19th Parliament · 1st Session
Mr. Speaker (Hon. Archie Cameron) took the chair at 2.30 p.m., and read prayers.
– Can the Prime Minister say whether the German spy, Count von Luckner, came to Australia just before the outbreak ofwar in response to an invitation from the anti-Labour Government which was then in power? Was he given any official government welcome, such as a Cabinet dinner, or were any other functions arranged in his honour during his stay in this country? If so, what was their nature, and what was the cost to the people of Australia ? Did Count von Luckner conduct in a ship off the Australian coast a ballot of Germans and Austrians resident in this country, and were ‘there present on the ship on that occasion prominent members of the anti-Labour parties?
– I have no knowledge whatever of the matters referred to by the honorable member, never having seen the gentleman referred to and, although a member of this Government at that time, never having previously heard the suggestion that he had been in some way received or entertained by the Government. I certainly do not intend to take up the time of any member of my staff on an investigation of such remarkable, late-coming suggestions as those put forward by the honorable member.
– The Prime Minister knows that they are true.
– I believe that they are just about as true as most of the other suggestions that the honorable gentleman has made.
– In the Sydney Morning Herald of Friday last, there was published a cablegram which stated that the Court of Appeals of the State of California had, on the previous day, ruled that the United Nations Charter prevailed over the State law of the United States of America. The case was an appeal against a law of the State of California that restricted the ownership of land by aliens. The appeal court held that United States law could not violate the human Tights article of the United Nations Charter. Legal experts in the United States have declared that this decision will have far-reaching effects, and that the rulings of courts in other parts of the world may also be upset if they are in conflict with the human rights article of the United Nations Charter. Does the Minister for External Affairs agree that Australian domestic law could be upset in that way? If so, what effect will the human rights article of the Charter have on our immigration laws, particularly in relation to the admission of known Communists, or other undesirable aliens not acceptable in this country, seeing that the international covenant provides that an individual may choose his country of residence?
– I am satisfied that no commitment has been entered into by the Commonwealth of Australia which would in any way limit the power of the Commonwealth to prohibit aliens or other persons from coming into the country if it was thought fit to exclude them under our immigration law. As for the inadvisable, in answer to a question, to embark on a discussion of the legal effects consequent upon the adoption by this Parliament of treaties on international relations. I think it is sufficient to say that it has ‘been made quite clear that by the exercise of our external affairs power, the field of legislative operation of the Australian Parliament can be extended even into what would normally be regarded as the domestic spheres of the States. The questions asked by the honorable member invite more elaborate consideration and reply. I shall give them further consideration and furnish a more detailed answer to the House as early as possible.
– Can the Minister for Health enlarge upon the details of his long-awaited national health plan, which was the subject of a broadcast at the week-end, by explaining, first, when the measure to give effect to the plan will be introduced into the Parliament; secondly, whether those who need protection from the crippling financial aftermath of illness and hospital treatment will either have to take out an insurance policy or join an approved friendly society, in addition to paying the special taxes which they thought would cover these very contingencies; and, thirdly, whether there is to be a means test or a limitation of eligibility to participate in the voluntary scheme according to income ?
– In reply to the last part of the question, I assure the honorable member that no means test of any sort will be applied. With regard to the other matters that he has mentioned, I assure him that full details of the scheme will be announced in this Parliament in due course. All I can say is that the period of gestation of the health scheme of this Government will be many years shorter than the period of gestation of the health plan of the previous Government.
– In the promised statement on the health scheme, will the Minister for Health say what answer he has to make to the Premier of New South Wales, Mr. McGirr, who has called the -Minister’s scheme a bare-faced swindle and a pay-off to the insurance companies for election help which will cost taxpayers £7 a year without adding anything substantial to the solution of the problem of public health? Will the Minister for Health also define his position in relation to the allegation of the president of the New .South Wales Taxpayers Association, Mr. White, that the health scheme is only another tax? Finally, will the Minister tell the House why he made a piecemeal announcement over the radio and so far ha9 consistently refused to give a full statement to the House ?
– I did not make a piecemeal statement over the radio. I made a broad and comprehensive statement of policy. Regarding Mr. McGirr ‘s accusation I remind honorable members that the last federal medical measure that was denounced by Mr. McGirr was the Tuberculosis Act of the Chifley Government which, in my opinion, was one of the best measures introduced by that Government. Mr. McGirr has not so far taken the requisite action in regard to that legislation and if he wants to class the Government’s health bill in the same category in describing it as a swindle, I am quite content to be in that company. The greatest health swindle in the world at present is the enormous wanton waste of the time, skill, money and health of doctors that i3 going on under the governmentcontrolled schemes of England and New Zealand. With regard to the comment, of the Taxpayers Association, it will be found that when the Government’s programme is brought forward, the amount of government contribution will greatly exceed the proportion of social services tax that is expended in relation to health.
– I address a question to the Minister for the Army. As the result of many inquiries that I have received on the subject, I ask the honorable gentleman whether he can announce now the names of those who will be appointed to the committee that is to investigate the claim of former prisoners of war for a subsistence allowance of 3s. a day during the period of their incarceration. If he is not yet able to do so, when will such an announcement be made, and when will the committee commence its investigations?
– I regret that it is not yet possible for me to announce the personnel of the committee. I am still waiting for ex-servicemen’s organizations to submit the names of the persons whom they wish to he considered for appointment to the committee. One very prominent group of ex-servicemen’s organizations has asked me to extend the time for the receipt of its panel of names until the 10th May. I have agreed to do so. The group has explained that it desires to obtain from its State branches the names of persons whom they desire to be included on the panel from which the Government will make the final choice. I hope to be able to make a statement relating to the personnel of the committee very shortly after the 10th May. The committee will then be given its terms of reference and I hope that it will make its report as quickly as possible.
– I direct a question to the Minister representing the Minister for Repatriation in relation to the establishment of neurosis clinics for treatment of ex-service men and women. In explanation of the question, I point out that in a reply which I received to a previous question on this subject I was informed that the Government would provide for the treatment of neurosis cases through repatriation establishments. Groups of exservicemen’s organizations in New South Wales desire to establish clinics in their own districts. Will the Government make available money from canteen funds, or from other sources, to assist these organizations to establish such neurosis clinics?
– I shall be pleased to bring the honorable member’s question to the notice of the Minister for Repatriation and I shall ask for an early reply.
– Can the Minister for External Affairs state whether consultations are taking place between representatives of British Commonwealth countries for the purpose of altering the title of the King of Great Britain so as to include in the Royal title all the members of the British Commonwealth? Will the honorable gentleman give an assurance that whatever action is taken, the title of “ King “ will be retained as a symbol of the unity of the democratic British countries and of their common bonds of loyalty to the British Crown?
– I am unaware of any consultation which may be taking place in relation to the subject of the honorable member’s question. The Australian Government has not been approached on the matter during the time that I have been Minister for External Affairs. I have seen in the press suggestions that approaches ave being made or are about to be made by some other people to alter the title of His Majesty, I understand that the suggestion is that the change might be made so that he would become the King of Australia, the King of South Africa or the King of some other part of the Empire. The Australian Government sees no reason to alter His Majesty’s present title, with which it is perfectly satisfied. I am of the opinion that if any alterations were made they would be to the prejudice of the ties of loyalty that bind us to the Crown.
– As the, Government has now been in office for six mo::ths and much has been said from time to time by Government spokesmen concerning proposed developmental work, I ask the Minister for National Development what practical steps the Government has taken in regard to the inauguration of works which will have a defence as well as a developmental value in northern Australia ?
– It would require a longer statement than you would probably allow me to make, Mr. .Speaker, for me to reply in detail to the honorable member’s question. The Government has a number of proposals under consideration which have come from the Government of Queensland. One of them is the Burdekin Valley development scheme which has been the subject of a good deal of political comment by the Premier of Queensland during the last six week. The Australian Government is still waiting to receive from the Government of Queensland essential facts concerning the scheme. These are facts which any government would find it essential to have available before it could commit the people of Australia to the tens of millions of pounds of expenditure entailed in the scheme. There is one, and there are possibly two, other proposals that have been received very recently from the Government of Queensland which are now under examination.
Every assurance has been given by the Prime Minister, the Treasurer, and other Ministers, including myself, that the Government is determined to assist to” the maximum of its power in the development of northern Queensland, in addition to carrying out a great many other tasks. The population of northern Queensland, for reasons which I need not go into, has been almost stationary for half a generaration. That is an Australia-wide as well as a Queensland preoccupation, and it is a problem which this Government is determined to solve, largely through the instrumentality of development.
– Early in this session I asked a question concerning the Oaklands coal-field and was told that mapping was in progress. I now ask the Minister for National Development whether this mapping has been completed.
– The honorable gentleman’s question concerns the potential coal-field at Oaklands which is about 30 miles north-west of Corowa in the southwest of New South Wales. When I answered the honorable gentleman’s question previously I gave him an indicacation from the Bureau of Mineral Resources that the field seemed to have potentialities covering about 50 square miles. Further work which has been carried out in the meantime shows that that estimate is likely to be a gross understatement and that the field appears to have potentialities covering about 600 square miles. Although nothing is yet known definitely, I .believe that this field contains most important developmental potentialities. The Bureau of Mineral Resources which is part of the Ministry of National Development, by arrangement with the Mines Department of New South Wales and the Joint Coal Board, is just about to start a programme of drilling in this field. In the first place five holes will be drilled, possibly down to 2,000 feet. I am not saying that coal is present ‘over the whole of this area by any means although nil the geological, geophysical and other practical evidence shows that there is a wide area of coal. If this is found to be the case, the Oaklands field may be a big factor in the development of that part of Australia. Should that be so, the field vill be fortunately placed in the Murray /alley near other resources to which the coal will be complementary. I shall be glad to keep the honorable member informed of development.
– Has the Minister for Labour and National Service any information to give to the House concerning the report that pit-top meetings would be held on the coal-fields this morning?
– I am advised that following the instruction issued by the central executive “f the coal-miners federation, pit-top meetings were held this morning, and of th. 155 coal mines in New South Wales, 63 have stopped work to-day and 92 are working. The estimated loss of coal is from 26,000 to 29,000 tons. I have no details yet of the resolutions that were adopted by the meetings, but I gather that no proposal has yet been made for a general strike on the coal-fields. A heartening feature of the situation is that Burwood mine on the northern coal-fields, which is one of the biggest producers of coal in 2?ew South Wales, is back at work.
– In view of the tremendous demand, particularly in rural areas, for heavy tractors, bulldozers and similar equipment, can the Minister for Development give some indication of what steps a’e being taken to meet this shortage?
– The honorable member’s question can be answered in several parts. First of all, the Australian Government is devoting as much as it can possibly afford out of its limited dollar resources to the importation of developmental equipment from the United States. It would be very difficult to increase the dollar allocation for this purpose, considering the many other calls on limited dollar funds. Equipment is also being manufactured in Australia on an increasing scale. Crawler type tractors are not yet made in Australia, but no less than six or seven manufacturers of this type of equipment are now considering setting up plant to manufacture those vehicles and ancillary equipment. Some equipment is also obtainable from Great Britain and other soft currency countries, where sources of supply are being investigated by my department. The Government is willing to encourage the importation of any equipment that offers promise of having a useful life in Australia.
– Is the Treasurer aware that the Commonwealth Bank makes housing loans available to its employees at an interest charge of 2 per cent.? Is he also aware that the Commonwealth Bank charges members” of the general public 3£ per cent, interest on housing loans ? Will he inform the House whether there is any reason why the Commonwealth Bank should not make housing loans available to the public. at the same rate of interest as bank employees pay? Will he instruct the Commonwealth Bank to provide housing loans at 2-£ per cent, interest for all home-seekers so that the benefits of home ownership may be brought within the reach of every family in the community?
– First and foremost, I remind the honorable member that control of interest rates was introduced by the Chifley Government. The other factors involved in his questions will be brought to the notice of the Governor of the Commonwealth Bank, under whose administration the bank is carried on without political interference.
– In view of the report that economically workable iron ore deposits in the United States of America are nearing exhaustion and that the American steel industry will be compelled by 1959 to look to foreign material sources for about 3,500,000 tons of supplies, will the Minister for National Development inform the House of any action that is being taken to develop the iron ore deposits at Yampi Sound? Are geophysical surveys being made with a view to finding other deposits of ore suitable for export, particularly to dollar countries ?
– With respect, I query the honorable member’s statement that the United States of America is becoming short of iron ore. Such stories have been reported in the past, but I have been given to understand that many years will elapse before the United States will require to draw upon iron ore resources outside its own hemisphere. I am unaware of the existence in Australia of very large deposits of workable iron ore that would enable us to contemplate the export of that commodity. However, I fully expect that an aerial magnetic survey, which would be appropriate to the discovery of large masses of iron ore, will be undertaken by the Department, of National Development during the next twelve months. That should bring to light any large accretions of iron ore thai might conceivably permit Australia to engage in the export trade in the future.
– It has come to my notice, following a trip to New Zealand by some Tasmanian farmers, that Australian galvanized iron’ is being hawked around New Zealand. I ask the Prime Minister whether it is a fact that token shipments of Australian iron, steel, wire and galvanized iron are being despatched to New Zealand. If so, will the Prime Minister ascertain whether New Zealand really requires the present quantities being imported, and if not will the Government reduce such shipments in view of the desperate need for those materials in Australia?
– I shall be glad to have the matter raised by the honorable member investigated at once by my appropriate colleague.
– I ask the Minister for Commerce and Agriculture whether it is a fact that there is a market for tallow in the dollar area at world parity prices and that Australian meat packers and butchers are compelled to sell their tallow to the United Kingdom Ministry of Food at prices below world parity. Is it a fact that the butchers and meat packers are unable to obtain such commodities as sausage casings, which cannot be purchased in. the sterling area ? Is the system of hides and tallow control still in operation? If so. can the Minister inform the House whether the Government intends to continue that scheme, which is estimated to have deprived the producers of approximately £13,000,000 per annum during the regime of the Labour Government?
– I am not personally aware that Australian tallow can be sold in the dollar area, but I have no doubt that that is so. The same may he said, of course, of other products., If we were to export all our produce to the dollar area merely because there was a sale there for it, we should be depriving the United Kingdom market of those goods. The availability of markets in dollar countries is not the only test to be applied. I do not doubt that butchers are experiencing a shortage of sausage casings. It has been the practice to import casings of certain types from, the United States of America. At present such imports are confined to a certain percentage of the pre-war trade. The increase of imports of casings is not merely a matter of sending more tallow to the United States of America. Priorities must be considered. There are many essential goods that we require from the dollar area. The hides and leather control remains in force. Its authority is based upon joint Commonwealth and State legislation, and it would not be reasonable for this Parliament alone to abolish it. Frankly. I have not yet got round to a close examination of the tallow control, and its continuance is a matter of policy that will be decided in due course.
– Will the Minister for the Interior consider the appointment of special investigators to examine and report upon the disabilities under which residents of Canberra labour? I suggest that such an examination should include the efficiency of hygiene supervision. Is there any evidence of exorbitant prices and an absence of real competition in this city? »To what extent does a prominent real estate firm control letting and restrict opportunities for the infusion of new business blood into this city? Will the department facilitate the establishment of departmental stores in Canberra?
– I shall give consideration to the honorable member’s requests.
– Can the Minister for External Affairs say whether any progress has been made in the furthering of arrangements to bring to this country the children of a number of Greek immigrants, now Australian citizens, who were separated from their families during the civil war in Greece? The plight of these unfortunate families, broken up by war, has stirred the sympathies of the world. The Council for International Social Services and the International Red Cross have worked unremittingly in their interests, and many of the children have been traced to Yugoslavia. It is known that, as long ago as October last, the Yugoslav Government agreed on the grounds of humanity to a request from the Australian Government that Greek children whose parents are now in Australia should be allowed to rejoin them. Can the Minister say whether there is any immediate propect of the arrival of some of these children?
– This problem has been brought to my notice since I have been Minister for External Affairs, and I am glad to be able to say that recently, following discussions that I had with the Minister for Immigration and the Treasurer, I was able to make arrangements to fly these children out of Yugoslavia to Rome where they will be picked up to be flown to Australia. In view of the humanitarian aspect of this matter, and the long separation of the children from their parents, it was considered that the Government, without establishing a precedent, should fly the children to Australia so that the families could be re-united as soon as possible. I expect some of the children to reach here shortly.
– My question to the Minister for Immigration follows a question asked him yesterday regarding the failure of certain foreign migrants to join the unions appropriate to their callings in this country. I ask the Minister whether it is a fact that the majority of the displaced persons who have arrived in Australia have been victims of Communist aggression in the countries from which they have come, and that they arrive here with the most lively hatred and detestation of the whole Communist system? Is not their reluctance to join unions or support the Australian Labour party due to the fact that a number of unions are Communist controlled and that in the Australian Labour party, which the unions support, there are a number of Communist sympathizers? Also, is it not a fact that even now that party is unable to make up its mind on its attitude towards the Communist Party Dissolution Bill?
– All I can say in reply to the honorable member is that it is notable that the cases of migrants expressing reluctance to join, or refusing to join, a particular union, have been more frequent in relation to unions which would be recognized by most members of this House as being strongly influenced by Communists or Communist controlled. In most cases, as I mentioned yesterday, these matters have been satisfactorily adjusted. I must say that since I have been in office, almost without exception, the officials of the trade union movement have been cooperative in their dealings with new Australians. I can think of the existence of no serious difficulties at the present time. It must be recognized by union officials, and indeed by those generally who claim that the migrants should join the unions, that there is a corresponding obligation upon those who control the trade union movement of Australia, and particular unions. That obligation is that, provided the qualifications of the migrants are up to the standard required, the doors of the unions should be open to them. I am certain that honorable members in this House would not favour the creation by either a private or a trade union organization, of a monopoly which would restrict the opportunities which would otherwise be available to new Australians.
– On Tuesday last the Prime Minister stated in this House the he required the passage of the Commonwealth Bank Bill, the Social Services Consolidation Bill, the Communist Party Dissolution Bill and the constitutional legislation, by the end of the session, which he hoped would be early in June. I ask the Prime Minister whether pen-‘- &i oners’ claims for increases are to be postponed until the reassembly of Parliament in September? Having regard to the high cost of living is it the Government’s intention to increase, during the present session, the rates of age, invalid, widow and soldier pensions?
– I have already indicated, and I want to make it abundantly clear, that it is not the practice of the present Government, nor, indeed, of any government, to make announcements of policy matters of that kind in answer to questions. When the Government has financial proposals to lay before the House it will lay them before the House.
– Following a question that I asked the Minister for Commerce and Agriculture on a previous occasion, I now ask the Minister whether he has :>ny further information concerning the election of Victorian members to the Australian Wheat Board ?
– I am now able to inform the honorable member and the House that arrangement have been completed for the election, in terms of the relevant legislation, of two Victorian wheat-growers to the Australian Wheat Board, and, concurrently, of one South Australian grower representative. Nominations will close on the 1st June, and the election will take place on the 20th July.
– Will the Treasurer say whether his statement that a” decision on the proposal to finance the scheme for the development of the Burdekin Valley, which is estimated to cost £29,000,000, will be determined on economic considerations, means a repudiation of the agreement made by the Chifley Government to pay half the cost involved (! If so, are the people of Queensland to interpret the Government’s refusal to provide the money as an indication that the outlook of the present Government is the same as that of the former Menzies and. Fadden Administrations, in that it is bounded on the north side by Sydney Harbour Bridge and on the south side by :the River Yarra ? Does it also mean that, for a second time, a Liberal-Country party Government has abandoned all Queensland north of the “ Brisbane line “?
– I have stated until I am tired of doing so that the financial soundness of the Burdekin River developmental scheme, or of any other scheme, will be thoroughly investigated by the Government before it authorizes expenditure upon it. On the point raised by the honorable member about whether a promise was given by the previous Government involves a matter of fact. No evidence whatever is available to indicate that any promise was given. Indeed, the correspondence that has since been received from the Premier of Queensland points out quite definitely that no financial promise was made-
– That is not true.
– In a letter written to the present Prime Minister on the 5th April, the Premier of Queensland pointed out that he “ understood “ that the Chifley Government was prepared to advance at least 50 per cent, of the cost of the Burdekin Valley scheme provided that the report of the investigating committee favoured the proposal. However, the report of the investigating committee was not favorable to the proposal. The whole scheme had had only a cursory examination. Although I am a Queenslander, I want to emphasize that a sound proposal must be placed before the Government. No public money will be wasted.
– by leave - I was not in the House last night when reference was made by the honorable member for Yarra (Mr. Keon) to Radio Australia, and to my share in the transfer of that instrumentality to the Australian Broadcasting Commission. I want to say straight away that the honorable member was kind enough earlier in the evening to tell me that he proposed to raise that matter on the adjournment, and I was here when the- debate on the adjournment commenced, but before the honorable member received the call to speak, I was called . away to a conference with the Prime Minister (Mr. Menzies) and was not able to return to the chamber in time to hear his remarks. However. I acknowledge that the honorable gentleman was kind enough to give me the warning of his intention to refer to Radio Australia. The matter arises from a statement in the political column of the Daily Telegraph about the 26th April last, to the effect that the reduction a’’ the activities of Radio Australia had had one result for which I, as Minister, had not bargained. It was further stated in the gossip column, or whatever it is, that Soviet Russia had taken over one of the abandoned wave lengths, and had used it for the rising air offensive agains: America. Following upon that statement, the honorable member for Parkes (Mr. Haylen) directed a question to thu Minister representing the PostmasterGeneral relative to that matter, but as everybody knew, that Minister was away ill, and the Prime Minister replied briefly that he would inquire into it. Yesterday he supplied a written answer to that question I shall not read the preliminary part of it, but the substantial part of it is as follows: -
Following on the decision of the Government to place the short-wave broadcasting operations under the control of the PostmasterGeneral and to restrict certain transmissions to overseas countries, discussions are now proceeding regarding the extent to which the transmissions from Radio Australia should be re-arranged and the short-wave services integrated with transmission for reception in isolated areas in Australia and the territories. It is not expected, however, that any changes made will affect the high frequency channels registered for use by Australia. When definite proposals have been formulated a statement will be issued in connexion with the matter.
I also answered a question by Mr. Keon yesterday-
– Order ! An honorable member must be referred to by hi; constituency and not by his own name.
– I am sorry. The honorable member for Yarra asked the following question : -
Has the attention of the Minister -for the Interior been directed to a report in this morning’s press that dismissal notices given to some persons employed by Radio Australia have been withdrawn as a result of military protests against the curtailment of our shortwave broadcasts to places overseas? If the report is correct, will the Government undertake that in future some notice will be taken of protests by members of the Opposition against futile and stupid curtailments of public services ?
I, as the former Minister for Information, who was in charge of Radio Australia, replied to the question, and I said -
As far as I am aware, the report is incorrect.
I may add now that it is still incorrect.
My answer continued -
Radio Australia is now being operated by the Australian Broadcasting Commission for a greater number of hours than hitherto and at approximately half the former cost.
– That is incorrect.
– That is perfectly correct, and it is in respect of that matter that I have risen to make this explanation. Last night, the honorable member for Yarra raised the subject again on the motion for the adjournment, and accused me of stating deliberate falsehoods in respect of that part of the matter. I shall not go into any detail about his remarks last night, because most of them wei answered by the Minister for External Affairs (Mr. Spender). However, the honorable member repeated his allegation that military protests had been made against the curtailment of our short-wave broadcasts to places overseas, and tha; statement, which is quite incorrect, was denied by the Minister, who has a personal knowledge of the matter. A further allegation was made to the effect that dismissal notices which had been issued to five announcers on the staff of Radio Australia had been withdrawn as the result of certain representations that had been made. That statement was also denied by the Minister. Yet another allegation which was made was that I had told a deliberate falsehood to the House when I stated that the Australian Broadcasting Commission was operating Radio Australia for a greater number of -hours than hitherto and at approximately half the former cost.
– It was an evasion, not a falsehood.
– The Government decided to transfer Radio Australia to the Australian Broadcasting Commission, and that was done.
Mr. Haylen interjecting,
– If the honorable member for Parkes (Mr. Haylen) wants a debate on Radio Australia, he may have it at any time, -but I suggest that, for the benefit of the persons who operated it formerly, it would be better not to have a debate of that kind. When the transfer took place, it was necessary to integrate the staff of the two organizations. As the Australian Broadcasting Commission had a large standing organization, it was obvious that it would be necessary to dismiss or terminate the employment of some of the members of the staff of Radio Australia.
I stated yesterday that Radio Australia is now being operated for a greater number of hours than hitherto. That statement was perfectly correct. Previously, Radio Australia, which was then engaged1 almost exclusively in broadcasting tocountries overseas, was in operation for as long as 23 hours a day. I have nopersonal knowledge of the matter, becauseit is the responsibility of the PostmasterGeneral, but I understand that that activity has been curtailed. There hasalso been - and I mention it because it isrelevant to the question of dismissals and. terminations of employment - an expansion of the domestic programme of RadioAustralia. It is now broadcasting more programmes to central Australia and other, places that are not normally reached by the ordinary home services. In otherwords, it is providing, from the Shepparton transmitters, a home service on a larger scale than previously. In theaggregate, it is operating for a greater number of hours than hitherto. My authority for that statement is a very senior official of the Australian Broadcasting Commission, whose word nohonorable member on either side of the House would challenge. When the honorable member for Yarra told the House that I had spoken deliberate falsehoods, he was under a complete misapprehension. In fact, it is completely and specifically true to say that RadioAustralia is now broadcasting for a greater number of hours than previously.
Mr. CALWELL (Melbourne).by leave - Will the Minister for Supply (Mr. Beale) prepare a statement showing the effects of the transfer, in order that,, under the new Standing Orders, we may have the debate to which he has said he is not averse?
– I shall arrange for a statement to be prepared and presented to the House.
Motion (by Mr. Chifley) proposedThat leave of absence for one month be granted to the honorable member for Hunter (Mr. James) on the ground of ill health.
– In supporting the motion, I wish to say that all honorable members have observed with great regret, not only the ill health of the honorable member for Hunter, but also the fact that he has once more suffered a most grievous family loss. I should like him to know that we have him in our minds on both counts.
Question resolved in the affirmative.
Motion (by Mr. Menzies) agreed to -
That leave be given to bring in a bill for an act to alter the provisions of the Constitution relating to the Senate.
In committee: Consideration resumed from the 3rd May (vide page 2172). Clause 11 (Disposal of profits).
.- The Opposition has no major objection to the proposed section 47, but I should like some clarification from the Treasurer (Mr. Fadden) regarding the distribution of the profits accruing from the bank’s control of the note issue. The proposed section provides that the profit from the note issue, which last year, if my memory serves me right, was about £4,000,000, shall be distributed in a certain way, after the payment of expenses associated with note issue control. I do not propose to weary the committee by reading the provisions at length. Will the Treasurer, however, inform me whether the amounts to be paid under sub-section (3.) of the proposed section may be altered, as one division or department may require more and another division or department less than the amount paid to it under section 15? Will the provisions of the proposed section 47 permit the apportionment of the note issue profits among the divisions and departments to be altered subject to the Treasurer’s approval?
– Yes, that is so.
– As the Treasurer assures me that, subject to his approval, the amounts apportioned can be altered, we offer no opposition to the proposal.
.- The clause under discussion has a very vital bearing on the well-being of the bank and of this country. The committee having resolved that the bank is to be controlled by a board, now has the next vital responsibility of ensuring that the bank, in all its departments, shall have sufficient capital to operate effectively and to give the service that it should give to this country. The bank will be unable to render maximum service to the community unless it has at its disposal sufficient capital to enable it to expand. That is true particularly at a time when we are experiencing inflationary conditions. For instance, a sum that would have been sufficient to finance many projects three years ago would be totally inadequate for the same purpose to-day having regard to the present spiralling of costs and inflationary conditions generally. The Government must not only place the Commonwealth Bank under the control of a board in accordance with the mandate that it received from the people at the last general election but it must also ensure that the hank will be given every opportunity to expand.
Official statistics show that from the 1st July, 1924, to the 30th June, 1945, the profits of the Note Issue Department totalled approximately £27,369,000 and that from those profits £25,125,000 was paid to Consolidated Revenue and £2,000.000 was paid to the Rural Credits Department, whilst the sum of £264,000 was transferred to the capital account of the Mortgage Bank Department. During the whole of that period the bank was controlled by a board. From the 1st
July, 1945, to the 30th June, 1949, when the hank was controlled by a Governor following the abolition of the board, the profits of the Note Issue Department totalled £15,878,000 of which £15,278,000 was paid to Consolidated Revenue and £600,000 was transferred to the capital account of the Mortgage Bank Department. Thus, having regard to inflationary conditions, the provision made for the expansion of the bank during recent years ha3 been totally inadequate. The Commonwealth Bank assumed control of the Note Issue Department in 1920 and since that year the profits from the note issue have exceeded £47,000,000. Of this amount, £44,000,000 has been paid into Consolidated Revenue, £864,000 to the capital of the Mortgage Bank Department, and, in accordance with the provisions of the Commonwealth Bank Act 1925, £2,000,000 of the profits from the note issue has been transferred to the capital of the Rural Credits Departments. It will be seen, therefore, that the amending legislation of 1925, which was introduced by the Bruce-Page Government, provided for the inauguration of the Rural Credits Department, and for making capital available for its operation. The transfer of £864,000 to the capital of the Mortgage Bank Department was made in accordance with legislation passed in 1943 and 1945, under which £150,000 from the profits of the note issue became available for this purpose each year. The legislation also provided that one-quarter of the profits of the Commonwealth Bank should become capital for the Mortgage Bank Department.
When the present Government took office, it found that the various departments of. the Commonwealth Bank had insufficient capital to meet the growing needs of the community. If honorable members examine the figures relating to those departments, they will realize that the Government has acted wisely in placing them under the control of a board, because their activities are too diverse and complicated to be within the understanding of one person, however competent he may be. Under the terms of the Commonwealth Bank Act 1945, the profits from the note issue are to be paid in full into Consolidated Revenue, except for £15u,000 a year which is added tothe capital of the Mortgage Bank Department, and it is provided that the payments shall continue only until the capital of the department reaches £4,000,000. After that, the bank would be restricted in its activities, unless quick action were taken by the Government. However, under the present bill, an amount of £500,000 may be paid each year from the profits of the’ note issue into- the capital of the various departments of the Commonwealth Bank for a period of five years.
– Order! The honorable member’s time has expired.
.- Clause 11 deals with the disposal of the profits of the Commonwealth Bank, and provides that profits from the note issue shall be transferred to the capital of the four departments of the bank. The Treasurer (Mr. Fadden) has assured us that there is need to increase the capital of the various branches, and he referred particularly to the General Banking Division. He promised that this division would compete with the general trading banks. The principal demand on the resources of the General Banking Division, he said, was for loans for housing, especially from co-operative building societies. The responsibility for finding money for that purpose, he said, was falling heavily and increasingly upon the Commonwealth Bank, because the trading banks were not very keen on getting such business. The Treasurer said that the Rural Credits Department and the Mortgage Bank Department had been established to meet special needs. Competition between the Industrial Finance Department and the trading banks was also limited, so that there was a particularly heavy demand upon tie Industrial Finance Department for hire-purchase facilities in connexion with farm equipment, including trucks and other motor vehicles. The private banks, he said, did not provide those facilities for the public. Thus, according to the explanation of the Treasurer himself, whilst it is proposed to increase the capital of the four departments of the Commonwealth Bank, the suggestion that there is to be keen competition with the trading banks is just so much eye-wash. I strongly support the proposal to increase the capital of the various departments of the Commonwealth Bank, hut the proposed increase is to be small, and the Government has taken care that the capital shall be used in such a way as to interfere as little as possible with the activities of the trading banks. Competition with the trading banks will be practically nil, and their profits will not be diminished as a result of the activities of the Commonwealth Bank. The clause now under discussion is in keeping with the other clauses of the bill in that ; while presenting an impressive shop-front to impress the people, they conceal a very shady structure. The Government is pretending to do everything possible to promote the expansion of the Commonwealth Bank, but when we examine the position we see that it is taking all precautions to ensure that there shall be no real competition with the trading hanks.
The Treasurer said that, oyer a period of five years, the capital of the four departments of the Commonwealth Bank would be increased by a total of £5,000,000, and he contrasted that proposal with what he suggested was the niggardly attitude of the Labour government. He said that the increased capital would enable the departments of the bank to give better service to the community by expanding their operations. Wow, let us examine the position. The General Banking Division is the one which competes, however slightly, with t-he trading banks, and it is to be supplied with additional capital to enable it to help in providing homes for the people. During the next five years, the capital of this department is to be increased by £1,400,000, or £280,000 a year, allegedly for the purpose of providing Joans for home-seekers. According to statements that have been made in this chamber there are 410 branches of the Commonwealth Bank throughout Australia. The additional capital to be made available to this department will provide only £700 per annum for each branch of the bank for advances to persons who desire to purchase homes. A prospective home purchaser would require at the very least an advance of £1,500. On that basis, each branch will be able to finance the purchase of one additional home every two years. Yet we have been told that wonderful improvements would be made in the operation of the Commonwealth Bank as the result of the policy of this Government.
Let u3 now consider the position in respect of the Rural Credits Department, the capital of which is to be increased by £700,000. Spread over the whole Commonwealth that amount will enable each branch of the bank to issue to primary producers who require financial assistance additional credits amounting in total to only £340 a year. The position of the Mortgage Bank Department will be no better. The provision of an additional amount of £1,500,000 for that department represents approximately £700 a year for each branch of the bank.
– I rise to order. Thu committee is now considering clause 11, but the honorable member for Wills (Mr. Bryson) is discussing clause 13. I submit that the Chair should direct him to confine his remarks to the clause now before the committee.
– I regard clauses 12, 13 and 14 as the concomitants of clause 11. I have permitted other honorable members to discuss all of those clauses and .1 accordingly rule that the honorable member for Wills is in order in so doing.
– The Treasurer (Mr. Fadden) has made special reference to the activities of the Industrial Finance Department of the bank because of the particularly heavy demand for finance for the purchase of trucks and other motor vehicles under the hire-purchase system. In order to meet that excessive demand the right honorable gentleman proposes to provide an additional amount of £1,400,000 over a period of five years. Again that represents an average of £700 a year for each branch of the bank.
The TEMPORARY CHAIRMAN.Order! The honorable member’s time has expired.
.- Clause 14 relates to the Industrial Finance Department of the Commonwealth Bank which makes advances for the purpose of industrial expansion. Time and time again during the general election campaign Government supporters and their propaganda organs stated that the Labour party stood for the total destruction of private enterprise and advocated the ownership and operation of the means of production, distribution and exchange by the almightly State. Strangely enough that party, which is so often accused of advocating such a policy, was responsible for the establishment of the Industrial Finance Department of the Commonwealth Bank. The Labour Government made available to that department millions of pounds for advances to small business men to establish their own businesses or to carry on existing businesses. Surely such an action is the very antithesis of socialism as it is interpreted by honorable members opposite. If the Labour party was so eager to destroy private enterprise and the small individual proprietor, as honorable members opposite alleged during the election campaign, it went about the task in a very peculiar manner. Is that the sort of socialism to which the anti-Labour parties object? The proof of the pudding is in the eating. What counts is not what the honorable members opposite claim that Labour means by its policy, but what the Labour Government did during the years when it was in office. By the provision of finance through the Industrial Finance Department of the Bank hundreds of thousands of small proprietors, who had not been able to obtain from any other source assistance to establish businesses or to carry on existing businesses, were set on their feet because Labour desired that people should work for themselves, own their own means of production, distribution and exchange, and retain for themselves the profits derived from, such ownership. In contrast with Labour’s socialist policy, which seeks to ensure that the most effective use shall be made of the means of production, distribution and exchange, is the policy of the so-called champions of private enterprise who sit on the other side of the chamber and, in the past, have invariably opposed attempts to increase the capital of that department of the bank. Now, however, because of the tremendous success that has attended the activities of that department they pay lip service to it by giving it token support. They propose that the capital of the department shall be increased by £2,000,000. The private enterprise which honorable members opposite believe in is not -the private enterprise that the Labour party assisted through the Industrial Finance Department of the bank - the small business man who is seeking’ assistance to start a business, or to carry on an existing business in the face of competition by a monopoly - but the sort of private enterprise that is represented by the Broken Hill Company Proprietary Limited, Australian Consolidated Industries Limited, Industrial Acceptance Corporation Limited and similar concerns. Wherever Liberal or Country party governments are in office, whether in the State or federal sphere, they mouth support for the ideal of private enterprise; but the facts prove that the only political party that has ever really assisted private enterprise - the small proprietor, the man who is working for himself and is dependent upon the fruits of his own labour - is the Labour party.
The TEMPORARY CHAIRMAN.Order ! The honorable member might touch on the clause now and again. I remind him that it has nothing to do with the ideals of the Labour party.
– Whilst we support the proposal to increase the capital of the Industrial Finance Department by £2,000,000, we regard that amount as only a token support on the part of a Government which claims that it is the champion of private enterprise. No matter how much honorable members opposite may talk about the socialization policy of the Labour party, they cannot deny that Labour has done more for the small individual than has any other political party in this Commonwealth. How will the Industrial Finance Department be administered in the future? Is it intended that it shall compete with large and influential organizations, such as Industrial Acceptance Corporation Limited, and specialize in financing the purchase of motor cars, trucks, refrigerators and the like, under hire purchase agreements ?
– Many of the dealings of that organization are not too good.
– I know that many of them would not stand the light of day. Is this Government, with its hoard of supporters representative of private industries and interested in such concerns as Industrial Acceptance Corporation Limited going- to permit the bank to lend on better terms than that corporation will offer? It is not. As soon as any real conflict occurs between the policy of the Commonwealth Bank and the interests of these gigantic money lending concerns the bank board which the Government proposes to appoint will undoubtedly see that the bank’s competition is withdrawn. That will be done as surely as the board will see that competition of the branches of the Commonwealth Bank with the private banks is withdrawn.
In providing for a further £2,000,000 for the Industrial Finance Department of the Commonwealth Bank the Government is paying tribute to the efforts of the Labour party to encourage private enterprise from one end of Australia to the other and to the Labour party’s assistance in the establishment of hundreds of- thousands of small business men in their own businesses with adequate finance to carry them on. It is paying tribute, also, to the falsity of the statements which Government members made during the election campaign regarding the attitude for the Australian Labour party towards private enterprise.
Industrial Acceptance Corporation Limited specializes in advances for luxury goods and, as a result of the tremendous expansion of its capital permitted by this Government when it removed controls over capital issues, that company has been able to flood the market with a great amount of money which will be used for the purchase of luxury goods and will cause labour and materials to be diverted to the manufacture of those goods from essential projects such as housing. If the Commonwealth Bank controlled the issue of credit some restraint could be exercised on the issue of capital for the purchase of luxury goods and the consequent diversion of materials from essential projects.
– Order ! The honorable member’s time has expired.
.- It was most extraordinary to hear the honorable member for Yarra (Mr. Keon) stating that the previous Government had protected private enterprise. No government in the history of this Commonwealth has done more to protect privilege and monopoly than did the previous Government. The man who was trying to establish a small business found himself faced, during the last eight years, with restrictions and controls which had been imposed by that Government under national security regulations. It is only since the defeat of the Labour government that the small business man has had an opportunity to build up his business.
The honorable member criticized the proposal to provide only £2,000,000 of additional capital for the Industrial Finance Department of the Commonwealth Bank. That amount is £2,000,000 more than the previous Government provided for that section of the bank during the last eight years. As the honorable member realizes, although he did not say so, the acquisition of £2,000,000 enables a bank to lend considerably more than that amount. Every time an advance is made a deposit is created and every bank is able and, in fact, does lend more than its actual capital. I venture to say that the proposed additional capital will make it possible for the bank to expand its activities tremendously. Liberal party policy is one of free competition and free enterprise. The provisions of this additional capital will enable the Commonwealth Bank to lend considerably more money than £2,000,000. Moreover, the private trading banks will also be able to make additional advances. This additional capital for the Commonwealth Bank will be available to the small business man looking for capital in times of crisis. Undoubtedly there is a demand for industrial finance. Action by the Commonwealth Bank to provide finance for new types of business or businesses not previously catered for will fill a gap in this country’s financial system. The Commonwealth Bank will have a great future under its new board and the proposed additional capital will facilitate an increase in the production of this country.
– I think that the honorable member for Sturt (Mr. Wilson) is a little confused concerning this matter. The Capital Issues Board was not set up by a Labour government, but by the previous Menzies-Fadden Government. I think that the Capital Issues Regulations were designed by the present Minister for External Affairs (Mr. Spender), who was then either Acting Treasurer or Treasurer. I happened to be a member of the Capital Issues Board at the time and the purpose of that board, as the honorable member for Yarra* (Mr. Keon) has said, was to restrict the expenditure of money on great quantities of luxury goods. There is a great deal to he said for the continued existence of a board to control capital issues.
– Except that it was illegal.
– Even the AttorneyGeneral’s Department is wrong sometimes. If capital issues cannot be controlled under federal law they should be controlled under State law. The MacArthur and Woolcott-Forbes scandals illustrate the necessity for having appropriate control over capital issues, and what the honorable member for Yarra has said on that subject is completely true. Large quantities of capital, man-power and materials are now going into the production of luxury goods which are in excess of the community’s requirements. The Attorney-General’s Department had advised that the regulations governing capital issues were valid. I can understand the confusion which has existed concerning this matter because I know the view that the High Court has taken recently with regard to defence and war-time security regulations but I wonder how the High Court is going to apply its decisions on recent actions to certain judgments which might have to be given in the future. It is true, as the honorable member for Yarra has said, that some organizations utilize too much labour and material in the production of luxury goods. In consideringthe clause now before the committee, I take my mind back to the inauguration of the Mortgage Bank Department. All themembers of the hank board said that it was ridiculous to attempt to establish such a department in war-time, because there was no staff and- no money and because other physical difficultieswere against the proposal. The Royal Commission on Monetary and Banking systems made it clear that thereshould be some sort of institution that would give an opportunity to borrowers, particularly farmers, to get longterm mortgage advances instead of applicants approaching the private or other banks which could call in their loans at any time. The provisions with regard to the Mortgage Bank Department were finally drafted by a joint committee of this House, and although that department has not madephenomenal advances, it has met the needs of a great number of people. In Europe similar banks have given valuableprotection to farmers. The Mortgage Bank Department of the Commonwealth Bank proved to be a success despite the opinions of experienced men comprisingthe bank board who advised against itsfoundation. The department was established hy the Parliament and proved a complete success in a limited sphere. So much for the experienced members of bank boards. The judgment of a parliamentary committee of this House was far superior to that of the bank board.
I turn now to the Industrial FinanceDepartment of the Commonwealth Bank. Honorable members have had an opportunity to read in the Commonwealth Bank, report of the phenomenal success of that department. The establishment of that department or something of its kind was recommended by the Royal Commission on Monetary and Banking Systems. If ever there was a financial racket in thi? country it was that concerning the hire purchase rates that were charged to primary producers and others. Members of the Government who were in the Parliament before the last general election did not enter a single protest against those rates. The Industrial Finance Department of the Commonwealth Bank cut the rates in half and still was able to make substantial profits, yet honorable members who are supposed to represent the farmers made no representations previously against the hire purchase racket. It was dealt with fully by another board appointed by the Lyons Government. That was the board of inquiry into hire purchase business, of which I was a member. Anybody who cares to read the report of that board of inquiry on hire purchase and cash orders will see how the people, of this country were fleeced by the companies that engaged in that business. Members of the board were shocked by the conditions revealed in evidence given before them. The Industrial Finance Department of the Commonwealth Bank has not been able to go all the way in meeting the needs of that business. All I want to say about that department is that although the Treasurer (Mr. Fadden) has claimed that the Commonwealth Bank could not get all that it wanted under the previous Labour Government-
– I did not say that.
– That was implied. The Commonwealth Bank was never denied by the Labour Government all the finance that it needed to expand its business. That was the policy of the Labour Government. My statement is supported by the results achieved by the Mortgage Bank Department and the Industrial Finance Department. The proposal now before the committee may go far enough for the time being but as time goes on and the business of the Industrial Finance Department expands, the amounts provided in the bill will be found to be insufficient. When the needs of the future are considered, the provision made in the clause before the committee is restrictive. That is also true with regard to other departments of the hank. It may be that, in time, the Industrial Finance Department will need £10,000,000 instead of the sum to be provided under this bill. One cannot calculate the amount required, and I cannot say whether the Government is right or wrong in its proposals in that direction, but I do say that there should be no restriction so long as the department is conducted on proper busi ness and economic lines. There should be no restriction on the amount available to the Mortgage Bank Department, the Industrial Finance Department or for housing loans.
.- The Leader of the Opposition (Mr. Chifley) has drawn attention to the restrictive effect of clauses S and 1.1. I think the right honorable gentleman knows as well as anybody else in this chamber that if value is to be put back into the £1, one of the steps that should be taken is to restrict the central bank and trading bank activities. In other words, we should restrict as far as possible the expansion of credit and perhaps even cut down the amount of money available. When the Leader of the Opposition was Treasurer he took strong steps to see that the trading bank activities were substantially restricted, but he did not take similar action with regard to the Commonwealth Bank. The simple fact is that the right honorable member has a great personal liking for the Commonwealth Bank.
– I admit the soft impeachment.
– He also has .a complete dislike for the trading hanks and all his activities have been built on that simple foundation. The right honorable gentleman wanted to increase the scope and activities of the Commonwealth Bank and restrict the trading banks. I think that much the same approach is adopted by the Commonwealth Bank itself. Its attitude to-day is, first, that if it does not increase its activities substantially it might not get the chance to do so in the future. Secondly it wants to make sure that its free capital and ability to lend are substantially increased because it is on that basis that the total amount of its advances will be based. I believe that this is not the time to contemplate further expansion of the Commonwealth Bank activities or substantial widening of the activities of the trading banks. If inflation is to be checked, it is necessary to limit credit and the expansion of the credit activities of the trading banks. Clause 11, of course, is complementary to clause 8. The Treasurer (Mr. Fadden) pointed out in his secondreading speech that the joint effect of the two clauses would be to expand the General Banking Division fund from £4,000,000 to £5,400,000, the Rural Credits Department fund from £2,000,000 to £2,700,000, the Mortgage Bank Department fund from £3,100,000 to £4,600,000, and the Industrial Finance Department fund from £4,000,000 to £5,400,000. In other words, the possible capital increment to the various sections of the Commonwealth Bank under this measure is £5,000,000. The present capital of the bank is £13,100,000. Thus, the Government proposes to increase the free capital of the trading bank sections very substantially. I gravely doubt whether the present time is appropriate for any substantial increase of that nature. In fact, my inclination would be to defer any such activity for a considerable time. However, that is only my personal opinion, which the Treasurer obviously does not share. The proportions in which the Government intends to allot the additional free money have been determined by the proportions in which the existing capital Ls distributed. I have been led to believe by the Minister for External Affairs (Mr. Spender) that this decision was made by the Government after consultation with the Governor and the Deputy Governor of the Commonwealth Bank, who are quite satisfied with it. Naturally, they would not be content with the actual amount of money to be allotted, because they would like to see the scope of the activities of the Commonwealth Bank considerably increased while that of the trading banks was restricted.
The General Banking Division is the only section of the Commonwealth Bank that has the right to accept money on deposit, and when it does so it borrows short. In other words, a depositor may demand at the end of a specified period that his money be repaid. But when the General Banking Division makes a loan to a co-operative society, it lends usually on a term of about 21 years. Under the policy that was adopted by the Leader of the Opposition when he was Treasurer, attempts were made to lend over £20,000,000 to co-operative building societies. Up to last year, approximately £6,700,000 had actually been advanced, leaving an outstanding commitment of approximately £13,000,000. I do not know where that money is to come from, because the Commonwealth Bank will Lave to go out of its way in order to encourage deposits of at least an additional £13,000,000 if it is to meet the commitment. I say here and now that the Labour Government’s policy was definitely not in the best interests of the Australian people. The former Treasurer should have gone to outside organizations, such a3 the insurance corporations, and persuaded them to lend money to co-operative building societies at a. rate of interest comparable with that charged by the Commonwealth Bank. The policy that he adopted had the most violently inflationary effects and was one of the real causes of the reduced purchasing power of the £1. We have become considerably involved in such transactions. Honorable members should realize that, whenever the activities of either the private trading banks or the central bank are extended, fresh inflationary forces are set in motion which deprive the £1 of some of its purchasing power. The proper course to follow in such matters is not to obtain money from the banking system but to get it from some other financial organization. As the Leader of the Opposition has pointed out, the profits of the Note Issue Department and the General Banking Division of the Commonwealth Bank last year amounted respectively to about £4,600,000 and £975,000. Normally we should expect those profits to be paid to the Treasury, possibly for the reduction of treasurybills or the reduction of taxes. In times of inflationary pressure, that would be easily the most satisfactory way in which to use such money. But to-day the Government has decided, as a matter of expediency, to build up the activities of the Commonwealth Bank and it will use some of those profits for that purpose. The provision that the total amount that can be advanced to the trading bank sections of the Commonwealth Bank shall be limited to £5,000,000 over a period of five years is very wise. Obviously it is designed to ensure that inflationary pressure in Australia shall not get out of hand.
– There spoke the true reactionary in the person of the honorable member for Lowe (Mr. McMahon) ! I have never heard such an extraordinary statement as his declaration that advances made either by the Mortgage Bank Department or the Industrial Finance Department of the Commonwealth Bank have contributed to inflation in Australia. Every advance, of course, makes some contribution to inflation, but we all know that the great prices obtained for our exports and also for products sold on the home market have been principally responsible for the great amount of money that is now afloat in this country. I am not complaining about that fact. Surely nobody fools himself into believing that advances made by the Mortgage Bank Department or the Industrial Finance Department of the Commonwealth Bank could have caused the inflation of which we hear so often in this chamber and to which I need not refer again! The honorable member for Sturt (Mr. Wilson) spoke of small businesses. The Industrial Finance Department of the Commonwealth Bank was deliberately established for the purpose of helping small businesses. I well remember that Mr. Holden, of Holden’s Limited, which later became General Motors Holden’s Limited, was keenly interested in the financing of small businesses when the royal commission that inquired into monetary and banking systems was making its investigations. He pointed out the urgent necessity for the establishment of some institution that could help small business undertakings by granting loans of perhaps £1,000 or £2,000 and also by giving technical advice. One of the important facts that the commission discovered was that many small businesses could gain a foothold and prosper without financial aid if they received good advice about costing and factory management. The objects of the Industrial Finance Department of the Commonwealth Bank were not only to provide money for small businesses but also to make available technical knowledge in relation to factory lay-out, equipment and costing. The establishment of that branch of the Commonwealth Bank’s activities represented, in my opinion, the most valuable contribution ever made to bunking practice in my experience. Yet the honorable member for Lowe talks about restricting such activities !
The capital expansion for which the clauses that we are considering provide may or may not be adequate. I make it quite clear that I do not support the argument that the allocations of capital mentioned in these clauses will necessarily be sufficient to meet the needs of the bank for a long period of years. They may prove totally inadequate. Does any honorable member suggest that the provision of money to co-operative societies for housing by the Commonwealth Bank is inflationary? What is the difference between the Commonwealth Bank providing money to co-operative societies for housing that is urgently required, and private banks making advances for similar work?
– There is a big difference.
– The only difference is that the Commonwealth Bank provides money at a lower rate of interest than any other bank.
– There is a difference between the Commonwealth Bank providing money for housing and insurance companies providing money for that purpose.
– The honorable member will argue no doubt that the money made available by the Commonwealth Bank is bank credit;. That is not so. Because of its wide ramifications, the Commonwealth Bank can make available large sums of “ saved “ money, which is the same as the money provided by insurance companies and other similar institutions. For instance, the Commonwealth Bank has the huge resources of its savings bank at its disposal.
– That is where most of the money comes from.
– Precisely. Loans made by the Commonwealth Bank to co-operative societies for building purposes arc “ saved “ money and not bank credit. There is no difference between the Commonwealth Bank performing that service and money being advanced for the same purpose by such institutions as insurance companies and State savings banks. The loans are not bank credit.
They are what we used to hear described as “ real money “. As the honorable member for Yarra (Mr.. Keon) said, with the exception of the Rural Credits Department, all the modern banking facilities provided by the Commonwealth Bank are the result of Labour legislation. It is quite true that a parliamentary committee of which the present Minister for Commerce and Agriculture (Mr. McEwen) was a member recommended the establishment of a Mortgage Bank Department, but it was Labour legislation that implemented that proposal. The Industrial Finance Department was set up in the face of the bitterest opposition from the present Government parties. As I have already pointed out, the Commonwealth Bank cut drastically interest rates charged by finance companies on money advanced for the hire-purchase of tractors, motor cars, and other essentials. The rates of interest that were being charged by those companies were yielding staggering profits which enabled them to pay their managers up to £6,000 or £8,000 a year for work which, in normal circumstances, would justify a salary of only £600 or £800 a year. ‘ The truth of those statements’ can be ascertained by a perusal of the report of the committee that investigated the hire-purchase system. The Industrial Finance Department does not provide loans for the purchase of luxury goods, unless motor cars may be placed in that category. To the man on the land, and to many businessmen, a utility truck or a motor car is essential. The few motor vehicles that are used entirely for pleasure do not, I admit, contribute much to the stability of our economy, but they do contribute something to the amenities of life. There has never been any suggestion that the Commonwealth Bank was denied adequate capital for any of its activities during my term of office as Treasurer. Somebody has suggested that I have a weakness for the Commonwealth Bank. I admit the soft impeachment. Over the years, the bank has needed somebody to shelter it from the anti-Labour parties whose aim has always been to destroy the bank by restricting its activities. Giving evidence before the Royal Commission on Monetary and Banking Systems, the then Governor of the Bank, Sir Ernest Riddle, frankly admitted that branch managers had been censured for having sought to take business away from the private banks. Commonwealth Bank officers have been removed from their positions and reduced in salary because they have persisted in competing with the private banks for local business. If honorable members opposite had the courage of their convictions, they would admit that that was so. The establishment of an Industrial Finance Department and other similar proposals have been violently opposed by members of the parties now forming the Government.. I do not say that of the Mortgage Bank Department, the origin of which I have explained, or of the Rural Credits Department which was established by the Bruce-Page Government. I emphasize that it is nonsense to suggest that, for the sake of a mere £20,000,000 or £30,000,000 required for housing loans, the Commonwealth Bank, with its vast resources, would have to resort to bank credit.
– The Leader of the Opposition (Mr. Chifley) stated, as he has often done in this chamber, that the objective of the present Government parties is to strangle or stultify the Commonwealth Bank. If any evidence to the contrary were required, it is to be found in the very clause that we are now considering. Within six months of this Government’s election to office, it has introduced into this Parliament, a bill providing for a different form of management of the Commonwealth Bank, and making available to that institution the money that its Governor considers to be necessary to enable the bank to carry out its functions. The Government is asking the Parliament to approve a provision which is a complete answer to the accusations- of the Leader of the Opposition. The clause now before the committee authorizes increases of capital for the various departments of the Commonwealth Bank. This proposal is not being made in a haphazard or cursory manner. As soon as the Governor informed me that the capital of the bank was inadequate for its requirements I placed the matter before Cabinet. Therefore, far from being an attempt to stultify or strangle the activities of the Commonwealth Bank, this measure is practical evidence of the Government’s desire to give to the Commonwealth Bank what the previous administration refused to give it, namely the capital which, in the opinion of the man in whom the Opposition has implicit and simple faith, is necessary to enable the bank to perform its functions adequately. It is ridiculous to accuse the Government of giving anything other than desirable and practicable encouragement to this national institution. The Leader of the Opposition said that he is not satisfied that this sum will be sufficient. He said that the arrangement is too indefinite and that it should be more elastic and less restrictive.
– I said that it might or might not be sufficient.
– Under our system of government there is provision for the introduction of amending legislation at. any time circumstances demand such action. The Leader of the Opposition knows that perfectly well. I draw the attention of the committee to the capitalization provisions in his own act which established one-man control. The Commonwealth Bank Act 1945 limited, in no uncertain way, the capital of the various departments of the bank. To those departments this hill proposes to allocate £1,000,000 a year over five years in the proportions outlined in the measure: There is some elasticity in the 1945 act to meet unknown and unforeseen requirements. The Leader of the Opposition inserted that provision himself. In this connexion I refer to section 98 which reads -
The Treasurer may make advances to the Bank, for the purposes of the Industrial Finance Department, of such amounts, and subject to such terms and conditions, as are agreed upon between the Treasurer and the bank.
This Government leaves that section undisturbed.
– I am desirous of having the Treasurer’s assurance on these matters.
– The right honorable gentleman should have studied the bill and compared its provisions with those of the Commonwealth Bank Act 1945.
Moreover, section 99 of the principal act remains undisturbed. That is the section which the Leader of the Opposition inserted during his term of office as Treasurer. It reads -
The Bank may make advances to the Industrial Finance Department of such amounts, and subject to such terms and conditions, as the Governor determines, but so that the total amount of those advances not repaid shall not at any time exceed £1,000,000.
The committee is asked to believe that the only doubt the Leader of the Opposition has is whether the requisite capital for the adequate carrying on of the functions of the bank will be provided.
– Honorable members are entitled to their doubts.
– The right honorable gentleman should not have doubts about his own act. The sections that I have quoted from the 1945 act remain undisturbed. The Leader of the Opposition also stated, with pride, that the Mortgage Bank Department was established by his Government. That department will be the recipient of a certain amount of extra capital under this measure. The right honorable gentleman lauded that department and stressed the magnificence of its record. The Mortgage Bank Department has been in existence for five years. It was established under the Commonwealth Bank Act 1943, and the total of the outstanding loans at the 30th June last was £3,659,000. That is equivalent to £730,000 a year, or by applying to it the argument put by the honorable member for Wills (Mr. Bryson), it is about £700 a branch of the Commonwealth Bank. I suggest that that argument has no connexion with the matter at all.
I am of the opinion that the previous Government deserves credit for the establishment of the Industrial Finance Department. This Government wisely intends to support, encourage and extend that department because it has stood the test of time and has done a good job. It is hoped that it will continue its good work. Contrary to general opinion, that department does not encourage extravagant expenditure because its activities are confined to the financing of commercial vehicles used in primary and secondary industry. Motor cars may be claimed, by prospective borrowers, to be commercial vehicles and may be so used, but to the best of their ability the staff of the bank are vigilant to see that they lend strictly in accordance with that policy. Advances are restricted to utility vehicles used in commerce and in primary and secondary industry. Contrary to the accusation of the Opposition, all that the Government is trying to do is to give practical evidence of its desire to assist and encourage the national banking institution on a basis of fair competition with free enterprise. The best evidence that the Government can produce in that connexion is the fact that within six months of its assumption of office it has brought to this House, for its approval a measure to provide £5,000,000 during five years apportioned to the departments of the bank in the way outlined in the bill.
.- I hope that the Government will forgive the Opposition for being suspicious of certain matters in connexion with this bill. The Treasurer (Mr. Fadden) said that the Government hopes to carry on the activities of the Commonwealth Bank in the same way as they were carried on during the last eight years. If so, it is the first anti-Labour government that has done such a thing. That is why honorable members on this side are naturally suspicious and hard to convince of the Government’s sincerity. If the Treasurer can show, after a couple of years of government, that there has been no interference with the bank’s policy, then the Opposition will believe in the sincerity of die Government’s intentions. At the moment it reserves the right to be convinced. In regard to the Commonwealth Bank as a whole, three departments are mentioned - the Rural Credits Department, the Mortgage Bank Department and the Industrial Finance Department. I should now like to read a few sentences from a book by Plumptre entitled Central Banking in the British Dominions. This is what an overseas observer says about the Commonwealth Bank at page 100 of his book -
It cannot be mere good fortune that has provided Australia with a number of institutions, such as the Commonwealth Bank, which, when international comparisons are made, appear to be specially appropriate to their environment. The Commonwealth’ Bank is certainly one of the most remarkable financial institutions in the British Dominions.
– In what year was that written ?
– It was written in 1940.
– That was when the bank board controlled the bank.
– That does not matter. The author went on to state -
If, among the Dominions, leadership in the device of new methods of central banking is tobe forthcoming, the Commonwealth Bank is already the best equipped to supply it.
That is the opinion of the Commonwealth Bank formed by an overseas expert after he had made a close study of it.
– In the days when the bank functioned under a board.
– Since then the Commonwealth Bank has increased the activities of its Industrial Finance and Mortgage Bank departments, and the operation of those departments has been eminently successful. The Government now proposes to increase the capital of the Rural Credits, Mortgage Bank, and Industrial Finance, departments. However, I cannot help feeling that those will be only token increases. The present Government has had to try to create the impression that it was really behind the Commonwealth Bank, and it has endeavoured to convince the public that it wants the activities of the bank to expand, although in their own hearts members of the Government know that any expansion of the bank’s activities must involve increased competition between it and the private trading banks. Over the long period of years during which the antiLabour forces controlled the destinies of this country they have invariably acted as the mouthpieces of the trading banks. Hence we can only feel now that the proposed expansion of the bank’s activities is nothing more than a token gesture made to soft pedal the fact that the hank is to be handed over to the control of a board.
The honorable member for Lowe (Mr. McMahon) made the astounding statement that the present is perhaps the appropriate time to restrict the issue of credit in this country. I am glad that the Treasurer does not agree with him. The ostensible intention of the clause represents a step in the right direction, but I cannot help asking myself what will happen if, during the next five years, which will be the term of office of the proposed board, a slump occurs in the overseas prices of our primary produce and the bank has not sufficient capital to be able to finance our farmers in their time of need. Of course, the limits to the capital of the bank’s departments may be increased during the next five years by passing special legislation, but the Government would have to introduce that legislation. However, I think that it will be a great mistake to restrict the amount that may be advanced to our primary producers to offset any large deflationary tendency overseas to the capital proposed to he provided for the bank’s lending departments. If the overseas markets in which our primary produce is sold collapse we should need to expand, not to contract, credit. Therefore, I think that the assertion made by the honorable member for Lowe was most unrealistic. In any event, consider the large number of people who desire even now to obtain credit to expand their operations. What about the farmers who want to purchase new tractors, the municipal and roadmaking bodies that desire to purchase new machinery to replace and extend their roads, and the private contractors who are anxious to purchase heavy earthmoving machinery? I believe that it ia utter foolishness to restrict credit at such a time.
In answer to the doubts expressed by the Leader of the Opposition (Mr. Chifley) the Treasurer cited section 98 (1.) of the Commonwealth Bank Act 1945, which provides that -
The Treasurer may make advances to the Bank, for the purposes of the Industrial Finance Department, of such amounts, and subject to such terms and conditions, as are agreed upon between the Treasurer and the Bank.
However, I point out to the Treasurer that if the measure that we are now considering becomes law the relationship at present existing between the Commonwealth Bank and the Treasurer will be altered, because the proposed board could alter the significance of the 1945 legislation. Is it possible that the board could even control the Treasurer under such conditions and, if necessary, over ride him? Of course, if such a thing could happen, then all the assurances given by the Treasurer fall to the ground, and the warning issued by the Leader of the Opposition becomes very real.
The work carried out by the credit departments of the bank has been eulogized by the Treasurer, and he gave the previous administration a pat on the back for having introduced the 1945 legislation which enabled the bank to do so. Section 95 of that legislation provides -
The functions of the Industrial Finance Department shall be -
to provide finance for the establishment and development of industrial undertakings, particularly small undertakings ;
6 ) to assist in the establishment and development of industrial undertakings; and
to provide advice on the operations of industrial undertakings with a view to promoting the efficient organization and conduct thereof.
Dwelling upon that for a moment, the present proposal to restrict the proposed addition of only £1,400,000 to the capital of the Industrial Finance Department seems fantastically insufficient in the light of the tremendous industrial development foreshadowed by the present Government and the development that has already taken place. Even in the small State of Tasmania the industrial development that has taken place during the last four years is astonishing and gives some indication of the aggregate expenditure involved in national development. Having regard to the number of large overseas corporations that are contemplating investing in developmental works in this country, apart altogether from the projects of local corporations, the sum of £1,400,000 seems hopelessly inadequate. In fact, that limitation may even restrict the activities of the Department of National Development. In making that criticism I have not lost sight of the fact that the proposed enlargement of the capital issue represents a move forward, but I repeat that it does not go nearly far enough. Time will tell whether or not the Government is sincere, and we cannot pass judgment upon it until some time has elapsed.
.- Continuing the remarks that I was making when I spoke earlier on the clause, I point out that the Government proposes to make available to the trading sections of the Commonwealth Bank an additional sum of £5,000,000 during the ensuing five years. At no time in the history of the bank has the Parliament ever been called upon to provide such an amount of capital for the trading section of the bank, and I should think that that is ample evidence of the sincerity of the wish of the present Government that the Commonwealth Bank shall expand to the maximum in common with other financial institutions. By contrast with the proposals in this measure, the Commonwealth Bank Act 1945 would have authorized the advance of only £800,000 of additional capital during the next five years. That is the answer to the ridiculous statements that have been made by the Leader of the Opposition (Mr. Chifley ) and his supporters in this debate. Of course, it may be necessary to review the legislation within a year or two in the light of all the circumstances then existing. But the act with the inclusion in it of certain proposed sections in this bill will allow the Parliament, at the request of the Government, freedom to extend the period beyond five years, or to amend these proposals. Proposed section 47 is evidence that the Government is seriously trying to expand the operations of the Commonwealth Bank, under a sound system of control by a board, in competition with other banking activities in Australia. The Leader of the Opposition claimed that the establishment of the Industrial Finance Department of the Commonwealth Bank was probably the first move by the Commonwealth to establish low rates of interest. As he admitted, the Rural Credits Department of the bank was established under legislation that was introduced by a non-Labour Government, and the low interest rates that were fixed in respect of loans granted by that department were the first real evidence of an intention to lend money at low rates of interest and to provide opportunities for rural expansion. That policy reflected sound leadership in finance on the part of that non-Labour Government.
The act that authorized the establishment of the Rural Credits Department of the Commonwealth Bank, also provided for the issue of debentures, and that innovation made it possible for people who derived their incomes from certain activities such as primary industry and other industries, to invest the money for short-term periods on the debenture arrangement with the Commonwealth Bank, at a rate of interest approved by the directors of that institution. Those funds were used for some time to make additional sums available at low rates of interest for the activities of the Rural Credits Department. Yet the Chifley Labour Government omitted that provision from the Commonwealth Bank Bill 1945, and, therefore, all the talk about the Labour party desiring to ensure that money shall be lent at low rates of interest has no substance, particularly when it is considered in the light of the achievements of non-Labour governments. The activities of the Commonwealth Bank fully justify the claim that various governments that have come from the political forces opposed to the Labour party have given every encouragement to that institution to expand its activities. Opposition members continually abuse the previous Commonwealth Bank Board, and paint lurid pictures of what the new board will do, but they are merely concealing the weaknesses of their objections to the bill. The Leader of the Opposition, who was a member of the Scullin Government, knows perfectly well that during the financial and economic depression of the early 1930’s, conditions were completely different from what they are to-day. Australia had a substantial indebtedness overseas, and the prices for our primary products in the markets of the world fell to disastrously low levels. Any honorable member who examines the relevant statistics carefully and without an unbiased mind has to admit that the Commonwealth Bank could not have successfully countered those economic conditions, regardless of whether it was controlled by a board or by a governor at the time. I support the clause.
.- I have what Carlyle would call a preternatural suspicion about everything that this Government does, and about its purposes in seeking to amend the Commonwealth Bank Act 1945. I just do not know what is behind that move.
– The honorable member is justified in being suspicious of the Government’s policy.
– That is so. The Treasurer (Mr. Fadden) was wilfully absent from the committee last week when the Opposition was seeking explanations of various proposed sections.
– I am glad that the honorable member missed me.
– I did miss the right honorable gentleman, but I know where he was.
– Does the honorable member know what I was doing?
– Yes, the right honorable gentleman was helping his tory friends to lose the State election in Queensland last Saturday.
– No, I was helping to win a number of seats against a rigged electorate.
– If the right honorable gentleman wants to learn anything about the rigging of electorates, he should go to Victoria, where the job has been done thoroughly.
– Order ! I ask the honorable member to relate his remarks to the clause under consideration.
– I shall do so. Government supporters speak with so many tongues that I am reminded of the Tower of Babel. For instance, the honorable member for Lowe (Mr. McMahon), who preaches the new economics, or perhaps the old economics dressed up in a new way, wants a reduction of governmental expenditure and higher interest rates, whereas the honorable member for Lyne (Mr. Eggins) advocates lower interest rates.
– I rise to order. 1 did not mention interest rates in m) speech.
– That is no point of order but merely a matter of opinion.
The TEMPORARY CHAIRMAN.Order ! The Chair will decide whether or not it is a point of order.
– The general trend of the speeches by the honorable member for Lowe has been definitely in favour of higher interest rates. If interest rates are increased, there must be a reduction of expenditure. The arguments that have been advanced about the achievements of anti-Labour governments in reducing rates are disproved by the facts of history. Interest rates in this country were reduced to the present low level only when a Labour government followed the example of the war-time Government of Great, Britain in deliberately deciding upon low interest rates. Such a policy is opposed to capitalist economics, which holds that, in prosperous times, interest rates should be high, and that, in bad times, they should be low. The Australian Labour Government kept interest rates low in prosperous times. However, I return to the clause that is under consideration. The Rural Credits Department of the Commonwealth Bank is doing very well. According to the latest report of the Commonwealth Bank, the funds that were made available to various marketing boards and co-operative societies last year reached the record figure of £217,000,000, compared with £181,650,000 in the previous year.
– Did not prices have anything to do with that ?
– Yes, they certainly did, but I have a fear that even with prices high, the Rural Credits Departs ment may be crippled in the interests o[ the private trading banks. Those simple souls, the non-ministerial members of the Australian Country party in this chamber, believe that the Government will encourage the Commonwealth Bank to compete strongly with the private trading banks, and take all the business from them. But they and other honorable members opposite were put in their present places by the private trading banks not in order that the banks might be destroyed but that their interests might be protected. To some extent, this bill is designed to save them. If it does so, it will be at the expense of all the departments of the Commonwealth Bank. There is only a certain amount of business to be got, and the Commonwealth Bank can take it only at the expense of the private banks. The latest report of the Commonwealth Bank also shows that grants from the funds of the Rural Credits Department last year aggregated £500,000, and were made for purposes such as research into various aspects of primary production, such as fodder conservation, pasture improvement, the importation of pedigreed stock, and herd testing. I have not heard very much about donations having been made by the private trading banks for the benefit of the community. Those institutions pay their profits to the shareholders and the money is sunk in Bellevue Hill in Sydney, Toorak in Melbourne, and other salubrious parts in the capital cities of Australia where those who neither toil nor spin reap thebenefits of investment in modern society.No private bank has a record comparable with that of the RuralCredits Department of the Commonwealth Bank in assisting primary producers. That fact should be emphasized here, just as the good work of the Mortgage Bank Department of the Commonwealth Bank should be stressed. I fear that the last named department will be fettered. An amount of £731,000 was lent to 379 new borrowers last year by that department, whereas in the previous year 327 new loans representing a total of £595,000 were approved.The Mortgage Bank Department is flourishing and is making profits.
I should like to direct the attention of the Treasurer to the Industrial Finance Department of the Commonwealth Bank. A few days ago, a question was directed to the right honorable gentleman which related to the Industrial Acceptance Corporation Limited, a hirepurchase organization that had announced the increase of its capital to £4,000,000. The flotation was underwritten by a large firm of share brokers. He said, in reply, that that corporation provided finance for the purchase of tractors, cars and machinery, which the Commonwealth Bank would not finance. We know that the Industrial Finance Department of the bank makes better provision than do private organizations for persons who want finance for the purchase of cars.
– They do not compete.
– They ought to do so.
– The honorable gentleman should have arranged that when he was a Minister.
– We understood that they were competing. We tried to think of everything, but if we overlooked a few items, I hope that the Treasurer will make good our deficiencies, however slight they may have been. The Industrial Finance Department advanced £14,000,000 last year. That was a very good job.
The ghosts of the late Sir Joseph Cook and the late Sir William Irvine must be fluttering round this chamber to-day in angry protest at some of the speeches that have been made in support of the Commonwealth Bank. Sir Joseph Cook and Sir William Irvine were the prototypes of the members of the present Government parties. In their day, they did not want a Commonwealth Bank or a note issue. The honorable gentlemen who have succeeded them in their toryism adopt the attitude that the Commonwealth Bank is all right and that the bigger and better it is, the more they will like it. That seems to me to be rank heresy, and something should be done to deal with the heretics. I do not believe that the Government is eager to extend the activities of the Commonwealth Bank in competition with the private trading banks. One honorable gentleman who is a member of the Australian Country party said that it was, and the Treasurer did not rebuke him. I take it that that silence signified consent, but I do not think that the honorable gentleman’s comrades or any honorable member on this side of the committee believed him. I am certain that if the directors of the private banks finally reach the conclusion that that is the attitude of the Government parties, there will not be much money forthcoming for those parties at the next general election.
– There may be a double dissolution.
– That is the last thing that the Government is thinking of.
– It is the last thing that the honorable member for Melbourne (Mr. Calwell) wants.
– We should not mind a double dissolution, so long as we got it on our terms. I remind the Treasurer that there has been only one double dissolution in the history of our federation. It was granted on the solicitation of an anti-Labour government, and the Labour party was successful at the subsequent general election. I tell the right honorable gentleman that to encourage him to go forward on this occasion.
– It will not be long.
– I am glad to have the assurance of the honorable member for Watson (Mr. Curtin) that it will not be long, because I have no wish to stay out of ministerial office for any longer than is necessary.
The directors of private trading banks are also directors of big industrial and commercial organizations. There is an interlocking, an interweaving and an interlacing of directorates. If some directors of private companies are appointed to the Commonwealth Bank Board, the Rural Credits Department of the bank will not make much progress.
– It is with some diffidence that I intervene in the debate on this clause, but I believe that some of the statements that were made by members of the Opposition should be answered by a supporter of the Government. Opposition members have referred contemptuously to what they regard as the very small increase of the capital of the bank for which provision is made in this measure. One honorable gentleman adopted the simple process of dividing the proposed increase of capital hy the total number of branches of the Commonwealth Bank and said that, on that basis, each branch would have an additional £400 a year in respect of the Rural Credits Department and an additional £700 a year in respect of each of the other departments, which, he claimed, would be sufficient only to enable each branch to finance the purchase of an additional house every two years. It is obvious that the honorable gentleman has a very slight knowledge of how our banking system operates and of the effect of the operation of a revolving fund.
As the honorable member for Melbourne (Mr. Calwell) generously directed attention to the report of the Commonwealth Bank and the Commonwealth
Savings Bank for the year ended the 30th June, 1949, I shall base some comments upon the sections of that report that are relevant to the clauses that are, either directly or indirectly, under consideration. The report states that in that year the Mortgage Bank Department made £731,130 available to 379 new borrowers. The comment that I make is that, for some reason or other, the advances that are offered by that department are not particularly attractive to persons who are seeking finance on a long-term or fixed basis to enable them to engage in primary production. The general comment that I have heard is that the managers of the branches of the Commonwealth Bank are so bound by red tape and regulations that, even under the system for which the Chifley Government was responsible, they have little opportunity to handle business of that kind with any degree of success. Whether that be so or not, there is a striking contrast between the operations of the Mortgage Bank Department and those of the Rural Credits Department for the year ended the 30th June, 1949. I direct the attention of the committee to a passage in the report of the bank for that year. It relates to the Rural Credits Department and reads as follows: -
As a result of the good seasonal conditions and high prices obtaining for primary products, the funds made available to various marketing boards and co-operative societies reached the record figure of £217,044,000, as compared with £181,650,000 in the previous year.
That was done on a capital of less than £2,000,000.
The Rural Credits Department of the Commonwealth Bank was established under the provisions of the Commonwealth Bank (Rural Credits) Act 1925, a measure that the present Minister for Health (Sir Earle Page) sponsored when he was Treasurer. The intention was that primary producers who were organized as co-operative societies or pools should be able to go to the Commonwealth Bank and arrange for financial assistance to be given to them based upon the value of their assets, not as an act of patronage by the Government, but in the ordinary course of business. It was intended that the Rural Credits Department should make advances to them against the value of their production and that as they sold their products they should liquidate their liabilities to the bank. As the advances were repaid, the bank could use the funds thus made available to it to finance other deals. The Rural Credits Department has been of great assistance to Australian primary producers. Its functions have been greatly expanded as a result of inflationary increases of the prices of primary products during and since the war. It is absolute claptrap, or a display of entire ignorance of the subject, for honorable members opposite to state that to increase the capital of the bank by an amount that is small in relation to the bank’s total operations is thereby to restrict those operations to a small proportion of the amount of capital provided. An increase of the bank’s capital is a matter of prime importance. The assistance granted by the bank through its Rural Credits Department is exceedingly valuable. In the year that ended on the 30th June, 1949, approval was given to 25,306 advances of all types, totalling almost £14,000,000, by the Industrial Finance Department of the bank. That has no relation whatever in the aggregate cither to the amount of capital that that department of the bank has already had or to the increase that is now to be. granted to it.
During this debate there have been many references to fair competition. What is fair competition in fields into which the Government enters? Private banks have to make provision for not only all the’ ordinary risks taken and losses incurred in conducting their businesses but also a very substantial proportion of the nation’s revenue from taxation. The taxes paid by the private banks constitute an appreciable part of the finance that enables the government of the country to be carried on. If a government activity is to be conducted on the lines of fair competition with privately conducted activities of the same kind, it is necessary to remove the props, seen and unseen, that the Crown provides in the shape of guarantees that are backed by the wealth of the nation. That should apply to the Commonwealth Bank as far as its trading activities are concerned. Whilst it is not possible to cover the ground completely in the time allotted I consider that I have at least disposed of some of the arguments that have been advanced by the Opposition in its attempt to discredit the purpose of the increase for which provision is sought by the proposed section.
– I have not taken any part in this debate until now because I cannot make myself enthusiastic about it. The difference between the bill now before the committee and the act that it is intended to supplant is so trivial that I cannot get excited about it at all. Apart from that, I know in my heart, or at any rate in my judgment, that the provisions of either bill do not matter in the long run. Everything really depends upon the policy of the” government that administers the legislation. The Government could have done everything that in this bill it seeks power to do without amending the 1945 legislation. There is no need for a government to give effect to all the provisions that are embodied in any act. Legislation that a government does not wish to implement can be put in cold storage and left dormant, and the government can continue with its policy. This Government could do that without the assistance of the present measure. Even if this measure were more advanced, more flexible, or more modern than the act that it is designed to supplant, that fact still would not give any guarantee that the Government’s policy would conform to its provisions. A government always determines its own policy. I can recall one occasion that was very unpleasant for me personally, in relation to the policy of a government. I was a member, of the fateful Scullin Government, from which I had to resign because I was not willing to help to administer a policy that I knew, from my study of economics and industrial history, must fail. We should not run away from facts. If we are proved to have had sins of omission or commission we must admit them. I always do so. Whether we like things or not we should be honest enough to admit facts and should not try to controvert them. I shall endeavour to contradict several of the statements that have been made by honorable members opposite, but not because I consider that they were being dishonest when they made them. [ do not believe that any one is dishonest. The matter is merely one of differing policies. If the present Government did not administer the nation’s financial affairs in a manner different from that in which we should administer them if we were in office, then it would not be honest in respect of the policy in which it believes. The economic philosophy of the Government parties is different from ours. The economic philosophy of the individuals whom the Government will appoint to the proposed board will be different from that which I espouse, and they will attempt honestly and sincerely to give effect to it. By so doing they will not be guilty of dishonesty. If they did not carry out the policy that the people whom they will represent believe in, they would then be dishonest. I have said that I was a member of the Scullin Government when the disastrous economic depression struck this country. I have never said either here or anywhere else that the Commonwealth Bank Board at that time was responsible for the depression. That would be a very foolish thing to say and I do not think that any one has ever said it directly. It has been put into the mouths of some of those who have spoken on the subject and their statements have been misconstrued. Any one who says that the Commonwaelth Bank Board caused the depression does not know anything about the subject.
– The statement made was that the bank board had aggravated the effects of the depression.
– Of course it did. The depression started overseas a long time before its ripples reached Australia. When it reached Australia, and conditions here became difficult, the Commonwealth Bank Board was approached, which wa3 the correct thing to do because no other uathority was able to come to the country’s aid, and was asked to try to arrest deflation and it3 effects, but it refused to do so because it believed in the policy that has been hinted at to-night by the honorable member for Lowe (Mr. McMahon). I do not know whether that honorable member hinted at that policy consciously or not, but his statements indicated that, he had it in mind. I knew Sir Robert Gibson well for twenty years before he was appointed to the former board. I sat at a conference table with him almost weekly over a period of years when he was president of the Chamber of Manufactures, and I would stake my life on his word. He was one of the most conservative men that I have ever known, but he was an honest man and having made a promise he would never break it. He said to me and to others, “ No, the Commonwealth Bank must not engage in trade”. That was the policy of the board. When the Scullin Government approached the board for help in stemming the effects of the depression, he said, “ You cannot get another penny. We are right up to the limit that it is possible for us to give to the Government. We cannot give you any accommodation at all. You must cut all expenditure by 25 per cent. If you do not, we shall give you only enough accommodation to pay 12s. in the pound of the Public Service salaries “. That is the position we were in. The trouble was that Sir Robert Gibson believed that a policy of restriction was right at that time instead of a policy of flexibility and of releasing money. He believed in continuing that policy of restriction instead of adopting one that would employ people and stimulate industry. The policy that he could have adopted would not in any event have been conducive to inflation because it would not have tipped the beam in that direction. He refused to adopt a policy of arresting deflation.
The Prime Minister (Mr. Menzies) has said that it takes some time to arrest inflation and then, when it has been arrested, to push it down. That argument can be applied in reverse. When a country is in a state of deflation that condition must first be arrested, and it is impossible to arrest it without increasing prices and the demand for goods and services. The only way to do that is to release more credit into the community. We asked the bank board to do that, and it refused. The board thought that that was wrong. 1 am not saying that the members of the board were dishonest. They believed that the only proper means for meeting the depression was to restrict credit. However, world-famous economists, including Professor Copland and Professor Cassels, have declared that the experience of the intervening years has shown that policy to have been wrong, and they have urged that the mistake be not repeated. I believe that every honorable member has heard that view expressed a dozen times by leading economists. That is evidence that the board’s action was wrong. At that time 15 per cent, of that section of industrial workers whom I represented were unemployed, and I said that a policy of restriction of credit would have the effect of doubling the number of unemployed within six months. That prediction was proved correct Indeed, such a development was inevitable because every £1 withdrawn from circulation intensified the deflationary trend and every dismissal of employees caused the demand for goods and services to be further reduced. I repeat that the Labour party has never contended that the Commonwealth Bank Board caused the depression. “What we say is that the board, by its policy of restricting credit, intensified the depression and, as I have said, every leading economist since that time has acknowledged that fact. The members of the board incorrectly interpreted the economic position at that time. Surely, therefore, when considering a proposal of this kind we are justified in recalling those facts. No honorable member has suggested that since 1945, when the Commonwealth Bank Board was abolished and replaced by a governor assisted by an advisory council, the bank has fallen back in any way. On the contrary, it has improved its position and all good Australians must derive pleasure from the fact that it .has proved itself to be a great and successful institution. ¥e want it to expand its activities. The Treasurer has said that the object of the clause is to make more capital available to the hank in order that it may do so. The Opposition does not oppose that proposal.
The TEMPORARY CHAIRMAN.Order! The right honorable member’s time ha9 expired.
Mr. THOMPSON (Port Adelaide) tunity to the committee to consider the profits from the Note Issue and the distribution of those profits. That subject calls for more than ordinary consideration. We must ensure that those profits shall, as far as possible, be used to assist the country as a whole. The clause provides for the allocation of the profits in a manner slightly different from that in which they have been allocated in the past. Certain proportions are to be paid into Consolidated Revenue and transferred to the Rural Credits Department, the Industrial Finance Department, and the Mortgage Bank Department of the bank. I was interested, to read that portion of the report of the bank for the year ended the 30th June last that deals with the assistance that has been provided from the bank’s profits in the interests of primary producers. Referring to the operations of the Rural Credits Department, the report states -
A feature of the department is that half of the profits are placed in a Rural Credits Development Fund, which is used for the promotion and betterment of primary production. Grants from this Fund aggregating £509,730 have been made for .purposes such as research into various aspects of primary production, fodder conservation, pasture improvement, importation of pedigreed stock and herdtesting.
Primary producers should be interested to learn that not all the profits of the bank are paid into Consolidated Revenue but that a substantial proportion of them is made available for research in primary industries.
– What government was responsible for making that provision?
– I am not concerned about what government was responsible for it. That is a. wise provision, and under the Chifley Government the Commonwealth Bank continued that policy. Every Government, regardless of its party political colour, should do all in its power to encourage activities in the field of research. I heartily supported such a policy at every opportunity that was presented to me when I was a member of the finance committee of the Council of the University of Adelaide. One of the great difficulties that confronted that institution was to obtain sufficient funds to finance medical research, which embraced maternity problems. I suggest to the honorable member for Lyne (Mr. Eggins) that he should forget party political considerations when dealing with actions of past governments that have proved of benefit to the nation as a whole. I urge the Government to foster research work in the interests of our rural industries. To that degree I support the clause. I am not very much concerned about the amount of capital that should he provided for the Mortgage Bank Department, because I am convinced that either this or any other government would be prepared to make available sufficient funds to enable an authority of that kind to carry on its work efficiently. As the honorable member for New England (Mr. Drummond) suggested, increasing the capital of the various departments of the Commonwealth Bank will not necessarily make much difference to their activities. The money is going out and coming in all the time. Policy and administration are more important than the amount of capital available. It has been stated that about £15,000,000 will be available for lending on mortgage, mostly for home building, and that is all to the good. I am sure that whatever the needs of the Mortgage Bank Department may be, the Government will ensure that they shall be met. I agree with the right honorable member for Melbourne Ports (Mr. Holloway) that the difference between this bill and the 1945 act is negligible. It is the difference between Tweedledee and Tweedledum. As I have said, administration is the important thing in connexion with the bank’s activities, and that is determined by the Governor or by the bank board. No matter how much capital is at the disposal of the bank, unless the policy and administration are right, the bank cannot give the service it should. A great expansion of activity is possible in the Credit Foncier section of the bank. It is true that other banks lend money on terms that are almost as favorable, but those who deal with the Commonwealth Bank know that they are dealing with an institution that can never get into financial difficulties, because it has the resources of the whole country behind it.
– Order! The honorable member’s time has expired.
.- The last two speakers on the Opposition side have suggested that this bill, when passed, will make very little difference to the activities of the Commonwealth Bank, and I suppose that is true of the ordinary business of the bank. However, the bill proposes a vital change in the relations between the management of the bank and the government of the day, if a difference of opinion should arise overpolicy.
I listened with great interest to thethoughtful remarks of the right honorable member for Melbourne Ports (Mr. Holloway), who criticized the former’ Commonwealth Bank Board on three grounds. First, he said, it did not encourage the bank to trade. That possibility will be removed for ever by the provision we are now considering. He also said that the former bank board applied conservative policies. That might happen if the bank were controlled by a single individual. Finally, he criticized thi board because, during the depression oi the early ‘thirties, it did not accede to th< demands of the government of the da; to release credit. Again, this legislator will make it impossible for the new board to refuse a similar demand.
The honorable member for Melbourne Ports suggested that no one on his side of the chamber has accused the Commonwealth Bank Board of having caused the depression. I regret that I cannot agree with him. -As a matter of fact, I have listened with great disappointment to one speaker after another on the Opposition side doing precisely that. It utime members of the Opposition moved a little nearer to the present time than the days of the depression. They are, a? has been said, bogged down in the depression. Australia is now on the threshold of tremendous economic expansion, but while one of the great political parties restricts its thinking to ideas born of thi period of the depression, now fortunately long behind us, our progress will he very seriously retarded.
– I wish to point out to the honorable member for Lyne (Mr. Eggins) and the honorable member for New England (Mr. Drummond) that there is some truth in the statement that the Commonwealth Bank Board did. not try to extend the activities of the bank.
The TEMPORARY CHAIRMAN.The right honorable gentleman must confine his remarks to the clause. The committee has already dealt with the appointment of the bank board.
– I propose to link my remarks with the clause under consideration. It has been claimed that the provision “of extra capital for the Commonwealth Bank will enable it to extend its operations. I doubt whether it will have that effect, although I am glad that the extra capital is to be provided. In the past, the board did not attempt to expand the activities of the bank. It refused to allow the bank to accept ordinary business, and it instructed branch managers to advise prospective customers to go back to their own banks. Moreover, the hoard even used the taxpayers’ money to investigate the financial condition of would-be customers, and then, on the strength of the information obtained, to recommend the trading banks to give them the accommodation they were seeking. In order to prove that statement, I propose to quote from an address by the Governor of the Commonwealth Bank, Sir Ernest Riddle, to the Royal Empire Society in October, 1932. He had gone to Great Britain with a business delegation, and while there, was questioned by bankers about the operations of the Commonwealth Bank. In the course of his remarks, he said -
Although the Commonwealth Bank continued to conduct general business, that side of its activities was not pushed. The trading banks had been advised that if they lodged their reserves with the Commonwealth Bank they would not be used in competition with the private banks for ordinary business. That promise had been faithfully observed. Moreover, the Commonwealth Bank’s policy was not to take advance business from private banks, even with its own money.
When a customer of a private bank asked the Commonwealth Bank for accommodation, the Commonwealth Bank undertook to investigate his position, and if satisfied that he was untitled to accommodation, the private banks were notified and informed by the Commonwealth Bank that if they were prepared to do the business the Commonwealth Bank would withdraw from the negotiations. If not, the Commonwealth Bank would make the advances. In nearly every case, the private banks made the advances.
We fear that the new Commonwealth Bank Board may adopt a similar policy. Sir Ernest Riddle’s statement proves conclusively the truth of our assertion that, from the inception of the Commonwealth Bank Board until the outbreak of the war it did nothing to extend the activities of the people’s bank. When some of my relatives approached the Commonwealth Bank for accommodation they were asked by an official with what bank they normally did business. When that information was supplied, the official asked, “ Why not approach your own bank for accommodation ? “ My relatives replied that they had done so but that it had refused to give them the accommodation they needed. The Commonwealth Bank official then said, “ Make a further application to your bank for the loan; if it is refused you may come back later “. The inspectors of the Commonwealth Bank were instructed to investigate thoroughly the financial stability of its potential customers. Only if they were satisfied with the financial standing of a prospective customer, was his business accepted. The general policy of the bank was to advise prospective customers to place their business with the private banks. As Sir Ernest Riddle said, the result of that policy was that most of the banking business of the community went to the private banks. Can there be any wonder, then, at our having serious doubts about the manner in which the new board will carry out its functions?
The honorable member for Forrest (Mr. Freeth) has said that Opposition members have not been able to submit a logical reason for their objection to the re-appointment of the board. Our objection is based on good grounds. It is based, not on suspicion of the honesty of purpose of those who will be selected for appointment to the board, but on the certain knowledge that the appointees selected by this Government will represent an economic philosophy different from our own. Honorable members opposite believe that private enterprise should be sacrosanct even in the field of banking. We do not agree with that view. Some years ago I asked Sir Robert Gibson whether, in his opinion, private enterprise should he sacrosanct even in the field of banking. He replied, “ Yes ; a government bank should not enter into competition with the private banks”. We contend that the people’sbank, which supplies the economic life-blood of this nation, should enter into full and free competition with the private banks. We gave effect to that policy in the Banking Act 1945. An honorable member opposite has asked whether I believe in unfair competition between the Commonwealth Bank and the private banks. I do not believe in unfair competition of any kind. I remind him that the Commonwealth Bank competed on unfair terms with the private banks only during the regime of the former Commonwealth Bank Board. Let the Commonwealth Bank secure all the business it can so that it may make larger profits which, in turn, may be devoted to the development of this country. In 1938, when the right honorable member for La Trobe (Mr. Casey) was Treasurer, the present right honorable member for Bradfield (Mr. Hughes) introduced a short bill, the purpose of which was to provide a guarantee by the Commonwealth in respect of a loan of £150,000 to be raised by the Administrator of New Guinea through a private financial institution to meet the cost of construction of a road between Salamua and Wau. When I asked the right honorable gentleman whether that was the sole purpose of the bill, he replied, “ Yes. I should like honorable members opposite to dispose of it without delay “. I then asked why it was necessary for the Administrator to obtain the loan from a private financial institution and not from the Commonwealth Bank. I said, in effect, “ Surely the people’s bank should be patriotic enough to advance the money to the Administrator of New Guinea. It could charge the same rate of interest as would be charged by the private bank, and any profit arising from the transaction could be applied to the further development of New Guinea “. The right honorable gentleman, who was as honest and frank then as he is now, replied, “ It is not the policy of the Government to finance such matters through the Commonwealth Bank “. Conservative governments have always favoured the private banks instead of the people’s bank.
Clause agreed to.
Remainder of bill - by leave - taken as a whole, and agreed to.
Bill reported without amendment; report adopted.
Bill - by leave - read a third time.
Sitting suspended from 5.50 to 8 p.m.
Bill presented by Mr. Menzies, and read a first time.
– by leave - I move -
That the bill benow read a second time.
This is a bill for an act to alter the provisions of the Constitution relating to the Senate. Its purpose is to avoid deadlocks between the House of Representatives and the Senate after a double dissolution. In short, the bill deals with the method of electing the Senate after a dissolution of that body. As honorable members know, an election of the entire Senate can occur only when thereis a double dissolution because it is only after a double dissolution that all the members of the Senate go to the country at once. Under legislation passed in 1948 the number of senators was increased to 60, giving ten senators to each State. In consequence of that law it is highly probable that any double dissolution under this new system would result not in the clearing of the air but in a further stalemate.
Under the system of proportional representation that was adopted in 1948 certain consequences became, not inevitable, but highly probable, and those consequences can be illustrated by considering the last election. That election disclosed a majority in the voting for the House of Representatives which was so substantial that in this House, under an appropriate system of distribution of seats, the Government had a majority of 27. Yet, on exactly the same voting strength, if all of the “60 members of the Senate went to the country and the voting was in the same proportion the parties would come back in the Senate with a strength of 30 all. That is one of the curious consequences of the system of proportional voting for the Senate which was adopted two years ago.
– It would not have had that result in Queensland.
– As it happens, it would have had the same result there also because, on the votes cast in December last, it would be necessary, in any one State, for one side or the other to obtain 54.54- the better part of 55 per cent. - of the formal votes recorded in order to win six seats out of ten. As neither side secured that proportion of the formal votes in any State it follows that if the last general election had resulted from a double dissolution, the strength of the parties in the Senate would now be 30/30 and in the House of Representatives there would be a government majority of 27. That serves to illustrate that if proportional representation is not to produce merely one stalemate after another, the number of vacancies to be filled in any electorate - the electorate being the whole State for the purposes of the Senate - should be an odd number and not an even number. Honorable members will recall that this point was emphasized by the honorable member for Mackellar (Mr. Wentworth) in his first speech in the House. That is a very serious state of affairs. I do not make that statement merely in regard to this Government. It would apply in regard to any government that might hereafter occupy the treasury bench. Suppose there is a general election for the House of Representatives, which in the long run, is the controlling House which makes and unmakes governments, and at that general election either honorable members on this side of the House or those on the other side of it secure a clear majority in this chamber. Unless in some States they can secure something rather better than a landslide and can win, for example, by a proportion of 54 seats to 46, which would be a very substantial electoral victory having regard to the history of politics in Australia, they will return to this House after a double dissolution with a Senate that can frustrate their desires.
– A joint sitting would prevent that.
– It would not. The honorable member for Fremantle (Mr. Beazley) takes much too short a view of this matter. I shall deal with the question of the joint sitting later on.
If nine senators were to be elected from each State the position I have just mentioned would not arise except in extraordinary circumstances, because one side at any rate, would win five seats and the other side four. It is quite true that if the odd circumstance occurred in which three States returned Liberal and Australian Country party members with a majority of one in each State and three States returned Labour party members with a majority of one in each State there would be a deadlock, but such a happening would not be probable. Under the present circumstances a deadlock is next door to being inevitable. A deadlock of that kind is something which is not only no good to a government, whatever that government may be, but it is no good to the country because Australia requires, always has required, and always will require, some stability of government, some continuity of administration and some reasonable prospect of putting on to the statute-book the programme of which the people have approved. Therefore the present situation presents a real problem. As things now stand, if this Parliament went to a double dissolution on some issue on which the people returned the present Government - I take the present Government by way of illustration - with a majority-
– An extreme case.
– I rather think it would do better. However, if the Government were returned with as good a majority as it had-last time I should not mind. But suppose the people returned the present Government with a majority equal to that which it obtained at the last general election but no greater, then the result would be that it would have a
House of Representatives majority of 27 but the strength of the parties in the Senate, under similarly distributed votes would be 30 all. That could be so and it would be so, even though the Government had a Senate majority in every State, so long as the majority was not of the extraordinary kind that is needed to get six seats out of ten. What would happen then?
– The right honorable gentleman could declare a couple of the Labour senators.
– I am obliged to the honorable member for the suggestion. I can think of at least one Labour senator whom it would be easy to declare.
– The Fuhrer has spoken.
– I can think of one member of this House who might escape only by the skin of bis teeth.
– The right honorable member is on dangerous ground.
– I agree- on dangerous ground. If this is dangerous ground I suggest to the right honorable gentleman that he might restrain his interjectors but, of course, the problem does not arise because-
– I suggest that the right honorable gentleman should not make threats.
– I never make a threat that I do not carry out.
– The right honorable gentleman is drunk with power.
– It is quite true that so far as the particular bill that gave rise to a double dissolution was concerned, there could be a joint sitting of the two Houses of Parliament. Under section 57 of the Constitution if, after a double dissolution, the bill which produced it is once more sent to the Senate and is rejected, then there may be a joint sitting of the two Houses.
– It would not be a double dissolution in that case.
– I agree. Let us take one step at a time. Suppose there is a double dissolution because a bill which was sent up has been rejected, or there has been failure to pass it, or it has been passed with amendments which the lower House would not accept. That happened twice. A double dissolution follows. Then, under section 57 of the Constitution -that particular bill may be made the subject of a joint sitting of the Houses. If there is a majority for the bill, as there would be under those circumstances, it would go through but thereafter there is no provision for a joint sitting at all. In relation to every other bill on the Government’s programme for the rest of the term of Parliament, there would be. no means at all of getting a joint sitting. The only thing that could be done would be to pass through a period of frustration and intolerable delay and then go to the country on another double dissolution. Then, on the argument that I have just stated, exactly the same thing would probably occur again. What I want honorable members to understand is that the system of proportional voting that has been applied to the Senate in which provision is made for an even number of members from each State does not make sense where there is a double dissolution. If the number to be elected from each State, were eight or ten or twelve, under this system of voting each party would get the same strength in the Senate normally after a double dissolution. There is another aspect of the matter. Suppose there is a double dissolution and in the resultant election one side has a clear majority in the House of Representatives and both sides are evenly balanced in the Senate. What happens? If that occurred and an equality of voting followed in the Senate it would mean, under the Constitution, practically the same thing as a majority for the Opposition, because under section 23 of the Constitution it is provided with reference to the Senate that -
The President shall in all cases be entitled to a vote; and when the votes are equal, the question shall pass in the negative.
Therefore, if the numbers in the Senate were 30-30 after a double dissolution, no bill could pass because, the votes being equal, the question would be resolved in the negative under the Constitution. So that the first reading, the second reading or the third reading, whatever they might be, would all fail by virtue of the Constitution. The result would he that a government which was strongly entrenched in this House by the vote of the people would be unable to put any measure on the statute-book except by the grace of some opponent in the Senate. Therefore, the Parliament of the people is called upon to-night to deal with an important question which involves the future of the relations between the two Houses, the stability of the Government in the House of Representatives and its capacity to give effect to the will of the people who have elected it. Both sides in the Parliament therefore have a strong and proper interest in securing political stability. There are too many problems in front of Australia, both international and domestic, some of them very grave and menacing, for any patriotic Australian to desire a state of affairs in which the Parliament, as a Parliament, becomes unworkable, or the Government as the Government becomes frustrated. Let us examine the position in relation to the present Parliament. Issues come before the two Houses which may give rise to a double dissolution under the present terms of the Constitution. I can assure honorable members that that is not impossible.
– It is very new for a Liberal party to object to an upper bouse.
– I am not objecting to an upper house. I am sorry the honorable member has been paying no attention to what I have been saying in the last few minutes and has lost the thread of my remarks.
– The principle of deadlocks is what the right honorable gentleman is complaining about.
– I am talking of deadlocks and not holy deadlocks but unholy deadlocks.
– There is one in every State and the Liberals are not objecting.
– The House will hear the honorable member’s characteristic whining before the debate is completed. If the honorable member had been in a Cabinet, he would understand perfectly that nothing can be more futile from the point of view of the people of Australia than to perpetuate a state of affairs in which a government that has been handsomely elected to the House of Representatives can be set at nought. That could happen even after a double dissolution because of a system of election which frustrates the will of the people in the Senate and upholds it in the House of Representatives though the same people vote in the same way.
– This is the ex-Victorian legislative councillor, who never uttered a word of protest-
– I am sorry to inform the honorable member that there is no provision for a double dissolution in the State of Victoria. I am talking about the Commonwealth of Australia. He must come out of his ancient history and become right up to date.
– It is very unpalatable.
– What is unpalatable?
– The fact that the right honorable gentleman sat in the Legislative Council for years, but never uttered a protest against the undemocratic franchise of that body.
– The honorable member should not exaggerate so much. I glittered above the horizon in the Legislative Council of Victoria for twelve months.
– Completely futile !
– Do not exaggerate. I am one of its few living old boys. Suppose that, during the life of this Parliament, there were to be a double dissolution under the terms of the Constitution as they now stand. There would be, as all honorable members will agree, a strong probability of a continued deadlock after the dissolution. But, under the provisions of this bill, it is strongly probable that the party that won in the lower house election would also have a sound majority in the upper house. Briefly, the bill provides that, in the event of a dissolution of the Senate-
Conversation being audible,
– I shall wait, Mr. Speaker, until members of the Opposition cease talking and become more interested in the bill.
– Order ! - There is altogether too much conversation on both sides of the House.
– It is the Government Whip who is causing the trouble.
– One Whip and a couple of scorpions. There is a biblical parallel for that.
The bill provides that, in the event of a dissolution of the Senate, the ten vacancies in each State shall be filled by the election of two groups of people - five senators for a sis-year term and five senators for a three-year term. In other words, two Senate votes will be recorded by each elector.
– Will there be two ballot-papers?
– Not necessarily. The two votes may be recorded on one ballot-paper. However, that is a matter of machinery. Both ballots, of course, will be conducted at the same time. In one ballot, the elector will vote for five senators to be elected for a six-year term, and in the other he will vote for five senators to be elected for a three-year term. Thus, he will vote for ten senators in all, as at present, but he will vote for them in two groups - the six-year group and the three-year group. Briefly, there will be two concurrent ballots for the Senate.
– I should not like to have to count the informal votes.
– I have a higher opinion of the literacy of the Australian people than has the honorable member for Fremantle (Mr. Beazley). I believe that the people will understand the system perfectly, though I notice from the attitude of some members of the Opposition that they are anxious that it should not be understood. In the result, it is inevitable under the proportional system that one side must win at any rate three out of the five vacancies in each contest. In brief, we propose to make proportional voting effective for the Senate by adopting an odd number of candidates to be selected. Let us consider a typical case. Suppose that one side had a victory in, say, the State of Victoria, equal to the one that the Government parties had at the last general election. Then the Government Senate candidates - assuming that the Government was on the winning side - would win six places and the Opposition candidates would win four. In
South Australia, if the voting were as it was on the 10th December of last year, the Labour party would secure six vacancies and the Government parties would secure four.
– There might still be a deadlock.
– Theoretically that is possible. I said so earlier. A deadlock would occur if the results were 9ix to four one way in three of the States and six to four the other way in ‘the remaining three States. There is no way of escaping from that. The real business of the bill is to minimize the chance of having a deadlock, and it does so by providing for candidates to be elected in two lots of five in each State so that we shall not be condemned to fifty-fifty representation of any one State, at any rate, in the Senate. Each side will have a chance of securing a majority of senators from every State.
The proposed change is really not so extraordinary as might be supposed. I remind honorable members of the terms of section 13 of the Constitution. The question of what should happen after a double dissolution was looked at, and it is dealt with in that section. The men who drafted the Constitution realized that, if there were a double dissolution, six senators would have to be elected at that time for each State and that it would be necessary to arrange their election so that half of the Senate would go to the people every three years. Therefore, it was necessary to provide for the division of the six winning senators from each State in a double dissolution election into three who would sit for three years and three who would have a term of six years. Under the Constitution as it now stands, that problem is attended to by the Senate itself. The provision is that-
Therefore, under the Constitution of this nation as it now stands, the Senate itself divides the successful candidates after a double dissolution into six-year senators and three-year senators. The proposed amendment of the Constitution simply provides that, instead of the Senate dividing the successful candidates into two classes after a double dissolution, the electors will perform that task when they vote. The proposal, therefore, is not only calculated to avoid futility in the Parliament, but is also designed to ensure an essentially democratic procedure. I repeat that, by this system, the people themselves will be asked to decide who shall have a six-year term and who shall have a three-year term.
– Will candidates for the Senate nominate specifically for either a three-year term or a six-year term ?
– The parties will attend to that. They will nominate their candidates as they do under the present system. Nobody else will do it for them. All that the parties will have to decide will be whether candidate Jones, Brown or Robinson shall nominate for a six-year vacancy or a three-year vacancy. Under this system, the people will decide who shall have a six-year term or a three-year term instead of leaving that decision to be made afterwards. The fact that there will be odd numbers instead of even numbers in each division will mean that one side or the other must have a majority of the five candidates elected.
– Not necessarily “must”.
– Yes, necessarily “ must “.
– There could be a deadlock under that system.
– What I am saying is that, in any one State, one side or the other must have a majority of at least three to two in each group. There might be a majority of four to one in some almost fantastic circumstances, but at any rate one side must gain a majority of three to two. As I said some minutes ago, it is theoretically possible under this .proposal, or under any other proposal - excluding a permanent alteration of the number of senators, and even then there would be no absolute safeguard - that there would still be even numbers in the Senate; but under the existing system, that is next door to being a stone certainty. Therefore, what we are putting before the Parliament, and what we shall put before the people is a proposal that every sensible step shall be taken to ensure that, if there is a double dissolution, the Parliament thereafter will be. able to get to work and that, whatever government emerges, it will know that it has not only a mandate from the people and majority in this House, but also a majority in the Upper House.
– It would be better to abolish the Senate.
– The honorable member for Melbourne (Mr. Calwell) says that it would be better to abolish the Senate. We heard no hint of that during Labour’s eight years of office.
– They doubled the membership of the Senate.
– As the Minister for Information (Mr. Beale) reminds me, the Labour Government, although pledged to the abolition of the Senate, succeeded in almost doubling its membership.
– That was because wu acted constitutionally.
– Yes, but never unwilling to try to alter the Constitution. On this, as on other matters, honorable members opposite should first seek common ground. If proportional representation can produce an equality of voting strength in the Senate out of inequality of voting strength in the electorates; in other words, if a majority of the electors can do no more than produce equality of strength in the Senate, then proportional representation is defective indeed. Worse still, it is a denial of popular self-government, and we shall not leave a position like that untouched. The claimed purposes of proportional representation are two ‘in number. The first is that, like any other system of voting, it purports to reflect in the Parliament the will of a majority of electors, expressed through a majority of their representatives. Secondly, proportional representation aims at giving effective representation, but not equal representation, in the Parliament to minorities. Once a minority is given equal representation with a majority in the Parliament, the validity of the majority is denied, government becomes impossible, and the whole purpose of the institution of Parliament is defeated. It is clear, therefore, that if there is an even number of seats for each electorate - in this instance, of course, the electorates are the States - those two objectives may be, and probably will he completely defeated. Nothing could be more exasperating to a community that wants clear administration and a firm course of legislation, than to have the prospect of a double dissolution that will leave matters exactly as they were. Those remarks, I believe, are sufficient to explain the bill, which is quite short.
– The Prime Minister should go in for the crossword puzzle business after this.
– I am coming to that. The Leader of the Opposition is very nimble to-night. Earlier, he was ten yards in the rear, but now he is half a yard ahead of me. Clause 3 not only sets out the changes that are to be made, but also, as honorable members who have examined the Constitution will recognize, incorporates the relevant remaining provisions of section 13 of the Constitution. One clause that may perhaps produce some mystery, is what the Leader of the Opposition just referred to as a crossword puzzle. When I first saw it, fresh from the hands of the draftsman, I was rather puzzled myself, but after reflecting for five minutes, I realized, not for the first time, that the draftsman knew more than I did about the drafting of a bill. If honorable members read clause 2, they will see that it apparently introduces a slight touch of humour into an otherwise somewhat matter-of-fact proposal. The clause refers to section 7 of the Constitution, which relates to the composition of the Senate, and states -
Admittedly, that sounds rather like a mathematical epigram, yet it is the shortest way of stating the Parliament’s intention. The. Parliament, from time to time, may determine the number of members of the Senate. If it increases the number of senators, it is under a certain obligation in relation to the size of the House of Representatives; but clause 2 of this bill puts a. particular limitation on that power. Under that clause, there can be say 10, 14, or 18 senators in each State, because each of those numbers is divisible by two, but not by four without a remainder. In other words, half of each of those numbers is an odd number, and with an odd number of senators to he elected for six years, and an odd number for three years, there is little likelihood of a deadlock. On the other hand, there could not be twelve senators in each State under this new proposal because half of twelve is six, and with six senators contesting the three-year vacancies and six senators contesting the six-year vacancies, a deadlock would be almost inevitable. In brief, the provision means that half of the number of senators for each State must be an odd number. Thus, there will be two odd-number groups, one of six-year senators and one of three-year senators. In each group, one side or the other in politics must secure a majority. I agree with the person who said that there is luck in odd numbers. We are going to have odd numbers and I anticipate the luck. It seems to me that the draftsman has succeeded in putting in two lines a mathematical notion that might have been explained by some of us, perhaps more clearly, but in about fifteen and a half columns. I do not wish to labour this matter any further.
– Does this proposed alteration require a referendum?
– Yes, it requires an amendment of the Constitution and therefore cannot become effective unless the people approve of it at a referendum. In this proposed referendum the people will be asked to determine whether they desire to perpetuate a system under which every now and then there can be complete frustration of government in Australia, or whether they want a system under which, if there is a real clash between the two Houses, they may state quite clearly how the government of the country is to be carried on. That is the whole issue to be determined in this matter. In order that that issue might be decided by the people of Australia this bill must go through the process set out in the Constitution itself.
Debate (on motion by Mr. Chifley) adjourned.
Debate resumed from the 28th March (vide page 1232), on motion by Mr. Spender -
That the following paper be printed: -
Debate (on motion by Mr. Daly) adjourned.
Fascism - Mr. R. G. Pollard, M.P. - Mr. E. J. Ward, M.P. - Distribution of Literature in Parliament House - Mr. W. C. Wentworth, M.P.
Motion (by Mr. Menzies) proposed -
That the House do now adjourn.
.- I take this opportunity to raise a matter of the utmost importance. An investigation was instituted by the Chifley Government, through the security service, into a subversive organization which it was believed was being established to overthrow constitutional government in this country. I am anxious to know how far investigations have proceeded and their result. I am given to understand that this organization, which was particularly active in Melbourne, but also had its contacts in Sydney and no doubt throughout Australia, was being organized on similar lines to the New Guard movement, which was well known to honorable members of this House. The new organization was being organized on military lines and active in it were former prominent members of the military forces. When I say “prominent members “ I mean officers of high rank. I have been advised of the names of some of those gentlemen, but I prefer that the Government should inform the House of the result of its own investigations. How far have these investigations proceeded and what has been their result up to date? I ask that, because information which has been submitted to me indicates that this organization has not only been recruiting members but has also been organizing and training them on military lines. I have also been informed that quantities of military equipment which has been regarded as obsolete by the military authorities and made available for sale, has been bought by this organization. It is quite true that members of the organization may believe that at the present time there is less need for their services because at the time that I am speaking of a Labour government was in control of the affairsof the Commonwealth. Since t hen an election has taken place.
I believe that quite a number of influential graziers are associated with this organization. The investigation was instituted some time ago, and certain information was passed on to the Chifley Government. Therefore, it should not be difficult for this Government to tell the House what the security service has been able to find out. I ask for information on the result of the security service’s investigations into this movement because despite all the pretence on the part of the Government to a desire to preserve democratic institutions in this country, I believe that there are people actually in this House on the Government side who favour the totalitarian form of Government. That was clearly indicated to-night by the Prime Minister (Mr. Menzies) himself when he admitted that the personal liberty of members of this House, elected by popular vote of the people, is in danger from the anti-Labour Government. The Prime Minister showed quite clearly that not only did the Government believe that certain Labour senators could be declared if the bill which is now before the Parliament is approved, but also Labour members in this House. Therefore it is a very good thing that honorable members should have an indication of the Prime Minister’s intention. He is using the Communist party as a screen to enable him to take action against every militant Labour man in this country. He has made that clear, because although he has often stated that this bill, if passed, is to be used exclusively against Communists, he has shown that that is not his full intention.
– Order ! The honorable member is now commencing to deal with a bill which is before the House and has been read a second time. His remarks of the past few minutes, I think, are trespassing on that ground.
– I do not propose to go against your ruling, Mr. Speaker, but I think I am justified in speaking on my own behalf, because I was the member who interjected at the time the Prime Minister made his threat. Therefore, I am taking the earliest opportunity to make it clear to the electors of Australia exactly what might happen in respect of some of their elected representatives. It is quite obvious that the organization to which I have referred may prove to be very useful to an antiLabour government if it desires to establish totalitarianism in this country. I believe that the organization was encouraged by the anti-Labour forces in this country, and that that is the reason for their hesitancy to tell this House the precise result of the investigations that have been made. They cannot deny that the investigation was instituted, because it was instituted by the Government of which I was a member. We want to know what has been the result of that investigation. We want to know who were the people responsible for this unconstitutional and subversive organization, and what action the Government proposes to take against it. 1 have endeavoured to obtain that information by interjection and by questions so that it may serve as a basis for discussions in the House, and I ask the Government now to make available a complete and up-to-date report of the exact position of the investigation that was instituted by the former Administration.
– In reply to the remarks made by the honorable member for East Sydney (Mr. Ward) and the query that they contain, I say first and foremost that I know nothing whatever about the investigation. However, I know that the principle laid down by the former Prime Minister and present Leader of the Opposition (Mr. Chifley) is a sensible one, and that it will be followed by the present Government. That principle i3 that investigations carried out by the Commonwealth Security Service should not be made the subject of public disclosures. If such matters were revealed to the world all the good that the investigations might otherwise do would be destroyed. It is obvious that the former Prime Minister realized that fact fully, because he established a special department under the supervision and control of Mr. Justice Reed, who was made available by the Government of South Australia for that purpose, and the right honorable gentleman was so mindful of the necessity for observing sensible vigilance concerning the security organization’s activities that he vested sole control of the organization in himself, and made it clear that Mr. Justice Reed was to have entree to him whenever he required it and that he was to function under the personal authority of the Prime Minister. As I have already said, I know nothing of the investigation referred to by the honorable member, nor is it likely that I shall know anything about it for the reasons that I have explained.
.- I believe that in the interests of factual reporting I should direct your attention, Mr. Speaker, and that of honorable members to a report that appears in to-day’s issue of the Melbourne Sim NewsPictorial. Under the heading, “ ‘ Escort ‘ for member into the House”, and the date-line “Canberra, Wednesday”, the following report appears : -
The Serjeant-at-Arms escorted Mr. Pollard (La bour, Vic.) back into the House of Representatives to-night on the instruction of the Chairman of Committees, Mr. Adermann.
Every honorable member who was present in the chamber last night knows that that
J3 completely untrue.
Government supporters interjecting,
– Order ! The honorable member for Lalor (Mr. Pollard) has the floor.
– I intend to hold it. If anybody challenges the accuracy of what I have said, see me after the meeting.
Government supporters interjecting,
– Order ! The honorable member must withdraw his provocative utterance which might produce a quarrel between honorable members, and it is my duty to prevent such an occurrence.
– That introduces my point of order.
– It does not. It is an instruction by the Chair that you must withdraw the threat against other honorable members.
– I did not threaten; I merely suggested that they should see me outside the chamber afterwards.
– Order ! I understand that language perfectly well.
– Very well; I withdraw that remark. I cast no reflection on the Chairman of Committees. I believe that I had left the chamber before the quorum was called for. I was actually holding the door open for the honorable member for Bendigo (Mr. Clarey), who, while leaving the chamber, delayed to speak, I think, to the honorable member for Adelaide (Mr. Chambers). I have been told since, and I believe it to be correct, that while the honorable member for Bendigo was speaking to the honorable member for Adelaide the Chairman of Committees called for the bells to be rung and ordered the honorable member for Bendigo to return to his place in the chamber. I understand since that the Chairman of Committees also called me into the chamber. However, I could not hear what was being said, although I did hear him order the Serjeant-at-Arms to escort an honorable member back to the chamber. I disappeared down the corridor, opened another door leading into the chamber, and returned to my place. I did not see the Serjeant-at-Arms until I had returned to the chamber. I ask you, sir, by what stretch of imagination I could be described as having been “ escorted back to the House “.
– The only difference is that the honorable member beat the Serjeant-at-Arms by 10 yards.
– The honorable member for Bass (Mr. Kekwick) could not beat any one. In explanation of my action, I say that after proceeding down the corridor I decided that it would be unfair to embarrass either the SerjeantatArms or the Chairman of Committees by absenting myself from the chamber. However, the fact is that I was not within the chamber when the Chairman of Committees called me back. I protest against the entirely false press report of the incident, particularly the statement that I was escorted back by the Serjeant-at-Arms. I can well imagine that under certain circumstances such a thing could happen, but it did not happen on this occasion, and the report is a lie.
– I cannot allow the occasion to pass without referring to some of the hypocritical remarks of that notorious pro-Communist, the honorable member for East Sydney (Mr. Ward).
– I rise to order, and ask that those remarks, which are offensive to me, be withdrawn and that the honorable member for Mackellar (Mr. Wentworth) apologize.
– The honorable member has asked that the honorable member for Mackellar withdraw the offensive remarks and apologize, and I ask him to comply with that request.
– I must withdraw in deference to your request, Mr. Speaker-
– And apologize.
– If the recital of these things offends the honorable member for East Sydney, of course I apologize - I would be unwilling to wound his delicate feelings. I shall content myself, therefore, with the recital of various facts. If the honorable member finds them offensive, then I am very sorry. The honorable member waxed eloquent about the misdeeds, or alleged misdeeds, of some alleged organizations. I wonder if the honorable member recalls the doings of the Labour army in 1927? I bring this up because the Labour army was formed principally by the man under whose patronage the honorable member for East Sydney entered this House. I refer to Mr. J. S. Garden, who carefully nurtured the honorable member for East Sydney and raised him to his present eminent political stature. The Labour army, which was formed in 1927, was organized into units, and I shall describe it by quoting from an official report, which states -
Units shall be formed in any city, suburb or town. A unit shall consist of not less than seven members. Each unit shall select a leader, deputy leader and correspondent, who shall form the management committee. The units may group themselves into companies for collective action. The general staff shall be appointed by the Labour Council of New South Wales and associated organizations.
There is no question that, in 1927, the Labour Council was under the domination of the man who made the honorable member for East Sydney. I refer, of course, to a former member of this House, Mr. J. S. Garden, who, in 1927, was setting up a military organization for the purpose of revolution. Further, I remind the House that the Workers’ Weekly, which was then the official Communist journal, preceding the Tribune in that respect, published, on the 20th July, 1928, a message from Russia in these terms -
The following message has been translated and delivered to the Workers’ Weekly for publication by Comrade Moxon, Australian representative at the recent anti-war demonstration of the Red Front Class War Fighters of Germany: - “ To the Labour Volunteer Army, Australia - Comrades,
Through Comrade Moxon we have heard of your organization, and we now send to you the very heartiest of fraternal greetings.
We look to you to build your organization and be prepared to stand up and protect the revolutionary workers of all countries.
It is no idle boast that our organization (the Red Front) has played a big part in preventing the Locarno and anti -Soviet Moo from being operated up to date.
The Labour Volunteer Army must assist us now and in the future.
Yours fraternally, (Signed) Thalmann, Willy Leo.”
– I rise to order. I should like to know whether the honorable member for Mackellar is entitled to quote from any book, document, or newspaper unless he is prepared to vouch for its authenticity.
– Order ! The honorable member may quote from a book.
– In view of the fact that the honorable member has distributed copies of that book to every honorable member, do you, Mr. Speaker, consider that it is worthwhile his repeating it?
– I vouch for the authenticity of those quotations, and I think that there is no doubt that they represent a true picture of what happened. The so-called honorable member for East Sydney-
– I rise to order. The honorable member for Mackellar has used the words, “ the so-called honorable member for East Sydney”. That remark is obviously offensive, and the honorable member should be asked to withdraw it.
– I did not hear the word “ so-called “. If the honorable member for Mackellar used it, he must withdraw it. The words “honorable member “ must be without qualification.
– The honorable member for East Sydney, honorable without qualification.
– Order ! I have asked the honorable member to withdraw the word “so-called”.
– I do so, sir. The honorable member for East Sydney was fully aware of the doings of his friend and mentor, Mr. J. S. Garden, at that time, and there is no doubt whatsoever that Mr. Garden was then preparing, not the kind of phantom and imaginary organization which the honorable member seeks to conjure up at this stage, but a very real military, revolutionary, Communist, Soviet-controlled organization dedicated to the overthrow of our democratic institutions. Although I have looked carefully, I have not yet been able to find that the honorable member for East Sydney has dissociated himself from those disgraceful incidents in the past of the Australian Labour party.
-(Hon. Archie Cameron). - Last night, on the motion for the adjournment, the honorable member for Parkes (Mr. Haylen) asked me a question about the distribution of certain, books in the chamber yesterday. I have looked into the matter carefully, and I find nothing in the Standing Orders and practice of this House that prevents an honorable member from giving books to other honorable members-
– Even if the other honorable members do not want them?
– That is a matter which honorable members have to decide for themselves. They are not obliged to accept the books.
– Somebody “ pinched my copy.
– The honorable member may apply for a re-issue. I point out to the House that almost the first thing that happens on the meeting of a new Parliament is the donation by the taxpayers to each honorable member, at the taxpayers’ expense, of a copy of the Bible on which that honorable member takes the oath. Therefore, the practice of giving books is firmly ingrained in the procedure of the House. Furthermore, the honorable gentleman himself is an author, and I assure him that if he desires to distribute copies of his latest works here, I shall not raise any objection to his doing so. I read one of his books last year, and I sincerely hope that his work? will at least be as well read by honorable members as the publication which was distributed yesterday, and the Bible? on which honorable gentlemen were sworn.
.- I ask you, Mr. Speaker, to convene a meeting of the Standing Orders Committee
– That will be done.
– I hope that the Standing Orders Committee will consider the matter that has been raised by the honorable member for Parkes (Mr. Haylen). ‘Honorable members are entitled to some protection against the kind of silly literature which may appeal to juvenile minds but which do not appeal to the adults on your left.
– Order ! The implication is that there are juveniles on my right. The honorable gentleman must not make imputations of that sort.
– I would not do that.
– Well, do not.
– Honorable members are entitled to protection against the distribution of literature of a type which, . to them, is obnoxious, false, and insulting. If what you, Mr. Speaker, say is true, and I accept it as being true, that you have no power to prevent an honorable member from distributing any literature that he likes to other Inorable members, a standing order should be formulated to give you the right to determine whether a book may be circulated with your permission. You can see that an absurd position may arise. If a gentleman who was mentally unstable were elected to this House-
– Order ! The honorable member should not deal with hypothetical cases.
– I have to deal with the possibilities that may arise. It hashappened in some parliaments. For instance, it happened in the Parliament of Victoria recently, when quite a number of unstable people were elected. They might decide to transfer their activities, and if they were elected to this Parliament and were to circulate that SO: of literature, and perhaps even more dreadful stuff to honorable members, you can see how the outraged feeling of some discreet and prudent persons like myself might cause us to move a vote of censure of the honorable gentleman responsible. Naturally, being placid and peace-loving people, we on this side of the chamber do not want to be embroiled, because of the distribution in this chamber of multicoloured and garishly-displayed stuff which is fit only for the place to which the honorable member for Parkes consigned a particular piece of this literature yesterday, and I place the word “ literature “ in quotation marks.
– Mr. Speaker-
– Order ! The honorable member for Lalor (Mr. Pollard) ha* already spoken on the motion for the adjournment, and may not speak a second time.
– I desire to make a personal explanation.
– Very well, I shall hear the honorable gentleman.
– The honorable member for Melbourne (Mr. Calwell) has expressed an opinion which cuts across my view on this matter. I am prepared to accept from any honorable gentleman literature upon any subject, provided that it is given to me free of charge.
.- I was amazed to hear the honorable member for Melbourne (Mr. Calwell) object to the distribution of the book to which he referred. I noted carefully the intense interest that members of the Opposition exhibited when they received them. I noted also that the honorable member for Parkes (Mr. Haylen) made a dramatic gesture by dropping his copy of the book into the waste-paper basket, as though it had a bad smell. I rescued it from the basket, and I found that it was a very interesting document. I believe that the minds of honorable gentlemen opposite havebeen considerably improved as a result of the intensive study that they have made of it. In view of the fact that the book was carefully prepared, that much energy and research was involved in establishing the facts that are set out in it, and that it has proved to be of such great interest to the Opposition, I hope that the Treasurer (Mr. Fadden) will consider the advisability of providing in the budget for a suitable number of copies to be delivered free to honorable gentlemen opposite so that they may distribute them to their constituents.
.- I wish to refer to an implication that the press, in reporting something that occurred in this chamber last night, published a deliberate lie. A quorum was called while I was speaking. Some members of the Opposition deliberately left the chamber so that a quorum would be called.
– That is not true.
– It is true. I do not dispute that the honorable member for Lalor (Mr. Pollard) believes that he was outside the chamber when the quorum was called. I shall merely state the facts. The Chairman of Committees ruled that the honorable member was outside the chamber, and he instructed the SerjeantatArms to escort him back to it.
Mr.Rosevear. - I rise to order. I submit that it is not competent for the honorable member for Bowman (Mr.
McColm) to discuss in the House something that took place in committee.
– Proceedings in committee that have been reported to the House are open to discussion. The consideration of the Commonwealth Bank Bill in committee was reported to the House, and the report was adopted. The present discussion arose from the action of the honorable member for Lalor (Mr. Pollard) in directing attention to a newspaper report. I do not wish the debate to develop into an argument about what happened in committee, because officially I have no knowledge of it. The boundaries of the House are fixed by the doors. Any honorable member who is inside the doors is inside the House.
– You have not given a ruling on my point of order, Mr. Speaker, which is that you cannot take cognizance of anything that occurred in committee. I submit that it is out of order for an honorable gentleman to discuss something that occurred in committee unless it was reported to you subsequently by the Chairman.
– That is a moot point. I do not propose to give an unconsidered ruling. I allowed the honorable member for Lalor to defend himself against what he said was an untruthful statement in the press. The honorable gentleman stated his case. If another honorable member does not agree with that case, I shall allow him to say why he does not. I shall consider the point that has been raised by the honorable member for D alley (Mr. Rosevear) and inform him next week of my opinion on it.
– The Serjeant-at-Arms was instructed to escort the honorable member for Lalor back to the chamber, whereupon the honorable gentleman, who was standing at the door, took to his heels and ran.
– I was standing outside the door.
– I did not say where the honorable gentleman was.
– The honorable gentleman said he ran.
– He did run. The door was open. Subsequently, the honorable gentleman entered the chamber through a side door.
– I came back unescorted.
– No one who was then in the chamber would know whether or not he was escorted back, but I believe that newspaper reporters could well have been under the impression, when they saw the honorable gentleman re-appear, that lie had in fact been escorted back.
.- I wish to refer briefly to the remarks that were made by the honorable member for Mackellar (Mr. Wentworth) regarding an alleged army with which the honorable member for East Sydney (Mr. Ward) is supposed to have been associated. From what I could glean from the -coherent passages of the speech of the honorable member for Mackellar, he alleged that the honorable member for East Sydney was guilty of unpatriotism or something worse in connexion with something that occurred as far back as 1927. As the honorable member for Mackellar referred to the operations of an army, I ask him, if I may do so, whether he will attempt to refute rumours that are current regarding his association with the Volunteer Defence Corps and the allegation that he was cashiered from that organization because he attempted to mine Cronulla beach one bright Sunday morning. Was he instructed by his commanding officer to mount his motor cycle, upon which he had broken all speed records, to disappear in the direction of “ the Brisbane line “ and not to come hack? Is it a fact that he was banned from the Cronulla area because of insubordination and disobedience of orders? It has been alleged that one section of the beach at Cronulla was used for military manoeuvres, that the officer in charge of the section of the beach at the time to which I am referring was the honorable member for Mackellar, that he decided that it would be a cunning stunt to use gelignite and live detonators on the beach, and that when the early morning bathers came to have their morning bathe they were whistled off the beach, which was railed off like a bombed area. Will the honorable gentleman also answer some questions regarding the re-issue to him, a fortnight before the last general election was held, of a driving licence that had been taken from him ? At about that time there was published in Sydney a pamphlet in which it was alleged that he was adopted as the Liberal party candidate for Mackellar because of the activities of the “ twenty fixers “, among whom were included the honorable member for Bennelong (Mr. Cramer). It was stated that he was adopted in peculiar circumstances. There were present at the meeting twenty persons from the head office of the Liberal party and twenty persons from the local branch of the party. As the Prime Minister (Mr. Menzies) said earlier to-night, honorable gentlemen opposite abhor even numbers. The honorable member for Mackellar was adopted by a majority of one vote. Why was the motor licence that was taken from him by a magistrate who said that he was not entitled to hold it restored to him a fortnight before the general election, when he was a nominated candidate?
The honorable gentleman has made atrocious attacks upon honorable members of this House. He has called them “ Communists “ or “ well-known proCommunists “ and has quoted from documents that relate to events that took place twenty or 30 years ago. He has called me a Communist on many occasions, but. the further I am away from him politically, the happier I shall be. In view of the fact that he is a cashiered officer of the Volunteer Defence Corps and a person who no longer holds a driving licence, or, if he does, holds it at the will and whimsey of the powers that be and that his presence in this House is due to the actions of the “ twenty fixers “ of the Liberal party, what right has he to criticize other honorable members? I suggest that his criticisms have no weight because he is mentally unstable.
– I trust that I shall be in order in referring to the unprecedentedly filthy remarks that were made by the honorable member for Parkes (Mr. Haylen).
-Order ! The honorable gentleman shall not use the term “ filthy “. It is completely out of order.
– Very well, sir, I shall say that some unusual remarks were made by the honorable member for Parkes. I realize that I have already spoken once on this motion.
– The honorable gentleman may not speak a second time on the motion for the adjournment of the House, When the Speaker is on his feet the honorable member should not remain standing, but should resume his seat. The only method by which the honorable member may now speak is to make a personal explanation in order to deal with any point upon which he claims to have been misrepresented. Otherwise, he has no further right to speak to-night.
– Thank you, Mr. Speaker. I think that you will agree that I have some right to make a personal explanation in view of the fact that I have been entirely misrepresented. I did not raise any point of order while the honorable member for Parkes was speaking, although if I had done so you probably would have upheld it, since the matters that he raised were of a personal nature and not such as are normally debated in this House. Knowing as I do the mentality of the honorable member for Parkes-
– Order !
– I am sorry, Mr. Speaker. I am not aware that that statement is out of order.
– The honorable gentleman may now only speak on points on which he claims he has been misrepresented. Counter-attack is not allowed here in these circumstances.
– The honorable member for Parkes attacked me on three counts, the first of which was connected with something in relation to the Volunteer Defence Corps. The second was in respect of a motor licence, and the third related to my election to this House. Of those three matters the first two are personal matters, but, having been raised by the honorable member, I think that I should take the opportunity to reply to them. There is no secret about what happened at Cronulla. It was fully reported in the press at the time. The circumstances were that the incident had nothing to do with the Volunteer Defence
Corps, but occurred before that body was formed.
– It was the boy scouts.
– A particular kind of boy scouts who happened to keep safe the skin of the honorable member for East Sydney (Mr. Ward). The incident had relation to the Army and not to the Volunteer Defence Corps. At that time, which was either in January or February, 1942, it fell to my lot to conduct an exercise. I was told to simulate an attack upon the prepared battalion positions. These positions were not merely exercise positions, but were occupied for the defence of Sydney shortly after the attack on Pearl Harbour at a time when there- was no air reconnaisance or radar and when nobody knew where the Japanese fleet was. It might at that time have been off the coast of New South Wales. Certainly everybody knew that if the Japanese fleet had elected to move against Australia nobody could have stopped it from doing so. I had for some time previously been drawing attention to the possibility of adopting a policy of using what were later known as commando raids.
– Order ! The honorable gentleman is going beyond a personal explanation. He should deal with what happened on Cronulla beach and say whether the statement by the honorable member for Parkes is wrong or right, or he may qualify it in some way; but he may not on an occasion like- this embark upon a detailed discussion of the military activities on that beach.
– I bow to your ruling, Mr. Speaker, and although I should like to go fully into these matters in detail, I shall content myself by saying that the honorable member for Park«s is completely wrong in every respect, and that I shall welcome an opportunity to say so more fully in this House or elsewhere. I think that you will agree with me that I have been subjected to a personal attack on matters that are not of a public nature. That attack i9, as far as I know, without precedent in this House. If there is a precedent for it, I shall be glad to learn of it. The attack being unprecedented, I think that I should be granted the right to reply in detail to the false, malicious and hypocritical allegations made by the honorable member for Parkes. I have, of course, a full answer to those allegations, but I am bound by your ruling and cannot give that answer now. My driving licence was removed on the order of a magistrate whose verdict was upset, not by some traffic officer, but by Judge Lamaro, who found that it was a grossly false verdict founded on untrue remarks made by the magistrate from the bench. There had been, in the words of the judge, a considerable miscarriage of justice.
Honorable members interjecting,
– Order! The honorable member for Mackellar has had certain allegations made against him. Surely it is not too much to ask honorable gentlemen . to hear him in silence. Other honorable gentlemen may find themselves in a similar position some day and, perhaps, would be annoyed if other honorable members interrupted them. I shall ask the honorable member for Mackellar to restrict his remarks strictly to the point.
– I rise to order! The honorable member for Mackellar said a few moments ago that his conviction was upset because of untrue statements made by a magistrate from the bench. I ask you, Mr. Speaker, whether that statement is not contrary to the rules of this House by being a serious and grave reflection upon the judiciary.
– Order! The only judiciary mentioned in the Standing Orders is the High Court of Australia, and the honorable gentleman is in order so long as he does not criticize that court.
– I did not make the remarks attributed to me by the honorable member for Grayndler (Mr. Daly). I said that the judge had made those remarks about the magistrate. They were not my remarks, but the remarks of Judge Lamaro, and I consider that I am entitled to repeat them to this House without committing any contempt of court. I am unable to say anything about the magistrate. I know nothing else about him and have never met him. I have simply repeated to the House that the judge said that there had been a miscarriage of justice which was founded very largely on untrue remarksmade by the magistrate from the bench.
I have dealt as far a9 I can with twoof the honorable member’s statements. His third statement was that I had been elected by the “twenty fixers”. That statement, of course, shows an extreme ignorance of the methods under which the Liberal party, to which I have the honour to belong, selects its candidates. The figures quoted by the honorable member are wrong in every particular. The number twenty that he quoted has nothing to do with the constitution of theLiberal party which provides for a panel, not of twenty, but of 50. Of course, one does not expect the honorable member for Parkes to know these things. One simply says when he makes remarks of that character that he does not know what he is talking about - or perhaps he knows only too well. As to that, I do not know. I am sorry that I have not been allowed to develop my reply in detail,, so I simply say that what he has said is false in general and in particular.
Motion (by Mr. McEwen) agreed to -
That the question be now put.
Original question resolved in the affirmative.
The following papers were presented : -
Nauru - Report to General Assembly of the United Nations on . Administration of Nauru for year 1948-49.
New Guinea- Report to General Assembly of the United Nations on Administration of New Guinea for year 1948-49.
Papua - Report for year 1948-49.
House adjourned at 9.30 p.m.
The following answers to questionswere circulated: -
asked the Minister representing the Minister for Trade and Customs, upon notice -
Cite as: Australia, House of Representatives, Debates, 4 May 1950, viewed 22 October 2017, <http://historichansard.net/hofreps/1950/19500504_reps_19_207/>.