Senate
2 July 1931

12th Parliament · 1st Session

  1. Senate
  2. 12th Parliament
  3. 1931

The President (Senator the Hon. W. Kingsmill) took the chair at 3 p.m., and read prayers.

page 3269

PAPERS

The following papers were presented : -

Correspondence between the Government and the Commonwealth Bank regarding the guaranteed price of 3s. per bushel f.o.b. For wheat, approved under the Wheat Advances Act 1930.

Arbitration (Public Service) Act - Determinations by the Arbitrator, &c. -

Nos. 13 and 14 of 1931 - Amalgamated Postal Workers Union of Australia.

No. 15 of 1931 - Australian Postal Electricians Union; Australian Third Division Telegraphists and Postal Clerks Union; Commonwealth Postmasters Association; Commonwealth Public Service Artisans Association; Commonwealth Public Service Clerical Association; Federated Public Service Assistants Association of Australia; Fourth Division Postmasters, Postal Clerksand Telegraphists Union; Line Inspectors Association, Commonwealth of Australia; Meat Inspectors Association Commonwealth Public Service; Postal Overseers Union of Australia; and Professional Officers Association, Commonwealth Public Service.

page 3269

QUESTION

TRANSPORT WORKERS’ LICENCES

  1. Is it a fact that a Mr. Ziegler, who has recently been retired from the Customs Department, has been appointed a licensing officer under the Transport Workers Act in Melbourne ?
  2. What salary is to be paid to this officer, and what is the nature and term of the appointment?
  3. In view of the falling of the imports, and, in consequence of the customs revenue, are there no officers available in the Customs Department capable of carrying out the duties of licensing officer!
Senator BARNES:
Vice-President of the Executive Council · VICTORIA · ALP

– The answers to the right honorable senator’s questions are as follow : -

  1. Yes.
  2. £6 10s. per week, during pleasure.
  3. The work being of an urgent character, as well as being temporary in its nature, it was thought desirable to employ the services of the best man available without withdrawing any officers in the Customs Department from the discharge of their regular duties.

page 3269

QUESTION

STATUTE OF WESTMINSTER

Imperial Conference Decisions - Merchant Shipping Legislation

Senator MILLEN:
TASMANIA

asked the Leader of the Government in the Senate, upon notice -

  1. What action has the Commonwealth Government taken to induce the British Government to pass legislation declaring that such acts as the Merchant Shipping Act and the Colonial Laws Validity Act should not apply to the dominions?
  2. Has the Commonwealth Government been a party to the framing of the proposed act of the British Parliament, to be known as the “ Statute of Westminster,” under which it is designed to render inapplicable to the dominions British legislation that will make dominion laws invalid because of their being repugnant to the laws of England?
Senator BARNES:
ALP

– The answers to the honorable senator’s questionsare as follow : -

  1. The Commonwealth Government was represented at a conference of representatives of the United Kingdom and dominions held in 1929 to report on certain questions connected with the operation of dominion legislation and merchant shipping legislation. The conference recommended, amongst other matters, that legislation should be enacted by the Parliament of the United Kingdom to provide that for the future dominion acts should not be invalid by reason of repugnance to an act of the Parliament at Westminster.
  2. The report of the above conference was considered last year by the Imperial Conference, which adopted a schedule containing the clauses of the proposed Statute of Westminster.
Senator PAYNE:
TASMANIA

asked the Minister representing the Prime Minister, upon notice -

Is it the intention of the Government to bring before Parliament, for approval or otherwise, the necessary resolutions signifying agreement to the enactment by the Imperial Parliament of a statute embodying the recommendations of the Imperial Conference of 1930 in connexion with the operation of dominions legislation; and if so, when!

Senator BARNES:

– The Government intends, as soon as the emergency financial measures are disposed of, to present to Parliament a resolution providing for the submission by the Government of the United Kingdom to the Parliament at Westminster of a statute containing the provisions relating to dominion legislation and merchant shipping legislation agreed to at the Imperial Conference 1930.

Senator OGDEN:
TASMANIA

asked the Minister representing the Prime Minister, upon notice -

  1. What were the decisions the last Imperial Conference regarding the report and recommendations of the conference on the operation of dominion and merchant shipping legislation 1929?
  2. Are such decisions being given effect to by the dominion and Imperial parliaments ?
Senator BARNES:

– Theanswers to the honorable senator’s questions are as follow: -

  1. The decisions of the last Imperial Conference will be found on page17 of the published Summary of Proceedings (Command Paper 3717), a copy of which is in the Library.

Briefly, the conference recommended that the Parliament at Westminster should pass a statute to give effect to the conclusions of the conference on the operation of dominion legislation held in 1929.

  1. Canada and South Africa have passed resolutions requesting the Government of the United Kingdom to submit the necessary legislation to the Parliament at Westminster and a similar resolution will be submitted to this Parliament at as early a date as possible.

page 3270

QUESTION

IMPORTATION OF SEEDS

Senator MILLEN:

asked the Minister representing the Minister for Trade and Customs, upon notice -

  1. What is the quantity and value of seeds imported into the Commonwealth for the use of agriculturists and pastoralists for the year ended 31st May, 1931?
  2. What has been the amount of sales tax and primage duty collected on these seeds during the same term?
Senator BARNES:
ALP

– The figures of imports under individual statistical items are made up in respect of financial years only, and the figures for the last financial year will not be available for some time.

page 3270

QUESTION

RE AR- ADMIRAL EVANS

SenatorFOLL asked the Minister representing the Minister for Defence,. upon notice -

Was a report on the Australian Navy presented by Rear-Admiral Evans during his period of command of the Royal Australian Navy ?

If the answer to No. 1 is in the affirmative, will the Minister say whether this report has been made available to Parliament?

If not yet available, will the Minister make such report available to Parliament?

Senator DOOLEY:
Assistant Minister assisting the Minister for Works and Railways · NEW SOUTH WALES · ALP

– The answers to the honorable senator’s questions are as follow : -

  1. During his period of command,RearAdmiral Evans submitted many reports. 2and 3. The reports were made to the Naval Board, and were in many cases of a confidential nature. They were never intended for publication, and it is not in the public interest that they be made available.

page 3270

QUESTION

COMMONWEALTH OIL REFINERIES

SenatorFOLL asked the Minister representing the Prime Minister, upon notice -

Did Mr. Hogan, Premier of Victoria, state, as reported on page 129 of the Commonwealth and State Ministers Conference held in Melbourne recently, that he had been advised that the Commonwealth Oil Refineries made enormous profits, but that none of these profits go to the Commonwealth Government?

What dividends have been paid by the Commonwealth Oil Refineries on shares held by the Commonwealth Government?

Will the Government have careful investigation made into the serious statement made by Mr. Hogan if the report of his remarks is correct?

Senator BARNES:
ALP

– The answers to the honorable senator’s questions are as follow : -

  1. Yes.
  2. All profits have been re-invested in the extension and development of the business.
  3. The Commonwealth Government has approached the States with a view to ft joint inquiry into the prices which the oil companies, including the Commonwealth Oil Refineries, are at present charging for petrol.

page 3271

QUESTION

SENATE AND SUPPLY

SenatorFOLL asked the Minister representing the Prime Minister, upon notice -

Did a statement appear in the Brisbane DailyMail on Saturday, 27th June, and other Queensland newspapers, issued by the Minister for Trade and Customs (Mr. Forde), stating that the Government had advice, on unimpeachable authority, that the Senate would refuse to grant Supply after the 30th June?

Was th is statement made to the press with the knowledge and concurrence of the Prime Minister and other members of the Cabinet?

Will the Prime Minister advise what was the “ unimpeachable authority “ quoted by Mr. Forde?

Has the Government received any information relating to the alleged contemplated action of the Senate relating to Supply; and, if, so, from whom was this information received ?

Did the last Supply Bill presented to the Parliament carry the Government on beyond the 30th June?

Senator BARNES:
ALP

– The answers to the honorable senator’s questions are as follow : -

  1. Yes. 2, 3, and 4. The statement was made by Mr. Forde, who is quite capable of making his own statements and of taking full responsibility for them.
  2. The last Supply Bill presented to Parliament was passed by Parliament after the Premiers Conference plan had been adopted by the Federal Government, and after Mr. Forde had made his statement, which was dated the 18th June, 1931.

page 3271

QUESTION

HOOVER PLAN

Senator COOPER:
QUEENSLAND

asked the Minister representing the Prime Minister, upon notice -

  1. Is it a fact that if the Hoover proposals arc adopted Australia will be relieved of war payments to the extent of between £3,000,000 and £4,000,000?
  2. If so, will the Government consider using portion of this sum in relieving returned soldiers of the proposed 20 per cent. cut in their pensions?
Senator BARNES:
ALP

– The answers to the honorable senator’s questions are as follow : -

  1. If the Hoover proposals arc adopted, Australia will forego her share of reparations for the present year amounting to £830,000. At the same time, Australia will secure relief from interest payments during the present financial year on its indebtedness to the Government of the United Kingdom amounting to £3,920,000. The net gain to Australia for the year will thus be £3,090,000.
  2. The policy of the Government in regard to reductions in war pensions and other expenditure will be dealt with in a bill shortly to be introduced.

page 3271

QUESTION

IMPERIAL PENSIONERS IN AUSTRALIA

Senator E B JOHNSTON:
WESTERN AUSTRALIA

asked the Minister representing the Treasurer, upon notice -

  1. Is it intended to pay Imperial pensioners resident in Australia the value of the exchange properly due to them on their pensions, which are provided in full in English currency?
  2. Who has had the benefit of the exchange on these pensions during the past twelve months ?
  3. Is it intended to make any retrospective payments to Imperial pensioners, resident in Australia, on account of exchange which has been withheld from them?
Senator BARNES:
ALP

– The answers to the honorable senator’s questions are as follow : -

  1. Yes. 2 and 3. The benefits of exchange will be passed on by the Commonwealth to the pensioners, as retrospective payments will be made as from the 1st January, 1930. The first payment will be made shortly, and will cover the period 1st January, 1930, to 31st March, 1931. Subsequent adjustments will be halfyearly in October and April.

page 3271

QUESTION

WHEAT GUARANTEE

Correspondence with Commonwealth Bank.

Senator E B JOHNSTON:

asked the Vice-President of the Executive Council, upon notice -

With reference to the resolution carried by the Senate on the 30th April last, reading as follows : - “ That the correspondence between the Government and the Commonwealth Bank regarding the guaranteed price of 3s. per bushel f.o.b. for wheat, approved under the

Wheat Advances Act 1930, be laid on the table of the Senate, such action having already been taken by the Government in regard to correspondence between the Commonwealth Bank Board and the Treasurer with reference to the inability of the bank to make further advances to the Commonwealth Government “ -

On what date did the Government write to the Commonwealth Bank asking for its permission to lay the said correspondence on the table of the Senate?

On what date did the Commonwealth Bank reply to that letter?

Is it a fact that the Commonwealth Bank gave immediate permission for the papers to bo laid on the table, but suggested that the whole of the correspondence should be disclosed ?

Why has the said correspondence not been produced ?

Senator BARNES:
ALP

– The answers to the honorable member’s questions are as follow : -

  1. 16th May, 1931.
  2. 30th June, 1931. 3 and 4. See reply to 2.
Senator E B Johnston:

– At any rate we now have the correspondence.

page 3272

QUESTION

PORT OF GERALDTON

Senator BARNES:
ALP

– Information is being obtained in regard to a question asked by Senator E. B. Johnston relative to the granting of a continuous permit to the port of Geraldton.

page 3272

QUESTION

WYNDHAM AS AN AIR PORT

Senator E B JOHNSTON:

asked the Minister representing the Minister for Defence, upon notice -

  1. is it n fact that Captain Pattiste, of the Dutch air liner which recently made Wyndham it* first port of call in Australia, expressed the opinion that the claims of Wyndham as an air port of entry into the Commonwealth were overwhelming, but had pointed out that there was an urgent need for the provision of ari all-weather landing ground there?
  2. Is it a fact that Dr. Webster, the Resident Magistrate at Broome, has reported to the Premier of Western Australia that local contractors were prepared to undertake the provision of an all-weather landing ground at Wyndham for a maximum of £400?
  3. Will the Minister have this offer investigated promptly with a view to its acceptance by the Commonwealth ?
Senator DOOLEY:
ALP

– The answers to the honorable senator’s questions are as follow : -

  1. I arn not aware of any report by Captain Pattiste in regard to the relative merits of Wyndham and Darwin as air ports of entry to the Commonwealth. It is moreover improbable that Captain Pattiste made any such comparison in view of the fact that he has not inspected any possible port of entry other than Wyndham.
  2. No such report is on record in the Defence Department.
  3. The report will be investigated when received, but in the present time of financial difficulty there is little prospect of funds being allocated for the preparation of an allweather ground at Wyndham.

page 3272

QUESTION

FINANCES OF TASMANIA

Report of Public Accounts Committee

Senator SAMPSON:
TASMANIA

asked the Minister representing the Prime Minister, upon notice -

  1. Have any of the recommendations contained in the report of the Joint Committee of Public Accounts on “ The Finances of Tasmania as Affected by Federation “, presented to Parliament on the 7th August, 1930, been given effect to?
  2. If not, what are the reasons for ignoring the committee’s recommendations?
  3. Does the Government intend to adopt any of them; if so, which?
Senator BARNES:
ALP

– Consideration of these recommendations was held in abeyance pending the further report of the committee on “ The Finances of Tasmania as Affected by Federation which has recently been received. The recommendations contained in both reports are receiving consideration in connexion with the budget proposals.

page 3272

QUESTION

PUBLIC SERVICE

Five-Day Week

Senator OGDEN:

asked the Minister representing the Minister for Industry, upon notice -

  1. What is the object of the proposed fiveday working week for public servants?
  2. Has the Public Service generally expressed any desire for the change, and is the Service opposed or otherwise to the change?
Senator BARNES:
ALP

– The answers to the honorable senator’s questions are as follow : -

  1. Information available to the Government indicated that improved efficiency, and in certain cases definite economy, would result from the adoption of the five-day working week.
  2. Representations in favour of the change were made by representatives of certain Public Service organizations. I am not aware of any opposition to the proposal by the officers of the Public Service concerned.

page 3273

QUESTION

HON. C. E. CULLEY, M.P

On what date did His Excellency the GovernorGeneral accept the resignation of the Honorable C. E. Culley, Assistant Minister?

On what date was His Excellency the Governor-General in Canberra ?

Senator BARNES:
ALP

– In accordance with constitutional practice Mr. Culley has not resigned his appointment as a member of the Federal Executive Council which was made by His Excellency the Governor-General. His resignation from the Cabinet, however, was accepted by the Prime Minister to take effect on and from 25th June, 1931.

page 3273

QUESTION

COLLECTION OF TAXATION

Senator BARNES:
ALP

– Information will be obtained as early as possible relating to a question asked by Senator Pearce regarding the cost of the collection of federal income tax and sales tax.

page 3273

QUESTION

GOVERNMENT SAVINGS BANK OF NEW SOUTH WALES

Senator COX:
NEW SOUTH WALES

asked the Minister representing the Treasurer, upon notice -

In the event of any new money being required for the forthcoming loan, will the Commonwealth Government approach the commissioners of the State Savings Bank of New South Wales urging them to make available the money they hold belonging to depositors where those depositors desire to place it in the new loan?

Senator BARNES:
ALP

– It is understood that the deposits lodged with the State Savings Bank of New South “Wales by depositors are at present fully invested and that the money is, therefore, not available for investment in a Commonwealth loan.

page 3273

LEAVE OF ABSENCE

Motion (by Senator E. B. Johnston) agreed to -

That leave of absence for one month be granted to Senator Sir Hal Colebatch on the ground of ill health.

page 3273

PREMIERS CONFERENCE

Printing of Report

Debate resumed from the 1st July (vide page 3211), on motion by Senator Barnes -

That the paper laid on the table of the Senate on the 1 7th June, 1 93 1 , namely “ Con ference of Commonwealth and State Ministers held at Melbourne, 25th May to 11th June, 1931 - proceedings and decisions of conference; together with appendices “ be printed.

SenatorKNEEBONE (South Australia) [3.15]. - I hope that I appreciate the seriousness of the problem confronting the Government, particulars of which were brought under the notice of this chamber yesterday by the Vice-President of the Executive Council (Senator Barnes). At a time of national crisis, such as the present, every citizen worthy of the name should be desirous of doing his best, and I believe that in this instance most Australians are anxious to assist their country. In dealing with every big and important problem, we all endeavour to exert our best efforts, but we cannot always agree upon the methods to be adopted. I find myself somewhat in that position to-day. There may be some excuse for those of us who disagree with this scheme, because, after having spent weeks, probably months, in preparing what is now commonly known as the Premiers plan even the experts themselves were not unanimous on all the proposals submitted. I do not think it will be held that because we do not agree with the methods proposed in their entirety, we are in any way opposed to the best being done, according to our lights, to extricate the Commonwealth from the almost intolerable position in which it is at present.

Whatever my views may be. upon the plan itself, I do not approve of some of the propaganda adopted by individuals and organizations directly concerned with its operation. In common with other honorable senators I have received a budget of correspondence from different sources. I can understand to some extent the feelings of some of the persons concerned, but I do not approve of the methods adopted by many in putting their claims before a chamber such as this. I am satisfied that our decisions, whatever they may be, will not be influenced by attempts from outside to bring pressure to bear upon us. In introducing this important motion yesterday, the Minister said, “ God knows what will happen “. In these circumstances, we may be excused for expressing our views as to what may happen. The Leader of the Opposition (Senator Pearce) set out with the admirable determination to keep the discussion of this important subject above party lines and free from recriminations. But he had not proceeded far before he indulged in a review of recent political history which -was by no means above party politics, and concluded by saying that in his opinion the country could be saved only by a change of . Government. He contended that there were certain tasks associated with the plan which must be undertaken by some Government, and that this Government could not stand up to them. In these circumstances, I may be forgiven for occupying the attention of the Senate for a few moments in quoting a few extracts from a speech delivered by the ex-Prime Minister (Mr. Bruce), on this important subject. It is easy to say, “ I told you so or to blame the other fellow; but I think it would be better if more attention were paid to the future than to the past. In justice to the party of which I am a member, I wish to quote remarks made by Mr. Bruce in delivering the Joseph Fisher lecture on commerce at the Adelaide University in July, 1927. On that occasion I had the great pleasure of listening to every word of the able utterances of the then first citizen of the Commonwealth. ,

Senator KNEEBONE:
SOUTH AUSTRALIA

– It was exactly four years ago yesterday that he delivered this lecture, but the fundamental principles to be applied to economic problems were the same then as now.

Senator Guthrie:

– Unfortunately, prices have fallen since then.

Senator KNEEBONE:

– Prices may be up again to-morrow. I do not say that prices will, in reality, be up to-morrow; but that is the answer to the honorable senator’s interjection. If the policy of a government were altered to suit every changing circumstance, th? country would get nowhere. The government of the country should be conducted on fixed principles which, if right, should be followed at all times. A comparison of what Mr. Bruce said four years ago with what he told a Premiers con ference more recently is most interesting, especially as active propaganda is being carried on to make the people believe that we have reached the last ditch, that despair is next door, and that there is no hone for the country. The preaching of that policy has made . conditions immeasurably worse than they were before.

Senator Payne:

– We have said all along that there is hope so long as the right thing is done.

Senator KNEEBONE:

– I hope tha) in this crisis the right thing will be done. Comparing Australia’s financial position with that of England, Mr. Bruce said -

I will deal in the first place with the question of public finance. This conveniently divides itself into expenditure from loan moneys and expenditure from revenue.

The position with regard to loan moneys ls that, as a result of the policy which has been . pursued in the past, Australia lias borrowed large sums, and to-day Iia” a very great national debt. There is a marked difference of opinion as to -what Australia’s future course with regard to her national debt, and her further borrowing, should be. One school of thought advocates that Australia should immediately cease borrowing, and devote herself to the repayment of her national debt. Advocates of this view accept the recognized practice of Great Britain in regard to her national debt. I will endeavour .to show in” a few minutes, however, that the position of Australia is vastly different from that of Great Britain, and that it would not be wise for us to accept the principles of finance which Britain has adopted in connexion with her national debt.

Mr. Bruce then quoted a number of figures which I will not read to the Senate. Among other things, they showed that Australia’s public debt at that time was over £1,000,000,000. In making a comparison of the national debt of Australia with that of Great Britain, Mr. Bruce said -

The first factor which has to be taken into account in connexion with Australia’s national debt is that some £305,000,000 of it was incurred for war purposes. This debt none of us would desire to challenge. We recognize that it was incurred in order to enable Australia to play the great and wonderful part that was hers in support of the Mother Country and the allied cause. This debt of £305,000,000 is the only dead-weight debt for which Australia is liable; the remaining portion of her indebtedness was incurred for the purposes of development, and is represented by valuable assets.

The national debt of Great Britain to-day stands at approximately £7,500,000,000, the whole of which is a dead-weight debt, and is represented by no assets, except receipts in respect of allied debts and reparations. This dead-weight debt of Great Britain represents a liability per head of population of something in the nature of £170. The liability of the Australian citizen in respectto the dead-weight debt of Australia is somewhere in the region of £50 a head.

Mr. Bruce was endeavouring to show that we, in Australia, should not necessarily follow the lead of other countries, or resort to practices which are popular in some quarters to-day, merely because we have a heavy national debt. In another portion of the report, from which I have already quoted, Mr. Bruce said -

From what I. have said it is, I think, clear that it is impossible to accept the view of those who say that we should proceed to pay off our national debt, and should not incur any further obligation by additional borrowing. It is our duty to provide for the redemption of all our existing debt, and this is done in ample measure under the financial proposals which the Commonwealth recently submitted to the States, and of which the States have expressed their approval.

In the opinion of the right honorable gentleman, Australia’s national debt had been placed on a sound basis by the financial agreement, because by it interest was secure, and there was a definite sinking fund, so that, in a given period, the debt would be wined out. The report of the right honorable gentleman’s speech continues -

To summarize theposition with regard to our national debt, as I see it. We have incurred a great debt, one-third of which is of a dead-weight character, and two-thirds of which has been created for developmental purposes, and is represented by assets. Provision must hemade for the redemption of the whole of this debt, but particularly for the dead-weight debt. Such provision is made under the financial proposals which the Commonwealth recently submitted to the States.

Dealing with questions which are very much in evidence to-day, Mr. Bruce said -

I first desire to deal with the position of the Commonwealth. In that sphere there are certain obligations which nobody, I believe, would suggest can be reduced.Let me remind you what some of those obligations are. The first and largest of our obligations is to meet the expenditure consequent upon our war efforts. This represents an expenditure of little short of £30,000,000 a year, and is madeup of interest and sinking fund to redeem our war indebtedness, pensions to our incapacitated soldiers, pensions to widows, and provision for the children of the incapacitated and those who were killed in the war.

The next obligation is that for defence, which amounts at the present time to something like £5,000,000 a year, an expenditure which public opinion in Australia is inclined to consider should be increased unless a definite advance is made towards the insurance of the world’s peace, which we all so much desire.

Another obligation is with regard to invalid and old-age pensions and maternity allowances, which amount to over £9,000,000 a year, and which, without the reversal of a policy which is generally accepted, cannot be reduced although we hope to place invalid and old-age pensions upon a sounder and moreenduring basis by the introduction of a scheme of national insurance, and to improve the manner inwhich assistance is rendered in maternity cases.

That statement seems to be in conflict with the remarks of the right honorable gentleman which were quoted in this chamber yesterday by the Leader of the Opposition (Senator Pearce). It is not wise to depart from a sound policy because of some temporary difficulty which has been caused by influences over which we have no control.

I shall give some further quotations to show that no political party is in a position to cast stones at another. Only a few weeks ago the present Prime Minister (Mr. Scullin), in a speech which was broadcast throughout Australia, answered very effectively the charge made only yesterday that Australia’s deplorable financial and economicposition is mainly attributable to the maladministration of thepresent Government. The right honorable gentleman then said -

On assuming office in 1929, our Government was faced with an adverse trade balance, a large deficit, falling revenue, increasing expenditure, heavy commitments, growing unemployment, and a decline in the value of our exportable products - a prospect that was dark indeed.

The Prime Minister (Mr. Scullin) pointed out, further, that exchange was now,costing the Commonwealth about £10,000,000 per annum. As a first step towards correcting the adverse trade balance and to avert the alternative of default, the Government was forced to take drastic action through the Customs Department, because, as he explained, we could not continue the practice of importing goods largely in excess of our exports, and expect to remain solvent.

The action then taken was necessary to restore confidence in the stability of the Commonwealth.

SenatorR. D. Elliott. - And the number of unemployed now totals 360,000.

Senator KNEEBONE:
SOUTH AUSTRALIA · ALP

-Surely the honorable senator does not. contend that the increase of unemployment is due to a change of government?

SenatorR. D. Elliott. - It is largely the result of lack of confidence in the Government.

Senator KNEEBONE:

– I am well aware that any explanation which I could offer in support of the artificial interruption of trade through the operation of our tariff or the protectionist policy of this Government would not meet with the approval of many members of this chamber. Nevertheless, it should be obvious to all that, since drastic action was imperative to check the rising tide of imports, a substantial loss in customs revenue was inevitable and, possibly, some proportion of that increase in unemployment may have been attributable to the drastic changes made. But I contend that the allegation that this Government’s administration is responsible for lack of confidence overseas, is not borne out by the facts. Since many loan operations of the previous administration proved partial failures, we are justified in assuming that Australian credit had been seriously impaired before the present Government took office. For example, in March, 1928, the Bruce-Page Government approached the London market for a 5 per cent. cash loan of £8,000,000, issued at 98. Of the amount required 84 per cent. was left to the underwriters. In July of the same year, it asked for another cash loan of £7,000,000, 87 per cent. of which remained with the underwriters; in January, 1929, still another cash loan of £8,000,000 was floated and 84 per cent. was left with the underwriters, and in May, 1929, out of a conversion loan of £12,000,000, 48 per cent. had to be taken up by the underwriters. This indicates how Australian credit was progressively declining under the administration of the previous Government. It may be stated, however, that in May, 1928, a loan of £10,000,000 in New York was fully sub scribed. These figures show that the charge of having destroyed Australian credit cannot be laid at the door of the present Government.

SenatorR. D. Elliott. - This Government could not get any loan underwritten.

Senator KNEEBONE:

– Since the present Government has been in office, it has successively negotiated loan operations totalling over £100,000,000, and with the exception of one small issue of which £2,000,000 remained with the banks, the whole of the money asked for was readily obtained. The following is the list of loans floated by the present Government : -

That I suggest, is a complete answer to the charge that this Government has dissipated the credit of the Commonwealth. It is, I believe, historically true that a Labour Government on going out of office leaves surpluses and other governments dissipate them. That certainly has been our experience in Commonwealth administrations, because the Labour Government which preceded the Bruce-Page Administration left a substantial surplus and the Nationalist Government, when it was displaced by the present Labour Government, showed a deficit in its accounts.

I come now to the plan. It is a comprehensive indivisible scheme. By this I mean that, as it has been presented to us, it must be accepted in its entirety; otherwise the scheme must fail. It provides for -

  1. Expenditure. - A reduction of 20 per cent. in all adjustable Government expenditure as compared with the year ended 30th June, 1930, including all emoluments, wages, salaries, and pensions paid by the Governments, whether fixed by statute or otherwise, such reduction to be equitably affected.
  2. Interest. - The conversion of the internal debts of the Governments on the basis of a 22½ per cent. reduction of interest.
  3. The securing of additional revenue by taxation, both Commonwealth and State.
  4. A reduction of bank and savings bank rates of interest on deposits and advances.
  5. Belief in respect? of private mortgages.

That was the plan as it left the Premiers Conference. Very soon it became obvious that there was nothing in it that would help anybody very much, so the Loan Council met immediately afterwards and decided that, as part of the plan, there should be floated a loan of £8,500,000, of which £2,500,000 would be utilized to assist necessitious farmers and £6,000,000 in connexion with unemployment.

Naturally these proposals are the subject of very serious consideration throughout Australia and beyond Australia also. If I were convinced that the plan offered a solution of our difficulties. I should be the last in the world to say one word against it. I believe, however, that other things will have to be done, and drastic action taken if we are to solve our problem on lines that will be satisfactory to all sections of the community. Even the financial experts who advised the conference, do not contend that the plan will overcome all our troubles. This is only the first essential, as it has been called by several of those who have discussed the matter. Professor Copland, in submitting the report of the subcommittee of the Loan Council on the 22nd May, said -

Even with the efforts of the magnitude suggested, it will not be possible to balance budgets during the next three years.

So that, after we have done all the things prescribed by these authorities and experts - if they are done - we shall still be, if not in the position of defaulting, at least unable to pay our way unless further action is taken. Therefore, in my opinion, the plan falls short of what is necessary to meet the national crisis with which we have to deal.

Take the position of the Commonwealth itself. It is proposed to save over £2,500,000 by a reduction of interest, about £3,500,000 by reducing old-age, invalid and war pensions and maternity allowances, £1,750,000 by reductions of wage rates and variations according to cost of living, and £1,000,000 on other adjustable expenditure, making a total of £8,500,000. It is further proposed that, having made all those reductions, additional revenues shall be raised by means of the sales tax, primage duty andincome tax, to the extent of nearly £8,000,000. But even when all that has been done we shall still be more than £4,000,000 behind.

The States also have pledged themselves to make reductions. Victoria proposes to save in this way £1,750,000, which will leave her with a deficit of nearly £1,000,000. South Australia’s reductions are estimated to improve her position to the extent of an additional £900,000, but will still leave her with a deficit of approximately £1,500,000. Queensland is to add to her reductions to the extent of £870,000, which will leave her with a deficit of £750,000. Western Australia, after obtaining an additional £660,000, will still have a deficit of £1,000,000. Tasmania is to make reductions totalling £130,000, but will still be £90,000 on the wrong side of the ledger. Therefore, as I have just said, the plan fallsshort of establishing budgetary equilibrium. If it were 100 per cent. successful, it would still leave Australia at the end of the year upon which it has just entered, with a deficit that has been variously estimated at from £11,000,000 to £20,000,000. Judging by the experience of the last twelve months, it appears to me that the deficit will be even greater than that. The experts themselves say that the cuts are just as drastic as are desirable or necessary for the present; that is to say that, after this dose of medicine has been taken, there is more to come - something else will have to be done to bridge the gap that will still exist between our revenue and our commitments.

I agree with the statement of the Leader of the Opposition (Senator Pearce) yesterday that we have had a multiplicity of conferences. It appears to me that we have gone from conference to conference, and have allowed wellintentioned people outside to decide in effect policies of governments. Although the whole of their advice has not been adopted, that which has been accepted has not proved entirely successful.

Let me revert to the well-known August conference, which was addressed by Sir Otto Niemeyer. The views expressed by that eminent financial authority were followed with close attention. He came to Australia, examined our financial position, saw what we were earning, spending, borrowing and lending, and came to the conclusion that our living standard was higher than could be maintained. That was what the Argus of the 22nd August last reported him as having said. Following that advice, governments, employers, and other authorities, approached the Arbitration Court and secured a lowering of the standard of living to such an extent that £40,000,000 per annum was taken from the pockets of the workers; yet the position, instead of improving as a result of that action, has become worse.

Senator Sir William Glasgow:

– The action was not taken as .a result of that statement.

Senator KNEEBONE:

– I am merely saying that he expressed that opinion. Evidently our authorities concurred in it. It was immediately after the consultation of the Premiers Conference with Sir Otto Niemeyer and Sir Robert Gibson that the wages of the* workers throughout Australia were reduced by 10 per cent. It was considered that that would go a long way towards solving our troubles.

Senator Herbert Hays:

– That action was. governed largely by the fall in the cost of living.

Senator KNEEBONE:

– That is partly so. But when, irrespective of the cost of living, a drastic slash of 10 per cent, was made in the returns of the wealth producers, the position became worse, and instead of the lower standard of wages leading to greater employment, fewer people were employed. It is historically established that unemployment increases as a result of any lowering of the still]. dard of living. Carried to its logical conclusion, if a lowering of the standard of living by a reduction of wages improved the position of a nation, those countries where the people work for nothing and have nothing should be the richest, whereas, in reality, they are the poorest.

Senator Herbert Hays:

– A lowering of the cost of living does not reduce the standard of living.

Senator KNEEBONE:

– This 10 per cent, cut was made irrespective of the standard of living. Arbitration Court awards were set aside for twelve months, and a cut of 10 per cent, was prescribed, in addition to the reduction brought about by the fall in the cost of living; consequently, the workers of Australia have been reduced by an additional 10 or 15 per cent.

I come now to the conference that was held in February of this year, to which’ reference was made yesterday by the Leader of the Opposition. On page 77 of the report of that conference will be found a letter from Mr. C. H. Tranter, in which he clearly pointed out that the rates of interest should be left untouched. Then, on the 26th February, the conference re-affirmed a resolution that had been passed at the meeting held in Canberra on the 13th February, and considered a further motion in relation to the proposal to have in Australia a fiduciary note issue. The decision of the conference reads as follows : -

As the Commonwealth Bank, through the

Chairman of Directors, has informed the Commonwealth Government that the hank cannot provide the necessary funds for the whole of these purposes under existing legislation, the Commonwealth Government should introduce the necessary legislation to create an issue of fiduciary currency to he devoted to such purpose covered by loans raised from the public from time to time. This issue should be limited to £18,000,000. The advances made from the fiduciary notes fund are to be as the market conditions become favorable.

That is to say, the money was to be advanced and repaid out of a loan raised at an appropriate time. The right honorable the Loader of the Opposition said that this resolution was not adopted, but the official report shows that after the discussion of it the representatives of the Commonwealth, Victoria, and South Australia approved of it, and those of Queensland, Western Australia, and Tasmania dissented, and I understand that it was taken as having received the approval of the conference. Mr. Lang was not in attendance. Steps were subsequently taken in this Parliament to carry into effect what was obviously the desire of at least a majority at the Premiers Conference in February. It is interesting to note that the experts have now assented to, if they have not recommended, a drastic scheme for the breaking of contracts, if it may not even be described as repudiation. On page 93 of the report of the February conference, the experts dealing with the scope of economies estimated the gross government expenditure of the Commonwealth at approximately £194,000,000, of which £57,000,000 would be required for interest, and £51,000,000 for wages and salaries. But rather than take the steps now proposed, they said -

Nevertheless, when confidence is restored, a fall in the Australian rate of interest comparable to the fall in the world’s rate may be anticipated. Reduction cannot be accomplished by direct government action. The most hopeful means of reducing rates is that private enterprise should attract capital from abroad. But there are possibilities of reduction in Australia itself. The magnitude of our savings bank deposits exerts a great influence on the rate of interest. The rates offered by these banks affect interest rates generally, including the rates paid by industry and by government and public authorities on loans raised in Australia. These savings bank rates are much higher than in other countries. To attempt any reduction in these rates at present would be to invite a further exodus of savings and a further pressure on the rate of exchange.

Two months later we find them seriously proposing that all our financial obligations should be thrown into the melting pot, and that individuals, organizations, and institutions which have responded to appeals made from time to time by some of our leading politicians, if not statesmen, to invest in Australian bonds on the ground that they were as good as gold are to be ruthlessly deprived of 22^ per cent, of that which was guaranteed to them under contract only a few months ago. Mr. Theodore, the Treasurer, dealt with the position in April last after he had received an ultimatum from Sir Robert Gibson that the limit of advances to Australian governments bad been reached. In his reply, which has been referred to rather unkindly by honorable senators, he said -

Depressed prices and diminished trade have wrought havoc with the national finances of this and many other countries. Those who are responsible for general monetary policy, especially for the disastrous contraction of credit, are answerable for the present unhappy state of things.

Yet he was blamed for having attacked the banks unfairly. He went on to say -

In a communication from the Commonwealth Bank Board in February, the undertaking was given that, conditional upon wages, salaries, pensions, and social services being adequately reduced, the banks would provide funds to sustain industry and restore employment.

The attitude taken up by outside institutions is that, conditional on Parliament doing something, they will do something. If those conditions are not complied with they will do nothing. Obviously, the only alternative is default. To me it seems that the Parliaments of Australia, whether they like it or not, are now acting under an ultimatum issued by the financial institutions of the country. Mr. Theodore, in his letter, said -

A campaign of economy alone, no matter how drastic, would be inadequate to bring about budget equilibrium.

After spending weeks in considering the matter, the experts have admitted the truth of this declaration. They have admitted that, although reductions may bring us nearer to budgetary equilibrium, they will not bring about the- immediate balancing of budgets or find employment for one individual in Australia. It seems common sense to say that the only way in which a country can pay its way is by producing wealth.

Senator Herbert Hays:

– But the wealth must be produced at a profit.

Senator KNEEBONE:

– No one would employ labour unless he could make a profit by doing so. Mr. Theodore continued -

There can be no hope of a balanced budget nor a return to commercial prosperity while more than 20 . per cent, of our employable citizens are out of work. Even the most drastic reductions in the governmental expenditure that have been advocated, at any rate by persons with any sense of responsibility, would result in savings in the Commonwealth expenditure amounting to not more than two millions or three millions in excess of the savings already effected.

Since then, the amount has increased to £4,000,000. It is easy to say slash this and slash that and save money, but the last twelve months have shown “.s that things do not always work out to expectations. Drastic economy often results in greater unemployment.

Senator Cooper:

– Should there be a sheltered class in the community?

Senator KNEEBONE:

– No, but I hope to be able to show that there is no equality of sacrifice under the proposed plan. Indeed, it seems to me to be an extraordinary plan for the Government to propose, after its bold stand for the carrying put of the Labour policy. Apparently, a new psychology has been created to bring about such a tremendous change in the course of a few weeks. Of course if the banks stop, we stop, but if to-day we conform with certain terms laid down by the money lenders, there is nothing to prevent them from exacting further terms from us to-morrow. As to equality of sacrifice, I quote the following from the May monthly summary of Australian conditions issued by the National Bank of Australasia : -

Equality of sacrifice lias been the watchword of the committee and the conference, but the impossibility of obtaining anything approaching such equality appears to be only slowly and reluctantly realized.

There is no equality of sacrifice in taking 2s. 6d. out of’ a blind man’s pension, and the same percentage out of the salary of some one considerably higher up on the ladder. The proposed reduction will press so heavily on people on the lower rungs of the social or industrial ladder that they will have to go short of necessities of life. That cannot be said of people in more fortunate positions. There is, therefore, to be no equality of sacrifice. The monthly summary, from which I. am quoting, proceeds -

T.n any case, it may be affirmed that the trading banks would not, of their own accord, be prepared to alter’ existing contracts for the payment of interest to their depositors.

Senator Sir William Glasgow:

– The banks have reduced their rates.

Senator KNEEBONE:

– I give them credit for that. I am always prepared to face the facts fairly, and am willing to be corrected if I am wrong. No one will have greater pleasure than 1 shall have if this plan does solve our problems It not only affects the present generation but also will affect those who come after us. Personally, I may not be very much affected one way or the other, but my interest in die nation is higher than my personal interest. Nevertheless, I do not propose to subscribe blindly to a plan which I do not believe will prove successful. It is my belief that it will break down in the three years under its own weight, and that we shall have further trouble. The committee of experts claimed that it was their task not to deal with unemployment, but to suggest the means by which the governments could come nearer to balancing their budgets. If an item of £10,000 is cut off one side of the ledger to make it balance with the other side, it may be bookkeeping, but in administration things do not always work out so smoothly.

Senator Crawford:

– Can the honorable senator suggest an alternative?

Senator KNEEBONE:

– I shall do so in a few moments, although it is not my responsibility to do so. In South Australia last year, the Premier budgeted for a slight surplus, but although the Commonwealth authorities paid to the State over £1,000,000, the South Australian budget finished up about £2,000,000 on the wrong side of the ledger. Sometimes plans do not work out even when they are prepared by economists.

In regard to equality of sacrifice, I have with me the statement of Mr. C. E. Skitch, a holder of a diploma of economy from the Adelaide University, as to what the experts’ plan means to Australia. This gentleman says -

To summarize the whole of the foregoing, the following features of the experts’ plan stand out: -

1 ) The deductions amounting to over £4,000,000 from pensions is an exaction far greater from the poor than is the £3,000,000 odd to be taken from bondholders.

I can correct that, because the £3,000,000 referred to is to be taken from the Commonwealth bondholders alone. Inclusive of State bondholders, the amount will be’ over £6,000,000.

Senator Sir William Glasgow:

– Economists sometimes err.

Senator KNEEBONE:

– So do we sometimes. Mr. Skitch continues -

  1. The plan does not result in “equality of sacrifice “ but in effect impoverishes the already poor to enrich the rich. The changing value of money produces much of this inequality, and any programme based upon an all-round “cut” must result in inequality through the normal operation of the monetary system.
  2. 3 ) The “ cuts “ suggested to be made in civil service salaries also fail to measure up to the principle of “ equality of sacrifice “. The sacrifice made by a man receiving £300 to £400 per year is out of all proportion greater than that made by his luckier fellow-citizen in receipt of a salary of from £3,000 to £4,000 per year. In the latter case the sacrifice is hardly felt, whereas, in the former, it may mean going short of the actual necessities of life.
  3. Although Australia’s interest bill will be lowered, there will be a correspondingly lowered national income with which to Day it, so that the burden will be as heavy as ever and as impossible to sustain.
  4. The plan will not relieve the unemployment problem, but may aggravate it.
Senator Crawford:

– That seems a rather hopeless outlook.

Senator KNEEBONE:

– Yes. It is to the effect that if the proposed plan is adopted the position will be even worse than it is to-day. The proposals of the Government relate only to certain financial re-adjustment ; but as the Leader of the Opposition (Senator Pearce) said yesterday, we shall also have to deal with the economic problem. When the State treasurers were asked to submit estimates for the coming year to sustain the unemployed, it was suggested that £10,500,000 was necessary; but as the experts said that that would be insufficient the amount was increased by £3,000,000. As there are over 300,000 unemployed in Australia at present, it would appear that the number of unemployed will be increased by at least 100,000 during the present financial year if the money required for their sustenance has to be increased to £13,500,000. The experts were not asked to submit proposals for dealing with the unemployment problem, but only to deal with the financial obligations of the Commonwealth and the States.

Senator Payne:

– It is the responsibility of Parliament to deal with economic problems.

Senator KNEEBONE:

– If the rehabilitation of industry is left entirely to Parliament, I am afraid it will be a long time before any beneficial results are likely to accrue. The British Economic Mission, consisting of successful commercial men appointed because of their business acumen, visited Australia and inquired into our economic position. They submitted a valuable report on the 7th of January, 1929, on page 9 of which they said -

Our final conclusion in regard to Australia’s finance is that her creditors have no cause whatever for present anxiety, because she is still borrowing well within her actual and potential resources, but we are of opinion that she has not in past years always borrowed wisely, and that she has pledged to too great an extent those future resources, and mortgaged too deeply that future prosperity upon which she can reasonably reckon, thus throwing the burden of her borrowings upon future generations, who will have their own needs to meet.

That seems to be more in the nature of a business man’s description of Australia’s position.

As was pointed out by the ex-Prime Minister (Mr. Bruce) in the lecture to which I have referred, most of the money borrowed by Australia has been used in the construction of railways. That aspect of the question appears to have been overlooked - or at least close attention was not devoted to it - by the experts who advised the conference. As has been suggested by some honorable senators opposite, it is the responsibility of the Government to get down to business with respect to railways and other such undertakings. At present, Australia has seven railway systems under the control of separate authorities, who, in the matter of policy, have practically a free hand. Practically all the expenditure on Australia’s railway systems has been met out of borrowed money, and under the present system of control railway finance has been allowed hopelessly to drift. The South Australian Government has spent millions of pounds on a railways rehabilitation scheme carried out under the direction of an

American railway expert, who appeared to be under the impression that South Australian railways had to cater for a population as great as that of the United States of America. Huge railway engines, capable of hauling enormous trains such as are in use in the United States of America, were constructed, and even if such engines would be economical in normal times, their use has placed a terrific burden upon the State authorities during the present depression. Although huge engines and trucks costing hundreds of thousands of pounds were imported, and similar railway stock was’ constructed in South Australia, the railway department in that State has now been compelled to revert to the R. X. engines, which are more economical to run. A most elaborate dining car, constructed of steel and costing many thousands of pounds, has been placed practically on the scrap heap. In view of the expense incurred in controlling seven separate railway systems, it would appear that the Commonwealth authorities should intervene in an endeavour to bring about a more economical system. There seems to be some influence undermining the whole structure of the Commonwealth. It is unreasonable to expect the six State Premiers to hand over the powers which they now possess to the central authority. Already some State Governments are talking of secession and four have come to the Commonwealth annually for a dole.

Senator Crawford:

– They are the secessionists.

Senator E B Johnston:

– They want their own money.

Senator KNEEBONE:

– We should have in Australia a national government to properly conduct the affairs of the nation instead of six State Governments - whether anti-Labour or not - meeting in conference with the representatives of the Commonwealth without the power to lay down a national policy-

Senator Herbert Hays:

– The State Premiers represent the same people as does the honorable senator.

Senator KNEEBONE:

– Does the honorable senator suggest that they have power to come to a decision upon problems such as are involved in this plan?

Senator Thompson:

– The State Premiers only made recommendations.

Senator Herbert Hays:

– They have equal responsibilities with the Commonwealth.

Senator KNEEBONE:

– I am suggesting that the whole structure of the National Parliament is being undermined. If this scheme is to operate for three years it would appear that there will be no need to hold an election during that period. If the Commonwealth and State Governments are committed to these proposals, there will be no issue on which to contest an election. In the circumstances it is only logical to conclude that the present Commonwealth and State Governments should be allowed to carry on for the currency of the scheme.

Senator Carroll:

– Is that part of the plan?

Senator KNEEBONE:

– It is not printed. As there are seven parliaments in Australia elected for a period of three years, it is reasonable to assume that on the average there is a general election every six months. What is to happen to this plan if one of the governments which have adopted it should be defeated? The plan breaks down hopelessly.

Senator Brennan:

– But it will be embodied in legislation.

Senator Crawford:

– A Premier signs on behalf of his government.

Senator KNEEBONE:

– That may be so, but there will be no obligation upon succeeding governments to carry out the proposals of their predecessors.

Senator Herbert Hays:

– The same argument would apply to all agreements entered into by governments.

Senator KNEEBONE:

– An antifederal movement is eating into the central system of government. If I had my way I would abolish all State parliaments, but such a proposal would not be acceptable to the State Premiers.

Senator Sir George Pearce:

– To abolish State parliaments is anti-federal.

Senator KNEEBONE:

– It may be. But I am speaking more in favour of unification. If one budget cannot be balanced, surely there is less likelihood of balancing six budgets. At present the central authority is rendering financial assistance to Western Australia, South Australia, and Tasmania.

Senator E B Johnston:

– Those States are receiving money of which they had been robbed.

Senator KNEEBONE:

– I am not speaking of robbery. After impoverishing the people, it seems an impossible proposition to increase the sales tax from 2- per cent, to 6 per cent., and thereby collect an additional £6,000,000, and also to increase the primage duty from 4 per cent, to 10 per cent., and to raise an additional £2,500,000. If the sales tax is increased the purchasing power of the people will be further diminished, and purchases will naturally decrease.

Australia, as an important part of the Empire, is affected by the present financial crisis, but other countries are also experiencing similar difficulties. It is only a question of degree. [Extension of time granted.’] Professor Gustav Cassel of the Stockholm University, says there must be a change in the policy adopted by the financial authorities of the world, and a statement was recently published to the effect that the Bank of England now favours a policy of slight inflation rather than one of deflation.

Senator Foll:

– That is not an official statement.

Senator KNEEBONE:

– No ; but it is so sensible that probably it is true. It is proposed to spend £8,500,000 to assist farmers, and to provide employment; but that is only touching the fringe of the question. There, must be an extension of credit if industry is to be revived, and employment found for our workless people. Mr. A. C. Davidson, in a letter published in the Sydney Morning Herald of the 10th June, admits that some of the things we are proposing to do having ‘been done, there should be an extension of credit to carry on industry. I do not think it can be denied that the restriction of credits has caused depression, and that an expansion of credit will stimulate industry. As to the extension of credit, Professor Copland, in his publication entitled Monetary Policy and its Application to Australia, says on page 504-

The Government created sufficient legal tender reserves, and the banks granted credits to individuals desirous of subscribing to war loans. This was a new use of credit, and it succeeded admirably in its purpose. But it also shows how the banker’s power could be used for a specific purpose. It is not necessary to enter upon a criticism of this method of war finance. . . .

Since that policy was adopted during the war it is only reasonable to assume that it could be adopted during peace.

Senator Crawford:

– But the banks held the bonds as securities.

Senator KNEEBONE:

– That is true. On page 505, Professor Copland also makes interesting reference to the gold basis.

Reverting to the question of railway construction, it will ultimately be found that this Parliament will have to intervene if our finances are to be placed on a sound basis. The present policy seems to be one of adopting the line of least resistance - by making cuts - but we must reach some point where we must stop and commence to rebuild. The Commonwealth Railways Commissioner deals comprehensively with Australia’s railway position, and shows quite conclusively that State deficits are mostly caused by the losses incurred on State railway systems. On the whole these railways have earned more than the actual running costs, but. in consequence of interest and other expenses which they have to meet heavy deficits have been shown. These deficits have been of such magnitude that, during the last five years, £40,000,000 has been lost on our railways.

Senator Payne:

– But they provide indirect gains.

Senator KNEEBONE:

– Yes ; but those gains are derived by private individuals, and not by the governments which control them.

Senator Payne:

– Those benefits are passed on to the State.

Senator KNEEBONE:

– They may be. Instead of adopting the line of least resistance, we should formulate a policy under which Australia’s financial stability would be restored.

Senator Payne:

– What does the honorable senator suggest with respect to our railways ?

Senator KNEEBONE:

– Possibly they should be placed under the control of one authority. Most of our loan money has been spent in building railways, and, according to the report of the Commonwealth Railways Commissioner, State railway departments are even now being charged with interest on trucks which were constructed 50 years ago, and which obviously are not now in use. Business-like methods have not been followed in dealing with one of our greatest public utilities.

In order to show that the plan will not do what has been suggested, I point out that hardly had the Premiers Conference concluded than a number of State Opposition leaders met in Melbourne and carried several resolutions, included in which was the following: -

It is to be regretted that the plan only deals with one aspect of the Australian problems - governmental finance. It fails to deal with the fundamental problem of the restoration of industry and the reduction of production costs. It is along these lines only that a solution of the unemployment problem can be found.

The resolutions referred to were published in the Melbourne Argus of the 13th June, and on the same day there appeared in that newspaper a letter from Mr. T.R. Ashworth, the president of the Employers Federation, in which he said -

There is nothing in the conference scheme which will help trade and industry and provide employment.

The first thing that we must do is to find employment. The plan before us does not touch that problem at all.

Senator Herbert Hays:

– We must put first things first.

Senator KNEEBONE:

– The first thing necessary is to find work for our people. If I had three grown-up sons and wanted to borrow money, and had to admit that my sons and myself were out of work, I would find it impossible to obtain a loan; whereas, if I could say that my sons and myself were working, and my wife doing her share also, it might be possible to borrow money. Similarly, in the case of the nation, we cannot restore confidence until we place our people in employment. Surely, in a sparsely populated country, such as Australia is, whose people are all of one colour, speaking one tongue, and of practically the same religion, we should be able to decide upon some constructive scheme for the salvation of our country! Mr. Ashworth made it clear that the finding of employment for persons out of work is the first essential. He then said that the next essential was the abolition of all tribunals for fixing wages and conditions of employment. If that were done, the workers would be forced to resort to direct action. Even to-day, when so many are unemployed, there are 500,000 workers working peacefully under arbitration awards. At present, when there is a surplus of labour, itmight be a good thing from the point of view of the employers to abolish arbitration tribunals, but if the workers are forced to resort to direct action there will be less production, greater chaos, and more trouble.

Senator Crawford:

– I do not think that Mr. Ashworth speaks for the employers of Australia.

Senator KNEEBONE:

– He is a representative of the employers; and he says clearly that, in his opinion, the plan agreed to at the Melbourne conference will not accomplish anything that will benefit industry.

SenatorRae. - The Arbitration Court is taking direct action by reducing wages.

Senator KNEEBONE:

– If we abolish the tribunals which prescribe the living standards of our people, we shall create further trouble, instead of diminishing it.

Senator Foll:

– SenatorRae does not believe in arbitration.

Senator KNEEBONE:

– There is a lot to be said against the system. All that the worker has to sell is his brain power, or muscle power. They form his capital, and he should be entitled to get the best return he can for them, and not be compelled to submit to conditions prescribed for him by any tribunal. However, for good or ill, the workers have accepted the principle of arbitration, and large numbers of them are working peacefully under arbitration awards. It would be a retrogressive step to wipe out those tribunals. Yet that is the object which Mr. Ashworth has in view. The plan of the Premiers Conference will not do anything to rehabilitate industry. It may help to balance budgets; but even with the plan in operation, the Commonwealth and the States will continue to have deficits.

An attack on the tariff has been threatened. Yesterday we heard a good deal about bananas from Java. The logical outcome of, the policy advocated by some honorable senators would be the destruction of the White Australia policy. Industrial organizations have enabled

Australia to adhere to its White Australia policy. But were -we to allow monetary considerations to control us our ideals would be shattered.

I realize I have not dealt fully with the problems confronting us. Indeed, that would be impossible in a short speech, particularly when we reflect that, in order to arrive at a common plan the leading experts of Australia spent several weeks in conference. It may be that I have disturbed the feelings of some honorable senators, or have expressed what they regard as disloyal sentiments; but I have given my opinion, as an Australian native with sons and a grandson following after me, for whose welfare I am deeply concerned. I want Australia to maintain its standards, particularly as the workers of this country produce more wealth per head than do the workers of any other nation in the world. The plan set before us will destroy the standards we have set up.

Senator Herbert Hays:

– What is the alternative to the plan before us?

Senator KNEEBONE:

– The troubles confronting Australia are not of mushroom growth. All political organizations have known for a long time that arising out of the war there would be problems to grapple with. During the war we borrowed money without thought as to how or when it would be repaid; and now we find that we have loans maturing which we cannot meet. Finding ourselves in difficulties, we resort to the cowardly action of doing something which can only be described as repudiation.

Senator Crawford:

– “ Needs must when the devil drives.”

Senator KNEEBONE:

– I hope that he will never drive me. In March last, representatives of the labour movement throughout Australia met in conference in Sydney, and fully recognizing that the capitalistic system would develop along the lines that it has taken, arrived at a number of decisions which were consistent witu the policy of the movement. Both the Prime Minister (Mr. Scullin) and the Treasurer (Mr. Theodore) were present at that conference. The Labour party proceeded to put into operation the policy there decided upon. I regret that this plan outs across that policy. I am concerned whether the policy of the

Labour party is again to be taken up or is to be abandoned, and whether we shall forever have to submit to outside organizations.

Senator E B Johnston:

– What about the Canberra conference?

Senator KNEEBONE:

– I am now dealing with the Sydney conference. Among the proposals adopted at that conference were the following: -

Many thousands of Australian citizens are unemployed and on the brink of starvation, although there is a vast amount of work waiting to be done. The nation’s resources are only partly developed. Many factories and machines are idle. We are not suffering from drought, fire, or flood. The nation’s capacity for wealth and production was never greater. Yet industries are paralyzed, businesses are becoming bankrupt, and thousands are in want. We are in that position to-day mainly as a result of the breakdown of the monetary system.

The time has come, therefore, to inaugurate Labour’s policy on banking and finance, and to give effect to its platform. With this object in view, the following steps should be taken : -

The control of the currency, creditcreating machinery and interest and discount rates to be placed under the control of a Commonwealth Central Bank. This bank to be managed in the interests of the whole community, and protected from interference or control by the private banks and private financial interests.

The management of the Commonwealth Bank to be established on lines which will enable that institution to function actively and aggressively, in competition with the private banks throughout Australia, in all places where banking services are needed. . All savings bank business should be absorbed by the Commonwealth Bank by arrangement with State Governments.

In the meantime immediate efforts should be made to stimulate industry to absorb the unemployed by putting in hand Commonwealth and State public works of a reproductive character. To finance such undertakings the fiduciary currency measure now before Parliament should be determinedly pushed forward without any unnecessary delay.

The Commonwealth Government should obtain legislative authority to control the rates of interest on bank deposits and bank advances and overdrafts.

Interest on Commonwealth and State bonds should be taxed for the purpose of compelling bondholders to contribute their share of the national sacrifice involved in economic reconstruction.

Effective tariff protection and import restrictions should be continued for the purpose of establishing and extending Australian industries and to ensure the continuance of a favorable trade balance.

Overseas exchange to be carefully watched, and, if necessary, controlled by the Federal Government.

That was the plan thatwas adopted by the Labour party, and it remains the policy of the party until another allAustralian conference alters it. I do not intend to break the pledge which I have given to my bondholders, and therefore, as I am opposed to all sections of the plan, I shall oppose it at every stage.

Senator THOMPSON:
Queensland

– I shall not address myself at great length to this measure. At the outset I wish to say that had the present Government carried out the recommendations agreed to at the Melbourne conference of August last, our short-dated commitments would have been straightened out before this, and the country well on the way to prosperity. Sinister influences have, however, been at work since then, as a result of which the Government endeavoured to pass through Parliament the Central Reserve Bank Bill, designed to control the currency and the banking of this country. The next experiment attempted was the introduction of the Fiduciary Notes Bill, which, if passed, would have brought in its train inflation with all its evils. Later the Government introduced a measure to export the gold backing behind our note issue. All those measures were blocked by the Senate. For that action we, on this side, have been severely criticized by the Government ; but I venture to say that it has been applauded by the community as a whole. It may be urged that only recently the Senate agreed to a measure to allow £5,000,000 in gold to be exported. That bill was different from its predecessor in that its purpose was to avoid default. Although it reduced the backing behind the note issue, it was necessary to meet our commitments overseas. During the debate on that measure several honorable senators expressed the strongest objection to sending any gold out of the country. While I have grave objections to sending away the gold which forms the backing of our note issue, I would not protest if all the other gold in the country were exported, because, in that case, the exchange position would be eased. Were Australia in charge of a dictator like Mussolini, who could take the gold of this country to the other side of the world, and with it quietly buy up Australian bonds, and thus save exchange, we should make a profit of many millions of pounds, but, a government cannot do these things.

Senator Cooper:

– Is not our gold reserve already too small?

Senator THOMPSON:

– Yes. Apart from the gold necessary to back our notes, there is no necessity to hang on to every ounce of gold in the country. Gold is of more benefit to Australia if sent to the other side of the world than if hoarded up here merely to look at.

All the foregoing measures, together with declining revenue and increasing expenditure, in which exchange loomed very largely indeed, and the impossibility of further borrowing, affected the position of Australia at home and abroad. Our credit has gone down lamentably. Our securities in both London and New York are quoted at less than one-half of what they should be worth in those markets. The Government, driven eventually by the force of inexorable circumstances, in May last, convened a conference of Premiers in Melbourne. The scheme evolved by that gathering is practically identical with the proposals agreed upon at the Melbourne conference in August of last year when Sir Otto Niemeyer was in Australia and made certain recommendations from time to time. It is also in line with suggestions that were made so frequently by members from this side of the chamber. The plan, as agreed upon, embraces the following measures : -

  1. A reduction of 20 per cent. in all adjustable government expenditure, as compared with the year ending 30th June, 1930, including all emoluments, wages, salaries, and pensions paid by the governments, whether fixed bystatute or otherwise, such reductions to be equitably affected;
  2. Conversion of the internal debts of the governments on the basis of a 22½ per cent. reduction of interest;
  3. The securing of additional revenue by taxation, both Commonwealth and State;
  4. A reduction of bank and savings bank rates of interest on deposits and advances;
  5. Relief in respect of private mortgages.

It has been pointed out that even when all these proposals have been given effect, there will still be a big gap between revenue and expenditure, but I am hoping this will be bridged by relief through tlie British, Government’s suspension of payments, and further relief out of the Hoover plan for the postponement of the payment of international debts arising out of the war. We are told that the reductions mentioned must be made if we are to avert national default. I, therefore, suggest that, on these high grounds, the proposals should be supported by every member in this chamber.

The reductions most repugnant to me, and I am sure also, to every other honorable senator, are those contemplated in respect of pension payments to returned soldiers and sailors suffering from war disabilities, particularly the blind, the maimed, and those suffering from tuberculosis. I therefore ask the Ministry to explore every avenue that may be possible to avoid a 20 per cent, reduction in this class of pensions. I approve of the action of the Government in referring the distribution of the economies under this heading to a special committee representing the returned soldiers themselves, and I hope that committee will be able to submit proposals which, while giving effect to the scheme, will permit of the econo- mies ‘being made without inflicting serious hardship upon that class of pensioners. The proposed reduction of oldage pensions is another matter which challenges the sympathy of every one, but as there has been a drop of 17^ per cent, in the cost of living the proposed reduction of 12£ per cent, will not, I hope, press too heavily on this deserving section of our people.

As for the Public Service, I feel that government employees are only being asked to bear their share of a common sacrifice. With other honorable senators, I have received a letter from the organizing committee of the Sydney branch of the Commonwealth Public Service Association dealing with this matter.

Senator Sampson:

– It is an impudent communication.

Senator THOMPSON:

– It is couched in the nature of a command, and I cannot help thinking that the organization in question has been accustomed to take up this attitude.

Senator Sir George Pearce:

– Why not read the first resolution?

Senator THOMPSON:

– It may be of some interest to the Senate if I do so. The first resolution is in these terms -

This mussed meeting of Commonwealth public service employees records its uncompromising hostility to the proposed reductions of wages and views with indignation the action of the Federal Labour Government in pursuing the policy of ruthless wage cuts, as it violates the principles of unionism and of the Australian Labour Party.

That all Federal parliamentary representatives be called upon to take immediate action to prevent the proposed salary cuts being put into effect.

The communication then goes on to enumerate the reasons for the opposition, by the Public Service organizations, to the proposed reductions. It is not my intention to read them. I repeat that the public servants of this country are only being called upon to bear their share of the sacrifice, the recognition of which is more apparent outside than within the Service. All these interests, must bear in mind that if the plan is not adopted, default must ensue in July. Then instead of having to submit to a 20 per cent, reduction of salary or a reduction of 12J per cent, in the case of invalid and old-age pensions, there would be, we are told, only 12s. in the £1 available for distribution by the Commonwealth, or 9s. in the £1 if the liabilities of all the States were taken into account. ‘I have seen that statement made a number of times, but I would point out that, if there is default, there is not likely to be a distribution of any payments for some considerable time, because the Government will then be in the position of a firm or company which has gone into liquidation. Some reconstruction scheme would have to be brought about and under it payments would be on a very much reduced scale - far less than would be available under the scheme for a 20 per cent, reduction.

With regard to the reduction of interest on Commonwealth bonds, I, as a holder, realize the necessity for this action, and agree to the cut of 22£ per cent., as well as the extension over a number of years on a 4 per cent, basis. I sincerely hope that there will be a satis? factory response to the appeal which is now being made, and that the conversion operation will be entirely successful. But there is a point of detail which I should like to mention. The general idea is that bondholders will lose 22^ per cent, in interest, and will then have their holdings capitalized at 4 per cent., but according to the actuarial table the short dated loans, notably the patriotic 6 per cent, loan, will be mulct in nearly 33$ per cent. If I am right in my contention, I do not think that such was contemplated by the Government, or that it will be cheerfully agreed to by the bondholder. I, therefore, suggest that the experts who were responsible for the preparation of the tables dealing with this matter, which I confess I am unable to understand, should meet honorable senators to explain the figures and the formula upon which the deductions are made.

Senator Reid:

– Perhaps they should explain that matter to members of another place.

Senator THOMPSON:

– The bill has been passed by another place. Apparently members there were not particularly keen about the point which I have raised. I am personally affected. Consequently I am interested in the matter, and while I am perfectly willing to accept a reduction of 22£ per cent, in the interest, I do not like the idea of a cut of 33$ per cent., because I do not regard that as equality of sacrifice. The reduction of the bank and savings banks rates, which forms part of the plan, has already been given effect. It was long overdue, and I believe that it will have a most beneficial effect upon private enterprise. The reduction of private mortgage charges is, I consider, in keeping with the other reductions of interest and altogether is highly desirable; but as this is a State matter I shall not pursue it further. Queensland has already brought down legislation to deal with this proposal and, I think, has agreed to the whole scheme. The promptness of Queensland^ compliance with the proposals is an object lesson to the other States, and I hope that there will be no further delay, although judging by what has happened in New South Wales, I am not at all hopeful that definite action will be taken in that State for some time to come. The securing of additional revenue is a corollary to the other proposals contained in the plan. This is unavoidable, but I regret very much that additional taxation is to be levied, as I believe that we have about reached the limit. Governments- must be made to recognize that it is bad policy to strain taxation to the breaking point.

The eventual results of the carrying out of this scheme should be to restore confidence, thus making money available for the funding of our present short-dated commitments, and for private enterprise, old and new, to be extended and gradually to absorb large numbers of our unemployed. On this point I disagree with Senator Kneebone who, this afternoon, expressed the opinion that the plan, in operation, will be responsible for an increase in unemployment. I believe, on the contrary, that there will be an easing in the money market, thus making possible the re-employment of large numbers of men who, at present, are without work. I trust that I am correct in this assumption. I hope, also, that Senator Kneebone will agree with me when I say that suspension of Arbitration Court awards, during the present critical time, would have a very beneficial result on our economic position. I believe that action in this direction would absorb our unemployed much more quickly than any other proposal. Employees, it is true, would not enjoy the sheltered wages and conditions provided for in Arbitration Court awards, but men out of work would certainly get employment at the very best wages obtainable, and the re-employment of so many of those who are at present workless would be a very great good to the community. I would not suggest that the suspension should be for any lengthy period. I prefer to regard it as a temporary measure to meet the extraordinary difficulties that confront us, and if the Government has the “ intestinal fortitude,” or in other words, if the Government is “game” enough to adopt this course, I would urge it to do so.

Senator Rae:

– That has been tried foi the last two years.

Senator THOMPSON:

– There has been no suspension of Arbitration Court awards.

Senator Rae:

– No ; but the Arbitration Court has been making cuts in wages.

Senator THOMPSON:

– That is an entirely different matter as the honorable senator knows. Reductions ordered by the Arbitration. Court bave been in line with reductions in the cost of living. I admit that the suggestion which I have made may be repugnant to the Government, but I think that it might be given a trial until our economic and financial position improves. As I cannot suggest a better alternative, I cordially support the principles of the plan. It is possible that when we are dealing with the details we may *be able to offer suggestions for their improvement.

Senator LYNCH:
Western Australia

– We are asked to approve of the agreement, which was evolved at the recent conference of Premiers in Melbourne, as the only solution in sight for the difficulties that confront us. That gathering was, as we know, representative of all shades of political thought in this country, and the Premiers’ plan, as it is now blown. represents the matured opinion of the people’s representatives. There has been much talk of late about various proposals to improve our position, and I consider it is about time that we were given an opportunity to deal with some practical scheme for the rehabilitation of this country. In proof of that I need only point to what has been said in the immediate past. I rather liked the tone of the Leader of the Opposition (Senator Pearce) when he said that he did not want to indulge in any political rancour or to recall the past unnecessarily. But I would say that we cannot discuss dispassionately and usefully the pros and cons of the present situation without extracting from the discussion something that may be of use and of value in the future. I quite realize that to “ Let bygones be bygones “ is a wholesome, and sometimes, a necessary and salutary doctrine. But while that may often offer a peaceful solution of the troubles that confront our time, still if the cause of those bygones, if their real source is not .laid bare, if an honest and a frank admission of guilt on one side or the other is not made, instead of being bygones they will be “ come agains “ in the future.

Senator Barnes:

– I invite the honorable senator to plead guilty without further ado.

Senator LYNCH:

– I intend to do my sharp nf that before I am finished; and

I want my esteemed friend, the Leader of the Government in the Senate, and the uncrowned King of the Australian Workers Union, also to shoulder his share of the guilt. I know that he will do that when I so bid him.

I have said that it is a very comforting doctrine to “ Let bygones be bygones “. But there is no use in doing so unless we approach this, the greatest and most complicated problem that has ever confronted the people of this country, in a frank, open and candid manner. If either side is guilty, let the guilt be admitted. I admit responsibility for a portion of the guilt, and I want others to be equally frank with me. Unless the doctrine “ Let bygones be bygones,” is adopted in a proper spirit, it will be a fruitful source of trouble in the future. If we do not extract a useful lesson from the difficulties in which the people of this country find themselves to-day, it is certain that sooner or later those difficulties will recur, perhaps in greater and more desperate volume and severity.

I affirm that the present position of this country has been brought about largely by our own people. I do not want to apportion the percentage exactly, but I should say that fully SO per cent, is directly attributable to them, and that the smaller percentage is due to external causes. It is not necessary for me to outline any phase of the trouble, because we all admit that it is the greatest that has been experienced in the history of this young country. The experience that most closely approaches to the present is that of the early ‘nineties. But that was soon overcome. As we know, the credit of this country was then stopped, unemployment was rife, and our industries were brought to a standstill. Had it not been for the fortunate opening up of the ‘ rich mining fields of that vast new region, Western Australia, it is very hard to say what the plight of eastern Australia would have been. It is safe to say that had Western Australia not opened its door to unemployed from the Eastern States, it would have been necessary to export a portion of our population. On the present occasion we have no Western Australia to fall back upon, and, therefore, are compelled to find the remedy within ourselves. It may be remembered that at that time we overcame’ ou’r troubles very quickly. I well remember’ the Treasurer of Victoria, Sir George Turner, showing a surplus in a very shortspace of time; and the Treasurers of the other States had a similar experience. The outstanding feature of the two situations is that, although on each, occasion Australia had a succession of good seasons, and the prices of our products were on about the same level, we were able to right our position very much more quickly then than we have been able to do’ now. In other words, the lands of Australia were equally as prolific over a series of years then as they are to-day. The seasons- were just as friendly and accommodating-

Senator Thompson:

– Price’s were notas low.

Senator LYNCH:

– They were about the san]e then as they are now. Mother” earth in all her bountifulness responded to the application of man’s design, and the seasons were friendly towards that design. But what about the population? Supposedly the people are the same how as they were then ; but are they ? There’s the rub. Although the people are the same,- 1 am afraid that they have changed their habits. That is the point of view that I wish to stress. We have gone iti for some newfangled notions in an endeavour to discover a new Garden of Eden over the hill. We were advised that all that was necessary to reach that Garden of Eden was to conform! fd certain formulae’; But unfortunately our journeying has led us to what is the exact opposite of a Garden of Eden. Whose fault is it? It is the fault, not of the land, not of the seasons, but of the* changed habits of to-day compared with what they were 40 years ago. At that time Sir Henry Parkes controlled the destinies of New South Wales. The’ gentleman”, who rules over that State to-day is’ John Lang. I ask any person who has passed through the two periods in that State to say whom he would prefer. I venture to affirm that the decisions of such persons would be Overwhelmingly in favour of the administration of the late.. Sir Henry Parkes, instead df the modern prophet, Mr. Lang. After all, is not

Mr. Lang but the embodiment and the personification of a class of mad mullahs, who have been leading the people’ of this* country along wrong paths straight to perdition! The condition of that State to-day is a reflection of then efforts; and they are reflected on a smaller scale elsewhere. The insane endeavour to arrive at a Garden of Eden without honest work, and without a strict adherence to those habits and practices which paid so well in the past, is alone responsible for this exceedingly productive Australia finding itself in the sad plight that it is not able to pay its debts.and is on the eve of the repudiation of its interest undertaking, with an army of unemployed unequalled in its previous history - all because men of the Lang type have been embraced by the people of this country and have been placed in the seat o’f authority.-

Proof of the accuracy of my declaration is easily furnished. There is the dominion of Canada - which,- as we know, has disadvantages that this country does not possess. Even “at the expense of being somewhat egotistical, or of voicing an opinion that might be considered laudatory of myself or my kinsman, I shall tell a true story that came to me first-hand from a brother of mine who has spent nearly 50 years in the United States of America, close to the border of Canada, and is now in Los Angeles, lie recently visited Canberra, and he listened to the debates in this chamber and in another place. I put to him this frank question - “ You have been in the United States of America; you have travelled through Canada, and down through Mexico. You have visited Western Australia, where you saw some of . your kith and kin struggling on the soil. I want to put a question to you, and 1 wish yon to answer it candidly. What do yon think of Australia as a land for a working man “ ? His reply -was : “ You have the best country in the wide world that 1 know of for a willing working man. Why do I say that? I was down to see my nephew, and I noticed how he was getting on. Some 45 years ago, when I want to North Dakota as a settler, having left a chemical works in Michigan, where T worked ten hours a day for 6s. a day, I bad to carry my coal and lumber 26 miles from the rail depot out to my quarter section. There was neither post nor guide in any direction that would enable me to find that particular quarter section. I had to cart the coal that cooked the first meal which I had there, as well as the timber for my span of oxen. Let me tell you plainly, you can go out with an axe in this country, and in half an hour get what would cost much effort and expense in the country from which I come. Besides, I was snowed in for nearly six months of the year.”

Canada has drawbacks unknown to Australia, especially in the great corn lands of the west, and yet it is not in the plight in which Australia finds itself to-day. Just before last Christmas Canada floated a loan of £20,000,000 on Wall-street at a shade over 4 per cent. Why cannot Australia do likewise? Why are we shooed off every money market, including our own? Why have financiers no faith in our country? We are of the same breed as Canadians. We come from the same stock, like plants in an asparagus bed. But we are having difficulty because, at the instance of such men as Mr. Lang, and of others in this Parliament, we have got into very ‘bad habits. The people of Canada have not drunk, in those doses of demagogic flattery and humbug which have within the last twenty years been preached, alas! so successfully in Australia. When the Labour movement was in its infancy in this country, the policy of “ live and let live “ obtained. There was a feeling of respect in the ranks of Labour for what was called a reputable employer. But what is the position to-day? in Sydney Domain or in the equivalent of such a classic spot in any other part of Australia, your ears are offended, the atmosphere is disturbed, and you are prevented from the enjoyment of God’s sunshine by shouted denunciations of the capitalistic class, or the moneyed class, or the bloodsuckers of the land. They are denounced as reptiles of society, and as men who are seeking the ruin of the workers. In the Labour press, paper intended for a better use, is disfigured with similar poisonous denunciations. The workers are told that in their midst there is a kind of venomous employing class, whose only idea in life is to bring ruin to the interests of’ every worker in Australia. I deny it. I may be taking my political life in my hands in saying this, but I have already said a thousand times that in Australia the worker in many industries rs getting more than his fair share. This is particularly the case in such industries as coal-mining, in which men refused £2 a day, and in the maritime industries. The country has been ruined as a result of the conditions ii: ;hose industries. The fruits S industry can be accurately weir]>.cd. Statistics show that the Australian worker has had more than his full share consistent with the progress of the country.

One of thb major causes of our present trouble is the way in which our people have listened to false, foolish and even poisonous doctrines, poured into their ears by men who. are really their woes* enemies. Even the bootmaker who has emerged from the ranks of the workers only last week, and has established his own business is regarded as an enemy of society. No person has any standing unless he has corns on his hands. It is ‘known to Labour that the preaching of such pernicious doctrines as these is causing the ruin of this country. If I am asked for proof, I quote Professor Giblin, who is still, I believe, a supporter of the Labour party, and who teaches nothing but the truth when he declares that up to a point Labour cap justly demand a true share of the fruits of industry, but that when it trespasses beyond that point it takes the first step towards bringing about the ruin of industry, and indeed of the country itself. Ramsay MacDonald said years ago that workers should not insist upon rates and conditions that would cripple industry. As I have shown from the Soviet Year Boole, men are working in the Soviet Republic to-day for a daily wage of 3s. The proper place for those who are preaching pernicious doctrines in pur country, where the working man is earning from 12s. to 15s. a day is Russia. Let them take ship for Vladivostock, and. set about righting the wrongs of the proletariat there. There is ample room in Russia for the reforms they advocate here.

I totally disagree that one of the contributing factors towards this country’s problems to-day is that it has overborrowed, although I admit that the money, having been borrowed, and put into the care of the Government for expenditure, has been most unwisely spent and that nothing but waste, extravagance, and mismanagement have followed as a result. In order to sustain this point, I turn once more to Canada. Half of Australia’s total indebtedness of £1,100,000,000 ‘has been incurred on railway construction in the six States. Canada has a much larger and more ramified railway system than Australia has; but most of its railways are owned and controlled by private enterprise. The State-controlled systems are, therefore, keyed up and kept up to the scratch better than they are in this unfortunate land of ours. If the money spent on railway development in Canada has resulted in no injury to that dominion, how is it that the 50 per cent, of our indebtedness, which has been incurred on railway construction has became a millstone round our necks here? According to the Commonwealth Commissioner of Railways, Australia has lost £30,000,000 on its railways during the last ten years. Again, if our present troubles have been caused by the millions we have borrowed and spent on railway development, the same argument should apply to Canada; because like causes should produce like effects. But Canada can borrow money to-day at a little over 4 per cent., a rate at which no money lender either at home or abroad would think of giving money to Australia.

During tariff discussions in this chamber, I have shown that the workers engaged in the manufacture of harvesters in Canada are enjoying better wages and conditions than are enjoyed by the corresponding workers in Australia. This can be attributed to the fact that Canada’s workmen are not hampered by conditions of industry such as are imposed in Australia by the blind leaders of trades unionism here. Canada, therefore, is in a better position than Australia, not only because private enterprise has been largely employed in its development, but also because its workers work under less hampering restrictions than exist in Australia. Not only the workers, but the whole country benefits as a result.

In direct contradiction of a life-long belief, I say now that in order to extricate the country from its present position in future we should consider carefully whether a single pound of borrowed money should be entrusted to any government under present conditions. We are now paying too dearly as a result of that policy. Take any industry you please that is controlled by the Government; take the Commonwealth shipping line. A capital expenditure of £10,000,000 . has been lost on Commonwealth steamers, and when the vessels were running they were controlled, not by the Commonwealth Government, but by the men in the forecastle. Although primarily the line was established to ensure communication between this isolated continent and the rest of the world, in actual fact it was being run in the interests of the men employed. Every one admits now that the Government’s flag had to be hauled down because labour did not play its part fairly. Take also the Queensland cattle stations. An election was won by labour by the condemnation of the “ beef barons “ of Queensland. But subsequently the Queensland Labour Government turned itself into a beef baron, and afterwards when those so-called beef barons had to apply to this Parliament, cap in hand, labour said, “ These poor men should be given some relief, or else they will be applicants for the old-age pension.” That is what Labour men did. As a result of the action of the Queensland Labour Government in turning itself into a beef baron, and in endeavouring to control the meat, business on a large scale, it saddled the taxpayers of Queensland with a burden of millions of interest and principal, which they will have to carry for many years. That is another instance of Labour’s policy run mad, the effect of which is reflected in our present position. One government enterprise after another has piled up our unproductive debt with its crushing interest burden. For some years there has been a complete absence of leadership. When there were real leaders of Labour our position was not as it is to-day.

There has not been any leadership except of the type of the humorous French political leader who, when asked why lie did not check the excesses of his followers, said : “ I must follow them because I am their leader “. That is the attitude adopted by the so-called leaders of the latter day Labour party, who sat in judgment upon this plan, and who are charged with the solution of, perhaps, the most momentous problem that has ever confronted the Commonwealth. “What leadership has been shown by Labour Ministers - those twelve apostles of darkness, those twelve cavedwellers?. The only way in which they exercised authority over their followers was to advise them to go and please themselves how they voted. Do they call that leadership? ‘When a governing party cannot lead its own supporters, how can it lead a nation? One who cannot be great in small matters cannot possibly be great in the ‘bigger issues. We have been informed that when these twelve men were asked to stand up to the responsibilities of leadership and pronounce judgment they did not give any definite directions, even to the representatives of the two Labour factions who sit opposite. No instructions were received from these twelve apostles of gloom merely because they are not possessed of the powers of leadership which they claim to hold. North, south, east and west we hear declarations concerning what should be done by every one outside the Labour fold; but the so-called leaders of Labour who had been sitting around a table in Canberra, when every one was standing on tip-toe, awaiting a definite lead, merely told their supporters to vote for or against the plan just as they pleased. I am not using these words out of any disrespect towards, or want of proper appreciation of, what the Labour party stands for. The workers of this country have no more genuine supporter and advocate in this chamber than myself. The best proof of that is my past actions. Words arc cheap. It is action, and action only, that indicates one’s attitude towards the workers, and my relationship with those iu the western States is well known. I am entitled to say these things, because’ I have squared-precept with example.

I have mentioned the position in Canada as compared with Australia - a dominion, perhaps, larger in extent than this continent, fresh from the hands of Providence, and handed down to British stock to successfully develop. In Canada there are comparatively no industrial troubles or financial difficulties of any importance. But what is the position in Australia? As I have already pointed out, it is not the soil or the climate that is at fault. What is responsible? It is the people, who, by following the false dictation and guidance of others, have been hopelessly misled. What is the moral ? The people ‘ must get fresh advisers: that is the essence of my efforts in this direction in this chamber and elsewhere for a long time. In other countries one state of society has succeeded another until society becomes a mass of warring elements; that is what will happen in this country. This isupposed to be a democracy; but those who read history know that democracy, as such, offers no guarantee of stability. Democracies have come into existence as a result of the individual sufferings and sacrifices of great men; but, as Aristotle said, they eventually come under the influence of demagogues. These demagogues have tongues as big as bullocks and brains like sand flies. It is men of that type who are now endeavouring to control this country, and who will eventually destroy democracy.

Senator Herbert Hays:

– That is not very complimentary.

Senator LYNCH:

– No, but it is true; and I ask those who do not believe it to disprove it. They are free to do so if they desire. I have read history as much as I could, and realize, as do other honorable senators, that society lives in cycles - one succeeding another. History has no greater characteristic than that of repeating itself. History will repeat itself, and, as in the past, democracy has been destroyed by the demagogues, so will our present democracy be brought to ruin by men of the type I have mentioned. These socalled leaders are the persons whom the workers of this country take to their bosom, but in thu end, when their false posturing is seen through, I should not like to be in their shoes.

The Leader of the Opposition (Senator Pearce) rightly pointed out that the making of election promises is the curse of this country. These promises are made by men who, in their hearts, know that there is not a ghost of a chance of their ever being honoured or properly executed. The time has come when men standing for public positions should be honest, and have sufficient capacity to say what can and what cannot be done. The electors should be told that certain of the concessions which they are seeking can be provided only at the expense and as a result of the sacrifices of others^ What has been the result of our democracy? One section of the community has rereceived favours and patronage or some other form of advantage, while an. unnecessarily heavy burden has been piled upon the shoulders of other citizens far less happily placed. When visiting Queensland recently, I was in conversation with a ship’s engineer whose uniform was adorned with a plentiful supply of gold braid. We entered into a discussion on current topics, and, having had some experience at sea, I was able to appreciate his view-point. At one stage, he became critical and almost impertinent. As the conversation proceeded I informed him that notwithstanding Lis knowledge on certain subjects he did not know everything, and that if he were to discard his brass braid, Open a shop, and enter into open competition with others in the open field, he would not earn one-half of what he was then receiving with his gilded uniform. I put the. position to him in. that way, because I knew of a superintendent of a shipping line who once set up in business on his own account in Sydney as a consulting engineer. Notwithstanding his qualifications, it took him all his time to make a living. I informed my friend that as a result of the work of an organization of which he was a member, he was able to strut up and down in a uniform adorned with brass braid, and receive a remuneration infinitely greater than he could possibly earn in open competition as a consulting engineer. Owing to the power of organization, persons of that kind can challenge society and almost deliberately exact from it in the form of mild blackmail gains to which they are not entitled. What right have the members of organizations to extract from society merely because they are organized, that to which they are ‘not justly entitled. Are they to obtain benefits denied others? Is a government entitled to any credit for legislating in a way that provides that those who are members of organizations shall receive benefits in excess of those who are not organized ?

What is the position of the wheatgrowers in Australia who, in effect, do not study either clocks or watches; who work from daylight to dark in producing a commodity that has to bc sold in open competition in the markets of the world? These men, who are working under real, and not artificial, conditions, are holding their own. If wheat were grown under trade union conditions, we would not be able -to export a single bushel. It is because those conditions are not observed that the primary industries of this country are still able to carry on and export to such an extent that they can substantially assist Australia’s financial position and its artificial standards as well. The Australian farmers, notwithstanding the adversity with which they are confronted, are holding their own. Why do not those engaged in secondary Industrie* do likewise ? I have figures to show that the exports of our secondary industries during the last twenty years are valued at only £2,000,000 annually. We once sent a few consignments of jam to the Federated Malay States, confectionery to the South Sea Islands, and a few shipments of boots to New Zealand; but we are not even doing that now.

Reference has been made to the high standard of living in Australia, which, of course, should be maintained if the same standard could be enjoyed by all sections of the community. Do members of trade unions realize that their own kith and kin on the land are working longer hours for lower wages, and under conditions which would not be countenanced by city dwellers? Condition* such as exist in some parts of the cona- try do not suggest progress. During the period in which we exported £2,000,000 worth of the products of our secondary industries, Canada exported some £90,000,000 worth. If we could export even £50,000,000 of secondary production, we should, with the assistance received from our exports of wheat and wool, soon be on the high road to prosperity. The secondary industries have not stood up to their jobs. Had they done so this country would not be in the plight it is in to-day.

What has happened in the coal industry of this country? At one time, even before coal-cutting machines were perfected, our exports of coal were valued at some £10,000,000 per annum. If the men engaged in that industry only, stood up to their job as the wheatgrowers stand up to theirs, and increased their output 100 per cent., they would be doing something to put the finances of the country on a satisfactory basis. Twenty million pounds from the coal export industry annually would be a great help. It could easily be obtained. Unfortunately, they will not do so, because they have established the habit, not of working, but of stopping work. In the coal-mining industry, as in the maritime industry, the normal condition is a state of war. The wheat-growers and the wool-growers may rise early and retire late, and subject themselves to all kinds of privations; but not so the coal-miners. It has been truly said that the only two classes of society which cannot be organized are the settlers in the country and lunatics. The poor settler in the country is always at his job, and it is his money which is expended in providing comforts for the pets and favourites of fortune in other walks of life. The dweller in the country finds it necessary to devote all his energies to his job; he has not the time to concern himself with any organization. It is time that these men rose up and said, “ The weary camel in the country has had the last straw placed on his back.” If relief is not given to the wheat-grower he will leave the country for the city to enjoy the rosy time that others have enjoyed in the past at his expense.

As pointed out by Sir Otto Niemeyer the present situation in Australia has arisen because too large a proportion of the people of Australia have turned a deaf ear to good advice, and a ready ear to evil advice. It is significant that Canada can pay her debts, and that thecredit of that country stands high in theworld, whereas Australia, the pride of the: white race because of its White Australia policy, has no credit at all. Instead of getting on with their job, Australians stand glaring at one another, warring with each other, and preaching the doctrine of class hate. In the early days of the Labour movement demagogues were not only discouraged; they were kicked out. Later they got into the movement, with evil results. These “ Johnniescomelately “ who never did anything to build up the movement, will bring it to certain destruction. That they have done their best in that direction is reflected in the finances of the country. If Australians would only cease fighting one another, and stand up to their duty, much of the -^resent trouble would disappear, and the restoration of the country would not be any more difficult than it was in the early ‘nineties.

It is said that the plan agreed upon at the recent Premiers Conference to get us out of our troubles, calls for equality of sacrifice by all sections of the community. A very fine declaration ! How does the Government reconcile it with its preelection statements regarding the moneyed interests in this country? The same men who now cry, “ Equality of sacrifice,” before the election described . the capitalists of this country as men who were determined to bring their evil designs to pass and to injure the workers. There must be something wrong when the Government calls upon these wicked conspirators to make only the same sacrifice that is demanded of their victims. By its latest action the Government admits that in decrying the moneyed interests it was only seeking the votes of the workers. Eighteen months ago ono section of the community was responsible for all our troubles, and would be called to account; to-day it is a case of “ all hands to the pump “. It may be that the change on the part of the Government is due to there being no election on the near horizon. But an election is pending; the portents are stormy.

Although I realize that the time has come when those persons who lent money to the country should be asked to make a patriotic sacrifice and agree to a reduction of interest, I maintain that one of the worst things that can happen in any civilized country is for it to violate a contract which has been deliberately entered into. By violating contracts we are taking the shortest and the swiftest way to a state of society in which confidence nolonger exists. The last stage of such a country is worse than the first. Like that Corsican bandit who had no respect for human life, a country which violated sacred contracts is heading towards destruction. If at all possible we must observe contracts honorably entered into; but occasionally there come times when the parties to contracts must give way under the pressure of a threatening national catastrophe. I am reminded of one such catastrophe which threatened my native land, Ireland, in my boyhood days. Owing to developments in the western world, and improved means of transport, produce from America was shipped to all parts of Europe, including the British Isles, at a rate previously unthought of. The lands of Ireland had for centuries been subject to contracts which governed the conditions of rental and tenancy. Realizing that ruin faced the tenantry of Ireland, the British Government under Mr. Balfour stepped in, and passed a law which meant the violation of contracts. The Government chose to break contracts rather than see such hardship inflicted on producers, the final effect of which would be to ruin those producers. The public creditors of Australia are entitled to point to the contract that has been entered into with them. [Extension of time granted.] I believe that the spirit of patriotism which has distinguished the people of Australia in the past, will again assert itself in this crisis, and that thosewho have lent their money to various governments will not claim their rights, but will come to the assistance of their country in its time of need. If they do not do so from high motives, they will do so because of a realization that otherwise the country will suffer, and they with it. I am reminded of the statement of Bismarck when Germany defeated France in 1870, that the next time the Germans beat the French, Germany should insist on paying rather than receiving an indemnity. He realized that the payment to his nation of £200,000,000 - a hitherto unthought of sum - instead of doing his countrymen good, did them much harm. The collection of that vast sum from an already impoverished nation that had suffered the bitterness of defeat was an enormous task; but, as we know, the people of France responded to the call, and eventually it did them a great deal of good. So it will be with Australia. The bondholders are to make sacrifices; but, in the long run, the conditions imposed upon them and other sections of the community will result in the restoration of our national prosperity, and therefore, benefit everybody, including the public creditors. I feel sure that the holders of governmental securities - and they represent the great body of our citizens generally - will not fail us when they realize that this sacrifice is necessary in order that Australia may recover its good name in the eyes of the rest of the world. All grades of society will emulate each other in popular effort, and popular fervour, with the result that eventually we shall overcome our difficulties and raise the fair fame of this country to the high level it attained when the sons of Anzac wrote Australia’s name in the skies.

Senator BRENNAN:
Victoria · ALP

– I do not propose to debate this subject at any length. Its gravity has been emphasized not only by all the previous speakers this afternoon, but also by honorable members of another place, as well as in the public press, and by the leaders of our own party in private conference. The position became so grave that eventually it was referred by common consent to the Premiers Conference. That gathering included also the representatives of both sides in this Parliament, and was assisted by a body of experts whose life has been given to the consideration of subjects of this kind - experts who had every opportunity to study the situation with which they were asked to deal. I should be claiming for myself an ability which I do not possess if I were to attempt, in the course of a lengthy argument to criticize in deail the conclusions arrived at. I think, therefore, that I shall be serving both the Senate and the people at large if I admit frankly that, in this very complicated matter, I am prepared to walk a little by faith along the path which those experts - men who are much more competent than myself and at least as honest - in their endeavours to find a solution have marked out for me. In the circumstances, I should be doing a disservice if I were to occupy the time of this chamber in a lengthy and detailed criticism of the proposals which emanated from the Premiers Conference. I hope that I shall never be included in the ranks of those who are prepared out of hand to “ deliver brawling judgments on all things, all day long”. Indeed, when it comes to financial matters, I am much in the position of Lord Randolph Churchill, of whom it is related that when the permanent head of his department - a man accustomed to deal with financial matters concerning which Lord Randolph knew little - explained that certain marks in a row of figures were decimal points, remarked, “ Oh, is that what they are? I have often wondered what those damned dots were!” I am not quite sure to what length one may .go in making quotations in this chamber, but I understand that what I have just mentioned has the authority of the House of Commons, so I hope it is allowable in the Senate.

I propose to offer a few general observations concerning the “position which confronts us. I agree with those who say that nothing is to be gained by recrimination. It is much better to face the position, and for all sections of the community to bend their energies to an effort to extricate this country from its difficulties. But I agree, also, with those who hold the view that the crisis has been hastened, and has, indeed, been much aggravated, by the delay of the present Government in putting into operation some of the plans agreed upon at what is known as the Niemeyer conference in Melbourne in August last. I am afraid, however, that all of us must accept some portion of the blame for the position up to that time. By this I mean not merely all parties in this Parliament, but all parties outside, and, indeed, all individual citizens.

The crisis to which we have been gradually moving, and which now confronts us, is catastrophic in the Greek sense. We borrowed lavishly, and we created false standards; we indulged in a policy of inflation at a time when that word was not so popular as it has since become. During the whole of that time we imagined that the prosperity which we were enjoying was the result of the natural wealth of this country and of our own native ability, when, in point of fact, it was due to the facility with which we were borrowing money from those who were willing to lend it to us. The crisis was precipitated by the sudden drop in the prices of our exportable products, the decline in the national income being estimated at approximately £200,000,000. I believe, however, that it was rather fortunate that our national income did decline, because it caused us to desist from a line of policy which voluntarily we should ha%re found it difficult to alter. All parties and all classes acquiesced in lavish expenditure, and all classes and all parties benefited from it. Consequently, now that trouble has come upon us, all parties and all classes must share in the sacrifices necessary to retrieve us from the position in which we find ourselves.

This fact should be borne in mind by those who are inundating us with statements of the particular claims which they have for exemption. It would appear that everybody agrees that everybody else should make the sacrifice. If this doctrine found universal acceptance, nobody would make sacrifices, and our difficulties would be increased. One result which would follow the granting of exemptions from sacrifice would be that the dykes would be opened, and the water would rush in. As one of the necessities of the situation is prompt action, this plan, which has been prepared with extraordinary skill considering the limited time at “the disposal of those who were responsible for it, would be thrown into the melting pot, and valuable time, which we have- been assured is the essence of the contract, would be lost. The great testing time of our character and democracy has come. We are faced with a test which will disclose whether or not we are prepared to impose sacrifices upon ourselves* It is easy to vote for proposals which will require other people to make sacrifices. But, if all are riot prepared to accept sacrifices at a time when sacrifices . are so necessary, then . individually and as a nation, we shall have failed in the great test and the only alternative will be anarchy or a dictatorship. 1 agree somewhat with the remarks of Senator Lynch who said that we are an over-organized community with the result that, sometimes, we obtain from the executives of various organizations, views which do not truly represent the opinions of the rank and file. When I, in common with other honorable senators, received to-day a circular letter informing me that a mass meeting of Commonwealth Public Service employees had passed a resolution recording its “ uncompromising hostility” to the proposed reduction of wages, and “views with indignation the action of the Federal Labour Government in pursuing a policy, of ruthless wage cuts,” I may say, to use a somewhat trite expression, that it left me cold. I would add that, when some of the constituents of Senator Lynch who, we have been informed, have no need for watches or clocks because they have so frequently to work the clock round in order to get the barest subsistance, and when we know that there are in the Commonwealth approximately 400,000 persons who have no employment, I venture to say that those who “ view with indignation “ a proposal under which they are asked to make some sacrifice in which all sections of the community are expected to share, are not expressing the sentiments of the general body of our public servants.

I am sure that every member, not only of this chamber, but also of another place, views with the utmost distaste the necessity to make any encroachment upon the funds provided for soldiers’ pensions or any sub-class of soldiers’ pensions. fi rn n, / or Uren w an .

But again I venture to think that the soldiers of this continent will prove afresh what they have already proved. I remind them., if it be necessary to do so, that “ Peace hath its victories no less renowned than war “. I believe that, when they are called upon in a crisis during a time of peace they will no more fail, us than they did when called upon in a crisis during a time of war. I am certain they can rest assured that there is not a member of either branch of this legislature who would like to see the slightest curtailment of the rights which they enjoy; but when the position is that either something must be done or the money will not be there, I am confident that they will prove themselves to be just as patriotic as they did in another time of stress.

Senator DUNCAN:
NEW SOUTH WALES · NAT

– They have said that they are prepared to make certain sacrifices.

Senator BRENNAN:

– I am perfectly certain that they are. I am not criticizing them. Rather am I putting the view - which, I understand, is the view of every honorable senator - that they should realize that we, as legislators, are trying to do what is best for them, but that we are faced with a terribly heavy responsibility and are burdened with a most unpleasant task.

There is the other class which says that it views with horror the proposed wage cuts and that .the Labour movement, or certain sections of it - I trust that i( is not the view of the whole movement - will never tolerate them. I am utterly unable to understand the position which they take up. For almost twenty years, by means of judicial, quasi-judicial, and semi-judicial organizations that have been set up in this country, wages have been raised almost consistently, and nobody has objected to it.

Senator Kneebone:

– They have been chasing hard behind rising prices.

Senator BRENNAN:

– That is not so ; they have run in front of rising prices, and have been the cause of prices rising. These gentlemen who have written on behalf of the Commonwealth Public Service organization in Sydney tell us that it is a violation of the principles of unionism to cutwages at all. Does that mean that the wage movement is a kind of ratchet movement, that it can move onward only and never backward?

SenatorRae. - What we have we hold !

Senator BRENNAN:

– I regret to say that that is the principle which seems to be enunciated in this particular document. These officers should remember that, while they hold what they have, 400,000 of their brothers are walking the streets of the cities and the roads of the country-side endeavouring to get something that they may hold. If my friend, Senator Kneebone, whose speech I enjoyed, even though I do not agree with his arguments, regards with horror a loosening of the rigid wage system under which we work, and expects terrors to arise should it be relaxed, I can merely say that I do not understand his estimate of his fellow citizens. We have in Australia a complicated arbitration system that is. unknown in any other part of the civilized world; and so used have we become to it that it seems to be regarded as almost a truism that were we to relax it at all, employers and employees would be at one another’s throats. I can only say that, for my part, I have a much higher conception of the character and the capacity of my fellow citizens than is involved in expressions of that sort.

I hope that I shall not be accused of preaching when I say that something also turns upon the spirit in which we face this situation. Only last week I read an article in, I think, the Sydney Bulletin, which dealt with the question whether Australians, as a people, were conceited. I am afraid that we have spent our money lavishly and lived joyously, and that now that we are asked to foot the bill we are not showing the disposition which we should show to wipe out the debt that we have contracted. I believe that something will have been gained if, having passed through this depression - as, please God, we shall pass through it in time - we emerge with chastened spirits -

For frantic boast and foolish word,

Thy mercy on Thy people, Lord !

That, I think, is the spirit which we should show. Without desiring to preach in any way, may I say that it is, perhaps, desirable that we should turn in a little upon ourselves and remember that “ An humble and a contrite heart “ is not despised, but is still accepted as a sacrifice. If we take all these things to heart, if we try to face the situation that has developed, it may turn out that, although we may drop to a slightly lower plateau, relatively we shall be no worse off, and the future may not be so bad as it has been pictured.

Sitting suspended from 6.12 to 8 p.m.

Private business taking precedence after 8 p.m.,

page 3299

WHEAT INDUSTRY

Guarantee of 3s. per Bushel.

Debate resumed from the 1st July (vide page 3202), on motion by Senator Lynch -

That the Senate is of opinion that the pledge given to the wheat-growers by means of an act passed by the Commonwealth Parliament, for the payment of 3s. per bushel for all wheat grown in the year 1930-31, shouldbe redeemed.

Senator CARROLL:

– That may be. I think that Ministers knew as much about finance being forthcoming for that guarantee as they did about securing it for the earlier” guarantee of 4s. In February a civic reception was tendered to the Minister for Markets (Mr. Parker Moloney) by the Albury Town Council, and in reply to the toast of his health, the Minister said that the problem of the wheat-grower was beyond all party ; that it was a nation-wide problem, and would have to be attended to in that spirit.

The nest step in regard to providing assistance for the wheat-growers was the introduction of a bill for the issue of fiduciary notes to the value of £18,000,000, part of the scheme being to make £6,000,000 available for the assistance of the wheat-growers. A great deal has been said in the press and elsewhere about what would have been the value of those fiduciary notes, and in this connexion I should like to repeat a statement contained in a letter written to one of the Western Australian newspapers by a most ardent advocate of a fiduciary issue. He said that bad the proposal been accepted, the farmers would have been in a position to pay off their mortgages in a currency probably worth about 3d. in the £1, and to sell their wheat overseas for real money.

That bill was rejected by the Senate, and, in a fit of pique, the Government immediately withdrew an accompanying measure which guaranteed to the wheatgrower some assistance on a diminished scale. On the 30th April of this year, Senator E. B. J Johnston asked the Government to table the correspondence between it and the Commonwealth Bank in connexion with the guarantee of 3s. a bushel f.o.b., the subject of Senator Lynch’s motion, and Senator Barnes, in his reply, said that the Government had been advised by the Commonwealth Bank that certain legal technicalities put that proposal out of court. If those are not his exact words, they convey what he meant. The Leader of the Government in the Senate (Senator Barnes) made that statement immediately after declaring that the constitutionality of the 4s. guarantee under the Wheat Marketing Bill had never been questioned.

On this subject I do not like to say all that might be said ; but it is rather significant that in another place the Minister for Markets, after having allowed his Wheat Marketing Bill to go to the second-reading stage, and be debated for some time, withdrew it and submitted another measure which was in several important respects entirely different. It contained a new clause providing that if any of the provisions of the bill were found to be unconstitutional, its remaining provisions should not be invalidated. He had evidently received some indication that the bill as first introduced was not constitutional. I remind the Senate that about the same time Senator Colebatch told us that counsel who had given the opinion quoted by Senator Barnes in regard to the 3s. guarantee had given exactly the same opinion in regard to the 4s. guarantee. Copies of the opinion are available.

Of all the proposals brought down by the Government to afford assistance to the wheat-growers, only the bill containing the 3s. guarantee, which was passed by both chambers, had no conditions attached to it. It was a plain, straight-forward, and honest proposal to assist the wheat-growers to some small extent. It is, however, the only measure which the Government has never since mentioned, and it has never been acted upon. Every other measure brought down had some condition attached to it which, however desirous honorable senators may have been to give assistance to the wheat-growers, made it unacceptable to them, and, indeed, even to the great bulk of the wheat-growers, who were so badly in need of assistance.

Senator E B Johnston:

– The Government of Western Australia had refused to be a party to the Wheat Marketing Bill.

Senator CARROLL:

– Under that bill, the State Governments had to be partners with the Commonwealth Government; but it was understood that if any State Government refused to be a party to the scheme, it was to be dropped. The Western Australian Government made it perfectly clear that, for obvious reasons, it was unable to become a party to the agreement embodied in the bill.

Notwithstanding the many proposals which the Government has brought down to assist the wheat-growers it has not given effect to one. In the first instance the Government was eager to form an allAustralian compulsory wheat pool. In this connexion I should like to remind the Senate that, during the war, the experiences of the wheat-growers of my State in connexion with such a pool were such that they made up their minds that, so far as they could avoid it, they would never again be associated with an all-Australian pool. On that occasion our wheat-growers suffered enormous loss as a result of the handling of the pool by authorities over which they had no direct control. That can be easily proved by any one who has a desire to ascertain the real truth. The whole legislative policy of this Government, so far as the wheatgrower has been concerned, consists of a long list of broken promises. In view of all the circumstances, I am reluctantly forced to the conclusion that when the first proposal was brought down assistance to the wheat-grower was the last thing which the Government had in view. That was not the object which it had in mind, and its real policy was disclosed as the session proceeded. It is recorded in history that Napoleon’s line of retreat from Moscow was lined with the bleached skeletons of the men of his army. The whole legislative path of this Government is littered and lined with broken promises which have resulted in bitter recriminations, and have brought on this Government the curses of the deluded wheatgrowers of Australia.

Senator E B JOHNSTON:
farmers, .as provided for in an act passed by this Parliament last December. I am glad that this matter has again been brought forward, although, ever since this Parliament has been in session, honorable senators representing Western Australia have, in one form or another, urged the Government to honour its promise. I cannot understand why the guaranteed price has not been paid, particularly as payments have been made to every other Australian industry which has been successful in securing assistance from the Commonwealth Parliament. It is only those engaged in the wheat-growing industry who have been confronted with excuse after excuse, and promise after promise. The present Government is responsible for the present desperate position of the wheat-growers because its leader urged the wheat-growers to produce more wheat. The farmers responded to that appeal and later the Government introduced a measure of a nature that had never previously been submitted in connexion with the granting of federal assistance to any other Australian industry. ‘Under the Wheat Marketing Bill the Commonwealth was not, as in every Other case, to ;bear the whole burden; it was to be spread over the wheat-growing ‘States. Fortunately, that wretched ‘and miserable bill, which provided ‘that the States should bear one-half of any loss, on the proposed guarantee of 4s. a bushel, was rejected by the Senate. It was an antinational and anti- Australian proposal, and such a scheme had never previously been submitted ‘to a Commonwealth Parliament. Under the ‘Government’s .proposal the heaviest burden would have been thrown upon Western Australia and South Australia, owing to the sparseness of the populations and comparative heavy wheat production in those States. It is not surprising that the Premier of Western Australia (Sir James Mitchell · Western the motion moved by Senator Lynch, which provides that the Government should pay the guaranteed price of 3s. a bushel to the wheat

, immediately on attaining office, telegraphed to the Prime Minister, saying that a proposal of that nature was absolutely unjust, and that his Government could not be a -party to it.

Ever since the inception of federation the primary industries of Western Australia - we have few others upon which to depend-have contributed their full share of support to every other Australian industry which is protected by means of customs duties or the paymen’t of bounties. The first time that any assistance by the Commonwealth to the Western Australian wheat industry was brought forward the Government said that it would assist it only if the States were prepared to shoulder one-half of the responsibility. During the last decade Western Australia has depended very largely upon the wheat industry. Its policy has been to borrow what money it could for the construction of railways from one end of the wheat belt to tie other. Its finances have been strained to the utmost in placing new settlers throughout the wheat belt, and in financing ‘Other governmental instrumentalities for their assistance. In response to the Prime Minister’s appeal to grow more wheat Western Australia did more than its share, and last harvest attained a record yield of no less than 52,891,492 bushels from an area of 3,958,313 acres. From that huge area of nearly 4,000,000 acres an average yield of 13.3 bushels per acre was reaped. That .great production per acre was a record for the State, with the exception of that in 1903-4, when an average of 13.6 bushels was obtained from an area of 137,946 acres. I ask honorable senators to consider the enormous increase in .production as a result of the energy displayed “by men, without capital, seeing that the area under production was increased from 137,946 acres in 1903-4 to last year’s record area of 3,958,313 acres in so short a period. In the .previous year our .production was 3,568,225 acres, which produced 39,081,183 bushels or an average of about 11 bushels to the acre.

It will be seen from these figures that Western Australia responded to the appeal to grow more wheat on the understanding that direct federal assistance would be forthcoming, and not under a hybrid system providing that the States were to carry a portion of the risk. Assistance has never been given to any other Australian industry on that basis.

TheWestern Australian Government has built railways in the wheat belt, and has encouraged settlement by straining its financial resources to the utmost possible extent. To-day our wheat-growers are right up against it. Many of them are in a desperate position, and are so deeply in debt that they are unable to. secure credit to procure the necessities of life for themselves and’ their families. That is the position in which they find themselves, despite the fact that it has been the policy of the State Government to assist its farmers and settlers as a means of increasing the State’s prosperity. The State Government has found it necessary to appoint an honorary royal commission to inquire into the conditions of the farming industry generally. As this commission is conducting its inquiries in Perth, no travelling is involved, and, as the members of the commission are acting in an honorary capacity, no expenditure whatever is being incurred. It is hoped that, as a result of this investigation, something will be done to assist the farmers where this Government has dismally failed. To show the extent to which the Government has assisted the farming industry in Western Australia, I may mention that, in giving evidence a few days ago, Mr. McLarty, the manager of the Agricultural Bank in that State, said that on the 30th April last the indebtedness of the farmers of Western Australia to the Agricultural Bank in that State was £5,221,231; to the Soldier Settlement Department, £4,450,940; to the Group Settlement Department, £1,178,783; and to the Industries Assistance Board, £1,795,383. At that time there were also arrears in interest owing to the Agricultural Bank amounting to £564,057, and to the Soldier Settlement Board, £472,709, making the total liabilities of the settlers in Western Australia, who consist largely of wheatgrowers, £14,294,108. Mr. McLarty estimated that the total indebtedness to the Agricultural Bank and the associated banks amounted to £26,544,110, apart from debts in the form of private mortgages, amounts due on trucks, cars and tractors. He estimated the indebtedness of the farmers of Western Australia on a conservative basis at a sum exceeding £30,000,000.

SenatorRae. - A high wheat yield was obtained at a big price.

Senator E B JOHNSTON:

– The burden of the wheat-growers was increased enormously in consequence of the response made to the Prime Minister’s appeal. Despite the expressed will of this Parliament, no assistance has been given to the wheat-growers. Ever since the inception of federation a good deal of the time of this Parliament has been devoted to legislation providing for the granting of assistance to Australian industries. At this juncture it is not my intention to say anything concerning the extent to which the tariff has pressed upon those engaged in the wheat industry. According to a statement made by the Minister for Trade and Customs (Mr. Forde) on the 16th of July last, the direct assistance given to the iron and steel industry in the form of bounties has amounted to £1,738,900. The bounty paid for the production of sulphur amounted to £293,812, and bounties for the production of wine and cotton to £1,330,443 and £360,873 respectively. Assistance to industries in Papua and New Guinea necessitated the expenditure of £2,893. We have, therefore, a total cash payment of £3,726,921 to assist these industries. Added to that sum, there are the amounts paid for the financial year just ended, and the bonuses to the flax and linseed industries.

Whenever an act authorizing the granting of assistance to other industries has been approved by Parliament, the money has been paid. How different has been the fate of the wheat-growers. Their first disappointment was in connexion with the promise of 4s. a bushel for their wheat. At this stage I desire to express my gratitude to the Minister for Markets (Mr. Parker Moloney) for having at last placed on the table the correspondence regarding the promise to pay 4s. a bushel for wheat under the Wheat Marketing Act. I have carefully copied out the correspondence, and I find that, from the first, the Commonwealth Bank adopted the attitude that it would not find the money at all. On the 25th March, 1930. Mr. Parker Moloney, the Minister for Markets, wrote to the Governor of the Commonwealth Bank , on the subject, and also sent him a copy of the report of the proceedings at the conference held at Canberra, on the 18th and 19th February of that year. In that letter, the Minister said, inter alia -

The Commonwealth will .defray from the revenue half of the loss, and the States the other half, based on the proportion that the production of wheat in each State bears to the total production of wheat placed in the pool.

There is no suggestion there that the bank should find the 4s. a bushel. The Commonwealth at once offered to find its share from revenue. The Minister commenced the correspondence by pointing out. that if the scheme were proceeded with the Commonwealth Government would defray from revenue one-half of any loss, and the States the other half. The Commonwealth Bank was not asked to finance the scheme. Clause 4 of the memorandum dealing with the financing of the compulsory wheat pool reads -

That in the event of any deficit accruing through the operation of the pool which deficit has to be made good by the Government the amount payable in such connexion shall be ascertained from month to month, and the Government shall undertake to pay the Commonwealth Bank such deficit from time to time as required by the bank.

It is apparent that each month the Commonwealth Bank was to be recouped by the Government from revenue for any payment made by it under the proposed legislation. The correspondence should settle for all time the controversy that has taken place, because it proves clearly that the Commonwealth Bank was not asked, nor did it agree, to find 4s. a bushel for wheat.

Senator Rae:

– The honorable senator would not have cared where the money came from, had it been paid.

Senator E B JOHNSTON:

– I only wish that it was possible to secure the motley from any source. I mention these things because organizers are going throughout the country telling the wheatfarmers that 4s. a bushel for wheat was promised by the Commonwealth Bank, and would have been paid for by that institution had the Senate not rejected the legislation. That statement is absolutely untrue. If it were true it would have been natural for the Government to say to the bank that since it promised 4’s. a bushel, and was not called upon to redeem its promise, there should be no difficulty in paying 3s. a bushel. There is nothing in the correspondence of this nature in regard to the guarantee of 3s. a bushel.

It is strange that even to-day some of the wheat-farmers of Australia do not appear to know that both Houses of Parliament approved the payment of 3s. .a bushel, f.o.b. being made to them for their wheat. Parliament did everything it could by the passing of that legislation to ensure that the wheat-farmers would receive 3s. a bushel, f.o.b. for last year’s harvest. That legislation became law in December last, but the act has been treated by the Government as a mere “ scrap of paper “. It has been repudiated. Although I admit that the Government desired to meet its obligation, the responsibility for not doing so rests on its shoulders. No other government which ever occupied the treasury bench was so bankrupt of confidence on the part of financial interests as to have been unable to make so small a payment to a deserving section of the community. Last November - only one month before the legislation to which I have referred was passed through Parliament - the Acting Treasurer (Mr. Lyons) appealed to the people of Australia on behalf of the Government, for a £28,000,000 Conversion loan. That loan was over-subscribed by £2,000,000. I am convinced that had that gentleman been retained in the office of Treasurer the farmers would have been paid 3s. a bushel for their wheat last January, with as much ease as the £28,000,000 loan was floated. Although the resolution of the Senate asking for the tabling of the correspondence between the Government and the Commonwealth Bank regarding a guarantee of 3s. a bushel f.o.b. for wheat, was carried on the 30th April last, only to-day has this scanty file come to light. It appears to be most incomplete; at least, it is remarkable for the information that it fails to give as to why 3s. a bushel was not paid to the wheat-farmers.

Immediately the legislation was agreed to in December last, Mr. Fenton, the then. Acting Prime Minister, wrote to theChairman of the Commonwealth Bank Board, Sir Robert Gibson, intimating that the legislation had been passed, and asking the bank to pay 3s. a bushel to the wheat-farmers. On the same day, Mr. Fenton also sent a letter to the Governor of the Commonwealth Bank. The proper procedure was followed, but the extraordinary thing is that the file does not disclose that the Commonwealth Bank even acknowledged his communications. There is nothing to show that the letters reached the addressees. Nothing is recorded as having taken place from then until 19th January. I have here also a summary of the proceedings at a conference which, took place between the Prime Minister (Mr. Scullin) the Acting- Minister for Markets (Mr. Forde), and the Chairman of the Commonwealth Bank Board (Sir Robert Gibson), on the 19th January last. The memorandum, which appears to have been written recently for the ink still looks fresh, states -

On the 19th January, 1931, the matter was discussed at a conference held in Melbourne between the Prime Minister (the Right Honorable J. H. Scullin), the Acting Minister for Markets (Mr. Forde), and the Chairman of the Commonwealth Bank Board (Sir Robert Gibson ) . The Secretary of the Department of Markets (Mr. E. J. Mulvany), and the Acting Solicitor-General (Mr. G. S. Knowles) were also present.

At that conference the Chairman of the Commonwealth Bank Board intimated that the hoard was unable to see its way to advance upon wheat any amount exceeding a sum which might reasonably be computed to represent the realizable export value of f.a.q. wheat, and that the bank’s legal advisers had raised serious doubt as to the ability of the Govern- ment to safeguard the bank against any losses under the guarantee proposed by the Wheat Advances Act; furthermore, that the Bank Board was faced under an act of Parliament with the responsibility of conducting the business of the bank and was under obligation to adopt any measure which might be deemed necessary to protect the bank against loss.

In the circumstances the Acting Minister for Markets intimated in the press that as the Government was unable to obtain the necessary finance from the Commonwealth Bank to give effect to the Wheat Advances Act by providing a guaranteed price on the basis at 3s. per bushel, f.o.b. for f.a.q. wheat, wheatgrowers should, in view of the decision of the Commonwealth Bank Board, proceed with their marketing operations in the ordinary way as though the act did not exist.

The circumstances are remarkable. Apparently, because the Commonwealth Bank stated that its legal advisers had raised a doubt as to the ability of the bank to guarantee the Government against loss, the Government immediately dropped the proposal to pay 3s. a bushel to the wheat-farmers for their wheat. In view of the “ Grow More Wheat “ campaign initiated by the Prime Minister, the Government should have taken action to ensure that the wheat-farmers would be paid that sum, not necessarily by the Commonwealth Bank, but, by any banking institution either inside or outside Australia. The Government had power to finance the necessary amount with any prescribed authority. There is nothing to show that any further legal opinion was obtained. All we know is that Sir Robert Gibson said that the finance could not be arranged. We were told by Mr. Parker Moloney that Mr. Menzies, K.C., had given this opinion, but the file does not disclose that it was communicated to the Government or that the Government availed itself of the resources of the Crown Law Department to persuade the bank that it could legally make the money available. We may be sure that, if the bank could not legally finance an advance of 3s. per bushel, it certainly could not finance an advance of 4s., because there is no mystic property about the figure four which would validate an advance of that amount if the bank could not legally and constitutionally provide finance to enable 3s. per bushel to be paid.

On the evidence disclosed by the file the Government is deserving of the strongest condemnation for its apathy in connexion with this matter. All that it did was to send a copy of the bill to the Governor of the Commonwealth Bank with a request that the payment should be made. Thereafter it took no action for a month and a day. There was an interview with Sir Robert Gibson, who intimated that the bank’s legal advisers had raised a doubt as to whether the payment could be made, and then the project was dropped entirely by the Government. The Government is entirely to blame for having failed to redeem its promise. It took no steps, after the passage of the bill, to provide for the payment of. even such a small amount as 3s. per bushel. For several weeks we have been endeavouring to secure a copy of the correspondence, so that we might discover the methods which the Government proposed to adopt to ensure the payment .of the proposed advance. Now that the correspondence has ;been produced it shows clearly that the Government, apparently, had -entirely abandoned the wheat-farmers, who have suffered more than any other individuals in the community during this depression. When prices for wheat are satisfactory, all .classes share in the prosperity of the wheat-farmers. When the growers secure a reasonable return for their year’s work, business in all towns in wheat-growing areas is booming and there is employment for all who desire to earn their living on the farms. I very much deplore the attitude of the Government as disclosed by this file. I hope that the motion will be carried, and that even at this late hour the Ministry will make some effort to ensure the paywent of at least the small sum of 3s. “f.o.b. to the wheat-growers of Australia for last year’s harvest.

Senator GUTHRIE:
Victoria

– I rise to support the motion submitted by Senator Lynch, which reads as follows : -

That the Senate is of .opinion that the pledge given to (the wheat-growers, -by means of an *ct passed by the .Commonwealth Parliament for the payment of 3s. per bushel for all wheat grown in the year 1930-31, should be redeemed.

I would, however, point out that there is a vast difference between 3s. per bushel for all wheat produced and 3s. per bushel for f.a.q. wheat f.o.b. The latter quotation would be equivalent to 2s. 3d. at some .country stations and 2s. 6d. at others for wheat delivered in bags.

The treatment of the wheat-growers of Australia by this Government has been shamefully cruel, especially in view of the fact that our primary producers, and also their womenfolk, work long .hours for a return that is wholly inadequate and these workers are, in reality, the backbone >of the country. Of the many rebuffs which they have sustained in recent years, the most cruel blows have been struck by this ‘Government from -time to time. Ministers and their supporters have made many promises, none of which has been fulfilled. We should not be surprised, therefore, df our wheat-farmers have become disheartened because of their treatment and disgusted with the Government and Its supporters in this Parliament. We all recall the promise made during the last election by Mr. Gibbons, a Labour member of another place, that, if Labour was returned to power, wheat-growers would receive 6s. per bushel. Where that money was to .come from was never disclosed.

Senator Rae:

– Mr. Gibbons denied having made that promise.

Senator GUTHRIE:

– He made it dozens of times during the election. 1.1 was largely because of that promise, which he must have ‘known was impossible of fulfilment, that he defeated the late Sir Neville Howse, V.C., one of the finest men we have ever had in this Parliament. Then Mr. Lang came along with further alluring baits for wheat-growers. He or the candidates supporting his party approached share farmers on my property in the Riverina and told them that, if they voted for Labour, and if Mr. Lang were returned to power, they would get 7s. 6d. a bushel for their wheat. Later the Commonwealth Government introduced legislation, under which it was proposed to pay a guaranteed price of 4s. a bushel for f.a.q. wheat delivered at railway sidings. That bill was passed in another place but rejected in the Senate. I voted for it, but I now realize no arrangements had been made for the payment of the guaranteed price, and I admit, also, that, as drafted, the bill was most unfair to the State of Western Australia. It provided, as honorable senators will remember, that the Governments of the wheat-growing States should undertake responsibility for one-half of any loss that .might have been incurred by the guarantee being so much above world’s prices. Although I voted for the measure, believing that 4s. was the lowest payment which farmers should get for their wheat, I do not blame those honorable senators representing Western Australia for voting against it. They did their duty by their State. I may add that no honorable senators fight harder in the interests ‘of our primary producers, especially our wheat-growers, than do those who now represent Western Australia. Some of them are directly associated with , the wheat industry, and all of them realize the preponderating importance of that industry to that State. If that ‘bill had :been passed -there would have :been a loss of .between £6,000j000 and £7,000,000, owing to the low price ruling for wheat in the world’s markets. That would not have meant very much to a thickly populated State .like Victoria, but it would have been a tremendous burden for Western Australia which State, last season, had the largest volume of wheat production, and has the smallest population.

Senator Lynch:

– It would have meant a burden of about £2,500,000.

Senator GUTHRIE:

– It would have been an unbearable tax for the people of Western Australia. In the light of subsequent events I believe that the Government had no intention of giving effect to its proposals, even if the bill had been passed by the Senate, and I frankly admit that those representatives of Western Australia in this chamber who voted against it merely did their duty, particularly in view of the fact that the Premier of Western Australia had declared that his Government would have nothing to do with the scheme. Much capital has been made by political opponents in Western Australia over the attitude of those honorable senators towards the bill in question. A misrepresentation of ‘Statements made by me in Melbourne was sent to Western Australia to further mislead the farmers, hut I took prompt action to correct the false report. Every effort has been made to cause mischief in the electorates and undermine the “position of those honorable senators from Western Australia who voted -against the , bill. .It is difficult to put :the matter right, because, as we -know, once a misstatement has been star-ted it travels -like a bush fire.

There are 62,000 wheat-farmers in Australia, and owing to the high cost of production the great majority of them are in a desperate plight. They have to ship their surplus product T2,’000 miles to overseas markets and sell it in ‘competition with wheat -grown in countries where production costs are infinitely lower than in Australia. We are constantly being told that, if Australia is to prosper, costs of production must be lowered. How is it possible to ‘bring down, -costs in our primary industries in the face of ever increasing tariffs, the imposition of embargoes and Arbitration Court .awards, ali of which are responsible for the levying .of increased ‘charges upon the farmers for all the. machinery used on farms, and on the whole of the requirements of their wives and families? Furthermore, as *a direct result of the imposition of high tariffs, the sea freight on primary products is substantially increased, because importations having declined enormously, ships come to Australia with half cargoes, or sometimes in ballast. and to make the business pay have to charge higher outward freights on wheat, wool, meat, and other products. Primary producers in South Africa .and New Zealand, the Argentine and Canada do not suffer this handicap.

I have seen no estimate by any individual, firm, or government department, that has placed the cost of producing wheat ki Australia to-day at as low a figure as 3s. a bushel. I have read many reports including those of the Department of Agriculture of South Austalia, and the other States, which compute that the cost of producing wheat, -and landing it at the seaboard, is anything from 4s. lOd. to 5s. 6d. a bushel. I happen to be in -one of the most favoured parts of Australia, and I have working for me a small army of most efficient and hard-working sharefarmers, who are splendidly equipped for the position. I cleared the land for them, and I supply them, free, with all superphosphate ;and seed, and one-half of the total number of bags required. They have no interest or capital payments to make. It is £11 an acre land. Last harvest they produced 84,000 bushels of wheat. They won the prize for the -best crop grown in New South Wales for the year, and” the judge said it was the best crop that had ever been entered at any competition in that State. Yet the year’s operations resulted in a serious loss; and the more wheat we grew the greater was the loss. It cost us from 3s. 3d. to 3s. 4d. a bushel to land that wheat in bags at the Rand railway station. All that we have so far received is ls. a bushel from the New South Wales primary ,producers pool for f.a.q. wheat delivered in bags at the railway siding; and another pool has .paid us ls. 3d. Bags cost ais 4d. a bushel, and cartage 2d. a bushel. Therefore, ;all that we have received is from ls. -6d. to ls. 9d. a bag for -prime wheat. The -best offer I have had this week for prime milling wheat delivered in Sydney is 2s. 2d. a bushel.

The wheat-farmers are broken-hearted. Promise after promise has been made, but none of them has been fulfilled. Why does not the Government make the payment of 3s. a bushel for f.a.q. wheat f.o.b. which this Parliament, by legislation, sanctioned? Although much below the cost of production, it would enable some farmers to carry on, and give heart to those who are now absolutely broken-hearted. I venture to say that the area under wheat this year will be not more than half what it was last year. We claim that we want to keep the people on the land. It is well known that we are absolutely dependent on our primary producers; that 98 per cent, of the total value of our exports, and 75 per cent, of the total wealth comes from the land. Yet the condition of the wheatfarmers in all of the States is nothing less than awful. Victoria is a garden State, but in the Mallee country the farmers have had a very bad spin. In my opinion, some portions of the Mallee, on which returned soldiers and others were placed, ought never to have been settled in small areas for wheat-growing purposes, because I do not consider that the land is suitable or that the rainfall is sufficient. The conditions in the rural industries in Victoria are so bad, owing to the adverse legislation for so long a period by most Parliaments, that 56 per cent, of the total population of the State is now domiciled in Melbourne. They have been driven ofl the land, and into the city. I know personally not one but dozens of good farmers who this year have walked off their farms brokenhearted. Two of them left their machinery on the land, and went with their wives and children into Albury. They are now living on the dole, or on any work that they can get. They are splendid men, and in the summer time would work the clock round by making use of the headlights on their trucks. More than once on my farm I have wakened up in the middle of the night, and wondered at the reason for the lights until I learned that the men were still working. A Little Brother, who came out to me from the Old Country, and who has grown into a fine, strapping youth, worked as long as eighteen hours a day, and lived on practically nothing. Now he writes to me saying that he is broken-hearted, and wants to get away from Australia. It is not the practice for a Big Brother to employ his own Little Brother, and I did not employ this youth for some years, but sent him elsewhere to gain experience. When he expressed a wish to make a start as a share-farmer, I placed him on 500 acres, and assisted him iu every way. His letter to me reads -

I am afraid I am fed up with farming and Australia in general; not through any fault of yours, please don’t take it this way. 1 hope to get enough money from my crop at Goombargona to enable me to re-visit the Old Country, and thence to the Argentine or elsewhere. It is only right that you should know of my intentions beforehand, as you have stuck to me. I trust I have reciprocated. This season has fairly “ put the pot on “ things. At present I am working for my tucker at Goombargona, iu order to save money, and to do my work as soon as the ground is workable.

This lad not only worked the 500 acres on my place, but also cleared 400 acres on an adjoining property, by working day and night by himself. He lived in a tent, and I now learn had neither sufficient clothing nor sufficient food. Now the floods have washed away whatever he has sown; and there were hundreds of acres that he was not able to sow. He had a crop last year, and thought that he would receive 4s. a bushel for his wheat. I told him that he would. I believed that the Government was sincere. At the time I thought that 4s. a bushel would be paid for f.a.q. wheat on rails. I told not only this boy, but also every other farmer that I met, to take heart because the people of Australia would see that they received 4s. a bushel for their crop. Instead of getting Gibbons’s 6s. 6d., Lang’s 7s. 6d., this Government’s 4s., or even the 3s. sanctioned by an act of this Parliament, all that they have received is ls. a bushel for f.a.q. wheat delivered in bags at the railway. Is not that enough to break the heart of anybody, particularly as the consumers are not getting a fair deal, notwithstanding the sacrifices that have been made by the farmers? The price of bread to the consumer is out of all pro- portion to the price of wheat. There is about1d. worth of wheat in a 4-lb. loaf of bread.

SenatorRae. - The Federal Government cannot legislate with respect to that matter.

Senator GUTHRIE:

– I know that it cannot; but the exploitation of the public is going on, nevertheless. In New Zealand the price of wheat is practically three times what it is in Australia, yet the price of bread is no higher. In the Old Country bread is cheaper than it is in Australia. These share-farmers to whom I have referred are still paying1s. for a 4-lb. loaf of. bread, while they are selling their wheat for only1s. a bushel. The price of bread in Geelong is still11d. a loaf in some shops.

Senator Dooley:

– This Government is not responsible for that.

Senator GUTHRIE:

– I do not hold this Government responsible. What I am saying is that the ridiculously low price of all our primary products is not bringing any material benefit to the people, and that the cost of living is not nearly as low as it should be. Because of the breaking of the contract made with the farmers by this Government, and for other reasons, the area of wheat sown this year will not be more than half what it was last year.

Why does the Labour Government in the Mother Country allow Russiato flood the British market with her wheat? Russia has definitely defaulted in the matter of her liability to Great Britain to the extent of £900,000,000. She is producing large quantities of wheat under conscript labour, which is totally opposed to the ideals of the Labour party, and of every other party, not only in this country, but throughout the British Empire; yet the British Government permits her to flood that market, while the sons of England, who are on the land in Australia, are in a practically starving condition. There are wheatgrowers whose wives and families have not a sufficiency of either food or clothing, despite the fact that they themselves work longer hours and much harder than the people in the cities.

This year, according to the newspapers, Russia has sown 160,000,000 acres of wheat.

Senator Dooley:

– This Government cannot control that matter.

Senator GUTHRIE:

– But the Government has control of the local situation. It is necessary to give some assistance to the wheat-growers of this country who are in a parlous condition, and who, we all admit, are the backbone of the country. The Government could not pay them 4s. a bushel, because it made no proper financial arrangements to do so. That is shown clearly by the correspondence which took place with the Commonwealth Bank. But it could have paid 3s. a bushel f.o.b., which represents only from 2s. 3d. to 2s. 6d. a bushel at the railway.

Senator Dooley:

– Provided the banks made the money available.

Senator GUTHRIE:

– The Government could have obtained the money. In Victoria alone, private loans could be raised - in fact they were offered - to finance the payment of 3s. a bushel f.o.b. This Government has not accepted any offer to help the farmers. It should not have passed the Wheat Advances Act if it were unable to give effect to it. No sooner was that act passed than the Minister who had charge of the matter stated publicly in Melbourne and elsewhere, that it was doubtful whether it was constitutional, and that the Government was unable to finance it. He advised the farmers to sell their wheat as best they could, and when they could. The consequence was that there was a scramble to sell, and the market collapsed. The farmers did not get even a fair market price for their wheat.

I say again that this Government has betrayed the farmers, and misled them with promise after promise, none of which has been fulfilled. No real effort has been made to give effect to the act, which passed both Houses of this Parliament. The farmers were cruelly treated, and they will not forget it. It is useless for the opponents of honorable senators from Western Australia to carry on propaganda against them, alleging that they were the men who let down the wheat-growers by declining to vote for the measure which povided for a guaranteed price of 4s. a bushel. Those honorable senators did the right thing under the circumstances. It would have been too great a burden on Western Australia. The Government knew perfectly well, as I know now, that no arrangements whatever were made for the payment of the money in the event of that bill being passed.

I hope that at long last something will be done for these suffering people out in the flooded Riverina, and in other wheatgrowing districts. They are plucky, and they will stick to their holdings as long as they possibly can, in the hope that some day they will receive a reasonable payment for their labours. I am afraid, however, that they will not have much faith in the promises of future Labour governments.

Debate (on motion by Senator Sir George Pearce) adjourned.

page 3310

ADJOURNMENT

Importation of Russian Timber: Labour Conditions in Russia.

Motion (by Senator Dooley) proposed -

That the Senate do now adjourn.

Senator PAYNE:
Tasmania

.- To-day Senator Glasgow gave noticeofa question relating to the recent arrival in Australia of a large shipment of timber from Russia ;but, feeling that it is necessary to lose no time in entering a protest, which I hope will be supported by honorablesenators, against the introduction of a commodity from a country like Russia, I make no apologies forspeakingon the subjectnow.Our timber industry is in a very parlous condition. It is a very important primary industry which, for years past, has afforded employment to many thousands of our people; but for many reasons, and particularly because of the depression that has come upon us, the demand for timber hasso greatly decreasedthat there are now many of our timber-workers out of employment, and many of the mill-owners are attempting to carry on with skeleton staffs, hoping for the arrival ofbetter times. Inour wisdom or otherwise, from time to time, by various arbitration awards, we have imposed upon mill-owners the obligation to pay certain rates of wages and observe certain conditions of employ ment, and we have passed a Navigation Act which has had a particularly marked effect upon the timber industry in Tasmania. The industry cannot be carried on in that State unless there is a market for the timber on the mainland. But, when one realizes that the freight on timber from Tasmania to the mainland is in some cases 100 per cent. higher than the freight from Russian and other overseas ports to Australia, one can see what a terrible handicap is being placed on this most important industry. In recent years many thousands of pounds have been spent on afforestation, in order that we may have sufficient timber in Australia to meet our needs for all time. Is it not a suicidal policy to spend these enormous sums in that way, and at the same time allow timber to be brought into Australia from a country where wages are low and where the conditions under which it ishandled are such as would cause any man to shudder if they were in existence in Australia?

Senator Rae:

– What evidence has the honorable senator to support that statement?

Senator PAYNE:

– The other day the honorable senator no doubt saw in the press where the captain of the vessel which has brought this timber had spoken of the conditions under which it had been obtained. And he understands, probably better than I do, the conditions in Russia to-day. There is sufficient evidence that this timber has been got and converted into sizes suitable for shipment under conditions that would not be tolerated in any other part of the world.

Senator Lynch:

– In Russia the workerscarry on under guards with fixed bayonets.

Senator PAYNE:

– It can be proved from Russian literature that thosewho are in control of Russia to-day have evolved a plan the purpose of which is to bring down the British Empire to the Russian level. Russia is the avowed enemy of Great Britain. Recently a large vessel arrived in Sydney from a Russian port laden with timber for use inthe construction of our homes and furniture.

Senator Rae:

– Shocking !

Senator PAYNE:

– It is a shocking state of affairs. We know that the

Government has been approached in regard to the matter, and is making inquiries; but I have received the following telegram: -

The Timber Advisory Committee is credibly informed that further shipments of Russian timber are in transit for Australia. Consider it imperative for the protection of the Australian timber industry that an absolute embargo be placed on Russian imports.

I am not in a position myself to say that further shipments are on their way to Australia ; but I believe that the secretary to this committee would not have made this statement unless he had received information in. that direction. I think that the Government should take immediate steps to prevent the markets of Australia from being flooded with timber from Russia. We talk about our unemployment, and say that it is imperative that it should be reduced. The admission of this timber will tend to aggravate our unemployment problem.

Senator Lynch:

– Have we no antidumping act?

Senator PAYNE:

– Yes. I am relying on the press for the information that the Prime Minister said that he would not be a party to placing any embargo on the importation of Russian products.

Senator Rae:

– That is not all that the Prime Minister said.

Senator PAYNE:

– I think that I am correct in my rendering of what he said -on that point. Scores of thousands of pounds have been invested in machinery and plant for the purpose of exploiting our Australian timber resources, and it must be remembered that the timber- getters of Australia are of that hardworking section of the community referred to by several speakers to-day in connexion with the wheat industry. They are the backbone of the country; they work very hard and are not afraid of work. But, unfortunately, from time to time they have been prevented from working by the organized efforts of the unions controlling them, with the result that there has been a large addition to Australia’s unemployed. We had a big timber strike in 1928. The difficulty was got over and we thought that there would be a. reasonable hone of a revival of this most valuable industry; but, unfortunately, recent happenings have had a tendency to make it extremely difficult for it to carry on. Our first consideration should be to improve our own industries, and try to provide employment for as many of our people as we possibly can. Above all we must not ignore the conditions under which the timber industry is carried on in Russia. The competition brought about by the importation of this timber is as unfair as would be the introduction into Australia of wheat from Russia, where it is grown by what is practically slavelabour. Russian products are not sent to Australia or elsewhere because they are the surplus production of the country. We have sufficient information to show us that Russia is not growing enough wheat for its own home consumption. It is part of the policy of those who are now controlling the country to exploit other countries in order to bring them down, if possible, to the standard which obtains in Russia to-day. Iprotest against the introduction of this timber, and I urge the Minister in charge of the Senate to bring the matter under the notice of his colleagues so that the inquiries which are now being made may be brought to a conclusion as speedily as possible, with a view to preventing the importation of any further supplies of it.

Senator RAE:
New South Wales

– I wonder why Senator Payne has confined his attention to Russian timber. As a matter of fact, the Australian markets are flooded withoregon and baltic, which do not come from Russia, andthere has been no protest in regard to their importation. The protest against the importation of Bus sian timber is all part of a criticism of Russia by people who have read only one-sided accounts of Russian conditions in the daily press, which has never been noted for its veracity. For instance, Senator Lynch, who has a well-known love for Russia, has interjected to-night that timberis produced by men under guards armed with fixedbayonets. That is purely a newspaper stunt.

Senator Lynch:

– Ican produce witnesses to prove the truth of it at any time.

Senator RAE:

– I am prepared to wager that the honorable senator cannot prove anything of the kind. But the point is whether Senator Payne does anything in his own State to insist that the fruit exported from Tasmania shall be cased in timber produced in Tasmania.

Senator Dooley:

– It is said to be too heavy for the purpose.

Senator RAE:

– I understand that that is so. There are many anomalies in connexion with our timber industry apart from the competition of Russian timber. Although I hold no brief for the Prime Minister, I think Senator Payne might have quoted all that the right honorable gentleman said on this subject. Mr. Scullin said that he had no intention of taking any action unless the inquiries that were then being made proved that the anti-dumping act was being violated by the importation of this timber. If the importation of this timber is to be prevented in order to help a local industry, manifestly, we should also prevent the importation of timber from any other country so far as the tariff can do that. Russian timber pays the same duty as timber brought from America and elsewhere. The speeches of some honorable senators consist of thinlydisguised hostility to Russia.

Senator Payne:

– I have not disguised my attitude.

Senator RAE:

– Perhaps not. But the whole of the comments I have heard on this subject are of the nature I have mentioned. Many wild statements appear in the press the accuracy of which could readily be challenged. Why should we swallow wholesale everything we read which may support the views of those prejudiced against the Soviet form of government ?

Senator Payne:

– The honorable senator is prejudiced.

Senator RAE:

– Every utterance of the honorable senator was overloaded with prejudice against the Soviet. I am not suggesting that everything is as it should be in Russia; but I contend that a vast majority of the statements made concerning conditions in that country cannot be supported by evidence. I have read sufficient to show that many of them are absolute inventions, and are pub lished for the purpose of discrediting’ Russia and stimulating the hostility of other countries towards her.

Senator Carroll:

– What evidence has the honorable senator?

Senator RAE:

– It is unusual for subjects of this nature to be discussed at length on motions for the adjournment,, and consequently I have not with me the indisputable evidence which in other circumstances I could submit. The real, facts can be obtained only by an impartial inquiry. Frequent reference has been made to huge importations of Russian wheat into Great Britain, but according to a statement made in the House of Commons, the quantity actually imported was comparatively small, and much less than was imported during the same period from the Argentine and other countries. A responsible British Minister quoted figures to show that Russia was seventh on the list. I have read evidence, which can be verified by other evidence, to the effect that people engaged in the timber industry in Russia are working shorter hours than the average hours worked in the same industry in this country, and that although the actual wages are not high, the workers receive concessions which more than counterbalance the comparatively low wages paid. A vast majority of them are infinitely better off than thousands of workers engaged in similar industries in other countries. That, of course, is a very general statement.

Senator Reid:

– It is.

Senator RAE:

– I have already said so. But if honorable senators opposite doubt it they. should submit evidence to contradict it. I know that lie after lie has been promulgated from one end of the world to the other against Russia, and that such lies emanate from lie factories which exist for the purpose of spreading the most abominable stories concerning Russia. If honorable senators were as impartial as they profess to be, they would not swallow wholesale the sensational items which appear in the newspapers, but would hear the evidence from both sides before coming to a conclusion.

Senator Cooper:

– Russia repudiated its war debt to Great Britain.

Senator RAE:

– The Allies, including Japan, United States of America and other powers assisted in blockading Russia in an endeavour to defeat the Revolution, and in doing so, destroyed such an enormous quantity of Russian assets in the form of railways, bridges, and other property, that in replacing them Russia has a bigger bill for damages than the amount of the debts she repudiated. Mr. Short, as Home Secretary in the British Government, when asked in the House of Commons what expenditure had been incurred by Great Britain in attempting to break up the Russian revolution, admitted that in munitions and cash over £100,000,000 of British money had been spent. None of the nations which had attacked Russia had declared war against her, and were therefore mere piratical adventurers. Their sole object was to destroy the revolutionary forces and bring that country back to the position which existed under the capitalist system. In these circumstances, honorable senators should study the position in Russia from more than one angle. I have read works in the Parliamentary and other libraries for and against the Soviet system of government, and any one who is unbiased must admit that whatever statements may be true, a vast majority of those published are untrue.

Senator Payne:

– Is the honorable senator unbiased?

Senator RAE:

– - Not in the sense that I have no predilections. I am prepared to listen to statements from both sides, instead of swallowing wholesale those of biased persons.

There is an anomaly in connexion with the protection of our timber industry which should receive the attention of the Government. Yesterday a question was asked as to whether our export of Australian hardwoods could not be promoted in connexion with certain railway construction contemplated in China. A good many years ago a gentleman who was afterwards appointed Under-Secretary for Agriculture in New South Wales was despatched on a trade mission to South Africa. Among other things he attempted to build up a trade in hardwood sleepers for use in South African railways, and to some extent he succeeded in making some sales. When he was arranging for the sale of sleepers to the South African Government the New South Wales Railway Commissioners stated that during that year the renewals of sleepers on the railways of that State had cost an additional £30,000 owing to the working out of the more accessible hardwood forests. It seems a contradictory policy to attempt to export our timbers, particularly those varieties which are of value in many of our own industries. The whole of the timber industry should be inquired into to ascertain which timbers are useful to us, and which can be spared for export. We should not have to pay an unnecessarily high price for timber which we require for our own use.

Senator LYNCH:
Western Australia

– I am pleased that Senator Payne has raised this subject, because it gives the Senate an opportunity to view in bold relief the action of this or any other Government guilty of the same practice. It has been said that Russian timber has been imported into this country and handled under conditions in the country of origin to which Australian workmen will not submit. Towards the end of his speech, Senator Rae stressed the necessity for impartiality, and suggested that anything less than pure impartiality was unworthy of notice. It is perfectly clear that a person can be a partisan and at the same time impartial, but from what we know of human nature it is very hard for any one to be a partisan and at the same time impartial. Following the dictum laid down by Senator Rae, it is difficult to reconcile the position of a partisan who at the same time claims to be impartial. I have before me a newspaper cutting reporting the proceedings of a case in the courts where Senator Rae figured as an important witness, when some communists were charged with damaging a property in Sydney. The report of the case shows that Senator Rae emphatically expressed where he stood in regard to the Soviet policy. The report states -

Senator Rae stated that he was a member of the Friends of the Soviet Union, and had been a member of the Workers International Relief Organization.

If the honorable senator can claim to be a member of the Friends of the Soviet Union and then ask the Senate to believe that he is impartial in his views regarding the Soviet Union, he is placing an undue strain on human credulity.

Senator Rae:

– I did not say that.

Senator LYNCH:

– The report is an account of Senator Rae’s statements in one of the courts of this country. Honorable senators would do well to contrast Senator Rae’s statements in the court with his utterances in the Senate to-day. I claim to be neither a friend nor an enemy of the Soviet Union; I am merely a searcher for the truth about Russia. When Mr. Kavanagh returned from attending the Internationale at Moscow, he expressed his views on conditions in that country. He said that Russia had a system of enforced labour. How can they have enforced labour without some form of compulsion, such as a number of fixed bayonets? It may be that Senator Rae will be able to show that enforced labour in Russia has only a feather duster behind it.

Senator Rae:

– That is silly.

Senator LYNCH:

– When I spoke of fixed bayonets I was quoting what one of Senator Rae’s “ comrades “ had told me about Russia. The gentleman to whom I refer says that enforced labour, or conscript labour, is the rule in Russia. Why does not Senator Rae make a clean breast of the position in Russia? I can show the honorable senator the man who told me that vessels in the Port of Odessa were loaded by men under the control of others armed with fixed bayonets. I merely quoted the words of a man whom Senator Rae knows well, when I said that in Russia there is enforced labour. .

Senator Rae:

– So there should be everywhere, but not at the point of the bayonet.

Senator LYNCH:

– I have a great deal of sympathy with the Russian people. Honorable senators know that under Czardom the Russian peasants were ground almost to the dust; but that does not warrant their instituting another czardom of a worse nature. “ There is nothing so terrible as the tyranny of the slave”. That is the tyranny which is being exercised in Russia to-day. Timber from Russia is coming to Australia and underselling timber produced in this country under Australian conditions.

The imported timber is the product of a country which has not hesitated to pursue a policy of robbery and spoliation. Russia has stolen gold, machinery, land and timber. If that country is allowed to dispose of its timber in Australia, thus competing with timber produced under Australian conditions, the responsibility rests on the Government. If the Government is prepared to reduce the people of this country to the level of Russian serfdom, it is well that the public should know. The Government cannot have it both ways. It cannot say that it wants to stimulate industry in this country by allowing timber to be sold cheaply, and at the same time claim that it desires to maintain the Australian standard of living. The Government which allows timber to come here from Russia, subject to a duty, has absolutely prohibited the importation of agricultural machinery from the Mother Country, the home of Senator Rae’s forefathers. That is not fair play; it is only a mockery of justice. The Government should make the Russian authorities throw open their doors to enable an impartial investigation to be made into the conditions of the timber industry in that country.

Senator Rae:

– Russia has offered to do that.

Senator LYNCH:

– Russia has made a fine art of “ readying-up “ things for visitors. A socialism which finds it necessary to gloss over so many things will never justify itself before the tribunal of mankind. The industrial conditions of any country should be as an open book for all who run to read. The only thing that Russia has taught the world, apart from its attempt to destroy Christianity, is how to eat a tin of tallow without getting bilious. No invention or discovery, or anything that has helped humanity, has come from that land of darkness. The allied forces did not remain at Archangel long enough to do all the harm of which they have been accused. A Russian is never to be trusted. No Russian ever fought a battle unless he had a fixed bayonet behind him urging him on. I refuse to be led by the nose by this band of semi-barbarians. Before any person is allowed to enter Russia a careful inquiry is made eon- cerning him to ascertain whether he is friendly or otherwise. What is wrong with the freedom that we enjoy in Australia that so many persons in our midst have such sympathy for Russia? Humble and insignificant units of the community in days gone by, both Senator Rae and I have, in Australia, been lifted into the highest counsels of the land. Could that happen in Russia ? What is wrong with a country like New South Wales when Henry Parkes, who entered it with half a crown in his pocket, rose to be the leader of a nation? What is wrong with Victoria that an outcast from Ireland in the person of Gavan Duffy should have risen to be the head of the Government there? And bo on elsewhere. Again, I say, what is wrong with Australian freedom ? Where is there any handicap in this country except it be in the diseased minds of men? I do not blame the Government: on the contrary, I sympathize with it, because I realize that Labour stands for the most glorious cause that has ever arisen. Labour stands to safeguard the interests of the labourer, the man who is worthy of his hire. Notwithstanding its shortcomings and its philandering with evil spirits, I have a friendly feeling towards the Labour party because it stands for such a noble cause. Unfortunately, the party has many false friends, but despite them, the cause for which it stands will succeed. Not every man who says, “ Labour, Labour “ is a true member of the Labour party. I should probably be out of order if I were to say more along these lines.

The PRESIDENT (Senator the Hon W Kingsmill:
WESTERN AUSTRALIA

– It may interest the honorable senator to know that he cannot get out of order on the question before the Chair, except by indulging in personal abuse.

Senator LYNCH:

– It behoves the Government to inquire fully into the conditions of the timber industry in Russia. A despatch should be sent to M. Stalin for information on. the subject. If it can be shown that Russian timber is produced under fair industrial conditions, I shall not oppose its importation.

Senator DOOLEY:
New South WalesAssistant Minister · ALP

– This discussion has been most interesting, especially as we have heard something new about

Russia; but I am at a loss to understand where honorable senators stand in a matter of this kind. Although some of them are out and out freetraders, they seem to adapt their policy to the country from which goods are brought here. The Government will not act hurriedly when dealing with the importation of Russian timber, seeing that our favorable trade balance with that country amounts to about £3,500,000 per annum. The matter has already been referred to the Tariff Board for investigation. If the vessel is cleared in the meantime a dumping duty of 10s. per 100 super. feet will be charged on the timber landed. Until such time as the Tariff Board has investigated the matter it would be unwise to venture an opinion. I assure the Senate that the Government is leaving no stone unturned to obtain the facts.

Senator Thompson:

– Has the Russian Government sent the timber to Australia speculatively, with a view to taking whatever can be obtained for it ?

Senator DOOLEY:

– It is difficult to obtain information of that kind. So far we have been unsuccessful. There appears to be a good deal of mystery about the shipment.

Senator McLachlan:

– Has the timber been consigned to any person or firm in Australia ?

Senator DOOLEY:

– So far as I am aware it has not.

Question resolved in the affirmative.

Senate adjourned at 10.1 p.m.

Cite as: Australia, Senate, Debates, 2 July 1931, viewed 22 October 2017, <http://historichansard.net/senate/1931/19310702_senate_12_130/>.

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