proposals for the nationalization of banking in Australia amount to restriction of liberty, would hamper trade and commerce generally, and, by reason of the banking legislation of 1945, are unnecessary. The petition is in accordance with the Standing Orders of theHouse, is respectfully worded, and concludes with a prayer.I should mention that, normally, this petition should be presented by the honorable member for Cook (Mr. Sheehan), but I understand that instructions have been given that no Government supporter shall present a petition against the banking proposals’.
– Order !
– Accordingly, I move -
That the petitionbe received.
– Order ! Before we proceed further,. I emphasize that the Chair will not permit any discussion on the details of a petition, or reflections upon other honorable members.
Question resolved in the affirmative.
Petition received and read.
Mr. ANTHONYpresented a petition from certain electors of the divisions of Richmond and New England, in relation to banking in Australia.
Petition received and read.
– Can the Treasurer say whether the Government has approached various persons- inviting them to become directors of various banks when they are nationalized? Will he state the names of those persons; if any, who havs expressed their willingness to accept appointments ?
– I assure the honorable member that he has beaten the barrier on this occasion.. No one has been approached about being made a director of any bank, nor in regard to any similar position. The matter has not even been discussed with anybody.
– The Canberra Times to-day reports that the president of the Associated Chambers of Manufactures of Australia,. Mr. Lionel Robinson, has warned the Prime Minister that nationalization of banking will alienate overseas capital and discourage migration to Australia. Does the Prime Minister feel disposed to reply to that statement?
-I do not remember having received any communication from Mr. Lionel Robinson about that matter. When. I last saw him, he did not indicate that he held the opinions attributed to him. in the report. I had brought to my notice yesterday a striking example of the falsity of claims that the banking legislation is alienating overseas capital. One very large overseas company proposes to embark on industrial expansion in Australia on a scale not known previously. Several other industries are also to be expanded.. I will not believe that Mr. Robinson made that statement unless he personally assures me that he did; but if he did make it, it is not founded on fact.
– I lay on the table the following paper: -
Commonwealth Giants Commission ActCommonwealth Grants Commission - Fourteenth Report, 1947, and inform the House that the Government has decided to adopt the recommendations contained in the report.
.^-! inform honorable members that I have asked the Minister for Labour and National Service (Mr. Holloway), and the Minister for the Navy (Mr. Riordan), to represent respectively the Minister for Supply and Shipping (Senator Ashley) and the Minister for Munitions (Senator Armstrong) in this chamber during the absence abroad of the Minister for Post-war Reconstruction (Mr. Dedman),
Motion (by Mr. Chifley) agreed to -
That the House, at its - rising, adjourn to to-morrow, at 10.30 a.m.
Recruiting Campaign: Damage Caused by Star Shells.
– Can the Minister for the Army inform me whether inquiry has been, made into the reason for the damage caused to property at Bondi on Sunday night, when star shells, or fragments of star shells, crashed through the roofs of houses and flats during the firing of artillery salvoes at North Head to mark the opening of the Army Recruiting Campaign? If so, with what result? Are steps being taken to ensure that adequate compensation will be paid to householders whose property has been damaged? Can the Minister furnish any estimate of the total damage done? “Was the happening due to neglect or carelessness on the part of the Army authorities or was it attributable to the use of faulty ammunition? In view of the damage done’ to property, and the grave danger to human life, exemplified by this in- cident, can the Minister inform the House of any steps that have been, or are to be, taken to prevent a recurrence ?
– At the moment I can only say that inquiries are being made into the cause of the mishap, which was a most unfortunate one. Although the exhibition was a little too realistic on this occasion, I can assure honorable members that there is no desire on the part of the Army authorities to run away from their responsibilities in regard to the payment of compensation. I am confident that following the inquiry which is now being held, there will be no recurrence of the unfortunate happening.
South Australian Quota
-Has the attention of the Minister for Immigration been drawn to a report which appeared in the Adelaide Advertiser on the 15th November, which stated that the Premier of South Australia, Mr, Playford, alleges that South Australia is not receiving its fair quota of immigrants? Has the Premier of that State made any protests to the Minister, or has the attention of the Minister been previously directed to the matter in any other way?
– I have seen the statement in the Adelaide press attributed to the Premier of South Australia, in which he is alleged to have stated that South Australia is not receiving its fair quota of immigrants in accordance with the decision reached at a conference of Commonwealth and State Ministers held last January. In regard to the honorable member’s inquiry as to whether I received any advice from the Premier of South Australia along the lines of his reported comment in the press, I have to inform him that I have not received any letter on the subject of immigration from the Premier of that State since the conclusion of. the conference last January. I am amazed at the long series of misstatements attributed to that honorable gentleman in the newspaper report. He is reported to have stated that unfortunately for South Australia it looked as though the amended quota of 6,000 immigrants would not sail this year. However, he must know quite well from the reports of his officers that the target of 6,000 immigrants agreed upon at the conference in January as being reasonable will be attained. He is also alleged to have said that he had not received any advice of further sailings of immigrants for South Australia since last March. The fact of the matter is that he has been advised of the number of people arriving on Asturias in the course of the next week or so. The number of migrants arriving on that vessel exceeds the total number of migrants landed in South Australia between March and the present time. The Premier has made altogether a long series of misstatements. I wish he would write to me for the information when I would give him the facts. Unfortunately he cannot keep the question of immigration out of party political warfare. In all my dealings with the Premiers and with honorable members on both sides of the House I have endeavoured to keep immigration outside the arena of party politics. I have treated the Premiers fairly and I expect to be treated the same way. I expect them to make their addresses to me find not air their grievances, if any, in the press before consulting me. It is true that there are some people coming here under the free, and some under the assisted, system of immigration. Those people, however, who are paying their own way have a perfect right to say where they will live. South Australia, under the premiership of Mr. Playford, is apparently not sufficiently progressive to attract them. I cannot be held responsible if those people choose some other State as their place of residence in this country. In condemning the Australian Government, Mr. Playford is incidentally criticizing the other State Premiers who are obviously .much more progressive in their outlook than he is.
– I ask the Minister for Information and Immigration whether it is true that Asturias is on its way to Australia with a. large number of British migrants, who are coming here under the free arid assisted passage scheme. Is the ship carrying migrants to South Australia, and if so, what number?
– It is true that Asturias is now on its way to Australia with about 1,768 new settlers. With the exception of 168 former members of the Polish Army, who saw service at Tobruk, and are on their way to Tasmania, and 100 Maltese for whom the British Government desired transport, all the passengers are migrants under the free and assisted passage scheme. This is the greatest number of migrants ever brought to Australia in any one ship under any scheme. Three hundred of them are for South’ Australia, bringing the total number of migrants for that State up to 584. Other ships are sailing from England between now and the end of the year, also bringing migrants to South Australia. I have not the slightest doubt that the quota which was agreed upon with the Government of South Australia will be reached, if not before Christmas, certainly early in the New Year. When we can get ships we arrange for the accommodation to be fully occupied. In this connexion, a recent statement by the Premier of South Australia that two ships had left Britain with practically 110 migrants on board is news to me. I shall have the matter investigated, because I should like to obtain some further information on it. It. seems to me that the Premier of South Australia has discovered a mare’s nest.
Mi-. BOWDEN. - I direct the attention of the Prime Minister to a press report published on the 12th November to the effect that the possibility of the lifting of permits for the sale of new motor cars in Australia is being considered by the Australian Government. The report also stated that the matter was being discussed by Cabinet following indications by some States of a desire to be relieved of the responsibility of issuing permits. I ask the right honorable gentleman whether it is a fact that the possibility of lifting the permit system governing the sales of new motor cars in Australia is being considered by the Government. If so, is the Prime Minister in a position to inform the House whether any alternative system is contemplated, and will he take appropriate measures to ensure that in any new system of priorities the interests of primary producers will be adequately safeguarded?
– I answered a question on this subject last week. It is true that the Minister for Transport is finding staff difficulties in dealing with the applications for permits for motor cars. He has to use the services of persons provided by the State governments. I understand that great difficulty is being experienced in New South “Wales in this respect. I do not know whether there have been any complaints from any of the other States, although I know that difficulties have arisen for the reasons mentioned. The Minister for Transport has discussed this matter with the New South Wales Government. I have already expressed the opinion that in the absence of some system of permits primary producers and others in country districts who, perhaps, would not have the same opportunity as city dwellers to get motor vehicles might not receive a fair deal. It is the view of the Government that, whatever difficulties exist, they should be overcome in the best way possible, and the Minister is endeavouring to do so. The permit system seems to be the fairest way to meet the difficulty.
Appointments - Justice Sir William Webb
– Has the Prime Minister seen the alleged statement of the honorable member for Warringah which was reported on page 5 of the Sydney Morning Herald on the 17th November, 1947, wherein the honorable gentleman is alleged to have said at a Liberal party meeting at Palm Beach that “ Federal Labour was determined, if it could, to pack the High Court with people whose judgments would support all the acts of the Labour Government”? Did the honorable member for Warringah make that statement on his own initiative, or did the Prime Minister inform him or any other member or person that it was the intention of the Government to appoint new judges? How many High Court appointments have been made since the first Curtin Government assumed office in October, 1941? What were the qualifications and previous judicial experience of the judge or judges appointed? In view of the fact that the honorable member’s statement contains the qualification that the Federal Labour Government would pack the High Court “if it could”, thereby implying the existence of some barrier which prevented past packing of the High Court, will the right honorable gentleman say whether there are any limits to the number of judges who may be appointed to the High Court, or could have been appointed during the past six years ?
– I do not know whether I saw the particular paragraph to which the honorable member has referred, but I did see in a newspaper - it was probably the Sydney Morning Herald - that the honorable member for Warringah, speaking at Palm Beach, had made a statement regarding the packing of the High Court. I assumed that the honorable member had .allowed his imagination to run riot, probably because of the surroundings in which the statement ‘ was made, because there is no foundation in fact for such a statement. There has been nothing to prevent any government from increasing the number of judges on the High Court Bench. Until about 1912, the High Court Bench consisted of five judges, but in that year the number was increased to seven. The High Court remained at that strength until the number of judges was reduced to six during the depression, presumably for reasons of economy. During the regime of the Curtin Government the number of judges was restored to seven. The only appointment made by either the Curtin Government or a government led by me was that of Justice Sir William Webb, who was formerly Chief Justice of the Supreme Court of Queensland. In other words, Labour governments have ! made only one appointment to the High Court in six years. Justice Sir William Webb was Chief Justice of Queensland for five years, and before that he was Crown Solicitor and Public Defender in that State. He was associated with a number of bodies dealing with the sugar industry and; other matters affecting the .public life of Queensland: He appeared before the Privy’ Council as an associate to Viscount Simon in connexion’ with certain appeals. I have no knowledge of his having been associated with State politics in Queensland’. He had in that State a long and distinguished public career,- mostly in a- judicial capacity. If I have- been correctly informed, the honorable member for Wentworth) in 1942, charged- him- with bias; but apart from that I have heard no suggestion of the kind. I repeat that’ there is absolutely no justification for the statement of the honorable member for Warringah’. There has been no discussion with me on the’ subject, nor has it been considered by the Government’ since Justice Sir William “Webb was appointed twelve months’ ago.
–*! desire to make a personal explanation because I was misrepresented in a statement of the Prime Minister in reply to a question. He made it’ appear that I had criticized certain members of the- High Court as i t- now exists.
– No, he did not.
– Well, the fight honorable’ gentleman spent a good deal of time stating the qualifications of Mr. Justice Webb. Addressing’ certain of my electors at Palm Beach, I referred to recent’ discussions- in this Parliament, and in particular to speeches made by the honorable member for Dalley a’n’d the Minister for Transport. I reminded them that it had been stated that the decision df the High Court on the Banking Act 1945 was a political one, and I added that members of the High Court had been attacked on the ground of their age, and their alleged incapacity, because of age, to give proper judgment. The only inference to be drawn from such attacks, I stated, was that it was in the Government’s mind to condition the public to’ receive a resolution in this House to remove certain of the judges on the ground of incapacity, and to appoint in their place nominees of the Government who would be amenable to the Government’s will.
Reception on” South’ Coast oj1 New South Wales.
-As broadcast reception on the south coast of New South Wales’ is damnable, will the Minister” representing the’ Postmaster-General cause to be examined the- statement reported’ to have been ma’de yest’erd’ay by departmental officials that relay stations are to be provided by the Australian Broadcasting’ Commission at Kiama* in 1949- 50 and at Narooma and Bega in 1950- 51-? Listeners have’ been very’ patient. If the officials consider that this time-table is sufficient; will the Postmaster General have them sent into those districts to e’n’dure even’ for a week the distortion, fading and static prevalent there?’ Will he ensure that the’ Utmost’ priority is given to the erection of these1 relay stations because listening’ conditions’ could’ not possibly be worse anywhere: else ?
– I shall bring the honorable member’s complaint to the notice of the Postmaster-General and ask that action be taken as soon as possible to expedite the erection of relay stations in the areas he has named. A programme was prepared years ago for the complete coverage of Australia by national stations controlled by’ the’ Australian Broadcasting Commission. But for the war, those stations would have been erected1 long ago. I have not the slightest doubt that, if conditions are as has been described by the honorable member, the PostmasterGeneral will do as he wishes and expedite the erection of the new transmitters as quickly as possible.
Government Policy - Provisional Assessments
– Has the attention of the Treasurer been drawn to a statement of the Minister for Information during the Victorian election campaign that, in the post-war era, the cost of many postwar projects will have to be met from the proceeds of taxation, and that high taxes will have to continue to wipe out debts incurred in the recent war? If so, is it to be understood from, that statemen that the Government intends to continue taxing the public at the present crippling rates?
– I have not seen the statement purported to have been made hy the Minister.
– He made it all right.
– There is nothing wrong with it, anyhow.
– I shall ascertain the truth of the alleged statement. I inform the honorable member, however, that rates of taxes have been very greatly reduced since the termination of the war. I’n fact, I believe that reductions have even outdistanced the hopes of the taxpayers. I shall consider the matter.
– I direct a question to the Treasurer concerning provisional income tax payments which, in normal circumstances, I should have dealt with on Grievance Day. I base it on the following paragraph from a letter written to me by a man at Irymple near Mildura in the dried fruits area -
As you are aware, the growers in this district experienced a very bad season this year, and incomes were considerably reduced. For instance, in my own case, which is typical of others, my income was reduced to £220 from an average of £500. This means that the amount of provisional tax demanded (£83) is about four times as much as 1 would be required to pay based on income ae shown in my income tax return.
In the event of income tax having been paid, when can a refund of over-payment be expected? In view of the fact that growers have had to arrange for overdrafts from their banks or advances from packing sheds in order to pay their income tax, will the Commissioner of Taxation repay interest on overpayments by them? Further, is it intended that this form of taxation shall be continued?
– The sections of the income tax legislation relating to the application of the provisional tax system, were given considerable thought by the special committee of members which was set up to consider taxation questions. The problem involved is not easy to solve. Salary and wage earners have weekly deductions made from their pay to meet their tax liabilities; but the only way to apply the “ pay as you earn “ system to income earners who are not in receipt of wages or salaries, is to make provisional tax assessments based on income earned in the previous year. There are cases - that mentioned by the honorable member for Wimmera is one - where a taxpayer may receive a high income in one year, and a relatively low figure in the next year. His provisional tax for the second of these years is based on his high income in the previous- year, and he may be unable to meet this commitment. These cases are dealt with quite easily. If the taxation authorities receive a satisfactory assurance - I imagine that such an assurance could readily be given in the case mentioned by the honorable member - the taxpayer can have the payment of his provisional tax held in abeyance until his income for that year has been ascertained. If, however, he pays the tax and subsequently finds that his income has been much less than that for which the provisional tax was assessed, he will receive his refund when his assessment is sent to him. I am sure that the honorable member will find that in any case of the kind mentioned by him to-day the Commissioner for Taxation or one of his deputies will be prepared immediately to grant relief by allowing payment of either part or all of the provisional tax owing, to be held in abeyance until the actual income has been ascertained. The taxation authorities of course would require definite evidence of inability to pay. Mere hearsay evidence would not be sufficient.
Post Office Facilities - Telephone Services
– What are the possibilities during the present financial year of improving the accommodation at post offices where there is insufficient room for staffs, and also of erecting new telephone exchanges to meet the needs of people who have waited for a long time for telephone services?
– Some little time ago the Postmaster-General caused to be issued a pamphlet indicating the difficulties confronting his department in the provision of telephones for the thousands of people throughout Australia who need them. He stated the position very clearly and pointed out that in many instances the difficulty in installing new telephones was due to the inability of the department, first, to erect the requisite exchanges and secondly to obtain the requisite exchange equipment. If the honorable member has any particular matters affecting his own electorate which he would like me to bring to the notice of the Postmaster-General, I shall see that attention is given to his representations at the earliest possible moment.
Storage - Sales to New Zealand
– I ask the Prime Minister which, in the opinion of the Government, is of the most pressing importance - the construction of a guided weapons testing range at Mount Eba or the provision of storage for the record wheat harvest? Which of these projects does the Government intend to give an immediate priority for the supply of materials capable of being used for the erection of wheat storage bulkheads?
– The reasonably expeditious construction of the testing range for guided weapons is the subject of an arrangement between the Australian Government and the United Kingdom Government. I have heard no complaint that the work being carried out on it affects in any way the provision of storage facilities for the wheat harvest either in New South Wales or elsewhere. The provision of grain storage, of course, is also of great importance from the point of view of the United Kingdom Government, as well as the governments of other British countries and continental nations. If the honorable member is aware of any instance in which work on the guided weapons testing range is likely to impede the provision of storage for grain crops I shall be very glad to consider the matter.
– In view of the reported intention of the Prime Minister to visit the Dominion of New Zealand during the coming parliamentary recess, will the right honorable gentleman inform the House whether it is his intention to take up the question of an immediate review of the Australia-New Zealand wheat agreement with the New Zealand Government? Does he propose to point out that the cost of the agreement to the Australian Treasury during the current year will be considerably in excess of £2,000,000. Does he propose to ask the New Zealand Government for a review of the agreement in the light of the current world parity wheat .price in order to relieve the burden on the Australian taxpayer of providing a cheap loaf for New Zealand?
– I do not intend to discuss, the matter that the honorable member has raised while I am in New Zealand. That is an agreement between governments, and this Government does not attempt to break agreements. I shall discuss a number of matters while I am in New Zealand, but that is not one of them.
– According to a report that appeared in the week-end press, the American Ambassador to Australia, Mr. Butler, who is now in the United States of America, gave an encouraging review of Australia’s future at a press conference. He praised the Australian steel industry and the proposed AmericanAustralian iron and steel venture, and added that many American companies were operating successfully in Australia and many others were likely to follow because Australia was heading for an economic boom, In view of the pessimism of some individuals in the community, I ask the Prime Minister whether he shares the American Ambassador’s thoughtful optimism. Also, can the right honorable gentleman say to what extent American capital is flowing into this country.
– It is quite evident to everybody who has an open mind on the subject that never before in the history of Australia has there been such great economic and industrial activity as there is to-day. People competent to express an opinion say that never before has so much interest been shown in the expansion or setting up of new industries. I think the pessimism of which the honorable member speaks is largely political and is not real. I have said before, 1 think, in this chamber that a grand opportunity exists for the development of
Australian industries, secondary, certainly, and, I believe, primary. I realize the factors that operate to-day always create the danger of an inflationary trend in the economic life of the community. I mentioned that in the House several years ago, and I do not want to be guilty of its repetition. Considering everything, however, I do not think this country has ever experienced such satisfactory conditions for the expansion of industry as exist, to-day.
– At the week-end, 1 found that many farmers in the western district of Victoria are unable to obtain from petrol distributors the petrol to which their ration coupons entitle them. It would appear that in addition r,o the ordinary rationing of the consumption of petrol by the issuance of ration tickets to petrol users, there is a secondary rationing by the wholesalers of supplies to distributors, whereby they do not get sufficient petrol to supply private users with all they are entitled to. I ask the Minister representing the Minister for Supply and Shipping whether the Government will try to ensure that farmers, who have prolific crops, shall get sufficient petrol to enable them to undertake their harvesting at the normal time.
– I have heard of difficulties regarding petrol supplies in certain areas. Those difficulties result from not an over-all shortage of petrol in Australia, but mainly distribution difficulties caused by the petrol companies having miscalculated the quantities of petrol that ought to have been sent to specific districts. The Government will endeavour to persuade the companies to make a more suitable distribution.
Mr. A. M. BLAIN, M.P.
– I have received from ex-servicemen’s associations letters protesting against the allegations concerning the honorable member for the Northern Territory when a prisoner of war remaining unanswered and leaving t.he honorable gentleman “ under a cloud”. The ex-servicemen’s organizations which have written to me point out that among their members are many who served with the honorable member, and that they are willing to come forward and testify to his gallantry as a soldier. The honorable member for Indi has given notice of a motion for the appointment of a committee to investigate all the circumstances of the matter. Will the Prime Minister give to the House an early opportunity to discuss that motion?
– I said last week that I would give consideration to the stage at which the House might consider the motion of which the honorable member for Indi has given notice. I think that I also mentioned that something ought to be done personally between the parties concerned regarding this matter. Perhaps, I am at liberty to say that 1. myself, mentioned it to the honorable member for the Northern Territory last Friday. 1 was hoping that good sense would prevail and that this matter, which has been the subject of unpleasant recriminations, might be satisfactorily adjusted. I cannot say anything more at this stage.
– Is the Prime Minister aware that there is a grave shortage of roofing materials in Queensland which is seriously retarding the housing programme of the State Government and private builders? Has the right honorable gentleman received a letter from the Premier of Queensland, Mr. Hanlon, requesting that action be taken to deal with the situation? In view of the anxiety of home-builders in Queensland, will the right honorable gentleman indicate what steps he proposes to take to make available to that State, particularly to southern Queensland, greater supplies of housing .materials, including galvanized iron and tiles for roofing and other articles required for home-building ?
– Discussions have taken place with the Premier of Queensland and other Premiers regarding the shortage of building materials. At the moment, I cannot recall specific correspondence on the matter, but I know that there has been a serious shortage of galvanized iron for roofing in all States. To some degree that applies also to roofing tiles, and the Minister for Works and
Housing has been giving consideration to the use of cement roofing tiles. Every effort has been made by the Australian Government to speed up production, but its function in this respect is limited. Where distribution of building materials between States is involved, the distribution has been made as fairly as possible. Galvanized iron roofing, for instance, is manufactured in New South Wales, and, recently, there has been a great demand for this material to protect stored wheat.
– Can we not concentrate upon production? Distribution would then, more or less, take care of itself.
– Production is largely in the hands of private enterprise. I shall have a look at the correspondence on the matter to see whether the Premier of Queensland has raised any special point which demands urgent attention.
– Is the Prime Minister aware that Judge Kirby, in a broadcast to the people of the Netherlands East Indies, appealed for moderation and understanding in order to bring about a just and lasting peace in that country? Will the right honorable gentleman make a similar appeal to the wharf labourers of Australia, who, for the last two years, have taken a direct but onesided part in the deplorable dispute with the Netherlands East Indies?
– I heard on the radio yesterday morning that Judge Kirby had made a broadcast from the Netherlands East Indies - I do not know whether he spoke from Batavia, Jokjokarta or elsewhere - making an appeal for a solution satisfactory to both parties in this dispute. The objective of the Australian Government, when it referred this matter to the Security Council, was to endeavour to bring about results which we all desire. That is why we have an Australian representative on the body, which is endeavouring to effect a satisfactory settlement in the Netherlands East Indies. In view of the efforts which are being made by the representatives of Belgium, the United States of America and Australia to effect a settlement, I consider that I should not make any statement on the subject at this juncture.
“Wyatt Earp” Expedition.
– Will the Minister for Labour and National Service inform me whether any dispute has occurred in fitting out the vessels for the Australian Antarctic Expedition? If so, will he supply details to the House? Has a settlement been reached, or is the success of ‘he expedition threatened by the possibility that one or more of the vessels will not be ready for service before it is too late for the proposed voyage to the Antarctic this season?
– It is true that a dispute occurred last week in connexion with the repair of the ship Wyatt Earp. The latest report which I received this morning indicated that the repairs will be finished in time to prevent any interference with the schedule.
General Agreement on Tariffs and Trade.
– by leave - In accordance with the arrangements entered into at Geneva, the provisional application of the General Agreement on Tariffs and Trade was made dependent upon the signature by the following eight key countries of the Protocol of Provisional Application, namely, the Commonwealth of Australia, the Kingdom of Belgium in respect of its metropolitan territory, Canada, the French Republic in respect of its metropolitan territory, the Grand-Duchy of Luxemburg, the Kingdom of the Netherlands in respect of its metropolitan territory, the United Kingdom of Great Britain and Northern Ireland in respect of its metropolitan territory, and the United States of America. All eight countries have now signed the protocol and the texts of the final act, the general agreement on tariffs and trade, and of the protocol of provisional application were released by the United Nations for publication at 1830 hours eastern standard time in the United States of America, the 17th November, corresponding to 9.30 a.m. to-day Australian eastern standard time.
The protocol was signed on behalf of the Australian Government by the Minister for External Affairs (Dr. Evatt), and the following statement was issued by him on behalf of the Australian Government : -
The Australian Government undertakes to apply provisionally, provided all other countries do likewise, the tariff reductions negotiated with the other countries whose representatives have been engaged in Geneva during the greater part of 1947. This action will be consequent upon my signing, on behalf of the Australian Government, the protocol of provisional application of general agreement on tariffs and trade.
The Australian Government will apply the new rates provisionally from the 18th November. At a later date, the Government will decide whether to recommend to the Parliament that the provisional agreement be confirmed.
The breadth of the negotiations conducted by a committee established by the Economic and Social Council of the United Nations is without precedent. More than 120 separate negotiations ranging over a vast number of products were completed by representatives who met to attempt mutually advantageous arrangements to free the channels of world trade. Australia negotiated with a full conviction of the benefits to be gained, not only to itself, but by the. whole world from a satisfactory settlement and a selective reduction of present trade barriers.
The negotiations have to be considered in the light of concurrent efforts to get agreements, in the form of a charter from an International Trade Organization, to commitments upon countries to maintain employment and the demand for goods, which are the basis of trade, and to adhere to agreed rules of good trade conduct.
These commitments are intended to supplement those which the members of the United Nations have already accepted in the United Nations charter - namely, to promote jointly and severally, higher standards of living, full employment, and conditions of economic and social progress and development.
The project embarked upon by the Economic and Social Council, through its preparatory committee and the world conference which is to assemble shortly in Havana, is one of the most constructive endeavours of the United Nations. The progress already made in tariff negotiations and the decision by a substantial number of the governments to bring tariff reductions into provisional effect lay a sound basis for successful achievement of a significant improvement in world trading conditions and for a solution of the present economic crisis.
I lay on the table the following papers : -
United National Conference on Trade and Employment - General Agreement on Tariffs and Trade -
Ministerial Statement, 18th November, 1947.
Explanatory Statementby the Acting Minister for Post-war Reconstruction, 18th November, 1947, together with accompanying documents.
Text of Agreement, together with - Protocol of Provisional Application.
Schedules of Tariff Concessions (Volumes I. and II.).
This is the text of the general agreement on tariffs and trade, which includes general articles, tariff schedules covering all the countries concerned, and annexed protocols. These documents, which have arrived from Geneva during the last few days, are extremely bulky, and until they can be reprinted in Australia I regret that only a limited number of copies will be available. The changes involved in the Australian tariff are contained in the resolutions and explanatory memorandum which I shall lay on the table in a few moments. Copies of these documents are available for distribution. Statements have also been assembled which, in conjunction with the tariff resolutions and explanatory memorandum, contain the latest information bearing upon the effect of the general agreement on trade and tariffs on Australia’s interests if the agreement is eventually adopted by the governments concerned. These statements are also available for distribution. I move -
That the Ministerial Statement and the Explanatory Statement with the accompanying documents be printed.
– That is reasonable.
– I agree.
Question resolved in the affirmative.
– I move - [Schedules to be incorporated in Hansard at a later date.]
These tariff resolutions, which will operate from to-morrow, give effect to the necessary changes in the Australian Customs Tariffs arising out of the provisional acceptance by the Australian Government of the general agreement on trade and tariffs prepared at Geneva.
– Before the Minister for Commerce and Agriculture resumes his seat, can he give the House some intimation as to when the debate relative to the schedules mentioned is likely to take place? This is a matter of considerable importance to some industries, and some indication should he given by the Government at the present stage.
– I lay on the table the following papers: -
United Nations Conference on Trade and Employment - Memorandum showing alteration of Tariff Duties.
The memorandum shows the new tariff duties arising out of the recent International Conference on Trade and Employment, and furnishes a comparison with the tariff rates at present operating. The memorandum also indicates the country with which each individual tariff item was negotiated. Imove -
That the paper be printed.
– Earlier I asked the Minister for Commerce and Agriculture (Mr. Pollard) whether he could give some assurance as to when the tariff schedules are likely to be debated. As this matter is of supreme importance to Australian industries, I again ask him to indicate when the matter is likely to come before Parliament for discussion.
– An opportunity will be afforded in due course for a discussion of the schedules. As the honorable member for Wentworth knows, the new tariff rates operate for a provisional period of six /months, and at some time within that period an opportunity will be given honorable members to discuss them.
.- I regret that the Minister for Commerce and Agriculture (Mr. Pollard) has not given a more specific undertaking. He merely said that in due course honorable members will be given an opportuni’y to debate the adoption of the new tariff schedules. With all respect to him, and without wishing to appear offensive,I consider that his undertaking does not mean anything, because we all know that, items can remain on the notice-paper for many months without being discussed. This matter is of vital importance to many Australian industries and honorable members are entitled to an assurance that full opportunity will be given for a debate on the new schedules before the end of the present sessional period.
– What does the honorable member mean by “ the end of the present sessional period “ ?
– I mean before the Christmas recess.
– I think that it would be impossible for the thousands of items contained in the schedules to be properly examined within that period. It is not likely that the matter will be discussed in Parliament until the beginning of the parliamentary sittings next year.
– The Prime Minister (Mr. Chifley) has been quite specific in his remarks, and we now know how the matter stands.
– The new schedules are very complicated and will require some considerable time to examine.
– Doe9 the Prime Minister mean that they will be debated within the next six months?
– We have had instances where that has not been the case.
– The new tariff schedules apply provisionally for six months, and the governments concerned are required to reach a decision within that time a9 to whether they will ratify them. It is now mid-November and, according to my calculations, the schedules will require to be ratified before the middle of May, or they will lapse. I understand from an earlier statement of the Minister for Post-war Reconstruction (Mr. Dedman) that the Government is required to intimate to the other governments concerned before the expiration of that period its intention with regard to ratification, and, that being so, it is obvious that the Government has less than six months in which to make a decision. I ask the Government, therefore, not to make a decision before it has given honorable members an ample opportunity to debate the matter, which would necessitate commencing the debate in the early stages of the sittings after Christmas. Can the Prime Minister give the House an assurance that in the early stages of the sitting after Christmas
– That is the Government’s intention.
– I point out to the Prime Minister (Mr. Chifley) and the Minister for Commerce and Agriculture (Mr. Pollard) that, although there is not time at present to examine the agreement, it is almost unprecedented for such an agreement to be implemented without discussion by the Parliament. Alteration of the present tariff schedules is a matter of life and death to certain Australian industries, and may permanently affect our economic destiny. The new tariff schedules are in operation now, and although honorable members cannot hope to assimilate all the facts connected with them in a few weeks, it is essential that discussion of them should begin soon. I suggest that they be discussed during the present sittings. It is said that the alterations of tariff schedules involved in the new agreement are far greater than those which were entailed by the Ottawa Agreement, which were very considerable. If the Prime Minister is prepared to give an assurance that time will be made available for discussion of the new tariff schedules during the present session honorable members will know, at all events, what the Government proposes. Major industries, such as canned and dried fruits, are likely to be seriously affected by the new tariff schedules, and it is obvious that the sooner the Parliament is afforded an opportunity of discussing them the better. Can the Prime Minister give some more definite indication of the Government’s intention?
– The Minister for Commerce and Agriculture (Mr. Pollard), the Minister for Works and Housing (Mr. Lemmon), and the Minister for Trade and Customs (Senator Courtice), and I have spent considerable time during the last twelve months considering the tariff schedules, and I can inform honorable members that they will require a period much longer than a few weeks in order to become familiar with the schedules. In saying that I have in mind that some honorabie members will be more interested in the effect on particular industries of the new schedules rather than in their general effect. The Government intends to examine the possibility of making time available for a commencement of the discussion on them at the end of the present sittings or early in the sittings after Christmas. The Minister for Post-war Reconstruction (Mr. Dedman) made two statements in the House on this matter; the first some time before the 11th October and the second on that date, and I believe that the notice-paper contains a notice of motion that the statements be printed. The “Government will endeavour to afford an early opportunity for discussion to honorable members who have had time to study the new schedules. My own opinion is that honorable members will not be able to make a satisfactory examination of the schedules in time to take part in an early discussion of the matter. However, for the benefit of any who may have had an opportunity to examine them, the Government hopes to make some time available for that purpose before the House rises.
– During that debate the honorable member for Indi (Mr. McEwen) would have an opportunity of discussing the effect of the new tariff schedules on industries in which he is interested ?
– In a general way. I shall consult with the Leader of the Opposition (Mr. Menzies) and the Leader of the Australian Country party (Mr. Fadden) and inquire whether the stamina of honorable members will be sufficient to enable them to “last the distance in order that some discussion may take place on the motion standing in the name of the Minister for Postwar Reconstruction. It is just possible that all the schedules may be disposed of during one debate.
Debate (on motion by Mr. Menzies) adjourned.
In committee : Consideration resumed from the 14th November (vide page 2161).
Clauses 37 to 46 - by leave - considered together.
.- L” should like some information as to how it is proposed to deal with shares held by people resident in England when the shares of Australian residents are acquired under clause 13. Sub-clause 1 of clause 13 provides -
Where the Treasurer is satisfied that the majority in number of the shares in an .Australian private bank are Australian shares, the Treasurer may, by notice published in the Gazette, declare that, upon a date specified in the notice the shares in that bank which are Australian shares upon that date shall be vested in the Commonwealth Bank.
The CHAIRMAN (Mr. Clark).With what clause is the honorable member dealing?
– I am dealing with clause 37 ; but in order to do so effectively I must refer to clause 13. In clause 37 and subsequent clauses there is provision for assessment of compensation where shares are acquired from Australian shareholders in an Australian private bank, which is defined as “ a private bank which was formed within the limits of the Commonwealth and the name of which is set out in Part I. of the First Schedule “. Where those shares are taken over, it is contemplated by other provisions of the bill, as, for instance, clause 18, that the Commonwealth Bank shall immediately appoint directors to such private trading banks. Those directors are given extensive powers in the internal organization of those private trading banks.
– I think that the honorable member is referring to a previous debate.
– With great respect. I submit that I am not. I cannot express my view in relation to clause 37, whicli deals with compensation, without referring to clause 13.
– The marginal note to clause 37 reads “Register of rights to payment of compensation “. The clause provides for the keeping of the names of shareholders, a statement of the number and class of shares held by each shareholder, and the date upon which those shares become vested in the Commonwealth Bank. The matters to which the honorable member is referring were dealt with in connexion with a previous clause.
– I am certain that the point I am now making was not deal! with in connexion with any previous clause. Under the clauses which we are now discussing provision is made for compensation to Australian shareholders whose shares are acquired by virtue of clause 13. YOU. “Mr. Chairman, will understand–
– I regard the honorable member’s remarks as a reflection -on the Chair, and-I ask him to withdraw and apologize.
– If .you -so interpret my remarks, Mr. Chairman, I withdraw them. The Treasurer will understand that the English shareholders in these companies where Australian-held shares have been acquired by virtue of clause 13 (1) will be directly ‘affected in the value of the shares as the result of the appointment by the Commonwealth of directors to control the trading banks. Should the profits o’f the trading ‘bank’s fall below their present level; the value of the shares held by English shareholders ‘would also fall. Since complete power is ‘te be given to the directors appointed by the Commonwealth to control priva’te banks as they think fit, I should like to know what is the Government’s intention regarding the control of a bank in the period between now and its liquidation, when its assets will be transferred to the Commonwealth Bank. I want to know what protection is given to the English shareholders
– I should like the Prime Minister (“Mr. Chifley) to say how it is intended to obtain the money with which to pay compensation in respect of the acquisition of the assets of the trading banks. According to the bill, those as’sets consist of property or shares, In his second-reading speech the right honorable gentleman said that it was the intention of the Government to have the acquisition financed from the resources of the Commonwealth Bank. He added that there was no need for the Parliament to pass an appropriation bill. I shall show that the Commonwealth Bank has not adequate resources of its own to Compensate the private bank’s fully. The amount of compensation has been generally accepted as approximately £100.000.000. The Commonwealth Bank has no resources of its own from which it can pay compensation amounting to that sum. The Central Banking Division of the Commonwealth Bank owed £268,834,000 to the private banks as at the 30th June last. The banks, ‘in turn, owed that amount to their depositors. No doubt the amount pf indebtedness has varied, either upward or downward, since then but those are the latest audited figure’s^ available. Of ‘the assets of ‘the Central. Banking Division, of ‘the Coin.monwealth Bank, which ‘amount to £438,000,000 excluding the note issue, the Commonwealth Bank has invested £274,456,000 in .government securities. In . other words, more than half of ‘the assets of the Commonwealth Bank consist of government securities, which, in turn, constitute the amount owed to the trading banks, and, as I have said, the private banks owe that amount ‘to their depositors. In “the light of those figures, I ask where the Commonwealth Bank will obtain .the money to pay compensation to the trading banks, except by using the assets of the trading banks which they hold as trustees ‘for their depositors. The Commonwealth Bank, including the Commonwealth Savings Bank, has invested £838,000,000 in government securities, including treasury-bills. As the total assets of the Commonwealth Bank amount to £1,174,00’0,000, the proportion of those assets invested in government securities is therefore self-e’vident. -.Supporters o’f the Government ha,ve claimed with pride that ‘the Commonwealth Bank is the people’s bank. It is ito such thing; it is the Government’s bank. The total deposits in the Commonwealth Savings Bank at the 30th June last amounted to £426,000,’00’0. Ninety per cent, of that money is invested in government securities, including treasury-bills. The Note Issue Department has invested £158,000,000 in government securities. In the trading division of the Commonwealth Bank the deposit’s aggregate £74,000,000, of which £35,000,000 have been invested in government securities. AH these amounts go to make up a total of £838,000,000 out of the banks5 entireassets of £1,174,000,000. Now we are told that £l6b,b00,000 for the purchase of trading bank shares will be found out of the resources of the Commonwealth Bank itself, This indebtedness, which the Commonwealth is to assume must be discharged either in bonds or in cash, as was stated by the Prime Minister in his second-reading speech. If payment is to be made in bonds, the shareholders will reasonably expect the terms to be at least as favorable as-those for bonds sold to the public within the last six or twelve months. If the bank draws on the fund of £274,000,000, including treasury-bills, and pays £100,000,000 out of this, only £174,000,000 will be left as security against special accounts amounting to £268,000,000. The Prime Minister should make it clear here .and now how it is intended to meet this obligation, and upon what resources of the Commonwealth Bank it is proposed to draw.
There will undoubtedly be a considerable loss of revenue when the banks are nationalized. It cannot be stated exactly how much will be lost in income tax, but it is certain that the amount will be large and the general taxpayers will have to make it up. It is a community tax, and if Peter does not .pay, Paul must. If the private banks, .after nationalization, cease to pay income tax, the public must pay something more to make up the amount. The private banks also pay large amounts in rates to local governing authorities.
– The Commonwealth Rank makes ex gratia payments to local governing bodies in lieu of rates.
– Yes, I know all about those payments, but they do not amount to anything like as much as a private owner would have to pay in rates on the same property. There will also he a loss of State revenue, including stamp .duty on general securities, bills, mortgages, &c. We cannot say just how much this amounts to at present, but a statement should be made by the Government on the subject, so that the people will know just what this proposed transaction will entail. Moreover, the State governments are entitled to know the extent to which their revenues will be affected, as are the local governing authorities. There is no statutory basis for ex gratia payments by the Commonwealth Bank, and they may cease at any time.
.- The clauses now under consideration deal with the assessment of compensation so as to preserve the rights of the former holders of bank shares when those shares are transferred to the Commonwealth Bank. These are machinery clauses, and their purpose is to ensure that the rights of shareholders are recorded, so that payment may be made when the amount of compensation is finally determined.
The Leader of the Australian Country party (Mr. Fadden) referred to the loss of income tax which the Treasury would suffer when the private banks were nationalized, and he also referred to losses of revenue by State governments and local governing authorities. It is true that the banks have paid a lot of income tax ; but they have also paid substantial dividends, and posted large amounts of money to reserves. The community will lose something by way of income tax which the private banks will no longer pay, but this will he more than compensated for by the profit which the nationalized hanks will farn for thecommunity. However. I nin not so much concerned with thai, us with the general benefit which will accrue to the community when the trading banks become a publicly owned instrumentality. Despite all the propaganda to the contrary, I believe that the operation of the banking system, as a public utility, conducted by bankers and responsible to the Government, must confer benefits on the community that will far outweigh any possible loss of revenue through the private banks ceasing to pay rates and taxes to the Commonwealth and State Governments, and to local governing authorities. Taking the short view, however, it is certain that, in the early stages, the banks, when taken over, will be controlled with regard to earning a profit, and this profit will more than make up for any loss of revenue. The Leader of the Australian Country party also referred to the payment to be made by the Commonwealth Bank for the purchase of the assets of the private banks, which he estimated at £100,000,000. Though that estimate has been fairly widely accepted, it is, of course, subject to final determination by the Federal Court of Claims. For the purposes of this debate, a commitment of that amount may be accepted as approximately accurate. The arguments advanced by the right honorable gentleman were intended to confuse rather than clarify the position. It is true that an amount of. approximately £282,000,000 is now held by the Commonwealth Bank on behalf of the private banks, which, in turn, hold it trust for their depositors. In effect, the private banks have a claim upon the Commonwealth Bank for that amount of money to be paid in notes if at any time a claim be made upon them by their depositors for the return of their deposits. The sole effect of this proposal will be that the depositors will have first claim on the Commonwealth Bank instead of on the private banks for the return of their deposits. In his second-reading speech, the Prime. Minister (Mr. Chifley) made it clear that the Commonwealth Bank will, as a normal banking transaction, provide for the payment of compensation to the private banks. As the right honorable gentleman pointed out, Commonwealth bonds and treasury bills held by the Commonwealth Bank are far more than sufficient to meet the claims of the shareholders of the private banks.
– But not more than sufficient to meet the claims of the depositors as well.
– The Leader of the Australian Country party is endeavouring to confuse the people on this issue. The simple fact, is that the shareholders of the private banks will be paid by the Commonwealth Bank either in bonds or in cash as they desire.
– By inflation.
– The shareholders of the private banks are to be given an opportunity to decide whether they will be paid in cash or in Commonwealth bonds. I suggest that, as good business men, they will readily accept bonds from the Commonwealth Bank.
– Upon what basis does the honorable member make that statement?
– The large amount of money available at short call to-day suggests that if the total amount were paid in notes the shareholders of the private banks would hold money which they probably could not expend and would be forced either to invest it on short-term deposit at a low rate of interest or pay it into their current accounts on which they receive no interest. Consequently, it is reasonable to assume that they will elect to be paid in bonds returning current rates of interest and saleable at any time. However, those who may desire to be paid in cash for utilization for any particular purpose will be given an opportunity to elect to accept that method of payment.
– What about compulsory loans ?
– It is strangely significant that exactly the same remark should have been made in 1910 when Commonwealth notes were first introduced. The people were then told that the issue of Commonwealth notes was a fearful thing, amounting practically to a forced loan. The Australian Labour party and the great Australian Labour movement would never have made such spectacular progress had honorable members opposite learned something new in propaganda as the years passed by. The simple fact is that, from the resources at its disposal, the Commonwealth Bank will take over the assets of the private banks. The only significant fact that emerges from the speech by the Leader of the Australian Country party is that the private banks, with comparatively small capital backing, finance practically all their operations and provide almost all their accommodation out of the funds supplied not by the shareholders but ‘by the depositors. In that respect the business of private banking is practically unique. That in itself constitutes one of the major reasons why public ownership of the banking system is not only essential and urgent but also pure common sense. The clauses before the committee provide merely that the claims of shareholders under the present system of banking shall be recorded in order to ensure that payment of compensation as finally determined by the Federal Court of Claims may be made to them. Any talk of loss of taxes resulting from the acquisition of the private banks by the Commonwealth Bank is rather naive, because, as we are all aware, private banks have not only paid income tax to the Treasury but have also returned substantial profits to their shareholders. If, after this bill becomes law, the Commonwealth Bank makes profits on the business which was formerly handled by the private banks, the yield will be more than sufficient to meet any loss of income tax resulting from the acquisition of the private banks. These are merely machinery clauses which have been designed to provide adequately for the recording of the claims for compensation by the shareholders of the private banks.
.- The committee is entitled to an explanation from the Prime Minister (Mr. Chifley) of the points raised during the debate, particularly those brought forward by the Leader of the Australian Country party (Mr. Fadden). The right honorable gentleman, however, is following his familiar practice of putting up a back-bencher to reply when he himself does not want to do so, doubtless with the intention of replying at some other time when it suits him, possibly outside of this chamber. This is a matter of great importance to the people of Australia, particularly those with savings bank accounts. The Commonwealth Bank, which is to be the purchaser of the trading banks, and has to provide 100,000,000 or possibly much more, has certain resources at its command. These ure tabulated in its report of the 30th lune, 1947, an informative and revealing publication, which shows exactly what funds and assets the Commonwealth Bank has at its disposal and what funds are available for purposes such as ‘that contemplated by this measure. The Prime Minister has told us that the Commonwealth Bank will provide the money for the acquisition of the trading banks and for the payment of compensation to their shareholders. Before he brought forward this proposal to nationalize the private banks, the right honorable gentleman must have discussed with the Governor of the Commonwealth Bank the means whereby the acquisition of the trading banks was to he financed. Accordingly, he should not leave it to an uninformed honorable member such as the honorable member for Perth (Mr. Burke) - and I use the term “uninformed.” with due respect - to reply to these important points.’ If the honorable member for Burke is in fact informed on this subject, be possesses knowledge which should be in the possession of every honorable member. The balance-sheet presented by the Commonwealth Bank shows the total deposits in the Commonwealth Savings Bank as £426,000,000. It might be suggested that the funds for the purchase of the private trading banks may come from that source, but the balance-sheet indicates that of that amount £369,000,000 has been invested in government securities and treasury-bills.. Thus, practically the whole of the savings bank deposits has already been invested in government loans.
– Over 90 per cent, of it.
– That is so. Possibly therein lies the explanation of the filling of Commonwealth loans. Much publicity has been made of the fact that Commonwealth loans have been fully subscribed when, as a matter of fact, a large amount of the deposits of the people in the savings bank has been utilized by the Commonwealth Bank for that purpose. It is apparent that the Commonwealth Bank has been quietly transferring to the Treasurer money belonging to depositors in the Commonwealth Savings Bank in order to enable the right honorable gentleman to boast that his loans have been successfully floated. The other principal source from which the money might be obtained is tho £268,000,000 which the Commonwealth Bank holds as trustee for the private banks. In order to make the position clear to any one who may not readily understand it, may I explain that the private banks were compelled, first by National Security Regulations, and later by the Banking Act of 1945, to deposit certain surplus funds Avith the Commonwealth Bank. They have been paid interest on those funds at the rate of per cent. On the opposite side of the Commonwealth Bank’s profit and loss account there is an amount of £274,000,000,. which is held in government securities, including treasury-bills. Therefore, practically the whole of the trading banks’ special accounts have again come to the Government. The trading banks are paid interest at the rate of per cent., but the Commonwealth Bank is paid 1 per cent, on treasury-bills, so that it is making a profit of 100 per cent, on money that properly belongs to the trading banks.
– That is a normal operation.
– “Whatever expert knowledge the honorable’ member for Perth may have, a duty devolves upon the Prime Minister to inform the committee and the country. The third method by which the Commonwealth Bank may finance the acquisition of the private banks is that of inflating the currency. That has been suggested by the honorable member for Perth.
– I did not suggest any such thing.
– The honorable member said that the banks’ shareholders might be paid either in bonds or in cash. Where are the bonds to be found ? “Where is the cash to be found ? “We are entitled to be given some information in answer to those questions. If the funds are to be obtained by means of inflating the currency, that means that there will be a further depreciation of the value of money and therefore a further depreciation of the value of the accounts of savings banks depositors. Should this £100,000,000 depreciation take place, such depositors will find that a deposit of, say, £100 will bc capable, of buying only £75 worth of goods. These are merely speculative possibilities, and I do not know the answer.
– Very speculative, too.
– That is the answer that I wanted. The Prime Minister is the only one who can resolve this speculation, and the people are entitled to have the information which he can give to them. He must be able to answer my questions. In a democratic community, there can be no legitimate reason for secrecy in this matter. This cannot be a secret transaction because, before the proposal to nationalize, the banks was formulated, the Prime Minister must have discussed with the Governor of the Commonwealth Bank the means of financing the scheme. He ought to tell the country what he proposes to do. The people are entitled to know whether there is to be an inflation of the currency by £100,000,000 in order to compensate the shareholders of the private banks, or whether the Commonwealth Bank pro poses to use money that has been deposited with the trading banks. Those are the alternatives. The Prime Minister ought to answer me. The country is entitled to an answer.
– The clauses now before the committee provide for the payment of compensation and the way in which it will be paid.
– They do not.
– The bill is clear on the matter. “What the shareholders in the private banks want to know is how they will be paid for their shares. The bill provides definitely that the shares shall be bought, at the very least, at the market prices ruling on the 15th August, 1947. Those are the lowest prices which can be paid for them, and it is possible that the Federal Court of Claims may award a higher rate of compensation. The Leader of the Australian Country party (Mr. Fadden) has referred to taxes and to the rates and charges levied by local government bodies, but they are not dealt with at all in these clauses. He has said that the Government’s proposals for financing the acquisition of the private banks should be explained. My contention is that the Commonwealth Bank is able to finance the payment of compensation. I was rather amused by the question posed by the honorable member for Richmond (Mr. Anthony), who asked whether payment would be made in bonds or in bank notes. “Would any person who owns shares in a private bank from which he receives a good dividend be likely to take a large sum of bank notes and put it in safe deposit where it would not earn interest for him? I cannot imagine that shareholders would take bank notes in payment for their shares and not put them to any use. Therefore, the honorable gentleman’s remarks about inflation appear to me to have very little relation to this discussion. The honorable member also asked whether the Commonwealth Bank would have sufficient security if shares were bought with bonds. I point out that people who hold shares in private banks consider those shares to be very good asset3. If the Commonwealth Bank takes over those shares, they will not lose any of their value as security.
The group of clauses which the committee is now considering deals with assets. If the Commonwealth Bank pays for certain hank buildings and other assets when it takes over from the private banks, it will be able to use those assets as security. It seems to me that honorable members opposite are very hard-pushed to find some concrete objection to the proposals within this group of clauses. Those proposals constitute the crux of this measure. Honorable members opposite may talk as much as they like about amounts of £100,000,000 or £267,000,000, but the fact remains that, when the Commonwealth Bank takes over the shares and buildings of the private banks those assets will remain just as valuable as they are to-day. The only difference will be that certain people will not continue to derive benefit from those assets as they are doing now, and that any lowering of the profit derived from the use of those assets will be to the advantage of the people generally. The Leader of the Australian Country party (Mr. Fadden) has said that profits from the use of those assets will not go to general revenue but will be used to reduce our national debt. I believe that most people will agree that, if the Commonwealth has a business undertaking whose profits reduce Australia’s national debt, that undertaking will be of great advantage to the people, because it will enable the Government to reduce taxes. As the national debt is lowered, the Government will be able to reduce rates of tax which are now necessary to meet the demands of the national debt.
These clauses need not be debated at great length, because they are virtually self-explanatory. I admit that there are some technical details on which honorable members may wish to have information, but the general principles embodied in the clauses are set out very clearly. They provide that the shares of the private banks will be taken over at the market values prevailing on 15th August last, or at any higher value which the Federal Court of Claims may consider that the shareholders are entitled to receive.
– How will the Commonwealth Bank pay for them?
– If the right honorable gentleman sold a block of land, he would be paid for it in one of two ways, namely, by cheque or by bank notes. Those are the usual methods of payment. If he were paid with bank notes, he would be anxious to lodge them immediately with his “bank. He would not be anxious to carry them with him. So, whether the shareholders are paid in notes or by cheque, the money will go back into banking accounts, and as there will be no private banks in existence after the passage of this legislation the money will be returned to the Commonwealth Bank, with the exception of that portion of it which will go to the State banks. The bank will be called upon to meet quite a lot of promissory notes. That is general banking practice, and it will be encumbent upon the bank to observe that practice, provided, of course, that adequate security exists. Obviously the bank would not accept a promissory note that lacked adequate security. The shareholders can rest assured that they will be treated fairly. I am sure that no honorable member opposite will argue that the court will not properly assess the value of the shares and assets of the private banks. Even those who are vigorously opposed to the nationalization of the private banks can have no objection to the manner in whicli it is proposed to compensate those who will be affected by this proposal. No valid argument has been advanced against the compensation provisions, and in the absence of such argument their retention cannot be questioned. The clauses now under discussion have no relation to income tax, or to payments to local government bodies. Reference has been made to these matters merely to cloud the issue. The Prime Minister has stated that ex gratia payments will be made to municipal bodies and I am satisfied that these payments will be reasonable.
– The honorable member for Hindmarsh has made a long speech, but so far as I can gather all he has said is that compensation will be paid by cheque or in notes. He has not touched the deeper issue of the effect of these payments upon the economy of this country. The point that the honorable member missed is that neither money nor any other means of exchange can be produced by laws.
Wealth can be produced only by labour. The passage of a bill does not necessarily produce a sound economy. The Prime Minister (Mr. Chifley) has been asked to explain fully, or at least in some detail, how the finance is to be arranged to pay the shareholders of the private banks. That is a simple question. When an individual undertakes a private transaction, the source of his money is his own private concern; but when a government undertakes to purchase goods or chattels, the people are the real purchasers, and the Prime Minister is called upon automatically to say what assets belonging to the people are to be used to finance the transaction.
.- The reply given by the honorable member for Hindmarsh (Mr. Thompson) to points raised by the Opposition is almost as vague as the clauses we are now considering. There are two aspects of the compensation question: the first concerns the shareholders themselves and the honorable member for Hindmarsh has said’ - I do not know with what authority - that they will be paid either in notes or by cheque.
– Or bonds.
– That is the very point that I wish to make. What type of bond will they be? When the United Kingdom Government bought the British coal mines, the shareholders were paid in non-negotiable bonds. Are we to assume that the shareholders in the Australian trading banks are to be paid in bonds that cannot be sold until they have matured perhaps 10 years or 25 years hence? That is a. point that must be cleared up.
The second point is the manner in which the operation of taking over the private trading banks at a cost of approximately £100,000,000 is to be financed by the Government. Recently the Government bought bank shares for approximately £100,000. We do not know yet how this purchase is being financed and I think that the public, quite apart from members of this committee, is entitled to some information on the matter. The Prime Minister (Mr. Chifley) knows very well that inflation could be caused by adding £100,000,000 to the currency. Is that to be done? That is a question to which the committee should have a definite, answer from the right honorable gentleman and I trust that he will give a satisfactory reply. So far, no attempt has been made to answer this question, although it has been asked on several occasions.
Sub-clause 1 (o) of clause 39 provides that persons entitled to compensation shall put in their claims not less than two months after the shares have become vested in the Commonwealth. This period is far too short, particularly for people living abroad, whose shares may not be available, and who may not even know what is taking place. A much longer period should be specified. That also applies to clause 41, which says -
A person who has in his possession the share certificate in respect of any shares which have become vested in the Commonwealth Bank under section thirteen of this act, shall, not later than two months after those shares became so vested, deliver up that certificate to the Commonweatlh Bank.
Penalty: One thousand pounds.
That seems an extraordinarily severe penalty for something that may be nothing more than inability to obtain a share certificate or lack of knowledge of what has occurred. That penalty might well be reviewed. Whereas shareholders are given only two months in which to comply with this provision and other provisions of the measure, the Commonwealth Bank is granted no less than six months in which to act in respect of any action to be taken by it. Surely, if the Commonweatlh Bank is to have six months in which to act, shareholders should be allowed six months too. Explanation is also required of clause 40, which provides -
That means that the court may determine the amount of compensation to be payable, but sub-clause 3 provides -
The making of an agreement under the last preceding sub-section shall be subject to the approval of the Treasurer.
What does (hat mean? Does it mean that the Treasurer will have power to sweep aside any agreement reached between shareholders, or their agents, and the Commonwealth Bank? If it does not, what is the point of that condition? It seems to destroy the effect of negotiations for an agreement if the agreement is finally to be subject to the approval of the Treasurer. The same provision is contained in sub-clause 2 of clause 43, which deals with the settlement of compensation by agreement-*-
The making of an agreement under the last preceding sub-section shall be subject to the approval of the Treasurer.
Why i3 that necessary ? Surely, if an agreement is made between the Commonwealth Bank and the person concerned, that agreement should be considered final. I! see no reason for the provision. Why should the Treasurer be allowed to intervene? Why, indeed, should he intervene at all?
.- Lt is interesting to see the way in which this discussion has developed and to note that Opposition members are now confining their attention to the manner in which payment to shareholders of the private trading banks will be financed. They have apparently completely abandoned their earlier statements in attacking this bill, that the rights of ike shareholders will be destroyed and their assets confiscated or paid for at less than fair value. Those statements were made when the proposal to nationalize the private banks was announced.
– By whom? The honorable member cannot name one honorable member who made them.
– -Those statements were made on behalf of. the Opposition parties.
– By whom?
– They were made in every newspaper, over every Commercial radio station, and on platforms in hundreds of towns throughout Australia. The people know that they were made because the statements aroused great concern amongst such members of the public as were prepared to trust the Opposition. The public should realize that proof of the incorrectness of the statements i.i afforded by the fact that Opposition members, in discussing the provision for the payment of compensation, no longer make such preposterous claims. ‘Opposition members have confined themselves to the manner in which payment is to be made. They ‘appear to have been effectively answered by the honorable member for Hindmarsh (Mr. Thompson). The payments will be made with bonds, cheques, or cash, as shareholders prefer. In what other ways could payment be made ? To the extent to which shareholders prefer to accept government bonds in place of dividendbearing shares that they now possess, they will continue to enjoy a satisfactory income, and no final cost to the community will be involved, because it is the community that enables the private banks to pay dividends to their shareholders. The dividends are paid out of the profits made by the private banks and those profits are made out of the banking transactions of the Australian people.
The honorable member for Flinders (Mr. Ryan) asked questions about clauses 40 and 41. It is hard to realize what hi; difficulties are in understanding those clauses. Clause 40 sets out the methods by which compensation for shares compulsorily acquired under clause 13 shall be determined. Where notification of an interest in shares or in the right to be paid compensation in respect of the acquisition of shares is not received by the Commonwealth Bank in accordance with clause 39. compensation will be paid to the person whose name appears in the compensation register. That is to say, that the compensation will be paid to the shareholder, or the assignee, if the shareholder has sold his right to payment of compensation, or to a person on whom the righto payment of compensation has devolved by operation of the law. If the -amount of compensation is not agreed upon, if will be determined by the Federal Court of Claims. It is unlikely that all persons entitled to compensation will agree with the Commonwealth Bank upon the amount that they ought to be paid. In practice, probably almos’t every compensation claim will be finally decided by the court. The court’s determination of the amount of compensation payable will be final. So clause.40 appears to present no difficulties. The honorable .gentleman also referred to clause 4i. The purpose of the clause is to ensure that 3hare certificates shall be surrendered by shareholders or other persons in possession of them. That means that share certificates in respect of shares, for the acquisition of which compensation has been paid, shall not be held by the public. I see little difficulty arising from clause 41.
– I cannot agree that the Government’s proposal on this bill is quite so easy, or equitable, as honorable members opposite pretend to believe it to be. First, no industry could be taken over in the way the bill proposes; and it has yet to be proved that under the Constitution the Government has power to grab shares from the people who have invested money in private banks. The compensation proposed will be paid, because it has to be paid. Were the Government permitted to do so, I have no doubt that it would have listened to the extremists who demand that the banks be nationalized without payment of any compensation. Those sections of the Labour party haTe been rather outspoken in declaring that no compensation should be paid in respect of industries, or corporations, which the Government acquires. Indeed, that has been the subject of a long fight in the ranks of the Labour party. The honorable member for Eden-Monaro (Mr. Fraser) has said that the profits of the private banks have been made out of the banking transactions of the people of Australia. However, the honorable member for Hindmarsh (Mr. Thompson) claimed that the Government will make large profits out of the operations of the monopoly hank, and that this will be a means of casing the burden of the national debt. He said that one of the objects of the Government in taking over the private banks is to obtain this profit for the people. However, the Prime Minister of Sew Zealand has stated publicly that in hia view the private banks are better able to control the banking system in that dominion, and for that reason he prefers not to nationalize the private banks.
The measure of compensation will be decided, we are told, between the private banks and the Commonwealth Bank; but any agreement reached between those parties can be upset by the Treasurer. That fact is made clear in the clauses now under consideration. .1 deny that the Government will he acting fairly in taking over shares in the private banks at their present market value, and I have not the slightest doubt that the owners of such shares will support that view. First, the present market value is not the true Value of the shares in private banks, because, since the war years, a sum of £267,000,000, the property of the private banks, has been held in special accounts by the Commonwealth Bank for which 10s. per cent, is paid and the Government, through the Commonwealth Bank, has had the use of that money. Because the ^private banks have been deprived of the use of those funds they have not been able to make a greater rate of profit than 10s. per cent., whereas the Commonwealth Bank has made profits through the use of those funds. If the private banks had had the use of those funds their profits would be very much greater, and, therefore, ‘ the inducement to the public to purchase bank ‘ shares would 1* greater. Thus the value of the shares would be considerably increased. The action of ihe Government in forcing the private banks to place those funds in special accounts with the Commonwealth Bank has reduced the value of their shares. I sincerely trust thai the shareholders of the private banks will realize that fact, and will seek adjustment on that basis by appealing to any court which may be instituted to adjudicate on disputes which may arise. I have no doubt that an equitable adjustment of the value of shares in that respect would return to the investors concerned a greater benefit than they are likely .to obtain in the form of any taxation concession which the Government proposes to give to those who agree to acquisition.
Secondly, we know that the Government, as it is still doing, took from the private banks d during the war tho total of their gold reserves and placed them with the Commonwealth Bank. That action, also has tended to depreciate the value of shares in private banks. In addition, the Commonwealth Bank, since it has become more active in its operations, has been prone to skim off the cream of investments and to leave the second-class risks to the private banks. Institution.-‘ whose applications for advances from the Commonwealth Bank have been rejected include public utility bodies. In this respect I have in mind various regional bodies which have been set up in Queensland. For example, the Wide Bay Regional Electricity Board, which was recently set up by the State government, applied to the Commonwealth Rank for an advance of £35,000 to enable it to inaugurate its operations. The Commonwealth Bank rejected that application, but within two hours of the board applying to a private bank for an advance the latter advanced the full sum of £35,000.
– When was that?
– That happened within the last few weeks. The manager of a local government body, the Wide Bay Regional Electricity Board, Mr. Cotton, applied to the Commonwealth Bank for an advance of £35,000. I have not had any communication with him or any member of the board on this matter, but I have carefully checked the facts. The Queensland National Bank accepted the board’s application and made possible the payment of any part of an advance of £35,000 within two hours of the application being made. The Commonwealth Bank rejected the board’s application, although the board was set up by the State Government and had the blessing of that Government. That is typical of the way in which the Commonwealth Bank has been skimming the cream off the investment market and leaving to private banks those investments which it rejects. This development, which has been going on for some years, has also tended to reduce the profits of the trading banks, because such investments are regarded, more or less, as second-class risks in the eyes of the Commonwealth Bank. In future, the private banks, whose eyes the Government is now attempting to burn out, will not be in operation to offset this tendency on the part of the monopoly bank. In view of the facts which I have cited, and which have tended to depreciate the value’ of shares in private banks, I urge shareholders in those institutions, should, unfortunately, the High Court declare this legislation to be valid, to seek adjustment of the value of their shares on those grounds by approaching any tribunal that may be set up for the purpose.
– The honorable member for Warringah (Mr. Spender) raised a question which is largely a legal interpretation of clause 37. The legal explanation is that the clause merely provides for the keeping of a register in which will be recorded the names of shareholders on the day on which the shares in private banks are compulsorily acquired by the Commonwealth Bank under clause 13. Any subsequent assignment, or devolution of the right to be paid compensation will also be entered in that register. In practice, a bank’s share register will become the register of rights for the payment of compensation, and in it will be recorded all assignments and the right to be paid compensation. That is the simple legal explanation of clause 37.
The honorable member for Warringah made the point that shares held in Australia in a private bank, which are not compulsorily acquired on the date set out in the notice, might belong to English shareholders, and that the value of the shares might fall before they are, in due course, vested in the Commonwealth Bank.
– They might also rise.
– The honorable gentleman may rest assured that the position of any of these shareholders will not be prejudiced in any way ‘by the fact that the shares are acquired by the Commonwealth Bank at a date later than was the case in respect of Australian shareholders.
– No provision is made for that in the bill.
– The point that the honorable member for Warringah has taken may have some substance. It is not possible to cover in legislation every detail that might arise. If, on the other hand, the shares are not acquired but the assets of private banks concerned are acquired, the interests of the British shareholders will be identical with those of the Commonwealth Bank itself. It is beyond reason to suggest that the Commonwealth Bank would take action which would have the effect of depreciating the value of thu assets.
The Leader of the Australian Country party (Mr. Fadden) was most disturbed about the capacity of the Commonwealth Bank, which is the central bank of Australia, to take over, as a business transaction, the assets of the private banks. In my second-reading speech, I said that that transaction could be done from the resources of the Commonwealth Bank. Some people endeavour to raise a bogy that for this transaction we must produce bank notes to the value of £100,000,000, which will be paid to the shareholders of the private banks.
– Bank notes?
-One honorable member spoke of the inflation of the note issue.
– The honorable member for Hindmarsh (Mr. Thompson) spoke of it.
– First, 1 point out that a considerable percentage would have to be paid, to British shareholders.
– What percentage?
– I do not know whether we have worked out all the details, but it was a substantial percentage of the shareholders. We shall not begin by making a payment in Australian bank notes. That is clear. Does any honorable member imagine that the shareholders of the private banks desire to be paid bank notes to the value of £100,000,000?
– We did not suggest that. Will the right honorable gentleman explain how the shareholders will be paid?
– The honorable member for Richmond (Mr. Anthony) has endeavoured to suggest that the Government’s proposals will cause intiation. He implied that the Commonwealth Bank will pay to the shareholders of the private banks £100,000.000 in bank notes, and that the country will be flooded with £1 notes.
– Even if the shareholders are paid by cheque, the result will still be inflation.
– That is the honorable member’s implication. During the last twelve months, in Australia, advances made by banks have increased by £100,000,000. Does the honorable member suggest that that was inflation?
– Not if that amount were met by production. That is the greatest safeguard. What is the Government doing to increase production?
– The Government’. banking proposals will not increase production.
– Without any protest* from honorable members opposite, tinamount of increased advances made by banks during the last twelve months wa.- £100,000,000.
– Was not the figure £79,000,000? The Commonwealth Bank stated in” its report that the peak has been reached.
– Those increased advances have been made during the last twelve months. One does not know what the shareholders of the private banks, including the British shareholders, might want. At all events, I do not imagine that they will want to be paid with bank notes. The Commonwealth Bank itself holds a certain amount of securities, whicli are its own property and assets. It has other resources. First, it is the central bank of Australia.
– What are those “ other resources “?
– I could ask the right honorable gentleman the same question about the resources of the private banks.
– I am not under an obligation to tell the right honorable gentleman, but he is under an obligation to tell me. That is the difference.
– Some honorable members always complain that the Government interferes with the conduct of the Commonwealth Bank, and dictates its policy. We have an assurance from the Commonwealth Bank that the assets which it is taking over are tangible assets. They are not something which might disappear overnight. These are tangible assets, and from them, within its own resources, the Commonwealth Bank is able to handle this business as a financial deal. That is the plain fact of the matter.
– The taking over of fixed assets does not give the liquid resources with which to liquidate the liability.
– There is nothing in that contention. Reference has been made to the special deposit account held by the Commonwealth Bank. In this account, the surplus funds of the private banks are retained. The right honorable gentleman himself agreed to that principle, although he did not believe in its. being made law. He believed in a voluntary arrangement with the private banks.
– We should have made that provision law if the private banks had not agreed to the arrangement.
– I incorporated that provision in the act for the right honorable gentleman. A large amount of this money in the special account has come from current accounts on which the private banks do not pay interest. Any suggestion that the Commonwealth Bank, to-morrow, will not be able to return to the private banks any of the money which has been lodged with it, and meet any of the commitments which it might have, not only to its own depositors, but also to the depositors of the private banks, is wrong. The truth is that the banking legislation of 1945 created a precedent in the financial history of the British Empire. It gave to the people of Australia a guarantee that all depositors would receive their money on demand, even if those deposits were held in a private bank which had gone into liquidation. In effect, the Labour Government was the first government of any country which gave to depositors a guarantee that their interests would be protected. It is true that we did not give a guarantee to shareholders. However, for any one to suggest, as the honorable member for Richmond did, that the depositors in banks were likely to feel that they would not receive full value for their money or that they might be paid in depreciated currency, was quite absurd. Subject to the legislation being valid, about which there may be some doubt, the Government has endeavoured to give to those people who have deposited money with private banking institutions what is in effect a guarantee that they will not lose their money.
– If the currency is inflated their assets must depreciate.
– The honorable member for Richmond should not talk nonsense about the depreciation of the Australian currency. If I may make passing reference to this matter, I point out to him that the Australian £1 has 40 per cent, more purchasing power internally than British sterling and 60 per cent, more purchasing power internally than the American dollar. On the basis of sound financial practice, the Aus, tralian £1 is one of the few currencies in the world which, from a mathematical point of view, could be appreciated. That is a fact which causes the honorable member for New England (Mr. Abbott) to shiver in his shoes whenever he thinks about it. The honorable member knows that under the law of supply and demand the Australian £1 has greater value than almost any other currency in the world. He knows what would happen if that law were put into operation.
– I do not know what will happen when the Government has finished with its banking proposals.
– The honorable member has been saying things about me for six years. Suggestions have been made that something the Government has done, or is likely to do, will render the Australian currency less valuable. There is no justification for that fear. The Australian currency could be appreciated. What I have said applies to the private trading banks as well as to the Commonwealth Bank.
– How much is the dollar worth now?
– There is no need for the honorable member to tell me that when the Americans came here they knew what the value of the dollar was in Australia compared with its value in their own country.
– What is the Australian £1 worth in the United States of America?
– On a sterling basis it would be worth a lot, but any attempt to establish such a basis would meet with violent opposition from members of the Australian Country party. Indeed, they would set up such a howl that the roof of this building would be in danger of being lifted.
– Does the Government intend to do that?
– I am something of a realist. If the Government had taken the stand frequently taken by bankers in the years gone by, those are the things that it would have done. The only complaint that I have heard about the Commonwealth Bank while I have been Treasurer has been that its ex gratia payments to local governing bodies have not given satisfaction. The bank itself denies that that complaint is justified.
– People know that it is no use complaining to the right honorable gentleman.
– It has been said that the profits made by the Commonwealth Bank go into the sinking fund. The money paid into that fund must come out of revenue. Reference has also been made to the saving of stamp duty. The people get the benefit of that. One of the greatest ramps that this country has ever known is the internal exchange on cheques charged by banks. Both the honorable member for New England and t have been interested in that subject for several years. I merely mention these subjects in passing.
– “Why not make a passing reference to the bill?
– I thought that I had done so. I was replying to some of the statements made by the honorable member for Wide Bay (Mr. Corser), who covered a wide field in his remarks. However, as that honorable member is a member of the Australian Country party, I realize that the Leader of the Opposition (Mr. Menzies) cannot be responsible for what any member of that “ spare part “ may say.
I rose chiefly to say, first, that the Commonwealth Bank, from its own assets, is in a position to pay off the private banks and in return acquire tangible assets. My second object was to make it completely clear that shareholders of banks, whether in England, or Australia, will get justice. They may enter into a voluntary agreement, or they may go to the Federal Court of Claims. It is all very well for honorable members opposite to sneer about the courts. That is one of the things about which complaints have been made recently. I could give the committee some of the history of appointments to courts in Australia, but I have never been one to cast reflections on judges. Whatever their background has been, I have not doubted the honesty of judges when sitting on the bench. I have not always held the same high opinion of their ability. No proposal of the Government will prejudice the rights of any one affected by this clause. The shareholders of the banks may choose to accept Government bonds. That may necessitate some adjustment of the rate of interest. Or they may accept payment by cheque. I believe that 99 per cent, of the people affected will choose one of those two methods. A third method is open to them ; they may ask for payment in notes, but I do not think that many of them will seek a settlement in that way. I hope that I have removed any doubts which existed in the minds of honorable members opposite.
– The Prime Minister (Mr. Chifley) made two points : The first was that the Commonwealth Bank would take over the shares in the private banks paying for them out of its own assets. The second was that the shareholders would get justice provided they did not go to the court and ask for it. The Government is relying upon the Constitution for authority to acquire the assets of the private banks. The Constitution gives this Parliament certain powers, but it does not give the Parliament authority to delegate those powers, nor does it authorize any authority, governmental, semigovernmental or private, to usurp the powers conferred by the Constitution. The Commonwealth Constitution Act authorizes the Government to acquire any property from any State or person on just terms; but I do not believe that what the Government is now proposing to do represents a proper exercise of its powers of acquisition. As for what the Government proposes to do by way of compensating shareholders, I say that the
Australian Government has no authority, either legally or morally, to fell the Commonwealth Bank or anybody else to pay for property acquired by the Commonwealth. If the Commonwealth acquires property on just terms, it stands to reason that it must pay for the property out of assets belonging to the Commonwealth itself. There must be an exchange of something of value owned by the Commonwealth for something of value which it is taking away from the citizen. In the present instance, according to the statement, of the Prime Minister, it is proposed to pay the shareholders t>f the private hunks out of assets which il ie Commonwealth Bank already possesses. The .Prime .Minister does not claim that these assets are the property of the Commonwealth Bank. As a matter of fact, we know that the total capital of the Commonwealth Bank is inly just a little over £16,000,000, and yet it is proposed that the Commonwealth Bank shall acquire £100,000,000 worth i>f other people’s assets. In other words, without an appropriation by the Parliament, without the imposition of taxes, without raising loans, and, thank God, without any’ suggestion of inflation by increasing the note issue, the Government proposes to get hold of £100,000,000 worth of other people’s goods.
The late Sir Henry Morgan, a famous seaman who operated on the Spanish Main before he became respectable and was appointed Governor of Jamaica, would have been very envious nf the Australian Government because, during the whole period of his depredations, lie never took from the Spaniards one fraction of what this Government is getting out of the shareholders of the private banks. There has been talk of the soundness of the currency, and of maintaining the purchasing power of the £1. I do not know whether any one mentioned “Fisher’s Himsies”. If not. I will do so now. When the Fisher Government took over, honorable members who preceded me as the representatives of political parties now on this side of the House, called the notes issued by the Commonwealth “ Fisher’s flimsies “. A better title was never invented. At the time those notes were first issued, they bore a printed declaration that they could be exchanged at the Commonwealth Treasury for one golden, sovereign. Not very long afterwards, a sovereign was worth 25s. That was the beginning of a process by which the Australian £1 note has approximated more and more in value to that of a piece of very ordinary paper This process has continued until to-day the Australian sovereign - and some of us still keep one or two as souvenirs, notwithstanding the regulations - is worth £2 12s. 6d. in Australian notes. I ask members of the Government, and their loquacious supporters who are trying to talk themselves out of the bog in which they are stuck, whether they want the Australian £1 note to become even more flimsy than it is. I address myself particularly to the honorable member for Eden-Monaro (Mr. Fraser), who seemed to doubt that honorable members would take up the challenge about “ Fisher’s flimsies “. There must be something in historical association, after all. I recall that Simon Fraser, who was Lord Lovat, sent his son to Culloden, while he himself was maintaining close contact with the British Govern.ment. The honorable member foi1 Eden-Monaro would also like to have it both ways. He would like to argue in favour of the soundness of the currency, whilst supporting a proposal to acquire £100,000,000 worth of assets merely by making an entry in the books of the Commonwealth Bank. An honorable member of his attainments is fully entitled to entertain such ambitions if he wants to, but whether they will he satisfied is another matter. So much for “ Fisher’s flimsies “.
As I have said, the Government proposes to take over £100,000,000 of assets without appropriating one penny piece of the money of the Australian taxpayers. Those taxpayers are to benefit to the extent of £100,000,000- out of nothing. A more immoral proposition was never put up in this Parliament. If the Government can get away with this, there is no earthly reason why the same formula should not be applied to every other big Business in the country. There is no institution in Australia with assets as great as the combined assets of the associated banks, not even Broken Hill Proprietary Company Limited. Probably, the next thing we shall know is that a hill will be brought down declaring that, when the act is proclaimed, all the assets of Broken Hill Proprietary Company Limited shall be taken over, to be paid for out of ;he assets of the Commonwealth Bank. There will be no appropriation by the Parliament, and no tax will be imposed for the purpose. One of the weaknesses of this bill, which will show up fairly soon, I think, is that no provision is made for the appropriation of money. It is not possible to compensate on just, terms any person whose property the Government takes over unless there is an appropriation of Commonwealth assets for the purpose. The assets of the Commonwealth Bank, which are to be used to compensate shareholders in the private banks, consist largely of compulsory lodgments by the private banks. Two years ago, when the Commonwealth Bank Bill was before the Parliament, I declared that it was untenable in law to make the private banks hand over their deposits to the Commonwealth Bank. These moneys were placed in the hands of the Commonwealth Bank as the result of the greatest act of highway robbery we have ever known. Behind the compulsion on the private banks to deposit a proportion of their surplus funds with the Commonwealth Bank lies a story not unlike that of Bobin Hood, who always financed his debts to the poor by waylaying merchants and bishops and relieving them of their wealth. It is fortunate indeed for the honorable member for Watson (Mr. Falstein) that he was not alive in those days; otherwise he might have paid his debts to many people quite unconsciously. This proposal will not commend itself to the people of Australia, and I should be very greatly surprised if it commends itself to any court, though from the court to be established under this bill anything may emerge, because it will be a creature of the Government’s own making. If the Government is firmly convinced that it cannot submit this legislation to the High Court with any chance of success it should not go t> the trouble of making provision for the Federal Court of Claims. I impress upon honorable members opposite that there are certain powers which this Parliament has the sole right to exercise under the Constitution. If the power of acquisition is to be exercised it can bo exercised solely by the Commonwealth Parliamenin its own right. If the power of compensation is to be exercised it can be exerciser! only by the Parliament. The Parliament cannot delegate those powers to the Commonwealth Bank or to any person or authority, governmental or otherwise. ! firmly believe that this legislation will not stand the challenge that will be made against it, and I sincerely trust that, ii. dun course, some honorable members opposite will get the deserts that they are so richly courting by their support of this measure.
Mr. FRASER (Eden-Monaro) [5.52 1. - When I spoke, a little earlier, suggesting mildly that honorable members opposite were no longer prepared to repeat the charges of confiscation and robbery which they made earlier in the history of this measure, there was a general choruof protest that they had never made such charges. Now, however, the honorable member for Barker (Mr. Archie Cameron) reiterates those very same charges, using such historical characters as Sir Henry Morgan and Ned Kelly in his attempts to describe the character of the Government.
– I did not mention Ned Kelly. He was a Victorian, and I leave him alone.
– The honorable member mentioned Robin Hood. When thi.proposal was first mentioned, honorable members opposite described it as confiscation or robbery, or both. There i? only one person sitting on the Opposition side of the chamber whom I did not hear use those terms. I refer to the SerjeantatArms. If there are some who did not use those terms, at least it cannot be denied that on the public platforms they supported those who did. The honorable member for Barker is now the only honorable member opposite who cares to repeat them. He referred also to the electorate which I represent, and to my ancestry-
– Not ancestry.
– The honorable member needed to go back more than 200 years to find a bad Fraser.
– I would not need to go back two minutes to find a bad Cameron.
Mr.FRASER.- The honorable member said that the electors of Eden-Monaro are not prepared to accept this legislation. Let me inform him that on. Saturday last I addressed the latest of a series of public meetings inmy electorate on this issue; That meeting, which was presided over by the Mayor of Bega, was held in the main streetof that town. It was held in the morning, when hundreds of people from the surrounding districts were in town to do their shopping. Only one question could be regarded as hostile. It was put by a man who said that he would not vote for the nationalization of the banks because he did not get from the Commonwealth Bank the accommodation he was able to get from the private trading banks. I asked him when such accommodation had been refused, and he replied, “That was in 1939 “. I then explained the set-up of the Commonwealth Bank in 1939, and the elector and other members of the audience were satisfied. Similar meetings which I have addressed at Goulburn and Bombala, in my electorate, have recorded unanimous votes of confidence in the Government in connexion with this proposal. I have issued invitations to debate to Parliamtarians who have entered my electorate to oppose nationalization of banking. Not one of the invitations I have issued has been accepted. Those invitations still stand.
– I look upon clause 37 as one of the most interesting in the bill. I expected the Prime Minister (Mr. Chifley) to make a clear statement as to how the purchase of the assets of the trading banks was to be financed, but I was disappointed. The right honorable gentleman merely said that he had received an assurance from the Commonwealth Bank that the tangible assets of the private banks would be paid for as part of the ordinarybusiness transactions of the bank. That statement causes me to look at the balance-sheet of the Commonwealth Bank in order to ascertain whether it has the necessary resources to meet such a huge payment as is contemplated in this proposal. I have ascertained that the Commonwealth Bank has assets valued at £14,000,000. One wonders, therefore, how it will be possible for. the Commonwealth Bank to finance such a tremendous transaction as is involved in this proposal. If 1 were in business and had assets of the value of approximately £1.4,000,000 and was able to devise a scheme whereby I could acquire the assets of. some other concern, worth £100,000,000, in order to merge it with my own, I would be nothing short of a financial wizard. If that is what the Commonwealth Bank proposes to do, surely it is the craziest kind of finance it is possible to conceive.
Sitting suspended from 6 to 8 p.m. Mr. HARRISON. - Prior to the suspension of the sitting, when pointing out that the Commonwealth Bank lacked the wherewithal necessary to negotiate the purchase of the assets of the trading banks, I used an incorrect figure. I said that the total excess of assets over liabilities of the Commonwealth Bank was £14,000,000. However, I have since read in the report and balance-sheet ofthe Commonwealth Savings Bank as at the 30th June, 1947, that the capital reserve funds and the special reserves, which of course represent the excess of assets over liabilities, amount to £22,000,000. If I could acquire £100,000,000 worth of assets with a backing of only £22,000,000, I should consider that I had negotiated an extraordinarily satisfactory deal, and indeed, should regard myself as a wizard of finance. The method of purchase proposed by the Prime Minister, therefore, seems to me to be a crazy system of finance having no virtue whatever. When he was gibed at with regardto the depreciated currency in Australia, the Prime Minister said, “ Why talk about depreciated currency? The fact is that people in the United Kingdom can purchase 40 per cent. less, and in the United States of America 60 per cent. less, than people in Australia can purchase with an equivalent amount of money. Therefore, we are in an extremely good position”. Notwithstanding how the right honorable gentleman may attempt to gloss over the depreciation of our currency, the Australian £1 to-day will purchase only the quantity of goods that could have been purchased for 12s. before the war. The truth is that the Government proposes to take over the assets of the private banks with an inflated currency. We have seen the dire results of the transfer of assets in other countries in- which currency ha& become excessively inflated.
The right honorable gentleman said that lie could not imagine the shareholders accepting bank notes’ in payment for their shares. He declared that they would want tO’ have some form of investment and that they would not regard notes as an investment. Therefore he had no doubt that bonds or cheques would be issued by the Commonwealth Bank, if the shareholders so desired, to liquidate its indebtedness’ to them. This statement deserves’ investigation. Let us examine it. The people who originally purchased trading bank shares did so in order to secure investments. They did not buy shares merely to acquire an easily realizable asset. They wanted to obtain a return from the money so invested’. Indeed, such purchases were a safeguard. They provided a guaranteed uniform return over a period of years; which the buyers wanted for reasons best known to themselves. As soon as those shares are taken over, the possibility of earning money by investment of the proceeds immediately disappears. The investor then will have nothing but a cheque account with the Commonwealth Bank, or bonds, as the case may be. In either case, he will lose a certain percentage of that which he originally sought to secure by way of investment. Therefore, it seems to me that the Government has an added obligation to pay compensation to the shareholders for the loss of returns which they expected to receive from gilt-edged investments. If the Commonwealth. Bank liquidates, its obligations to the shareholders by means of cheques, those persons will be left to choose between two unsatisfactory alternatives. If they wish to secure a return greater than that provided by the bonds’ which the’ Prime Minister has mentioned, they must withdraw their money from the cheque accounts and invest it, probably in some industrial undertaking. But where will they be able to invest it ? With the threat of socialization hanging over the heads of the people of Australia, they are not likely to take chances with such investments lest their money should be lost overnight. It seems to me, therefore, that these cheque accounts will be operated upon ultimately and bank notes will be paid out to meet withdrawals. This will result in the whittling down of the shareholders’ capital holdings. The final effect will be equivalent to the acquisition o£ shares by means of the exchange of bank notes. This will, mean that the shares will be taken over with an inflated currency, because most of. them were purchased years ago when the Australian fi was worth approximately £1. To-day, as I have pointed out, the purchasing power of the Australian £1 is approximately 12s. This sort of thing has been practised by financiers through the ages. It is equivalent to taking advantage of inflated currency for the purpose of acquiring some asset on advantageous terms’ to the purchaser. Such & transaction by a government cannot be condoned. If finance is to remain on a sound footing in Australia, the Government must have backing for the cheques which it will pay to the shareholders of the private banks. However; the excess of assets over liabilities in the Commonwealth Bank amounts to only £22,000,000. Yet the Government seeks to acquire assets worth £100,000,000 !
Now I put my finger on the greatest weakness in the Government’s scheme. Already we know that the special accounts of the trading banks lodged with the Commonwealth Bank amount to no less than £268,000,000. That will provide the backing- for the cheques which will be issued for the acquisition of the £100,000,000 worth of assets. What are we to think, of a government that, is prepared to use an amount of. £26S,000,000 that has been, extracted from, the private banks by force under the legislation of 1945, and deposited with the Commonwealth Bank, as backing for cheques issued as payment for the assets of the trading banks? In his wordy speech on this matter, all that the Prime Minister said was that the Commonwealth Bank might issue bonds, or pay the shareholders by cheque. As I have shown, an examination of the assets and liabilities of the Commonwealth Bank, reveals that according to sound banking practice, the bank could not make available sufficient funds for the purpose of this legislation, unless it had something more behind, it. That something, of course, is the £268,000,000 in the special account, and that money belongs to the trading hanks.
Clause 40 is rather interesting. It deals with the payment of compensation. The second and third sub-clauses state -
Although the Prime Minister has said that the Commonwealth Bank gives an assurance that it can negotiate this deal, the arrangement will be subject to the approval of the Treasurer. Obviously, the bank could not negotiate even one word of an agreement off its own bat. It must await political direction. The Treasurer must approve any arrangement, agreement, or contract entered into by the Commonwealth and the shareholders.
The CHAIRMAN (Mr. ClarkeOrder! The honorable member’s time has expired.
– The clauses encompassed in this part of the bill cover some of its most important features. Clause 46 prohibits the carrying on of banking business by private hanks. Other clauses deal with compensation for the acquisition of shares and the method by which settlements are to be reached. However, the really important clause in this group is that which provides that private banks shall never again be permitted to carry on business in Australia. One would imagine from all the noise that has been made about the taking over of the banks that something revolutionary was being attempted. It has been said that this is the first step in a ten-year plan of socialization. Nothing could be more false. This legislation, and in particular the clause to which I have directed attention, proposes to nationalize banking. It is not a means to an end. It is an end in itself, and has no reference to any proposal to socialize or nationalize other undertakings. As I pointed out in my second-reading speech, we have not the constitutional power even to socialize a lolly shop. But we are concerned about the continuation of private banking in this country, because we believe that the public credit of the nation should be handled by the elected representatives of the nation and not by 50 or 60 bank directors who control the destinies of nine trading banks. If this legislation were never passed, there would still be fewer hanks for the people to deal with twelve months hence than there are now. There is a ‘merger on the way to completion between the National Bank of Australasia Limited and the Queensland National Bank Limited, and there was a proposal for a merger between two English banks, the Union Bank of Australia Limited, and the Bank of Australasia. Negotiations for this second merger had progressed to a certain point when it was decided by the directors of the banks concerned that nothing further should be done in the direction of, completing the amalgamation until the effect of this legislation had been determined in the Parliament, and possibly, ultimately, in the courts. So, when honorable members opposite talk about a number of banks being available for the people to deal with, I point out that that number is continually ‘diminishing. In 1917 it was 23, in 1947 it is nine, and should this legislation find disfavour in the High Court on the ground that it is ultra vires the Constitution, there would only be seven banks by the end of next year and, no doubt, fewer later on. Ultimately, we should reach the point when there were perhaps two or three, or even one. Thus, the much-vaunted right of the people to transfer their accounts from one bank to another is proved to be a nullity. Even to-day there is a complete understanding between the private trading banks.
– To what clause is the Minister referring!
– I! am dealing with the prohibition of private banking. That is an important clause, as the right honorable gentleman will perceive. Mr. L. J. McConnan, the chief manager of the National Bank of Australasia Limited, in a radio talk not long ago, sought to prove that, after all, the people, and not, the shareholders, owned the banks. These were his words -
The banks are just concerns established by the people to look after their personal financial affairs and to carry out their wishes. Th, bald facts of the Australian banking system are perfectly plain. The banks have been created by the people, they are owned by the people, and they are controlled by the people. And that’s the democratic way.
This is Mr. McConnan speaking -
Why should any government interfere with this democratic arrangement?
If all the shareholders in the private banks resided in this country, Mr. McConnan might be able to say at least that these banks were owned by 70,000 Australians, that they functioned in the interest of 70,000 Australians, and that the profits went to 70,000 Australian shareholders. But the truth of the matter is that, although there are 70,000 share-“ holders, only 35,000 of them live in Australia. I have before me a very informative table, which shows the profits made by the trading banks between IS93 and 1946. In those years the aggregate profits of the trading banks - maybe not the net profits - amounted to £12S,000,000. That £128,000,000 profit, made out of banking, went to 70,000 shareholders. If the division of the profit was in the same ratio as the division of shareholders inside Australia and outside Australia, £60,000,000 of profit made out of banking went to people who have never seen Australia or even lived here at all.
– Is that gross or net profit?
– I am speaking of aggregate profit. The net profit may be perhaps £8,000,000 or £10,000,000 lass. At. any rate, approximately £50,000,000 of profit went to people whose interest in this country between 1893 and 1946 - the shareholders have never numbered more than 70,000 at any time - did not even know where Sydney, Melbourne, or Brisbane were. All they knew was that Australia was a continent out of which they were making profit. To-day we are doing our best to let them know where the National Capital is, because any profit that is to be made out of banking in this country should go to Australian citizens - the people whose labour makes Australia prosperous, and whose services, like those of their parents and grandparents, have made this country what it is. If for no other reason than that, half of the shareholders in the private banks have never seen Australia and are not interested in this land except for profit making, we should nationalize the banks. The private banks, if they were wise in their own generation, would have seen that their shares were transferred to an Australian register ; but they were selfish and greedy, and wanted to make what profit they could and take it out of the country. But the banks which are supposed to help the people in time of need, and are supposed to be most helpful in time of depression, present this unique picture to Australians that, whereas in the depression years most industries paid no profit at all, while all industries, more or less were endangered, and some industries had to call on reserves to keep going, no bank in Australia during that period was conducted at other than a profit. Every single bank in Australia made a profit during each year of the depression. They made very big profits before the depression, and they made reasonable profits during the depression, if we have some regard to the condition of other people. The English, Scottish and Australian Bank, which refused from 1893 to 1946 to pay those who held interminable stock sums amounting to £2^000,000, paid dividends as high as 20 per cent, in some years, whilst the average dividend of the banks was approximately 14 per cent, per annum when the depression commenced. Today, the banks are not making such great profits; but it was not this Government which curtailed their profits. It was our predecessors in the war years who told the banks that they were not to be allowed to invest surplus funds in war loans, or make advances to other people to invest in war loans, so that the banks could make a profit on a profit as they did during World War I. It was a government of which the honorable member for Warringah (Mr. Spender) was a member which restrained the banks in that way in the national interest. When the honorable member had responsibility of government he was prepared to do something to protect the national interest, but now he is out of government he is thoroughly irresponsible. All he has done in this debate is to barrack for the banks. He does not care what profits they make. It does not matter what the. future might hold ; we say that the banks must be nationalized. The Opposition says that they should not :be nationalized.
– What do the people say?
– The people say that the Government’s 1945 banking legislation should be supported; and that they returned this Government after the passage of that legislation. But neither the party to which the honorable member for Wimmera (Mr. Turnbull) belongs, nor that to which the honorable member for Warringah belongs, has stated where it stands with respect to the 1945 legislation.
– Yes, I did.
– Does the honorable gentleman speak for the Liberal party?
– I express the same views as the Liberal party expresses.
– The honorable gentleman and his party - and I emphasize the party aspect - have not declared their attitude with respect to the 1945 banking legislation. So unsatisfactory is their negative approach to this question that the Sydney Sunday Sun last Sunday published a leader headed - I hope that the Leader of the Opposition (Mr. Menzies) does not mind when I read the language - “ Menzies must remove this doubt “, which stated that the Liberal >party must say where it stands with respect to the 1 945 banking legislation.
– I read that article to-day, and it contains a grossly untrue statement.
– The right honorable gentleman can have that out with the editor of the Sunday Sun.
– The article contains a statement that I said that if we won we would repeal the banking legislation. No such statement was contained in my policy speech.
– -The right honorable gentleman must make himself right with his own supporters on that point; but, at any rate, even if what he says be correct he has- still to declare his attitude towards the 1945 legislation. He did not do it before the 1946 elections.
– I did it in this House, in plain terms.
– Did the right honorable gentleman support the 1945 legislation ?_
– In a few minutes 1 shall read what I did say.
– When we come to the Leader of the Australian Country party (Mr. Fadden) it is still more difficult to state his position, because in his second-reading speech on this measure he attacked one of the vital principles of the 1945 legislation, namely, that dealing with the special accounts which the private banks have to lodge with the Commonwealth Bank. He derided the argument of the Government that that fund was established as a safeguard against secondary inflation. It waa established by his own Government, but he derides it now. In effect, he says “ Let us disregard secondary inflation, and give the banks back their money, and let them invest it, not at 1 per cent., but at any per cent, they can get “.
– I did not say anything of the sort.
– The right honorable gentleman implied that. He can make clear to the country where he stands on this matter.
The honorable member for Warringah has suggested that there may be shares in an Australian private bank which are not compulsorily acquired on the date specified in a notice given under clause 13, that these shares may belong to English shareholders and that the value of these shares may fall before they are, in due course, vested in the Commonwealth Bank. The honorable member can -rest assured that if these shares are subsequently acquired the position of any such shareholders shall not in any way be prejudiced by the fact that their shares were acquired by the Commonwealth Bank at a later date than in the case of Australian shareholders.
– Order! The Minister has exhausted his time.
.- The Minister for Information (Mr. Calwell) has given us a second-reading speech on clause 46, and for the second time we have heard him going back to the depression. He and his colleagues can never extricate themselves from the bog of the depression. He rested all bis arguments upon conditions which may have obtained 20 or 30 years ago, but which have no bearing on the problem confronting us to-day. He drew attention to the fact that the interest which was charged by private banks over a period of 50 years had resulted in substantial profits, but he conceded that they do not make those profits now, nor have they made them for some years past. It is well that this point should be clarified, because that has never been a real issue in this debate. We admit that there should be control over interest rates, control over the general policy of advances, control over currency, control over credit and central bank operations, and, consequently, control over the ultimate profits of the private banks. Indeed, that was the policy pursued by the Government of which I was a member during the war, as was conceded by the Minister. So it is to-day. Those controls, which, without any doubt whatever, are matters with respect to banking which could not be successfully challenged - and if they were, this bill falls to the ground - remove all the abuses the Minister complained about. Therefore, the only reason for this legislation is for the purpose of vesting complete control of all financial transactions in the Government.
There is inherent in the Minister’s speech something to which I draw the attention of the Prime Minister (Mr. Chifley), because our experience in this chamber is that, whilst his Ministers say one thing he, himself, says another. The Minister for Information says, “ Why not remove the shareholders of the banks? There are 75,000 of them, and half of them do not reside in this country. That is a good reason why the Government should take over the private banks “. I find that difficult to understand, particularly in view of the Prime Minister’s statement this afternoon about how people are going to invest their money in this country. If the Government believes that the Commonwealth should take over a business because foreign capital is invested in it, let the Prime Minister say so, and not leave it to the Minister for Information to make the disclosure. That is what was said, and that was clearly what the Minister had in mind. His words were, “ That was a good reason why the private banks should be taken over by the Government, because one half of the shares were owned by English capital “. Honorable members opposite should do their utmost to encourage the investment of more British capital in Australia, instead of endeavouring to destroy confidence in the future of this country by statements such as those which the Minister made. It is futile for the Prime Minister to speak of attracting British capital to Australia when he permits the Minister to make statements of that kind.
I have directed attention to the need to give some firm basis of consideration to the position of the English shareholders in private banks in Australia, and I have not yet received a reply. Under this part of the bill, two classes of shareholder are dealt with. One is the Australian shareholder in the ‘banks, which are set out in Part I. of the first schedule. These are the shareholders whose shares will be taken over under clause 13. Then there are other shareholders to whom clause 22 applies, under which the Commonwealth will take over the assets as distinct from the shares of the private banks. Regarding both of those classes of shareholders, Part IV. provides that in the event of an agreement not being reached between the Government and the shareholders in the first instance, or the Government and the private banks in the second instance, the issue may be determined by the Federal Court of Claims. The problem to which I directed attention is a problem which affects British and foreign shareholders.
It is all very well for the Government to say that we can rest assured that those persons will get a fair go. I prefer, if I may say so, to see an appropriate provision contained in the bill. This is what can happen. Under clause 13, those who hold shares on the Australian register may receive notice of the taking over of the shares, leaving them rights of compensation; but the bill does not contain any provision with respect to taking over the shares of English shareholders. The position, then, is that the Government will take over the Australian shares, and appoint its own directors who, under the bill, will have complete power to carry on in any way they think fit for the purpose of selling the assets to the Commonwealth Bank, and finally winding up the affairs of the private banks. Then, the time will come when the directors of the Australian banks, who are the mere nominees of the Government or the Commonwealth Bank, will decide the terms upon which liquidation shall take place, and the assets be handed over. The interests of the English shareholders will depend upon the nature of the bargain that the liquidators or directors of the company ultimately make with the Commonwealth Bank. The bill should make provision for the English shareholders.
The position can easily be met by having an appropriate amendment inserted in the bill when the Senate is considering it. It could be dealt with by a provision that any English shareholder, who felt aggrieved with the amount paid to him for his shares or for his interest in the private bank, should have the right to bring the matter before the Federal Court of Claims. That is a reasonable proposition. Otherwise, he would be left entirely in the hands of the Government, without redress. The directors might be following the policy which they think fit and which they believe to be in the interests of the Commonwealth Bank, but their decisions can vitally and adversely affect the interest of the British shareholders. I ask the Prime Minister to give me an assurance that some provision will be made to enable the English shareholder, if he feels aggrieved in the circumstances which I have described, to have recourse to the Federal Court of Claims.
Earlier, the Prime Minister replied to a question as to how this transaction will be financed. It is agreed that approximately £100,000,000 is involved. As the honorable member for “Wentworth (Mr. Harrison) pointed out, the available disclosed assets in the Commonwealth Bank are not sufficient for the purpose of financing a transaction of this magnitude. The Prime Minister said, “ Well, it can be dealt with as an ordinary trading advance. Here, the assets are being transferred to the Commonwealth Bank. It can advance the money for the purpose of acquiring these assets”. If that argument be correct - its shallowness will be revealed shortly - we can say that all Commonwealth public works can also be financed by the Commonwealth Bank, because assets are created, the Commonwealth Bank can provide the requisite capital, and additional taxes need not be imposed for the purpose of meeting it. If that argument be correct, the Government could nationalize any business in Australia by merely increasing the liabilities of the Commonwealth in terms of bonds or currency which is available in the community.
It requires no exemplification to prove that if we increase the liabilities of the country, whether in the terms of increased currency circulating in the community, or of securities, we must vitally affect the national economy. To that matter, little consideration has been given. It was only when the Prime Minister was forced, by constant requests as to how the transaction would be financed, to refer to the subject, that we received this extraordinary reply. All I have to say is that if that is the way in which the Government proposes to finance the affairs of the country^ it will not be long before the people realize that the Prime Minister’s reputation for financial wizardry is purely a myth. It is fantastic to pretend that any transaction, no matter what amount is involved, whether it be £100,000,000 to cover the taking over of the private banks or £1,000,000,000 for the purpose of nationalizing many industries, can he financed simply by the Commonwealth Bank increasing the liabilities of the country, without serious consequences to the community.
For the reasons which I have stated, the Prime Minister should reply to the statements of the Minister for Information. Does the Prime Minister stand, or does he not stand, by the Minister’s statement that, because nearly one half of the shares in the private banks are held for the most part by shareholders in Great Britain, that is a good reason why the Commonwealth should take over the banks? Let the Prime Minister say whether the Minister has expressed his views. If he does not agree with that statement, let him make his position clear, because this is exceedingly important. Secondly, I ask the right honorable gentleman to give an undertaking in respect of English shareholders. They should not be obliged to rely upon whatever government is in office at the time. The life of the present Government will shortly come to a close. Honorable members opposite may laugh, but they know that my statement is true. For this Government, the writing is already on the wall. It will not be long before it will be out of office, as it deserves. Finally, 1 should like to know what the Prime Minister proposes to do about compensation for the private banks incorporated elsewhere. These are referred to in Part [II. of the first schedule. So far as I am able to see, the effect of this part of the bill will be that none of the banks, including those in Part III. of the first schedule, namely, the Bank of China, the Bank of New Zealand and the Comptoir National d’Escompte de Paris, will be permitted to function in Australia, and the bill does not contain any provision for compensating them if clause 46 of the bill is relied upon - as it could be exclusively - to destroy the private banks. Perhaps the right honorable gentleman will be able to show that my interpretation of these provisions is wrong; but I have yet to discover in the bill that these institutions will be compensated for the business that they would lose in these circumstances.
.- The honorable member for Warringah (Mr. Spender) referred to the arrangements which the Prime Minister (Mr. Chifley) said have been made for financing the acquisition of the shares and assets of the private banks as being in the nature of a hoax. Nothing could be further from the truth. If the honorable member were to spend more time in the Parliament he could have found out what arrangements had been made in regard to this matter. In the first place, clauses 37 to 46 provide for two separate parts. The first part, namely Part VI., contains two divisions, the first of which provides for the acquisition of the shares of the banks, whilst the second division provides for the acquisition of assets. Part VII. is a part to which I thought the Opposition would have offered strong objection because it deals with the prohibition of private banking in this country. Before dealing with Part VII., however, I should like to refer to some of the arguments which have been advanced by Opposition speakers in relation to Part VI. It has been said that no clear indication has been given to the Parliament, or the country, as to how the assets of the private banks are to be acquired by the Commonwealth Bank. The honorable member for Wentworth (Mr. Harrison) and other “ notable financial authorities “ have given a variety of figures purporting to be the actual capital of the Commonwealth Bank. Before the suspension of the sitting for dinner the honorable member for Wentworth said that the assets amounted to £14,000,000. I do not know whether he then said that he only “ thought “ that was their value, but later he said that he thought the assets were valued at £22,000,000. He referred to the annual report of the Commonwealth Bank. Any one who wants to obtain information about the capital of the Commonwealth Bank has only to read the Commonwealth Bank Act of 1945. The figures’ that I shall give to the committee do not include the Commonwealth Savings Bank, but only the central bank functions and general trading activities of the Commonwealth Bank. The 1945 act provides that the central banking department of the Commonwealth Bank shall have a capital of £4,000,000; its general banking division a capital of £4,000,000; the rural credits division a capital of £2,000,000 ; the mortgage bank department, a capital of £4,000,000, and the industrial finance department a similar sum. That makes a total authorized capital of £18,000,000.
– The capital of the Commonwealth Bank, as set out in its last report, is £16,392,000.
– I shall not accept the honorable member’s figures-
– I have taken them from the bank’s balance-sheet.
– The argument would seem to turn on the actual capital of the Commonwealth Bank or what is provided by way of capital. I merely draw the attention of the committee to what is provided for in the 1945 act. The bank may use up to £18,000,000 in those various divisions that I have mentioned.
The basis of the argument of the Opposition is false; its members refer merely to the capital of the Commonwealth Bank, without reference to its assets, whereas they refer to the assets of the private banks without mentioning liabilities to shareholders. Opposition members who want the actual figures can have them. The act provides for the utilization of capital up to £18,000,000 distributed in the way that I have already mentioned. Excluding the Commonwealth Savings Bank, the assets of the Commonwealth Bank as at the 30th June, 1947, were valued at £730,883,858. That figure must be considered in relation to the amount of capital which the bank is authorized to use should it so desire. For the purposes of comparison I shall read from a statement relating to the Australian banking statistics which has been circulated among honorable .members. It is true that the figures are not given as at one date, but it appears to me, from a cursory examination of them, that they all fall within the one quarter. The returns have not been made as at the 30th June in each instance, as some of them cover periods ended the 31st August, the 30th September or the 14th October. However, as they all fall in the one quarter, it is fair to cite them. They show that the total liabilities of the private banks to their shareholders amount to £71,426,770. The assets of the private banks, also covering diverse periods, but coming within the same quarter, are shown to be £839,432,222. That is merely illustrative of the fact that whereas, on the one hand, the trading banks have liabilities to their shareholders amounting to over £71,000,000, their assets amount to more than £839,000,000. The Commonwealth Bank has an authorized capital of about £18,000,000 in its central bank and trading section - that is, exclusive of the Commonwealth Savings Bank - but its assets exceed £700,000,000 ; so that whatever arguments are advanced by the Opposition, no accountant would deny that a considerable sum of money is available to the Commonwealth Bank, either immediately or over a period of months. There is a positive limitation to what can be done.
– What about the excess of assets over liabilities?
– I shall present my argument in my own way, as by that means I shall be more clearly understood. The figures will show what can be done and what is being done. On this subject the Prime Minister in his second-reading speech said -
In acquiring the business of the private banks the Commonwealth Bank will also assume the liabilities of these institutions. The amount of compensation payable will necessarily have regard to this factor, and it will be well within the capacity of the Commonwealth Bank to meet the payments from its own resources. ‘ The Commonwealth Bank will make payment in cash or government bonds as desired.
Nothing could :be more explicit. I refer to Part VII. of the bill, which includes clause 46. This is the clause which prohibits the carrying on of banking business by the private banks. Not one argument has been advanced by honorable members opposite in opposition to clause 46. It is more than passing strange that this matter, which ordinarily would have aroused their hostility, should be passed over, while the whole of their attention has been diverted to Part VI. of the bill, which deals with the acquisition of assets and shares. It would appear that members of the Opposition do not want to give any indication of possible moves which might be taken outside the Parliament by way of objection to this legislation. Evidently, they are prepared to let their case rest upon the objections which they have so far taken. When they are blown out on those, as they undoubtedly will be, they will use the second string to their bow. I hope that before the “ guillotine “ falls at 11 o’clock to-night we shall hear something from the Leader of the Opposition about clause 46. Honorable members opposite have been most vocal in seeking information from the Prime Minister. If we are to carry on this system of interrogatories, I should like to ask the Leader of the Opposition what he thinks about clause 46.
I believe that the provisions in the clauses under consideration are most reasonable, and I have no hesitation in recommending them to the committee, despite the fact that the honorable member for Warringah raised some objection about English shareholders. I am sure that their rights can be adequately protected. Those who know the Prime Minister for his honesty and fairness will be quite prepared to let the matter rest in his hands.
– I rise, I hasten to say at once, not to answer the honorable member for “Watson (Mr. Falstein), because in my experience of him nothing he has ever said has called for an answer, but to revert to a matter mentioned earlier by the Minister for Information (Mr. Calwell), in regard to Part VII. of the bill. He quoted a leading article from the Sunday Sun, a newspaper not remarkable for its hostility to the Government, I may say. In the course of its leading article for Sunday last, this paper makes this very remarkable statement -
On the 23rd October, during debate on the bill to nationalize banks, Opposition leader Menzies said that those sections of the 1945 Act which established this control-
That is the control which was designed to prevent secondary inflation - namely, the special accounts provision. The article continues - had never been challenged, nor was it suggested that they would be. So that even without a nationalization bill, the Federal Government still had control of banking. But in his policy speech preceding the last federal election, Menzies said he would repeal the 1945 Act, if the Opposition won the election.
In the first place, that statement is completely wrong, and it is, of course, utterly confused. Two acts relating to banking were passed in 1945, a fact which ought to be made clear to the public. The first was an act relating to the Commonwealth Bank, providing for the abolition of the Commonwealth Bank Board, and the substitution for it of direct control by a Governor, under the Treasurer, on all matters of which was the abolition of the Commonwealth Bank Board, and the substituting for it of direct control by a Governor, under the Treasurer ,on all matters of policy. The second piece of legislation was the Banking Act- not the Commonwealth Bank Act - but the Banking Act of 1945, and it contained various provisions regarding special deposit accounts. As the matter had been specifically dealt with in the Parliament, and I have made the clearest possible state ments regarding it, no reference to it at all appeared in my policy speech. Therefore, it is untrue to say that in my policy speech I promised to repeal the Banking Act of 1945. No statement was made by me, or by any member of the Opposition, about repealing the Banking Act of 1945. At no time did we indicate that we would, if successful in the elections, repeal those sections dealing with the special deposit accounts. A statement was made clearly and definitely about the Commonwealth Bank Act - not the Banking Act - and it was made in these terms - I quote from page 759 of Hansard, for the 21st March, 1945. I quote it, not to comment on it, but to repeat it, and to say that it still represents our view. It is as follows: -
Therefore, on behalf of my colleagues and myself, I desire to make quite clear to the House and to the people that, when we on this side of the chamber are returned to office, we shall take prompt steps to restore board control to the Commonwealth Bank, free from political interference, and to secure a complete restoration of parliamentary authority in this matter. In every other respect we shall hold ourselves obliged instantly to review the working of this legislation with the object of bringing it into line with what we believe to be the stable requirements of the people.
That was the only statement made, and it was made in relation to the Commonwealth Bank Act. All who were here during those debates would at once agree with me in that. The statement had no relation to the Banking Bill of 1945, consequently the suggestion that some portions of the 1945 Banking Act, which I said were unchallenged and unchallengeable, were the subject of a promise by me on behalf of the Opposition is fantastic. Nothing has been said at any time on behalf of the Opposition which would shake the operation or authority of those provisions of the Banking Act of 1945 which enable the central bank to control banking policy. The more clearly that appears to the public mind the more abundantly will it appear that this piece of legislation, which seeks to go far beyond the Banking Act of 1945, is not based on some doubt which attaches to the 1945 legislation: It is based on a desire to go beyond the control of policy, and reach out to the control of the individual, in his individual transactions with the bank. That, of course. is what makes Part VII. important. I am indebted to the Minister for Information for having emphasized that Part VII., which seeks to prohibit the carrying on of banking business by private banks, may stand by itself. I do not know whether it is too long ago for some of us to remember, hut I hope that honorable members will recall that clause 6, which has already been passed by the committee-
– As it has been passed the right honorable gentleman should not mention it.
– We had no time to mention it. I did not impose the time limit on the debate on this bill; the party to which the honorahle member for Watson belongs did that. Consequently, the Opposition has had opportunity to concentrate its attention only on certain matters. Clause 6 contains a simple provision, the effect of which is that this legislation is to operate even if only a portion of it is declared invalid and even if that portion is found to have quite a different effect from that which the Parliament thought it had when it was passed. Clause 6 reads -
It is hereby declared to be the intention of the Parliament -
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.
I ask honorable members to work it out for themselves. What it means is that this is deemed to be the intention of the Parliament even if it was not the intention of the Parliament at the time the bill was passed. Remembering that, let us recall, as the Minister properly reminded us, that if every other portion of this measure is rejected as the result of some judicial process except Part VII., that part, by virtue of the provision which I have just read, will stand by itself, and standing by itself it will constitute authority for the Government, by notice published in the Gazette, to re quire any privatebank to cease operations. There is no mention of any compensation. The notice goes to the bank and the bank goes out of business. Here is a perfect charter for a banking monopoly by the simple and inexpensive process of crushing all competitors by notice published in the Gazette. It would he a great mistake if anybody listening to this debate, or reading the report of it hereafter, were to suppose that the major element in that problem is the terms and conditions on which compensation is to be paid to the shareholders of the private banks. Let us say once more that their interest is a minor matter; the real point about the monopoly bank is that it will afford the means by which all industry and enterprise may be controlled. The monopoly bank may exercise that control by the simple process of saying, “ To you I shall give credit; from you I shall withdraw it. To you I refuse banking facilities, for this, that, or some other reason; to you I grant them.” So, a government with a totalitarian outlook and a completely socialist concept, may give effect to that concept through the banking monopoly irrespective of whatever other provisions may exist in our Constitution.
It wearies me to hear honorable members opposite say, “ We have no desire to nationalize the coal-mining industry; we have no desire to nationalize the steel industry”. A government which has a single banking monopoly under its instant responsive hand, may control all the activities of Australia, great or small. Indeed, it may say to any industry, “ Unless you conform to our requirements, you go out of business; you shall have no banking accommodation unless you are prepared to go on to the black market for the money you require or the accommodation you need “. That is the very heart of this monopoly bill, and because it is so, Part VII. will give to the Government the opportunity to give effect to all its desires and amhitions to control individual industries in Australia, great and small. Indeed, the smaller the industry the more easily it will be possible to control it. It may very well be imagined that I, for one, am indebted to the Minister for Information for having reminded us - and very properly - that we are not here concerned with a few dry-as-dust provisions. Far from it; we are here concerned with the most vital element in the most disastrous piece of legislation ever put before the people of Australia.
» - At least the Government is indebted to the Leader of the Opposition (Mr. Menzies) for some very valuable legal opinions expressed during the course of the speech he has delivered. Whilst at first glance it may appear that the carrying of Part VII. of this bill will mean the end of the private banks, we have very serious reasons to doubt whether it will. We hope it will.
While I am dealing with the question of the elimination of the private banks, it may be appropriate for me to answer some of the criticisms levelled at the Government by the honorable member for Warringah (Mr. Spender) when addressing some organization at Palm Beach - I think it was the “ Beauty and Virtue Association “, or something of that kind. In his address, the honorable- member made some very serious criticisms of his own profession, and it would be interesting to know if his opinions are shared by the Leader of the Opposition. The honorable member for Warringah suggested that appointees selected for elevation to the High Court Bench by a Labour government would be so venal, crooked and corrupt as to do the bidding of the government which appointed them. The thing that amazes me is the great confidence of every honorable member opposite that this legislation will be rejected by the High Court before which its validity may be contested. The honorable member for Warringah has expressed the opinion that it is the intention of the Labour Government to stack the High Court to give effect to this legislation. In other words, he believes that the Labour Government aims to appoint to the High Court additional justices favorably disposed to Labour’s policy in order to secure a majority decision in favour of the banking legislation. If that charge could be substantiated, there would be clear evidence that at the moment the High Court is stacked against the Labour Government.
The Leader of the Opposition has constantly referred to the intention of the Government to establish a banking monopoly. Such a monopoly already exists to-day. The Minister for Information (Mr. Calwell) made that clear when he reminded us that although normally there are nine private banks in this country they, in fact, constitute a monopoly, because they work to one policy, and have an association in which Ls discussed matters fundamental to their interests. It is utter rot to suggest that there will be any detrimental change in banking practice as affecting Ite individual member of the community as the result of this proposal, because, when people are dealing with a government bank, the directors of which are not linked up with other monopolistic concerns, individual applicants will receive better and more just treatment than they have been able to obtain from the private banks. Listening to the Leader of the Opposition, one would imagine that the directors of the private banks in Australia were interested solely in banking. The private financial institutions to-day have the very power over industry and individuals which the right honorable gentleman said it would be wrong to confer upon the Government. This bill will not create such power, because it already exists in the hands of those institutions, but will merely transfer it to the elected government of the country.
I shall give some illustrations of the interlocking of directorates in order to show that bank directors are interested in other activities than the business of banking. Sir Frederick Tout, M.L.C., besides being chairman of directors of the Bank of New South Wales, is a director of the Australian Mutual Provident Society and a vice-president of the Graziers Association. Mr. J. H. Fairfax, a director of the Bank of New South Wales-
– I rise to order. There is nothing in the two parts of the bill now before the committee relating to directors. The two parts are headed respectively, “ Assessment of Compensation “, to which the subject of directors is not related, and “Prohibition of the Carrying on of Banking Business by
Private Banks”. I submit that the qualifications of directors, their personal ^activities and so forth, have no relation whatever to these two parts. That subject is related to the parts that the committee discussed last week.
– I do not think that the banks have ever been carried on without directors. The Minister might be able to connect his remarks with the bill. The two matters before the Chair are as stated by the honorable member for Barker, but I think that the Minister’s remarks have reference to Part VII., dealing with the taking over of the private banks.
– That is correct. I am stating reasons why private banking should be prohibited in Australia.
– We are back in the second-reading’ debate.
– Order ! The Leader of the Opposition has had liberal treatment.
– That is the effect of your ruling, Mr. Chairman - that we are back in the second-reading debate.
– I shall explode the argument of the Leader of the Opposition that the Government proposes to establish a monopoly in banking for the first time in Australia. The fact is that a monopoly already exists in the field of private banking and, until the Commonwealth Bank Board was abolished by the legislation of 1945, the monopoly even embraced the Commonwealth Bank as well. The Commonwealth Bank Board was under the domination of the private bank interests. I return to J. H. Fairfax, a director of the Bank of New South Wales. Although the Sydney Morning Herald persists in contradicting me on this point, my information is that Mr. Fairfax is connected with that newspaper. He is also a director of the Australian Mutual Provident Society, a director of J. Fairfax and Sons Pty. Ltd., and a director of the Royal Insurance Company Limited. Martin Mcllrath is a director of the Bank of New South Wales and also is associated with McIlrath’s Holdings, the North-west Pastoral Company, Macs Limited, Homes Limited, and Myuna Proprietary Limited. Mr. H. D. Giddy, chairman of the National’ Bank of Australasia Limited, is also vice-chairman of the Herald and Weekly Times Limited and a director of the Australian Newsprint Mills. Sir Frank G. Clarke, M.L.C., the gentleman who caused the election in Victoria, is a director of the National Bank of Australasia Limited, a director of Goldsbrough Mort Limited and a local director of the Australian Mutual Provident Society. G. J. Coles, a director of the National Bank of Australasia Limited, is chairman of directors of G. J. Coles and Company. Sir Olive McPherson, a director of the National Bank of Australasia Limited, is managing director of Younghusband Limited and was appointed a member of the Commonwealth Bank Board in 1940.
According to the Leader of the Opposition, when a person applies for an advance under our existing private banking system, the decision of the bank concerned is governed by the sheer merit of the application. I wonder how many people in Australia believe that, if a man wanted to open a grocery store next door to one of Mr. Mcllrath’s established and flourishing stores, the decision of the Bank of New South Wales on his application for an advance would not be affected by the fact that Mr. Mcllrath is one of its directors ? It is sheer rot to say that a member of the community to-day can establish his own business and conduct it in his own way. Monopolies determine the prices at which he may sell his goods. We have had illustration after illustration of this fact. If a trader is satisfied to have a quick turnover at a smaller return on each item than is customary, he is told by the monopolies that if he cuts prices wholesale supplies will be withheld from him. Nevertheless, the Leader of the Opposition declared in his second-reading speech and at the meeting which he addressed in the Sydney Town Hall that he was concerned, not for the few shareholders in the private banks, but for the great majority of people, the depositors, the plain citizens in the community. It has been very evident in this discussion that honorable members opposite are concerned in the preservaton of the power, and influence exercised by the private banking institutions. When anti-Labour parties have had the opportunity to govern, they have done so only in a secondary degree, hecause they have merely carried out in this Parliament the policies that have been determined by the private financial interests.
The honorable member for Warringah is very anxious to please those who have briefed him in this case. I recollect how, only last week, great exception was taken to a remark made by the honorable member for Dalley (Mr. Rosevear). when he referred to the members of the Opposition as “ paid agents of the private banks “.
– I qualified that.
– Are they not the paid agents of the banks ?
– I said they were not worth “ two bob “.
– As the honorable member has said, if some honorable members opposite were paid according to their merits, they would receive very little. Judging by some of the speeches they have made on this measure, they would not be worth very much to the banks. Collectively, as an opposition, they represent particular interests in this Parliament, and they are out to defend them. In my opinion they are the paid agents of the private banks. I do not regard seriously the names that the Leader of the Opposition throws across this chamber at members of the Government. He talks about the danger of fascism in Australia. I am amazed at his audacity. I guarantee that, if a national “ quiz “ were held in Australia to-night and a competitor were asked to name the greatest Fascist in the country, he would want only one chance to answer the question. He would name the Leader of the Opposition. Prior to the Avar, the right honorable gentleman was continually singing the praises of the Nazi and Fascist forms of government, and talking about the great benefits that they bestowed upon the workers of Germany and Italy. We know these things, and therefore we do not worry when the right honorable gentleman hurls such names across the chamber. The people of Australia know how to assess his worth.
I hope that the honorable member for Warringah will not prove to be accurate in his prediction that the High Court is sure to throw out this legislation.
– I have said nothing of the sort.
– The honorable member did so by inference.
– Not by inference or otherwise.
– By inference, he said, when addressing an old ladies’ gathering at Palm Beach, that the High Court was sure to reject the legislation of the Labour Government. Let me put this propositions to him. If the Labour Government’, believed that its legislation would beapproved by the High Court, there would be no need for any suggestion of “ stacking “ the court. Is not the mere suggestion that the Labour party would have to> stack the High Court in order to guarantee the implementation of its legislation .an indication that the honorable member is already convinced that the court will reject the legislation? I do not know where the honorable member gets his information although he does move in circles where he may be able to find out the intention of certain gentlemen in regard to this Government’s legislation-
– Order ! The Minister’s time has expired.
.- The committee has been listening once again to that old familiar refrain which trips so readily from the lips of the Minister for Transport (Mr. Ward). We all remember that when, speaking on the second reading of this measure, the Minister said that he had waited twenty years to make that speech, my colleague, the honorable member for Richmond (Mr. Anthony) pointed out, very aptly, that it was the same speech that the Minister had been making for the last twenty years. It was the same familiar diatribe against the High Court, and the same familiar stuff about directors of various companies and how directorates are interlocked. Whilst the speech was all nauseatingly familiar to members of this Parliament, I propose to deal with one or two aspects of it because, after all, the broadcasting of our proceedings is still something of a novelty, and there are, perhaps, those who may be misled by the specious arguments that the Minister puts forward. The honorable gentleman challenged the honorable member for Warringah (Mr. Spender) on his statement about “packing” the High Court Bench. I do not propose to devote very much time to that. Those who listened to the Minister’s speech a few nights ago heard him support everything that had been said by the honorable member for Dalley (Mr. Rosevear). Those of us who are familiar with the speeches of the Minister for Transport know how, time after time over the years, he has said that the High Court should not stand in the way of what he has described as the “ majority will of the people of Australia “. I think I can fairly say that that is the way that the Minister expressed his sentiments. Since we have been referred to the events of 1945, and the hanking legislation passed through the Parliament at that time, I remind the Minister of a speech that he made in the Sydney Domain - one of his more popular stamping grounds - in July. 1945, when he said this -
We can add to the High Court: we can put mcn there who are more sympathetic to the people. We should not hesitate to see that the will of the people is not thwarted by those who are not sympathetically minded towards them.
Yet the honorable gentleman asks what authority we have for saying that Labour will “ stack “ the High Court if it gets a chance. The honorable member for Dalley has said that he would not object to it, and the Minister for Transport, on many occasions, has given his approval to such a course. There is ample support for our view in what has happened -in regard to the conciliation commissioner system, and the other partisan appointments that this Government has made ever since it took office, some years ago.
I wish to refer now, for a moment, to this almost paranoiac tendency of the Minister to refer to company directors, as if to be’ a director of some industrial or commercial enterprise in Australia were, prima facie, a crime in itself. Apparently it has become a crime in this country to be a success, because when one analyses the careers of most, of those men who are directors of our great institutions to-day, one finds that they are mostly men who have made a successs of their lives. In this country, few individuals start off with a hereditary advantage. I should estimate that to-day per cent, of the men and women working in this country are employees, and that of the remaining 10 per cent. 90 out of every 100, either have been employees at some stage of their lives or are the children of those who, in turn, were employees, working for a wage in some Australian undertaking. So, why spread this class poison and attempt to divide this country on class lines when no such lines should exist? This is a young country, and there is no place in it for the poison and venom that the Minister for Transport and those who speak like him try to inject into public life. What crimes have these directors committed other than that they have been successful in life - and not entirely from personal motives. They are responsible to their shareholders, and are removable by their shareholders if they do not give satisfaction. In the main they have earned the confidence of the people of Australia. This Government itself has no objection to the principle of directorships. In fact, clauses 17, 18 and 19 of this bill provide that when the shares in the private banks vest in the Government, the Government shall immediately appoint its own directors to take up the guidance of those great financial institutions. I put it to the people of this country: To what body of men would they look for greater security and progress - the men who by virtue of their experience and ability are in control of these financial institutions to-day, or the set of partisan supporters that this Government will appoint to these positions if it runs true to form ?
The Opposition has been subjected to some criticism because when debating the 1945 legislation, we advocated a return to board control. That has been alleged against us as if it were some great weakness in the policy of the Opposition parties.
– Hear, hear !
– The Minister for Information says, “ Hear, hear ! “ and no doubt that will be echoed by some of his colleagues.
– Hear, hear!
– Including, of course, the Minister for Transport.
– Why does the Opposisition spend so much time opposing it?
– The Prime Minister (Mr. Chifley) asks why we spend to much time opposing “ it “. That is a very misleading impression of what took place when two of the most important bills which up to that time had been presented to the Parliament were under discussion - the Banking Act 1945 and the Commonwealth Bank Act 1945. Why does the Opposition spend so much time opposing “ it “ asks the Prime Minister. We spent a great deal of time opposing particular provisions of that legislation, and any body who cares to study the debates will see just where our opposition was directed. Primarily, it was directed against the bank control which permitted the executive Treasurer of the day to take from the Parliament its control over banking policy, the note issue, and the extent of the gold reserves as a backing for the note issue. These were the things that we fought at that time. We were fighting for a Parliament that had exercised for centuries the privilege and responsibility of controlling financial policy in this and other English-speaking countries; but the Prime Minister and his rubber-stamp caucus behind him, surrendered the authority of the Parliament. They handed that authority over to the Treasurer of the day, who has no direct responsibility to report back to the Parliament on what he is doing. These were the things that we were fighting, and when we specified that there should be board control, we did so because we believed that there would be greater security and greater stability if advice were given by a representative board of men - not necessarily appointed from one side of politics, because I remind the committee that there have been men appointed to the Commonwealth Bank Board from all sections of the community, and from all sides of the political arena. We felt that the collective wisdom of a representative body of men would ensure greater stability and security than would be the case if decisions were left solely to the Treasurer of the day, and particularly a Treasurer who has developed illusions of grandeur and who believes that, while the people may desire to have a say in what is best, for them, he knows what is best for them and proposes to give it to them regardless of their wishes. It was not merely the view of an obstructive opposition that board control should remain; it was also the view of the Royal Commission on the Monetary and Banking Systems, and one to which the Treasurer himself subscribed. The right honorable gentleman did not hesitate to express his dissent from other aspects of the royal commission’s report; but I have yet to learn that he expressed any dissent from the recommendation that there should be board control of the Commonwealth Bank.
– I dealt with that very fully in the report. Let the honorable gentleman deal with it properly, too.
– If the right honorable gentleman now claims that he did dissent from the recommendation with respect to board control, I can only say that no specific dissent was expressed in the report. But, conceding that the right honorable gentleman did dissent, and that he was not in favour of board control, the other six members of the royal commission were in favour of board control; and they were a thoroughly representative body of men whose standing has not been challenged by any honorable member in this debate. Nor could their standing be challenged. For instance, one of them is now Chief Justice of the State of South Australia, another is the head of a great Commonwealth department, and another has been an adviser to the Commonwealth, whilst the remainder have enjoyed a high reputation for their financial knowledge and ability in this country.
– And whose recommendations governments which the honorable member supported ignored.
– The Prime Minister tries to say that governments which I supported ignored the commission’s recommendations. We never looked like ignoring them to anything like the degree the Prime Minister is now doing. He has gone directly in the teeth of the recommendation of the royal commission, that the best system for Australia is a system with a central government bank directing banking .policy associated with strong trading banks able to give, through competition one with another, the best service to this country. That was the cardinal recommendation made by the royal commission, and it is that recommendation ‘that the Prime Minister and his colleagues have seen fit to flout in this legislation.
In the limited time at my disposal, the only other aspect I shall touch upon is the conscription of employees of the private banks which is to take place as the result of this legislation. The honorable member for “Warringah (Mr. Spender) has already pointed out that, subject to one month’s notice being given to them, these employees, if they are declared to he redundant at any time, can be discharged from, the service of the Commonwealth. The rights which they have built up in the private banking institutions which now employ them can be destroyed over-night, and the only protection they have is that they shall receive one month’s notice. The Minister for Post-war Reconstruction (Mr. Dedman) during the war and subsequently has said that if the banks are nationalized, 6,000 banking employees could be released for productive work. Having regard to what has happened in Great Britain in recent days, we can see what a Labour government will turn to when it is confronted with difficulties so far as labour supply is concerned. From my knowledge of the Labour party in this country, its statement that it would never engage in industrial conscription in peace-time cannot be relied upon. “We have seen the socialist Labour Government in Great Britain turn to industrial conscription in peace-time, and if corresponding difficulties arose in Australia there would be no greater restriction upon a socialist Labour government in this country than that which the present socialist Labour Government in Great Britain has found it necessary to impose upon itself. So, we can take the pattern of what is being done with respect to employees of the trading banks as exemplifying what will be done in respect of employees in other industries which the Government may propose to nationalize in the future. The Government proposes to set up a permanent Federal Court of
Claims, to deal not merely with this issue, but also any other claims from an industry which may be socialized; and just as it has created machinery for this purpose, we can take it that its method of dealing with employees as exemplified in this legislation will be the same for dealing with employees in other industries which are nationalized.
– Does the honorable member suggest that the Federal Court of Claims will do the Government’s bidding?
– No. Last week, in the course of this debate, the honorable member for Dalley (Mr. Rosevear) said that the High Court had given a political decision if ever one had been given. I have sufficient faith in the men who comply with the qualifications required by legislation before they can be appointed to the judiciary, in whatever aspect of judicial life it. might be, not to be swayed by such influence; they will be guided solely by the legal merits and justice of the issues coming before them.
– Order! The honorable member’s time has expired.
.- There was one bright spot in the speech of the honorable member for Fawkner (Mr. Holt), and that was his assurance that he did not believe the Federal Court of Claims would do the Government’s bidding. I shall show how widely divergent are the views expressed by two lawyers among honorable members opposite. The honorable member for Fawkner, I repeat, in response to my interjection, said that he did not believe the Federal Court of Claims would do the Government’s bidding because he had sufficient faith in the qualifications of men eligible to be appointed to that court to believe that they would not do the Government’s bidding. I refer further to another suggestion he made that the Government will put persons on the directorates of the private banks who will do the Government’s bidding ; and I refer again to the opinion expressed by the honorable member for Warringah (Mr. Spender) when he spoke at Palm Beach the other night, and, according to a report published in the Sydney Sunday Telegraph said -
The Labour party aims to pack the High Court with men whose judgments would support all the acts-
He made no qualification- of a Labour government.
– That is so.
Ml’. ROSEVEAR. - Does the honorable member admit that he said that?
– “Unquestionably, I do; and I stand by it.
– The honorable member said -
The Labour party aims to pack the High Court with men whose judgments would support all the acts of a Labour government.
– If the honorable member had his way, that is what he would do.
– I do not think that any honorable member will deny that men who would be qualified to be appointed to the High Court would be men of the highest standing in the legal profession; and that the opinion expressed at a public meeting by the honorable member for “Warringah, himself a leading king’s counsel, means that among men in the highest flight of the legal profession in this country are men who are so corrupt and so venal that they would,- in’ return for appointment to the High Court, make any corrupt decision as members o’f that court that the Government which appointed them desired.
– The only qualification
– There can be no qualification on this point. In order to emphasize the honorable member’s statement I shall repeat it -
The Labour party aims to pack the High Court with- men whose judgments would support all the acts of a Labour government.
If that is- not ari insinuation that in the’ highest flight of his own profession there are nien so venal and corrupt that they would make any corrupt decision to satisfy the government that appointed them, I do not know what he did mean; and I do not think- that anybody else’ could know.
– I meant exactly what
– The honorable member for Warringah has continually addressed us in this chamber on the ethics of politics and the ethics cif the legal profession. In order to test his credibility, I shall refer to one of the finest exhibitions of abuse of ethics that has ever been given . in a court in New South Wales. I refer to the case of Sydney Hyam Davis v. W. J. Smith, which was heard before Mr. Justice Street. In that case the honorable member for Warringah appeared for the plaintiff^ and in his opening address he referred to the defendant as, among others things -
He continued -
I have to reveal a man, who, through tortuous methods with his associates, set out to destroy all competition with his own firm.
Then he proceeded-
Smith has ridden to wealth and power over the trampled remains of his associates and competitors. Gold is his God; power the shrine at which he worships.
We have heard much about the ethics of the court and the legal profession. The ethics of the court, if indeed not its rule, are that counsel in his opening speech shall not make charges unless he hopes, during the progress of the case, to seek to prove them. After having made his scandalous address, the honorable member for Warringah disappeared from the case and left it to his junior counsel.
– He thought that he was in- this chamber.
– Actually he was in the court, where, I believe, his attendances are more regular than they are in this chamber. On- the 29th October, the case collapsed. The honorable member left his junior counsel, Mr. Pilcher, to clear up the muck. Mr. Pilcher asked for a non-suit, and a verdict was entered for the defendant.
This question of ethics, I consider, is important because the honorable member for Warringah suggested that there are such people who may be placed on the’ High Court who would be so venal1 and’ corrupt gis to do the Government’s bidding. In his book. Law and Other Things, Lord McMillan devotes a chapter to the ethics of advocacy. The honorable member for Warringah has devoted many chapters of Hansard, to the same subject, but not with such good results to himself. Lord McMillan wrote, among other thin m -
For an advocate to allow charges to be launched with his name attached to them, without the fullest investigation, would be to abuse the absolute protection against actions for slander which the law affords to counsel.
Lord McMillan proceeded -
Counsel is not worthy of that protection unless he justifies it by the most scrupulous care in his written or oral attacks on character.
Counsel must insist upon being supplied with all the information which is sought by his client to justify the attack, and then he must decide for himself-
And this puts the onus on the honorable member for Warringah - whether the charges made arc such as can be justifiably made. In exercising his judgment in such a matter, the advocate is fulfilling one of the most delicate duties to society which his profession casts upon him. It is no small responsibility which the State throws upon the lawyer in thus confiding to his discretion the reputation of the citizen.
No enthusiasm for his client’s case - no specious assurance from his client that the insertion of some strong allegations will coerce a favorable settlement - no desire to fortify the relevance of his client’s case, entitles the advocate to trespass in matters involving reputation a hair’s breadth beyond what the facts as laid before him and duly vouched and attested will justify. It will not do to say lightly that it is for the court to decide the matter. It is for the counsel to see that no man’s gond name is wantonly attacked.
The honorable member for Warringah, who lectures us so much on the ethics of banking and the ethics of law, so impugns the general character of leading members of his own profession as to assert that they would be capable of giving corrupt and untrue decisions in favour of the government which appointed them, merely because it had appointed them. The honorable gentleman, in the case to which T referred earlier, stopped at no lengths to defame the name of a man on an assumption, and then walked out of the court and left it to his junior counsel to appeal for a non-suit. The judge rightly threw out that application. The honorable member for Warringah imputed most evil motives, made vile charges and besmirched the reputation of a litigant; but so far from his adducing proof to justify his attack, the case collapsed for the want of information or proof. This is the gentleman, who at Palm Beach a few days ago, sullied the good name of his profession.
– Where is Palm Beach?
– All I can do is to describe it as a “ narrow neck of land with calm water on one side and rough water on the other “.
– I know on which side I should put the honorable member for Dalley, anyway.
– I have not the slightest doubt about that; and I have not the slightest doubt that the press will not give the same publicity to my exposure of the honorable member’s ethics in law-
Mi1. Spender. - I do not mind if the press does, provided I am given the right to reply to the honorable member’s statements, by telling the truth.
– I am sure that the newspapers will not give me the same write-up as they did to the famous speech which the honorable member for Warringah delivered at Palm Beach a few nights ago.
– What has all this to do with the bill? The honorable member is only engaging in a slanderous attack on me.
– Order.’ I ask the honorable member to remain silent, or he will be. named.
– We can dispose of those people who preach so much of political ethics and legal ethics. We know them for what they are worth, and we can evaluate their criticism of the Government, when they imply against the Government the same “ crook “ motives as they imply against a defendant in the court, produce no proof of them, and then slip out of the court and leave somebody else to cleat; up the mess.
Reference has been made to the recommendations of the Royal Commission on Monetary and Banking Systems. Indeed, the royal commission’s report has been freely quoted during this debate. Members of the Labour party have been castigated because we did not follow the findings of the royal commission in their entirety. But when I look at the honorable member for New England (Mr. Abbott), and realize that he was a member of the commission, I wonder why honorable members opposite bothered to quote the commission’s report at all. The one observation that I do desire to make before I conclude is this: It is true that we have not carried out the findings of the royal commission in their entirety; but it is also true that our predecessors never adopted one of its recommendations. The clauses now under consideration, I. have no doubt, will be passed by the committee. As I stated a few days ago, the Leader of the Opposition has a very thin skin, and this evening he spoke, not to support the Opposition’s general ease against these clauses, but for the purpose of defending himself against the leading article in the Sydney Sunday Sun. That article plainly and bluntly told him, and, by implication, the Liberal party, that it was time that they made up their minds what attitude they would adopt towards the banking legislation of 1945.
– What did the Sunday Sun say about the honorable member?
– Whatever the Sunday Sun said about me will gain for me thousands of votes. To-night, the honorable member for Fawkner explained that his only objection to the banking legislation of 1945 was to the control by the Treasurer of the financial policy of the country. If his choice as to who shall dominate the economic and financial policy of the country lies between the directors of the private banks and the Government, I have not the slightest doubt what the people of Australia will have.
– The choice is between the Parliament and the Treasurer.
– If the choice as to who shall control the economic and financial policy of the country is between the Parliament and the people who are financially interested in making profits out of the private banks, I have not the slightest doubt about the one which the people will support.
– The choice is between the Parliament and the Treasurer. The honorable member should not make a mistake about that.
– As I assessed the value of the honorable member’s argument on the banking legislation of 1945, his opposition was not so much to the Treasurer having the final voice in determining banking and credit policy as it was to the fact that that legislation abolished the Commonwealth Bank Board, which was strangling the Com.monwealth Bank in the interests of the private banks.
The TEMPORARY CHAIRMAN.Order ! The honorable member’s time has expired.
– I desire to make a persona] explanation.
The TEMPORARY CHAIRMAN.What is the nature of the personal explanation that -the honorable member desires to make?
– The honorable member fo.r Dalley (Mr. Rosevear), who at other time9 occupies the position of Speaker of this chamber, has spent the major portion of the time allotted to him in alleging against me unethical conduct. I heard him clearly, and I now want to give the facts to the committee, because this is the second occasion on which the honorable member has so accused me. The statements ascribed to me are, I assume, perfectly correctly repeated. It is correct that a non-suit was obtained. It is equally correct that I was elsewhere during portion of that case. It is also correct, although the honorable member for Dalley did not mention it, that the whole of the facts which he had taken up the time of the committee to mention to-night were placed with other facts before the highest tribunal of the legal profession, on the complaint of the informant, namely the Bar Council, and that my conduct was completely vindicated. The Speaker of this House has occupied ten minutes in laying a charge against me when he should know better. He has indulged in personal abuse of me, although my conduct was completely vindicated by the highest tribunal in my profession.
.- The speech just delivered by the honorable member for Dalley (Mr. Rosevear) is of the kind that is becoming rather typical of his utterances. His method is to divert attention from the Banking Bill by making personal attacks upon leading figures of the Opposition. On the last previous occasion on which he resorted to such tactics he made a bitter personal attack on the Leader of the Opposition (Mr. Menzies) in the course of which he said that there was in the right honorable gentleman “ a yellow streak a yard wide and a foot thick “. I pay a tribute to the Leader of the Opposition for the way in which he has placed the case for the Opposition before the Parliament and the people in connexion with the high and important issues involved in this legislation. If any man in this chamber has made a real sacrifice to serve his country it is the Leader of the Opposition. He has sacrificed earnings amounting to probably £10,000 a year. Compare his courage and ability with that of the man who attacked him ! Haying spent the week-end licking the wounds that he received last week, and brooding over the discredit he has brought upon his own party, the honorable member for Dalley came into this chamber to-night and made a further personal attack - this time on the honorable member for “ Warringah (Mr. Spender), to whom he delivered a lecture on ethics. If any one in this chamber ought to be lectured on that subject it is the Speaker of the House of Representatives. Frequently honorable members on the Government benches say that we on this side can “ give it “ but we cannot “ take it “. To-night I propose to do some “giving”, even if in doing so I have to follow the line set by the honorable member for Dalley. On the question of ethics, an authority on the Constitution and the judiciary says of Mr.
– The honorable member must refer to the honorable member for Dalley by the name of his constituency and not as “Mr. Speaker”.
– I want to deal with the question of ethics on the highest possible plane. There are the ethics of the judiciary, the ethics of the Parliament and the ethics of the courts. On the subject of the ethics of the Parliament, Bryce says -
The note of the Speaker of the British House of Commons is his impartiality. He has indeed been chosen by a party, because a majority means in England a party. But on his way from his place on the benches to the Chair he is expected to shake off and leave behind all party ties and sympathies
The Speaker can lower or raise the tone and efficiency of the House as a whole by the way he presides over it; but a custom as strong as law forbids him to render help to his own side, even by private advice. Whatever information as to parliamentary law he may feel free to give must he equally at the disposal of every member
That is the example set by the Mother of Parliaments, .but to-night the honorable member for Dalley, who at other times presides over the House of Representatives as “ Mr. Speaker “, indulged in an abusive attack on another honorable member. Could absurdity go further? It has been said that there was no suggestion in the speech of the honorable member for Dalley last week, or that of the Minister for Transport (Mr. Ward), that the Government intended to pack the High Court. Now that those two honorable gentlemen have felt the strength of public opinion - they had the week-end to reflect on what they had said - they are trying to remedy the mischief that they have wrought. Let us consider some of the appointments made by the present Government to high judicial offices. I refer now to the recent life appointment of a member of the conciliation comissioners. These men will have complete powers over the several industries with which they will have to deal.
The TEMPORARY CHAIRMAN The appointment of conciliation commissioners has nothing to do with the clause before the chair.
– I realize, Mr. Temporary Chairman, that a fairly wide interpretation of the matter before the chair would be .needed to cover my remarks, but I submit that considerable latitude has already been allowed to the honorable member .for Dalley and, therefore, I trust that I may answer him. Unless I do so, it will probably be assumed that I, as the next speaker from this side of the chamber, had no answer to give to the honorable member. Of the fifteen conciliation commissioners recently appointed, fourteen were either union secretaries or supporters of the Labour party. That is not packing a judicial body ! Included among them was Mr. Hamilton Knight, formerly Minister for Labour in the McGirr Government in New South Wales. Also included among them was the private secretary of the Minister for Transport, Mr. Donovan. An impartial judicial authority they are supposed to constitute! I am not now going to suggest anything about them other than this: There is not a man among them who has not spent a great part of his life either giving political decisions in favour of Labour or in advancing political policies in favour of Labour. It is suggested that because certain people believe that their constitutional and legal rights are being violated by the legislation now before the Parliament, and intend to appeal to the High Court against it, they are doing so only because they know in advance what the decision of the court will be. What other course is open to any person who feels aggrieved, whether he be the lowest labourer in the land or the highest captain of industry, or the representative of a bank, other than to appeal to the authority appointed by the Constitution, namely, the High Court, and after the High Court, to the Privy Council ?
In the speeches of the honorable member for Dalley and the Minister for Transport, they have clearly shown their hand. They first said that some of the judges of the High Court were senile, and that the appointments of all judges should terminate upon their reaching a specified age. Then, when the honorable member for Barker (Mr. Archie Cameron), on Thursday night last, moved that members of the Federal Court of Claims should be appointed with a retiring age of 65 years, the honorable member for Dalley, who first espoused such a proposal, walked out of the chamber. He was not game to have his name recorded in Hansard as voting in support of the proposal which he claimed to favour.
The Prime Minister (Mr. Chifley) excused himself for proposing to appoint the judges for life on the ground that, under the Constitution, there was no authority to do anything else. Well, if that be so, why have leading government spokesmen tried to discredit and besmirch the members of the High Court, knowing all the time that there was no power to do anything about it? If it is really desired to introduce a retiring age for judges in the Commonwealth judiciary, it can be done by altering the Constitution with the consent of the people. Let the Government submit its proposals to the highest tribunal in the land, namely, the people themselves. With an air of great bravado, the Government proposes to submit to the people next year certain proposals in regard to prices control. It will say to the people that it needs more power in order to protect their interests. It will have courage enough to do that - to use this word “ courage “, of which the honorable member for Dalley is so fond. The Government will have the courage to go before the people in February next, and ask for more power to control prices, but it has not the courage to invite the opinion of the people on this banking legislation.
We on this side of the chamber have been criticized by , the Prime Minister and his minions for our defence of the Commonwealth Bank Board. We have been twitted because we have said that if we were returned to power we would re-appoint the board. Is there anything wrong in that?
– The Minister for Transport says that our proposal is wrong. Let me quote from a speech by Mr. W. C. Taylor, who, I understand, was federal pesident of the Australian Labour party.
– No, he was not.
– Well, he was senior vice-president.
– Wrong again.
– This man was the Government’s nominee on the Commonwealth Bank Board before it was abolished. He was the Government’s nominee on the Australian National Airlines Commission, and the ‘ confidential adviser to the Prime Minister. This is what he said at a meeting of the Henry Lawson Labour College, held in the Trades Hall, as reported in the Sydney Morning Herald of the 27th September - and thespeech was made since this legislation was introduced in Parliament -
Nationalization should be discussed on an economic rather than a political level, said
Mr. Taylor. Labour supporters were too prone to discuss economic problems with a cliche: that the banks caused the depression, that the banks kept people out of work. These statements were quite untrue. . . .
The nationalized bank should be controlled by a board or commission comprising representatives of all interests.
It will be seen that he proposes to reconstitute the controlling authority which the Prime Minister and the Minister for Transport, and other honorable members opposite,have described as an anachronism. I have no more to say other than this: When the honorable member for Dalley is next tempted to lecture on the ethics that should guide honorable members of this Parliament, I suggest that he himself should read more carefully May’s Parliamentary Practice. Then, if he still feels the need of further reading, let him study Quick and Garran on the Constitution.
– I desire to make a personal explanation, because I have been misrepresented by the honorable member for Richmond (Mr. Anthony). I do not mind how he criticizes what I say; but his statement that I walked out of the chamber when a vote was taken on the amendment of the honorable member for Barker (Mr. Archie Cameron) is untrue.
– The honorable member did not vote.
– The statement was that I walked out of the chamber and did not vote. The fact is that I was not in the chamber during the discussion on the amendment. I have never voted in the House or in committee since I have been Speaker. Furthermore, I will never be stupid enough to vote for something that is not worth the paper it is written upon.
Mr. CALWELL (Melbourne- Minister for Information and Minister for Immigration [10.7]. - Mr. Temporary Chairman
– I rise to order. I have observed that during the debate this afternoon the honorable mem ber for Reid (Mr. Lang) has risen to speak, but he was not called. He is not an official member of the Labour party, but he is more bitterly opposed to my opinions than are many members of that party. Nevertheless, I believe that he should be heard in this debate.
– On a point of procedure. I understand that some honorable members on the Government side, and possibly on this side also, have been called twice, while other honorable members who have tried to speak have not been called at allI understand that the practice in committee is that no honorable member shall be given a. second call until all other honorable members who desire to speak have had an opportunity to do so.
– After I took the chair, the first call was given to the honorable member for Dalley (Mr. Rosevear). He caught my eye, and I called him. After him, the call went to the honorable member for Richmond (Mr. Anthony). When he finished, the honorable member for Reid (Mr. Lang) and the Minister for Information (Mr. Calwell) rose together. I assumed that the Minister was representing the Prime Minister as Minister in charge of the hill at the moment, and therefore had a right to reply to criticism.
– But he has already spoken.
– I shall not detain the committee very long, but I want to reply to some of the criticism-
– I raised a point of procedure, and referred to what I understand has been a practice of long standing in committee. The Minister for Information is not in charge of the bill. The Prime Minister is in his place in the committee. He is in charge of the bill, and any honorable member who wishes to speak for the first time on the clauses now before the committee is entitled to receive the call before any other honorable member is called a second time.
– Order ! The Chair has already given the call to the Minister for Information.
– The debate this evening has been responsible for two things.
First, it brought forth a statement by the Leader of the Opposition (Mr. Menzies) that the Opposition - and I assume the right honorable gentleman includes both of the parties in Opposition - still stands on the statement he made in connexion with the Commonwealth Bank Bill of 1945 ; it still wants the Commonwealth Bank controlled by the Commonwealth Bank Board. Our objection to that is as solid to-day as ever it was ; it goes right back to 1924, when the former Leader of the Australian Country party, the right honorable member for Cowper (Sir Earle Page), who was then the Leader of the “ rump “ party, without a mandate from the people, imposed upon this national Parliament the banking policy of the Country party. We are opposed to the control of the destinies of the people by a Commonwealth Bank Board because in effect it means control of an instrumentality of the people by representatives of the private .banks whose desire is to make the Commonwealth Bank a bankers’ bank. We want the bank to be the people’s bank. On a previous occasion I cited the instance of one member of the Commonwealth Bank Board, Sir Clive McPherson, who resigned a directorship on the National Bank of Australasia Limited to become a member of the Commonwealth Bank Board, but who, when we decided that we no longer wanted his services, went straight back from the Commonwealth Bank Board to his former position on the directorate of the National Bank of Australasia Limited. The Opposition says that it stands for that kind of thing. I am indebted to the Leader of the Opposition for the frankness with which he has expressed his case. As’ a matter of fact, everybody seems to be indebted to somebody else to-night. The Leader of the Opposition expressed his indebtedness to me for some references I had made to clause 46. The Minister for Transport (Mr. Ward), who followed the right honorable gentleman, expressed his indebtedness to the Leader of the Opposition for some legal opinions which he had given in the course of his remarks.
The second statement made by the Leader of the Opposition was one for which we are also indebted to the right honorable gentleman. I did not take down his words verbatim but as far as I recall he said, speaking for the Opposition -
We have not said that we do not support the Banking Act of 1945.
That is, as distinct from the Commonm on wealth Bank Act of 1945 the right honorable gentleman has resorted to the old technique of using the double negative, leaving it to be inferred that the Opposition in this Parliament does now support the bill of 1945, but not saying so in. unequivocal language. I hope that before the committee finally disposes of this clause he will say in positive language, and not in a phrase containing a double negative, just where the Opposition stands in regard to that legislation. He then went on to say that if this clause, taken by itself, were to stand, and irrespective of whatever else in the bill may be declared ultra vires, it would enable the Government to do many things. He conjured up a supposititious case which nobody with the slightest intelligence would believe, that notwithstanding a declaration of invalidity in respect of every other clause in the bill this clause could still stand. The right honorable gentleman is setting up aunt-sallys merely to knock them down again. Those tactics do not carry conviction with those who analyse this subject. The right honorable gentleman also said that this clause gives to the Government power to intrude into the most private banking affairs of every citizen. Let us see what Mr. McConnan, one of the bankers directing the opposition campaign to this bill, has had to say. Speaking in respect of the 1945 legisla tion Mr. McConnan said -
Government control over the banking system, which means control over the people’s money, would permanently give the Government vast powers over industry and substantial control over the individual.
Mr. McConnan said that in respect of the 1945 legislation. The Leader of the Opposition now brings the same argument forward as a reason why the 1947 legislation should not be passed. He affirms in a double negative phrase that the Opposition now has no objection to the Banking Act of 1945 about which Mr. McConnan so graphically and extensively expressed his fears. These are the same fears which the Leader of the Opposition now expresses about the 1947 legislation. Mr. McConnan continued -
This would place in the government’s hands a powerful control not only over industry as a whole but over the economic and financial ambitions of every individual.
The Leader of the Opposition now attempts to terrorize the customers of the banks by using the same arguments with which Mr. McConnan failed to impress the people about the 1945 legislation. When in 1911 the Labour party brought forward its first banking bill much the same attempt was made to blackmail the people into accepting the arguments used in the Opposition campaign. When in 1911 Mr. Fisher introduced his Commonwealth Bank Bill, a measure which in succeeding years Opposition members began to hold up as a perfect piece of legislation which we should support and beyond which we should not go, the Sydney Morning Herald in its issue of the 17th November, 1911, had this to say -
The bank is to be pitted against all other banks, with intent to displace them, and the better it succeeds the sooner may private and State concerns be invited to put up their shutters. This is really little better than a species of wholesale confiscation, and it should be resisted to the last ditch.
We have heard of fights to the last ditch prophesied by the Opposition in connexion with this bill.
– The second battle for Australia.
– As I am reminded by my colleague, the fight against this bill has been referred to as the second battle for Australia. Whenever a progressive Labour Government introduces progressive legislation in connexion with banking the same extravaganza of misrepresentation and distortion takes place. The dire happenings prophesied by the Opposition in 1911 did not come to pass. The frightful consequences that were prophesied to follow the Banking Act of 1945, which -we are told the Opposition parties now approve, did not come to pass. Yet the same arguments are advanced against the 1947 legislation. Let us see what one distinguished member of the community had to say on the question of banking. I refer to Professor Walter Murdoch, of the University of Western Australia, now a very old man. After dealing with the question of banking in the Melbourne Herald and in other newspapers - some other newspapers which regularly printed his syndicated articles would not print this one - Professor Murdoch had this to say -
My conclusion, not come to all of a sudden nor without due thought, is that our money system - the regulation of the issue and recall of currency and credit on a rational .and scientific basis - is far too important, far too vital to the welfare of all of us to be left to private profit making firms. It is the concern of the nation. We talk of responsible governments; if there is one thing a responsible government ought to be responsible for, it is surely this.
That is a very sound statement from the. viewpoint of the average citizen. It epitomises the Government’s viewpoint. We are not desirous of destroying industry which we ourselves helped to create. We are not anxious to destroy the solvency of the country, for which we alone are responsible. We are not anxious to upset the lives of the people, who to-day are not oppressed by the fear that they had during the depression, the fear that they would not be able to get work. If the workers of Australia are to lose any freedom under this bill, it will be only the freedom to starve. We are trying to ensure that they shall not suffer from that fear of want that so many - at least 700,000 workers at one time and 400,000 workers at another time - suffered.
– Why is the Minister addressing his remarks to his own supporters?
– Because I regard the honorable member as being completely hopeless. It is of. no use for me to cast my pearls in certain directions.
When we nationalize the banks and when we rationalize banking procedure, it may be found by the Commonwealth Bank authorities that the trading banks’ shareholders have been making, not only an inordinate profit overall, but also a profit in certain directions in which they should not have been allowed to profit at all. I refer to the payment of exchange on cheques, a charge to which every person living in the country areas is subject, whereas city residents are largely exempt. When the Commonwealth Bank Board takes control of banking in this country, exchange may be eliminated. If so, there will be a great saving to the primary producers. Furthermore, when the Commonwealth Bank takes charge of banking in this country it will probably be found possible to reduce interests rates on rural indebtedness, and perhaps on housing loans, in the interests of people living in both the city and the country, to a far greater degree than ever before. In the Commonwealth Bank Act 1945, we tried to translate into legislative actuality something that had been a part of our platform for many years. On the Labour party’s platform we had this statement, “ The financing by the Commonwealth Bank at the actual cost of issuance and services of public work “. The legal draftsmen, when they interpreted our wishes in the legislation, provided that loans should be made for housing purposes at “ the lowest practicable rate of interest “. That was the desire of the Parliament and of the nation. In my view, a rate near 2 per cent, would be desirable. Some day we shall get down to that rate, but we shall not be able to do so while we have nine trading banks cluttering the way. The sooner we get rid of those banks the sooner shall we be able to govern the nation in the interests of the whole population.
.- I refer to clause 46, sub-clause (1), which reads - (1.) Notwithstanding anything contained in any other law, or in any charter or other instrument, a private bank shall not, after the commencement of this act, carry on banking business in Australia except as required by this section.
I move -
That, in clause 46, sub-clause (1.), after the word “ section “, the following words be inserted: - “provide that such prohibition shall not apply to co-operative banks constituted in accordance with the rules governing the establishment of co-operative societies, such cooperative banks for the purposes of this act not being regarded as private banks.”
In moving that amendment, I desire to say that co-operative banking is in accordance with the fundamental principles of the Labour movement. It is also an absolute safeguard to the Labour movement. It is a protection against monopoly control of banking by antiLabour governments. Honorable members know that nowhere has the cooperative movement flourished more than on the coal-fields of our country. There the co-operatives have acted as banks for the miners during every major industrial crisis. Without the co-operative banks, the miners would have lost everyindustrial battle that they fought from the time of the notorious leg-irons to the present date. What would have happened had anti-Labour governments been in power during those disputes if the present bill had been in operation? During their disputes the miners have invariably survived because of the credit extended to them by the co-operative movement. The co-operative societies work on bank overdrafts. They also virtually operate as banks, creating their own form of credit which they supply in order to protect the miners and their families. However, a hostile anti-Labour government, under this bill, could stop the credit of the cooperatives and, by calling up the overdrafts instead of extending them, apply economic pressure to the workers on the coal-fields and elsewhere.
This bill assumes that the Commonwealth monopoly bank will always hea Chifley bank. Under this bill, it might at any time be a Menzies bank, a Casey bank, or even a Thornton bank. What would have happened had this bill been in operation in the ‘twenties? Then it would have been a Bruce bank or a Page bank. What would have happened to the co-operatives on the coal-fields during industrial disputes then? The first thing would have been that the bank, by order of the Government, would have called up their overdrafts and that would have been the end of the struggle. The Miners Federation could never have survived a crisis without the assistance that its members received from the co-operative movement. Yet, unless provision is made in this bill for the co-operative banks, all the co-operative societies in Australia will be at the mercy of any future anti-Labour government. The miners would not be able to last a month in an industrial dispute because, under this bill, they would be beaten to their knees immediately. The Government and its supporters must realize that when they pass this bill they create a Menzies bank or a Casey bank. They will be giving the anti-Labour forces control by monopoly just as surely as they are creating a passing Chifley monopoly. The Government appears to be blinded to the future just as it is to the past. Unless it makes provision for co-operative banks - and I say this deliberately - it will be forging the greatest weapon that the anti-Labour movement has ever had presented to it. These union funds will be at the mercy of an anti-Labour banking monopoly. The Treasurer of the day will be able to freeze trade union funds. Think of what would have happened to the timber workers in 1929 if other sections of the Labour movement had been unable to come to their assistance, as they would be unable to do when this bill becomes law, and an anti-Labour government takes charge of the treasury bench ! Think of what the Bruce-Page Government could have done then ! By making provision for co-operative banks, this .Government could protect the trade unions of Australia and the Australian workers.
Co-operative banks are not run for private profit nor are they run for the benefit of a few privileged persons, but among the workers themselves. The Co-operative Wholesale Society’s Bank in England has been a most successful institution. It was started in 1872 by the society as a loan and deposit department. The cooperative movement in Great Britain then obtained an amendment of the act that made it possible to transform that department into a bank. That was in 1876. Since then the co-operative movement of Great Britain has had its own bank, conducted by its own members, and with directors elected by its members. The bank not only acts as a banker for the society itself; it acts as a banker for 11,866 trade union accounts. It acts also for mutual organizations, as well as members of the co-operative movement and any one else who wishes to utilize its services. It is also banker for 95 local governing bodies. It has its head-quarters in Manchester and it has branches in other cities, and agencies f’”” receiving deposits and cashing cheques in various co-operative institutions throughout the land. That Go-operative Bank is a safeguard against monopoly banking in Great Britain. It does not operate for the sake of private profits. It provides banking facilities at absolutely the minimum cost; but it does more than that. It not only pays a high rate of interest on deposit accounts, but it also pays interest at the rate of 1-J per cent, on current accounts and that is something that neither the private banks nor the Commonwealth Bank has yet done. If a worker deposits his money with the Commonwealth Bank in a cheque account he receives no interest on it; but the bank lends the money at a high rate of interest. If the Co-operative Bank in Great Britain can pay interest on current accounts, why cannot the Commonwealth Bank in Australia do likewise? The Commonwealth Bank is merely a replica of the private trading banks and it has all their vices. It is profit-hungry, and there is no guarantee under this measure that it will change its habits. Cooperative banks, operating in accordance with the principles of the co-operative movement, would be conducted on altogether different lines. A co-operative bank would be a democratic institution and not a monopolistic institution. Trade union funds would be safe in a period of industrial crisis, and the co-operati. e bank could extend credit just as the cooperative societies do to-day.
If the Government rejects this amendment, it is not sincere in its attitude to fundamental Labour principles. According to its latest balance sheet, last year the Co-operative Bank in England had a turnover of £1,311,000,000. Its assets now amount to £473,000,000 and after paying £500,000 in interest on current accounts it still showed a very substantial surplus for distribution amongst les members. The co-operative movement regards banking as the bridge between production and distribution and that is the true function of banking. Many trade unions in this country have refused to bank with the Commonwealth Bank because they have been afraid of government interference at a time when they were engaged in an industrial struggle. That fear will be intensified unless the
Government gives protection by making provision for co-operative banks.
– What unions are they?
– Practically all of them. Government supporters should ask themselves: What is going to happen to the accounts of the trade unions and Labour organizations when anti-Labour governments control the monopoly Commonwealth Bank? Unless they vote for this amendment they will be voting to hand over the funds of the trade unions and the labour organizations to the enemies of Labour when the enemies of Labour are in power. I hope that the Government will give serious consideration to the amendment, and for the sake of the trade unions, the workers and the co-operatives, I hope that the amendment will be accepted.
– I wish to say something to-night about the remarks made by the honorable member for Dalley (Mr. Rosevear), who gave honorable members a lecture on ethics. The honorable member quoted Lord McMillan, the distinguished English law lord, with regard to the ethics of barristers, and then proceeded to complain about the professional conduct of the honorable member for Warringah (Mr. Spender). It ill became the honorable member for Dalley to lecture anybody on ethics after his own unethical conduct in the labour movement in this country. The gross manner in which the honorable member betrayed his predecessor in the electorate of Dalley, Mr. E. G. Theodore, is not beyond the memory of members of this committee and of the public generally. The honorable member had been secretary to Mr. Theodore in the previous election campaign, and had learned the whole inner workings of the machine of that electorate. He then preceeded to stab in the back the man he was supposed to support. I tell the Prime Minister (Mr. Chifley) that neither the leopard nor the leper changes his spots: and there have been signs that the honorable member for Dalley is organizing the rank and file of the present Government to do the same kindly deed towards him as he did towards Mr. Theodore, when the latter was the member for Dalley. So, it ill becomes this paragon of virtue to strut and parade himself in this chamber as one who should lecture other honorable members when we know that his history is the history of a political assassin who destroys the people he is pledged to support. The other night we witnessed the spectacle of the honorable member making an attack upon the High Court, which is the highest judicial tribunal in this country. What was his reason for making that attack? He was determined, if possible, to lower the prestige of the High Court in the eyes of the people of Australia, or to terrify the members of the court. He failed in both of those objectives. He did not lower the court in the eyes of the people; and he did not terrify the members of the court. They will not be terrified by the idle threats of a man like the honorable member for Dalley. It ill became him to do what he did. During the week-end he went to Sydney, and discovering the repercussions of his speech against the Government and against himself, personally, he now returns and indulges in a torrent of abuse of honorable members. The public of Australia can judge what the honorable member for Dalley is worth by his conduct in this chamber, and his conduct in the past.
The Minister for Information (Mr. Calwell) said that the Commonwealth Bank Board should not be re-established, and that the objection of the Labour party to a bank board is just as strong to-day as it was in 1945 and 1924. The fact is that there are great gaps in the memory of the Minister, because he forgot to tell the committee that the Banking Bill introduced by the Scullin Government in 1930 provided for the reappointment of a bank board. What did the Scullin Government do? It was a Labour government, and we are told that Labour governments never change their views. The Minister did not tell the people that the Scullin Government, not only proposed to re-appoint the bank board, but it also appointed Sir Robert Gibson, who, to-day, is condemned by all honorable members opposite as the arch enemy of the workers of this country, not for one year but for seven years, and gave him powers which the honorable members opposite say should not he given to any man. Honorable members talk about wanting a people’s bank and not a bankers’ bank. They try to mislead the people by these phrases, because the central bank must be a bank for the trading banks. The Royal Commission on Monetary and Banking Systems recommended that the Commonwealth Bank should also have the function of a trading bank in order to enable it to discipline the trading banks by active competition with them in carrying out fully the functions of a trading bank.
The Minister for Information talked about the setting up of a regional court of appeal to protect the interests of the man on the land. How would the man on the land obtain satisfaction from such a court, provision for which is not made even in this bill, although the Prime Minister referred to such a tribunal in his second-reading speech? How could the man on the land obtain satisfaction from such a court after his experience of having to wait month after month to obtain advances from the Commonwealth Bank to enable him to stock his land or to purchase implements and such articles as cornsacks for the handling of his crops? The Labour party is purely a city-controlled party, which does not understand in the slightest degree the requirements of the man on the land, when it puts forward such a superficial proposition as that and expects the man on the land to believe it. The Minister for Information also said that the trading banks charged internal exchange upon cheques. If that was such an evil, the Government has had two years to abolish it in respect of the transactions of the Commonwealth Bank; but it has not done anything in that direction. On the word of the Minister for Information, the Government is thus guilty of gross insincerity. According to the Minister it has robbed the people of Australia by charging internal exchange on all cheques handled by the Commonwealth Bank. Then we have the proposition that with one monopoly bank the interest rate will be reduced to 2 per cent, or, indeed, to zero. There has not been anything to prevent the Commonwealth Bank from reducing the rate of interest below the present rate.
As the Royal Commission on Monetary and Banking Systems pointed out, the Commonwealth Bank reduced the rate of interest charged by all of the pastoral houses of Australia to a figure that was considerably lower than the rate previously charged. The bank did that simply by making funds available at a low rate of interest to two, or three, pastoral houses, the remainder of those institutions being obliged to fall into line. There has been nothing to prevent the Commonwealth Bank, which, since the passing of the 1945 banking legislation, has been in the fullest competition with the trading banks, from reducing the rate of interest and forcing all of the trading banks to come into line. But it did not do so. Is it likely, when it has a monopoly of banking in the future, to behave differently from other monopolies? No. The monopoly bank will screw the people just as hard in the future as it has in the past.
With regard to the amendment moved by the honorable member for Reid (Mr. Lang) to provide for the establishment of co-operative banks, we in the primary industries are vitally interested in such a proposal. Probably, he has a much greater knowledge than I have of the operation of co-operative movements on the coal-fields and of the requirements of people living in those districts; but I say that in no industry in Australia has the co-operative movement taken deeper root than in the dairying industry. In my own electorate and the adjoining electorate of Robertson, there are two of the largest co-operative butter factories in Australia. One of those factories desired to extend its operations to a considerable degree, and on being refused an advance for this purpose by one trading bank, it obtained the accommodation it desired from another private bank. The other establishment, the Singleton- Waratah butter factory, wished to establish a selling floor in Sydney for its whole milk trade, and when it failed to obtain accommodation from one trading bank it obtained the accommodation it desired from another trading bank. No one engaged in primary industry believes that economists and bureaucrats, who possess only book learning, will be seized with the necessity for the establishment of industries of that kind in districts where practical men know them to be essential. The economists and bureaucrats, live in the detached air of Canberra, far removed from the scenes where, in blood and sweat, the farmers produce the food to feed the world. Do we think for a moment that we shall get any better accommodation in the establishment of our co-operative factories from this monopoly institution than we did in the past? Therefore, it is the duty of the Government to accept the amendment. I have great pleasure in supporting it.
.- I shall address most of my remarks to the amendment which the honorable member for Reid (Mr. Lang) has moved in relation to co-operative banking. I do not feel that in the volley of abstract nouns which the honorable member for New England (Mr. Abbott) discharged in the House, there is very much to answer; but the honorable member for Reid has discussed a problem which, he states, will confront trade unions in the event of industrial disputes when this bill is passed. The political career of the honorable member may be summed up in the expression “right wing actions and left wing slogans “. I feel that to-night, in advancing one of the arguments that the private banks have put forward, he has borne out that striking feature of his political career. If a trade union is on strike in defiance of an arbitration court award, and if the Government, in order to enforce that award, passes legislation impounding its funds, it is immaterial whether the funds are in a private bank, the Commonwealth Bank or a State savings bank. The power which this Government has to enforce laws with respect to industrial peace under the conciliation and arbitration power would enable it to over-ride a private bank in precisely the same way as it would over-ride the Commonwealth Bank. Therefore, in the main point of the honorable member’s argument there is no merit whatever. It was advanced, of course, with the idea of alarming the trade unions with the thought that in the hands of the political parties opposed to the Labour party, the Commonwealth Bank could be used as an instrument against them. Even without the nationalization of banking, the funds of a trade union in a private bank could be impounded by a government which was disposed to impound them. I make that point perfectly clear at the outset. Under the Banking Bill, there will be no greater disadvantage to a trade union in the event of the Liberal party and the Australian Country party coming into power than under the present system.
The second remark of the honorable member for Reid related to the formation of co-operative banks. That it was a phantasy is shown by the fact that in dealing with the subject of co-operative banks, he cited English examples, and then, by making play with the word “ cooperative “, he spoke about how the cooperative stores, although he did not use the word “ stores “ but that was what he meant, had carried various trade unions during strikes. He left us to infer that this was being done by co-operative banks established by trade unions. Of course, there are no co-operative banks established by trade unions in Australia, so that that particular phantasy which the honorable member brought forward to bolster up his amendment, and to give him an excuse to echo in the name of the left the slogans of the right, was as invalid as his suggestion that there was a menace to the trade unions in the bill in its present form.
The clauses under consideration relate to the assessment of compensation, and prohibit the private banks from carrying on banking business. It is important to notice that the Federal Court of Claims will be staffed by judges with qualifications equal to those of justices of the High Court. Sub-clause 2 of clause 40 provides -
The amount of compensation payable shall, unless agreed upon, he determined by the court and not in any other manner.
Sub-clause 4 of the same clause provides -
Where a notice is given under the last preceding section in relation to any shares, the persons entitled to payment of compensation in respect to the acquisition of those shares shall be determined by the Court and not in any other manner.
Throughout these clauses, the absolute authority of the Federal Court of Claims is established by this bill. I desire to make an observation upon that, because it has been the practice of the High Court in the past, when determining whether just compensation has been paid, to require only that there shall have been a judicial inquiry into compensation. I wonder, however, whether one clause of the bill will be found, upon challenge, to be valid. I refer to the clause which purports to cancel the right of appeal from the Federal Court of Claims to the High Court. Since the Constitution itself lays down that when the Commonwealth acquires property, just compensation must be paid for it, the phrase “ just compensation “ being a part of the Constitution, is a part which must be in the jurisdiction of the only court which can interpret the Constitution, and this is the High Court. However, that is a. matter for lawyers to determine. ‘
Statements have been made concerning the judicial appointments of the Government, and I desire to refer to them. The Prime Minister (Mr. Chifley), in answer to a question this afternoon, stated that in the period of six years during which the Government has been in office, it had made only one appointment to the High Court. That, of course, was the appointment of Sir William Webb, formerly Chief Justice of Queensland. Last week, and during a part of the debate to-day, the Government has been accused of intending to pack the High Court. When I asked purely objective questions of the Prime Minister to-day concerning statements which the honorable member for Warringah (Mr. Spender) made as statements of fact that the Government intended to pack the High Court, the honorable member said that it was a fair inference. There is a name well known to lawyers given to people who, in a court of law, elevate their inferences into statements of fact. Now, this denunciation of the appointment of the Government either means nothing, or is an attack on the former Chief Justice of Queensland, Sir William Webb, the only appointee of the Government to the High Court. If the High Court is to be packed, the Government must amend the Judiciary Act, which now provides for the appointment to the High Court of only seven judges. The seventh judge - again I emphasize that this is the only appointment that this Government has made - was appointed in April, 1946. He had been the Chief Justice of Queensland, and before that a highly qualified and respected lawyer. The assertions about packing the High Court are either an attack on Sir William Webb or gaseous nonsense, and the people, knowing the calibre of that judge, can ascertain for themselves that this smear campaign concerning the Government’s judicial appointments was intended simply as a part of a political rather than an analytical campaign against the bill.
Question put -
That the words proposed to be inserted (Mr. Lang’s amendment) be so inserted.
The committee divided.. (The Chairman - Mr. J.. J… Clark.)
Majority . . 12:
Question so resolved in the negative.
Question put -
That clauses 37 to 46 be agreed to.
The committee divided. (The Chairman - Mr. J. J. Clark.)
Majority . . . . 13
Question so resolved in the affirmative.
The following papers were presented : -
Arbitration (Public Service) Act - Determinations by the Arbitrator, &c. - 1947 - No. 85 - Federated Ironworkers’ Association of Australia.
No. 86 - Commonwealth Temporary Clerks’ Association; Federated Clerks’ Union of Australia; and Federated Public Service Assistants’ Association.
No. 87 - Peace Officer Guard Association. Commonwealth Public Service Act - Appointments - Department of Works and Housing - G. H. V. Hewitt, J. A. O’Neill.
Lands Acquisition Act - Land acquired for - Department of Trade and Customs purposes - Cairns, Queensland.
Postal purposes - Richmond, Victoria.
Papua-New Guinea Provisional Administration Act - Ordinance - 1947 - No. 11 - Supply (No. 1) 1947-48.
House adjourned at 11.11 p.m.
The following answers to questions were circulated: -
In my reply I indicated that it would be difficult to estimate the quantities of wool to be exported to the United States of America this financial year. The reported decline in wool production in that country, should mean that it would purchase additional quantities from Australia and so augment our dollar resources. I have not been able to secure any information regarding United States of America’s intentions which would be of value to the honorable member.
asked the Minister for Commerce and Agriculture, upon notice -
y. - On the 22nd October the honorable member for Capricornia (Mr. Davidson) asked me the following questions, upon notice: -
How many temporary Commonwealth public servants are employed in the -
Research; (/) Department of Defence;
Patent, Trade Marks, Designs and Copyright Offices?
The following information is supplied to the honorable member: -
y. - On the 4th November, the honorable member for Indi (Mr. McEwen) asked a question regarding tobacco production in Australia. The Minister for Commerce and Agriculture has supplied the following information : -
The successful development of tobacco leaf production in Australia is dependent on a number of factors and it is considered that the most important of these are the provision of irrigation facilities in suitable growing areas and the control of crop pests and diseases. The return which the grower will receive for his crop is of importance also, but even high prices cannot compensate a producer whose yields have been seriously depleted by lack of water and the ravages of insects or other pests. The provision and extension of irrigation works and assistance to producers generally are matters for the governments of the producing States. The Commonwealth Government has assisted the States from time to time in making grants available to supplement work being done in connexion with production problems. Last year the Commonwealth approved of a grant of £10,000 per annum for a five-year period on a £1 for £1 basis to be allocated amongst the producing States of New South Wales, Queensland, Victoria and Western Australia for experimental and demonstration work in connexion with tobaccoleaf production, particularly in regard to the control and elimination of diseases and pests. In addition the Council for Scientific and Industrial Research is engaged upon research work connected with the problems of the tobacco industry. On the subject of prices for tobacco leaf, attention is directed to a recent announcement by the Minister for Commerce and Agriculture that the prices tobe paid to growers are to be increased by the payment of specific premiums based upon the appraisal values placed on leaf. It is expected that these additional payments will stimulate production in the industry and particularly reward the output of better quality leaf. Other steps which might be taken to assist towards a greater production of Australian leaf are under examination and the Minister for Commerce and Agriculture will take the opportunity of discussing this question with the State Ministers for Agriculture at the next meeting of the Australian Agricultural Council.
y. - On the 13th Novem ber, the honorable member for Swan (Mr.
Hamilton) asked a question concerning the supply of power kerosene to primary producers. The Minister for Supply and Shipping has supplied the following information : -
Although power kerosene is in global short, supply, there is at present uo rationing of power kerosene in Western Australia or any other State, nor has there been any shortage of stock of power kerosene in Western Australia, but it is of course possible that on occasions due to transport and other difficulties a temporary local shortage of stock may have occurred. In such cases the local oil company agent would, of course, be compelled to ration his customers. It is considered that the local man is best able to deal fairly in such a situation and it is obviously in his own best interests to ensure an equitable distribution of the stocks available. The Government has no immediate intention of rationing power kerosene, but should future circumstances make such action necessary, 1 cun assure the honorable member that all due regard will be paid to the requirements of that product for both primary producers and all other essential users.
y. - On the 12th November, the honorable member for Deakin (Mr. Hutchinson) asked a question concerning the supply of tinplate for cake tin lids. The Minister for Supply and Shipping has supplied the following information : -
Owing to the shortage of supply of tinplate the manufacture of cake tins suitable as containers for sending cakes abroad is prohibited. They require a considerable quantity of tinplate that cannot be made available for this purpose. Manufacturers of domestic tinware, who are severely rationed in their supplies, do manufacture, however, a re-usable cake tin as a piece of kitchen equipment. This is an entirely different model and a lid is neither practicable, necessary or desirable. No doubt this is the type of tin to -which the question referred.
Cancer: Cantassium Tablets.
d. - On the 28th October, the honorable member for Wilmot (Mr. Duthie) asked a question concerning an importation at Launceston, Tasmania, of cantassium tablets. The Minister for Trade and Customs has supplied the following information : -
Tlie Customs (Prohibited Imports) Regulations provide that the importation of medicinal preparations, known as “ Cantassium “, whether described by that name or any other name shall be prohibited except with the consent of the Minister for Trade and Customs.
The prohibition was enacted many years ago on the advice of the Director-General of Health with the object of preventing the exploitation of the Australian public with preparations which are considered of no use for the purpose intended. In the administration of the prohibition, however, authority was given to permit importation of these goods in cases whore the Collector of Customs is satisfied that the cantassium is imported by or for a person who is actually suffering from cancer, that it is not intended for sale and also that the quantity imported is not more than would be necessary for such patient.
The parcel cif cantassium tablets referred to by tlie honorable member arrived in Launceston on 13th September, 1947. On the next day the importer’s agent stressed the urgency of the matter and, on being informed of the conditions under which the goods would be delivered undertook to obtain a certificate from the patient’s doctor. The agent was repeatedly reminded by the Customs officer dealing with the transaction to obtain the doctor’s certificate which would have provided authority to release the goods but the certificate was not produced. In the absence of such necessary evidence of the intended disposal of the goods and as the importation was in the name of a wholesale chemist, delivery was withheld. It is understood that it was not until the 19th September that the relatives of the patient were requested by the importer to furnish a doctor’s certificate but by that date the patient had died. As there should be very little difficulty in obtaining proof that a person is actually suffering from cancer, it is considered that no alteration from the existing procedure regarding the importation of cantassium is necessary or warranted.
I can assure the honorable member that the Commonwealth Government would not prohibit the importation of any drugs recognized by competent authorities to be beneficial in the treatment of cancer.
n asked the Minister for Works and Housing, upon notice -
– The answers to the honorable member’s questions are as follows : -
n asked the Minister representing the Minister for Supply and Shipping, upon notice -
– The Minister for Supply and Shipping has supplied the following information : -
Instructions were issued recently to the Liquid Fuel Control Boards in all States that long distance travel by motor vehicle should bo eliminated in respect of both business and particularly pleasure journeys, unless there are very urgent reasons for justifying such travel such as the owner of the vehicle being on permanent transfer from one State to another and unable to arrange for the transport of his vehicle by either boat or rail.
Since these instructions were issued, information such as that brought to notice by the honorable member has been received by the various fuel boards, which are taking special action to check the position and eliminate all unessential travel of this nature.
In addition, a conference is being held in Melbourne this week at which all Liquid Fued Boards will be represented. This conference will, in conjunction with a recently constituted oil advisory committee, consider all aspects associated with the control of motor spirit, including action necessary to eliminate unauthorized journeys of the type referred to by the honorable member.
Broadcasting : Australian
t asked the Minister representing the Postmaster-General, upon notice- -
– The PostmasterGeneral has supplied the following information : -
n asked the Minister representing the Minister for Supply and Shipping, upon notice -
– The answers to the honorable member’s questions are as follows : -
Settlement for recent purchases by the mission has already been made, but 30 days’ credit will be allowed in respect to any future purchases should the mission so desire.
Rail TRANSPORT: Burial o» Mr. V. H. Allen.
n asked the Minister for the Interior, upon notice -
– The answers to the honorable member’s questions are as follows: -
Cite as: Australia, House of Representatives, Debates, 18 November 1947, viewed 22 October 2017, <http://historichansard.net/hofreps/1947/19471118_reps_18_194/>.