15th Parliament · 1st Session
The President (Senator the Hon. J. B. Hayes) took the chair at 10.30 a.m., and read prayers.
– I have to announce that I have received from. Miss A. Isabel Hawker a letter thanking the Senate on behalf of her mother, sister, brother and herself for its resolution of sympathy on the occasion of the death of the Honorable C. A. S. Hawker.
– I have to an nounce that the Prime Minister has received from the Prime Minister of the United Kingdom a letter thanking the Senate for its resolution of sympathy on the occasion of the death of Lord Stanley.
SenatorFOLL laid on the table re ports and recommendations of the Tariff Board on the following subjects: -
Ammonia, viz.: - Acetate, Carbonate, Anhydrous, Liquid and Chloride.
Amyl Acetate; Ethylacetate ; Methyl Salicylate; Vanillin; Couinurin; Flavouring Esters and Aldehydes
Articles, n.e.i., partly or wholly made up from Textiles or Feathers.
Articles of Cut Glass
Barbers’ Chairs and Optical Chairs
Books, viz.: - Account, Betting, Cheque, Copying, Drawing, Exercise, Guard, Letter, Memo., Pocket, Receipt, Sketch, and the like.
Buckles, Clasps and Slides; Buttons, n.e.i.
Canary Seed and Mixtures containing Canary Seed.
Caseine; Caseine-Sheets, Rods and Tubes (unspecified).
Chalks, Crayons, Pastels,&c
Cordage, Braids, Fringes, Edgings, Tassels and Girdles; Pyjama Braid and Dressing Gown Braid
Corsets and Knitted Elastic Piece Goods
Cotton and/or Paper-covered Electrical Conductors; Weatherproof Braided Aerial Cable.
Discs for Agricultural Implements
Electric Household Clothes Washing Machines
Ethers and Chloroform
Feathers, dressed, including Feathers made up into Trimmings, also Natural Birds and Wings.
Gas Cooking and Heating Appliances
Glass Paper and Flint Paper; Abrasive Papers n.e.i. and Abrasive Cloths.
Manufactures of Paper, &c
Manufactures of Paper n.e.i.
Men’s and Boys’ Fur Felt Hats
Miners’ Portable Acetylene Lamps
Paper, viz. : - Stencil, Carbon and other similarly prepared Copying Papers, in packets or otherwise.
Paper, viz. : - Vesta and Match-boxes, empty, n.e.i.; also Vesta and Match-boxes, empty having advertisements thereon.
Paper Bags n.e.i.
Paper-insulated Lead-covered Telegraph and Telephone Cables further processed by a covering (outside the lead sheath) of any protective material.
Perfumery and Toilet Preparations
Piece Goods Knitted or Lockstitched
Playing Cards, in sheet or cut.
Sheet Glass, viz.: - Figured Rolled, Cathedral, Milled Rolled, Rough Cast and Wired Cast.
Stay Cloth and Gummed Paper
Sulphate of Soda
Woven and Embroidered Materials in the piece or otherwise, Ribbons, Galoons and Bindings.
– Has the Government taken action in connexion with the matters covered by these reports before making them available to honorable senators ?
– Action upon them has been taken. It is quite obvious that, when dealing with customs matters, action must be taken before the reports of the Tariff Board are released, largely for the protection of the revenue.
– Has the attention of the Minister representing the Minister for Defence been directed to the report in yesterday’s Melbourne Herald that Mr. Dunstan, the Premier of Victoria, had informed the Legislative Assembly of that State that during the first five months of this year 1,087 railway men had. been dismissed? Will this fact be taken into consideration in connexion with the provision of defence annexes at railway workshops?
– I shall bring the matter to the notice of the Minister for Defence.
– In view of the colossal expenditure to which the Lyons Ministry has committed Australia in connexion with defence, bounties, and other matters, will the Leader of the Government make to the Senate a statement concerning the alleged further resignations from the Cabinet?
asked the Minister representing the Minister for Defence, upon notice -
With reference to the Minister’s statement that it is intended to provide a modern dock at Sydney in connexion with the defence programme, will the Government consider the necessity of completing the Henderson Naval Base, at Cockburn Sound, Western Australia, on which it is reported over £1,000,000 has already been spent and in connexion with which an up-to-date dock was promised by the Government of the day?
– The Minister for Defence has supplied the following answer : -
So far as the present defence programme is concerned, the Government’s naval advisers do not recommend any resumption of work at Cockburn Sound.
Rebates of Tax
asked the Minister representing the Treasurer, upon notice -
Senator ALLAN MacDONALD.The reply is not yet to hand. The honorable senator will be advised as soon as it arrives.
Assistance to States - Annexes to Railway Workshops
asked the Minister representing the Minister for Defence, upon notice -
In view of the statement read to the Senate by the Minister representing the Minister for Defence, on the 7th December -
Will the Government favorably consider granting to the Governments of the States a sum of money which will assist such governments to embark upon a plan of building and repairing engines and other rolling-stock, the repairing and renewal of bridges, culverts or permanent-way lines, or such other works, which will materially assist in the defence plans of the Government?
If the answer to the above question be in the affirmative will the Government make .is much money available before Christmas as will prevent the dismissal of any State employees?
– The Minister for Defence has supplied the following answer : -
asked the Minister representing the Minister for Defence, upon notice -
Has the Government arrived at an agreement with the Western Australian Government in connexion with the manufacture of munitions at the Railway Workshops, Midland Junction : if not, what is the reason for delay?
– The Minister for Defence has supplied the following answer : -
Negotiations are still proceeding with the Western Australian State Railway Department with a view to work connected with the mechanization of artillery being undertaken in the workshops in that State.
asked the Minister representing the Minister for Defence, upon notice -
SenatorFOLL. - The Minister for Defence has supplied the following answers : -
asked the Minister representing the Minister for Commerce, upon notice -
Will he supply the following information, viz.: - The names of the members of both Mouses of the Federal Parliament who have been or will be financially interested in the Wheat Industry Assistance Act 1938?
Senator ALLAN MacDONALD.This is a matter controlled entirelyby the States, and it is not considered that any useful public purpose would be served by making the necessary investigations and then publishing such information.
asked the Minister representing the Treasurer, upon notice -
Senator ALLAN MacDONALD.The answer is not yet to hand. I shall advise the honorable senator as soon as it arrives.
asked the Minis ter representing the Minister for the I nterior, upon notice -
– The Minister for the Interior has supplied the following answers: -
Sena tor FRASER asked the Minister representing the Minister for Commerce, upon notice -
– The Minister for Commerce has supplied the following replies to the honorable senator’s questions : -
Protection of Aborigines - Payne- fletcher Report - Development.
asked the Minister representing the Minister for the Interior, upon notice -
Senator ALLAN MacDONALD.This information is not yet to hand.
asked the Minister representing the Prime Minister, upon notice -
– The information is not yet to hand.
asked the Minister representing the Minister for Commerce, upon notice -
– The Minister for Commerce has supplied the following answers : -
asked the Leader of the Senate, upon notice -
– The fixing of prices in respect of bread is entirely the responsibility of the State governments.
asked the Minister representing the Minister for Commerce, upon notice -
Senator ALLAN MacDONALD The Minister for Commerce has supplied the following answers to the honorable senator’s questions : - 1 and 2. The Government has no knowledge of these matters.
asked the Minister representing the Minister for Commerce upon notice -
Senator ALLAN MacDONALD.It is not possible at the present juncture for the Government to announce a policy on the question raised.
asked the Minister representing the Treasurer upon notice -
Senator ALLAN MacDONALD.The Treasurer has supplied the following answers to the honorable senators questions : -
Message received from the House of Representatives intimating that it had agreed to the amendments made by the Senate in thisbill.
Bill returned from the House of Representatives with a message intimating that it had made the amendment requested by the Senate in this bill.
Bill (on motion by Senator Allan MacDonald) read a third time.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Allan MacDonald) read a first time.
– I move -
That the bill be now read a second time.
In a statement which I read to the Senate yesterday, I described the Government’s proposals for the defence of this country in the years that lie immediately ahead of us. It now remains for me to deal with the finance side of the Government’s proposals. The burdens that adequate defence will impose are now realized to be greater than had been thought to be necessary even such a short time ago as the early part of this calendar year. Honorable senators are aware that in each year since 1932-33 there has been a steady growth of the expenditure on defence from various sources, culminating in the programme that was announced about eight months ago, involving a total of over £44,000,000 over the next three years. The expenditure already provided for, for the current financial year, is just under £15,000,000. to which has to be added the financing of commitments entered into in previous years, to the amount of £1,800,000, which will be met from trust and loan fund. This total sum of £16,800,000 is to be met as follows : -
The total programme that the Government has now decided to recommend to the Parliament involves a total expenditure for the three years, including the present financial year, of about £63,000,000, that is, about £19,000,000 in excess of the £44,000,000 programme announced six or eight months ago. The Government is very conscious of the seriousness of a proposal involving the expenditure of such a vast sum of money,
but believes it to be no less than essential, in the interests of Australian security. The programme involves authorizations and expenditure over the three years as follows : -
It will be realized that, in connexion with defence, it is essential to plan for some considerable period in advance. Orders have to be placed and commitments entered into for periods of two years, and sometimes more, ahead. This leads me to dwell for a moment on the importance of proper distinction being made between the terms “authorization” and “ expenditure “. In the early part of any programme designed to cover a period of years, it will be found necessary to provide for authorizations very much in excess of actual expenditure. In its latter years, the reverse holds good, that is, actual expenditures will be in excess of authorizations. It has been the general practice, and I believe an entirely proper practice, in Commonwealth public finance, not to embark on authorizations or commitments unless there was in existence some parliamentary authority for the expenditure involved. It is necessary at. times to anticipate to some extent parliamentary appropriations of a subsequent year, but as far .as possible this is restricted to cases of urgency or the necessity to carry on existing departmental activities. For this reason this loan bill is necessary. In the current financial year, 193S-39, this increased programme involves entering at once into authorizations or commitments to the amount of about £10,000,000 over and above those envisaged and provided for in respect of the 193S-39 portion of the £44.000,000 programme. The actual expenditure in 1938-39 will be only about £3,000,000 above the actual expenditure previously contemplated. It becomes necessary, therefore, to acquaint Parliament with the new proposals and obtain parliamentary authority for further commitments to be entered into for defence equipment, and additional obligations being undertaken in accordance with the enlarged programme.
What I have said is designed to explain why, under the new programme, a loan bill for £10,000,000 is now submitted for approval; in addition to the loan authority for £10,000,000 which was obtained last April. The first loan authority was obtained to enable £5,250,000 of urgent authorizations to be entered into immediately for the first year of the programme, and further authorizations which have since been entered into bring the total commitments up to date to approximately £S,500,000. The balance of the authority remaining in the £10,000,000 Loan Act of May last, namely, £1,500,000, is insufficient to meet the immediate necessities of the expanded programme. The schedule to the loan bill will therefore constitute the basis for future authorizations. It will enable authorizations or commitments to -be entered into in respect of 1938-39, 1939- 40 and 1940-41. The final allocation of the expended programme as between revenue and loan will be decided later, when the budgets for 1939-40 and 1940- 41 are brought down. Honorable senators will realize that it is impossible to say, at this stage, what the budget position will be so far ahead, but the policy of - the Government will be to carry as much as possible of the total expanded programme on the revenue account in. the next two years.
Under the authority of the Loan Act of April last, £4,000,000 was borrowed for defence just prior to the commencement of this financial year, and we are also borrowing at present a further £4.000,000, as part of the current cash and conversion loan. The necessity for this further borrowing of £4,000,000 became evident after the recent crisis. We have already entered into commitments in respect of the years 193S-39, 1939-40 and 1940-41, to the amount of about £S.500,000 out of the £10,000.000 authorized in the April loan, and, as I have previously stated, further commitments of £.10,000,000, and expenditure of £3,000,000 for capital services and ordinary services combined, have to be faced this year under the new programme. It is anticipated that the whole of the £8,000,000 already raised will not be expended in this financial year, but a proportion of it will be available towards meeting expenditure . early next year. The enlarged programme involves an expenditure of roughly £63,000,000 over three years, or, an average of £21,000,000 a year. Foi the last three years, the average expenditure on defence from current budget revenue has been about £6,000,000 a year, as distinct from defence expenditure from trust and loan funds. We therefore have to finance large additional amounts, from one source or another, for defence in this and the next two years. Even if it were physically possible to raise the whole of this additional burden by taxation alone - and the Government does not for one moment believe that it is possible - the reactions upon our internal economy would be too serious to contemplate. Such an extreme course would bring about most adverse repercussions to State revenues and also to employment in industry. On the other hand, there are not lacking those who advocate that the whole of defence expenditure should be financed from some mysterious form of national credits. I say quite frankly that the Government is not prepared to adopt a form of inflation which would jeopardize our economy and might well lead us to disaster. Clearly, therefore, our full financial resources must be concentrated for this emergency. In addition to the maximum sums that can be provided from revenue without serious repercussions, a substantial portion of the total programme must be met by borrowing. Nor can finance be visualized solely from Australian revenue and loan resources. In the circumstances, the Government has in contemplation the raising of a portion of the loan requirements on the British market. Having regard to the national emergency with which we are faced, the Government believes that this course is fully justified. Just how much money will be raised overseas, and when it will be raised, is a matter to be deter: mined when the actual expenditure becomes more imminent than it is at present. It would also be necessary to bear in mind, in this connexion, the state of the relative loan markets, both in Australia and overseas.
– A proper consideration of this measure is somewhat difficult, because of the atmosphere which exists at the moment regarding the subject of defence. It would be quite easy to say things which could be, I think, more than completely justified, but which it would.be better to leave unsaid. This Government has had supreme control over the affairs of the Commonwealth for the last seven years. It has had a full knowledge of the requirements of the nation, for both internal and external defence. It has done nothing but. pursue a policy of discreditable muddle on every major subject from the time of its assumption of office until the House of Representative., adjourned at 3.30 this morning. It now proposes financially to implement a policy which it knew all along was more or less necessary. The Opposition has continually been urging the Government to take a comprehensive view of the whole situation, and to attack those en8111181 which operate internally as well as to prepare itself against the probable attacks of enemies who operate externally. The Government has done “neither. In a policy speech delivered by the Prime Minister two elections back, he suggested that his Government proposed to put into- operation immediately certain things. One of the most important of these “was the standardization of railway gauges. The Prime Minister did not suggest the carrying out of that work without giving reasons. The right honorable gentleman said in effect, “first we must do something with regard to the serious volume of unemployment, and the standardization of railway gauges will offer the greatest amount of relief because the money thus expended will be largely for wages “. The right honorable gentleman also stressed the importance of uniform railway gauges in times of national emergency, but beyond the construction of a very few miles of standard gauge line nothing has ‘been done. Other projects mentioned by the Prime Minister as likely to reduce unemployment were water conservation and sewerage schemes for the larger country towns. Not a hand’s turn has been done to one of them. Now we are being asked to pass legislation providing for the expenditure of millions of pounds upon defence, but this Parliament is not given the chance to do anything to relieve unemployment.
– That is not correct.
– I repeat that nothing whatever is being done by this Government for the unemployed. The Government has refused a request by members on this side that work should be provided to tide the unemployed over the few weeks of the Christmas and New Tear period. But sinister moves are being made in every direction. A few days ago a bill was passed by the Government through this Parliament to tax the poorer classes of the community by raising the price of bread. That increase means a tax ,of some shillings weekly to workers with large families. It is all very well for Ministers to give specious answers to questions, and to seek to throw responsibility for this condition of affairs on to the State governments. Everybody knows how the arrangements for this legislation were completed. It was not the State governments that imposed a tax of £5 15s.” a ton on flour, thus necessitating an increase of the price of bread.
– That action was approved by the States in conference, which was attended by representatives of three Labour Governments.
The PRESIDENT (Senator the Hon. J. B. Hayes). - Order! The excise on flour may not be discussed under this bill.
– I know that, Mr. President, but I hope that “you do not intend to impose too severe limitations on the subjects that may be mentioned in this debate. If the Government seeks our co-operation in its proposals for adequate defence - and that is the policy of the Labour party - it must remove such anomalies as the bread tax and the national insurance scheme, about which there is so much dissension in the Cabinet to-day. It must remove all those things which lower the domestic standards of the workers. In other words the people of this country must be persuaded that they have something -worth defending. Let no one try to tell me what we are discussing under this bill. We are dealing with the whole problem of the manhood, womanhood and childhood of this country. Their vital interests must be tackled when this Parliament is being asked to make money available for defence.
I was greatly interested in the second-reading speech of the Minister for Repatriation (Senator Poll). He said that in order to make this country safe, it was necessary to do certain things a long time in advance of actual happenings. I said exactly the same thing in another way just now. This Government, I contend, should have considered adequate defence measures not in September last when the war clouds were hanging so definitely over Australia that every member of this Parliament was in a state of emotional suspense and feared the worst.. That was not the time to make arrangements to meet an aggressor; that was not the time to realize the vulnerability of this country, and seek the best way to evade what looked like being a very grave situation for the nation. The time for doing all these things was years ago, when the Prime Minister delivered the policy speeches to which I have alluded. ‘ The Prime Minister knew then, or at least said that he knew, of contingencies that were likely to arise. But he did not fulfil his promises to proceed immediately with undertakings which he had claimed were then feasible.
The Minister for Repatriation now says that, because of more recent developments in the international situation, it has become necessary to ask Parliament for an appropriation to cover a largely expanded defence programme. By the same process of logic, it is obvious that, but for the fact that the Government could not constitutionally appropriate this money without the consent of Parliament, it would have taken that action behind the back of Parliament. The Minister in charge of the bill made another very significant statement. He said that the Government did not think that it was possible to raise the necessary money for its enlarged defence programme by taxation. Of course it does not think that. The Government has taxed the poorer classes of the community by every specious device known to it, and during the last six years, by remissions of taxes, it has conferred benefits amounting to millions of pounds on its wealthy friends, especially those who pay federal land tax.
– How many millions of pounds does the honorable senator say was remitted by way of land tax?
-Remissions of all classes of taxation in the last six years amount to at least £6,000,000 a year. The remissions of land tax have been so substantial that to-day it is bringing in only 50 per cent. of the amount collected when it was introduced by the Fisher Labour Government. Let that fact sink in. Naturally, this Government would not dare to finance its defence expenditure from taxation. I know that, in furtherance of its defence plan, the Government is trying the system of voluntary enlistment, but it would not hesitate to conscript the man-power of this country in time of national emergency, though it would not conscript wealth. In fact, it proposesto take the opposite course and feed its fat friends further by raising loans on which interest will have to be paid.
– Labour Governments have not been backward in raising loans.
– Had I the honorable senator’s lack of modesty, I would be much less backward than I am. I repeat, that further loans will be floated, and in that connexion the writing is on the wall for all to read. There is a big Commonwealth conversion loan before the people to-day, and whether the Treasurer (Mr. Casey) likes- to admit it or not, he knows that the greater proportion will have to be underwritten by the Commonwealth Bank. Every day and every night a fresh appeal is being made to the people to put their money into this loan, or to convert their existing holdings, the latest inducement offered being that by so doing they will escape taxation. In other words, the Treasurer is saying to the people, “ If you put your money into this loan we shall pay you interest on it, and let you off your just share of taxation “. If this cajoling fails - and in my opinion it will fail - the Commonwealth Bank will have to come to the rescue. Obviously, the Government does not wish to finance this defence expenditure out of taxes. It does not desire to “ put the screws “ on those people who provide its party funds and vote for its candidates at election time. It does not dare to do this.
In contrast to this attitude of the Government a Labour Government would say - our policy is not a nebulous or secret proposition, everybody knows what it is - to the wealthy interests of this country, “ We know that the manhood of Australia will answer the nation’s call if it comes. We are determined that men shall not be called to defend the interests of the wealthy classes unless those wealthy classes are willing to assist by offering, not their lives as the workers would do, but their wealth “. If I had my way I would take every penny from these wealthy people and leave them on the basic wage, or to face the horrors and terrors of the dole. I would say the them, “ You have had more than your fair share of things right through the ages. This country has been mighty good to you, and, by God, you are going to do your share to defend it “. That is what this Government does not dare to say to its wealthy friends. Its defence programme will be financed in the ordinary way out of loan money. The “ looting “ will continue.
– Would the honorable senator take away from people everything over the basic wage?
SenatorCOLLINGS.- It is a good thing that there is not a mental basic wage. If there were, the honorable senator would be on the dole. I am aware that the Government is going to get away with its. taxation proposals. It has got this country into a dreadful muddle, and it is now beginning to feel the repercussions of its ineptitude. There is serious dissension in its own ranks, nor. with regard to the justice of certain proposals, but as to which party is to get the greatest rake-off. No doubt a labour Government will be called upon to clean up the mess and see that the defence of the country is adequately provided for.
The Labour party’s defence propramme is in readiness. Should we get into power we would see that these people, upon whom the burden of taxation should fall, do their part. To compel them to do so ia a national emergency would not be an act of reprisal, but an act of absolute justice.
– Tell us what is the policy of the honorable senator’s party.
– If my party were as devoid of policy as the honorable senator is of political intelligence, I would have nothing whatever to say.
This bill may be divided into two sections, the first dealing with the physical measures to be taken for defence, and the second with the financing of the scheme. For a few moments I should like to deal with the financial aspect. I am not going to elaborate the Labour party’s policy at this stage - I have done that on many previous occasions in this chamber - but I say deliberately that as a result of the machinations of the racketeers of death - the manufacturers of armaments - there has been created in every country a state of war hysteria, from which Australia has had no opportunity to escape. I do not ask the Government to disclose all that it knows, but I desire it to say definitely against which country it considers that Australia should be armed. It has not done that.
– It would be very bad manners for it to do so.
– I believe that the Ministry knows something of which the Opposition is -not aware. Although [ have a poor opinion of the political sagacity of the Government, we do not imagine that it would submit these proposals unless it had certain knowledge of which the Opposition is not possessed, [f it does not know more than we do, this bill is not required.
– Which country was the potential enemy of Australia when a Labour government launched a costly defence programme?
– This party did not. wait for a national emergency to arise. It has always had a defence policy, and, if given an opportunity, would implement it. It would not have left Australia naked to the world when the recent international crisis occurred. I realize that the Government must be advised by its defence experts and I expect it to act on that advice. I have no quarrel with the Government because of its defence proposals, except that they are disastrously belated. I could state how many antiaircraft guns we have in Australia, how many of them are capable of action, and how many are not. It would be a sorry tale.
The Opposition is prepared to say to the Government, “ Defence is your responsibility ; we agree that Australia should be adequately defended”. But that does not imply that we accept every detail of the defence programme. We have the right to point out certain features of defence policy, apart from those about which the Government talks a great deal. The Government i3 very anxious to increase the man-power of the forces. It desires to raise the strength of the militia from 35,000 to 70,000. It ha3 sent out, at the head of a recruiting campaign, William Morris Hughes, one of the most dangerous elements to .let loose in the community at a time like the present. This is he whom every young man of military age will recall as tho spectre which haunted his parents between 1916 and 1917, when Mr. Hughes put volunteers into camps, and, without the authority of this Parliament, endeavoured to make war conscripts of them for service overseas.
Weeks before the present campaign commenced, I drew attention to the fact that the Australian Defence League had commenced operations in New South Wales and elsewhere, and I asked the Government to see that this subversive body was not allowed to interfere in public affairs at a time of national emergency. I received a cowardly reply, and this organization is continuing its work. At a recruiting meeting held in Martin Place, Sydney, speeches were made in favour of the proposed increase of the militia ; but certain citizens who, in my opinion, are misguided, had something to say in opposition to the appeal for recruits. I believe that they belong to the Communist party, with which I have no sympathy whatever. In the State from which I come, in every part of the Commonwealth, and, in fact, in every country where there is a Labour party, the Communists are banned ; but surely they are entitled to their opinions on this question of recruiting and to express them. Yet representatives of the Australian Defence League, speaking in
Martin Place, made the declaration, and, with the connivance of the Govern* ment, got away with it, that action would be taken against these “internal enemies “ of Australia. In a month’s time, members of the Australian Labour party, who will defend to the last gasp the plank of its platform that no Austalian should be sent from these shores to take part in an overseas war may be the “ internal enemies “ against whom action will be taken. The Labour party believes that Australians will respond to the call of their country without conscription. If the plain facts of the international situation are put to them, there will be no shortage of men for Australian defence. If it were proposed to send men to some other country to fight, members of the Labour party would object, and would then be regarded as the internal enemies of Australia, and proper targets for the vehement political spleen of an irresponsible body whose actions are connived at- by this Government. Yet the Government expects the present recruiting scheme to be a success ! I do not believe that Mr. Hughes wants it to succeed. The “ Little Digger “ desires to be restored to the throne which he occupied during the Great War, wearing a “ digger’s “ hat with feathers in it. He covets the position of eminence and unbridled, authority which he held over twenty years ago, and Australian workmen will be sacrificed if he gets his way.
– Would the honorable senator , allow our men- to defend New Zealand?
– The Australian Labour party and the New Zealand Labour party would take all the steps necessary to protect their countries from foreign aggression, and would do that much more effectively than the present Government even dreamt of doing it until a few months ago.
One of the difficulties that the recruiting sergeants will experience will be the large number of men who will have to be rejected on account of physical unfitness. What is the first thing young men have to do when they present themselves for enlistment? Senators Brand, Collett and Foll could tell us. They are stripped and measured, and a tre-mondous percentage of them will have to be rejected, because they have been raised under such conditions that they are undernourished. They have received low wages, and have lived under slum conditions amid all the horrors thai go with unemployment. I am not speaking of a matter of which I am ignorant. The police chief in New South Wales found that many men desired to join the police force last year, not because they wanted to be policemen, but because they needed a job and the sustenance which regular wages would bring them.
– A very high physical standard is required of those joining the police force, and a large number of the applicants are necessarily rejected.
– Is a lower physical standard’ accepted of recruits for the militia than police recruits ?
– Of course.
– That answer will suit me. No difficulty will be experienced in getting the men required for the militia, because they will desire to serve their country.
– Senator Foll had no difficulty in being accepted as a member of the Australian Imperial Force, but he could not have obtained admission to the police force.
– The honorable senator is not likely to be a candidate for the police force, and he is less likely to seek a job overseas, which would mean a position in a front-line trench. In passing, I may say that in the next war. the trenches in the front line will probably be the safest positions of all, because the zones of greatest danger will be the cities. But where are the gas shelters and the gas masks required by the citizens of this country ?
– We ought to have them in this chamber.
– The honorable senator certainly needs protection from the political gas that I am emitting. It is intended to be poison gas for the supporters of the Government, but to members of the Opposition it is the invigorating oxygen of political life. Over a year ago I asked that gas masks be made available in Queensland so that the members of the voluntary militia could set about the training of the- people in the use of this equipment, but not a single mask was supplied. Although I asked a question on the matter later, and probed the subject on numerous occasions, we still have no gas masks in Queensland. Yet the Government tells the country that it has made preparations for defence! The Labour party has been urging the Government to get on with the job.
– Nothing of the kind!
– The honorable senator evidently does not know what has happened in the last few months. At the last elections, the Labour party submitted a definite defence policy to the people. It is not trifling with this matter. Every member of the Opposition has signed a pledge that he will do all in his power to carry out the Labour party’s defence policy. The details of that policy are available to all who desire to read it. Ministers made a pronouncement some time ago in regard to their defence plans, but they have since been scurrying from party room to party room, and have left themselves little time to deal with concrete business. It has become quite clear to me that this Government will not last much longer. It comes along with this grandiose programme too late to do the job that has to be done. Even now it is most concerned with the need to rush into recess in order to preserve its political life. It fears a total collapse. But no doubt some of my colleagues will have something to say on that aspect of the subject a little later.
I wish to deal with the Government’s financial proposals in relation to this programme. I was surprised to hear a certain statement by the Minister for Repatriation on this subject and I ask whether a similar childish statement was made in the House of Representatives. Cheap jibes respecting the opinions of other people on a subject of such serious importance as finance arc entirely out of place. It is ridiculous to talk about inflation in a country like Australia. Honorable senators opposite speak of monetary inflation as though it were a kind of financial horror. Yet the Canberra Times gives us some enlightening information on this subject this morning in its cable columns. Although it does not say so in as many words the message to which I refer makes it very clear that the Government of the
United Kingdom not only financed portion of its operations during the last war by means of a fiduciary note issue, but has also maintained the issue ever since. It maintains it at this moment, and, as the cablegrams inform us this morning, it is proposing to increase the amount in,volved by £30,000,000 in order to meet the needs of the Christmas trade.
– That is exactly what is done here. Our note issue is on the same ratio.
– Surely Senator Gibson does not think that, with my political experience, I am ignorant of what the Commonwealth Bank is doing in this regard. All Commonwealth Bank notes are fiduciary. FortY years ago when I demanded that fiduciary bank notes should be issued instead of note* containing a promise to pay in gold, my voice was as “ the voice of him that crieth in the wilderness “.
– The honorable senator has not changed.
– It is quite true that, unlike Senator Dein, I do not chop and change my political views with every “.political wind that blows. I adhere to the policy for which I stood 40 years ago, and, much to my delight, and enjoyment, I have lived long enough to see hated opinions of those days become the commonplace facts of everyday life. Our note issue is fiduciary, and our notes may not now be changed for anything except goods or services. In the opinion of the Labour party this is proper. The Minister for Repatriation referred to “ some mysterious form of national credits I know that he was searching in his mind for some other word to substitute for national. I do not propose to use the word that he was seeking. I am an opponent of the theory to which he so subtly referred. The Labour party has a definite financial policy. We say that in order to finance the defence policy of this country the wealth production of the nation should be drawn upon. Taxation is capable of expansion to meet all the needs of the situation. As a matter of fact if the wealth production of Australia were more equitably distributed we should have very few financial difficulties.
We are opposed to the financial proposals of the Government for we consider them to be entirely lopsided. If the Government’s policy be implemented, the result will be that the excessively wealthy of our community will become wealthier, and the excessively, and disgracefully, and horribly, poor will become poorer. The national wealth should be re-distributed. In the final analysis under the policy enunciated by the Government the whole burden of financing these proposals will fall upon the poorer people of Australia. The money to foot the bill will be extracted from the pay envelopes of the workers. The Labour party makes no apology for saying that the wealth of Australia should be conscripted for defence purposes. The wealthy people of this country, who own the land and live in the mansions, ought to be called upon to defend their possessions against any invader. A sane government, which wished its voluntary system of defence to be successful, would declare unequivocally that the people who own the wealth of Australia should be called upon to defend it. It should leave such people no loophole of escape. In order to meet the cost of our defence measures, taxes should be imposed upon people in accordance with their capacity to pay. It may be necessary to borrow some money internally for the purpose, but the proposal of the Government that the necessary funds should be obtained from overseas is one that my colleagues in this chamber and I will resist to the last ditch for the reasons given so eloquently yesterday by the Leader of the Opposition (Mr. Curtin) in the House of Representatives. We are opposed definitely and finally to the borrowing of one pound from abroad to finance the defence programme of the Government. We know that we cannot look to the people of other countries to defend this country.
But if internal loans are to be floated it should be done through the Commonwealth Bank in accordance with the procedure followed by that eminent banker, Sir Denison Miller, when the nation required funds during the years 1914 to 1918. We should not allow the interestmongers or the coupon-clippers to levy extortionate rates of interest upon the people. We consider that this Government should do as a Labour government would do. It should have regard to the declaration of the Royal Commission on Monetary and Banking Systems, which was appointed by this Government, to the effect that if any conflict of policy occurred between the Commonwealth Bank, which is the instrument of the Government, and the Government itself, the bank must give way and carry out the policy of the Government. During the years of the last war the Commonwealth Bank, under the direction of Sir Denison Miller, was able to ‘ make available national credit to the extent of hundreds of millions of pounds in order to meet the needs of the nation.
– Was that money subscribed by the public, or was it loaned by the Commonwealth Bank?
– I must decline the honour which Senator Dein offers me of trying to illuminate the dark places of his mind, and to remedy his ignorance concerning things upon which he should be better informed. If the Government’s defence policy cannot be entirely financed by taxation, the necessary funds should be supplemented by internal borrowings, but not at 4 per cent., 5 per cent., or 6 per cent, interest, with certain immunity from income tax legislation. We say that the Government should take the national wealth of the country and use it to provide for our defence. The Government must equate those two factors. Howling about inflation will get us nowhere. Honorable senators opposite may cry out until they are black in the face, but when the tyres of the national bus puncture they become deflated, and the bus is useless. A duty rests then upon the Government to remedy the deflation and inflate the tyres again, so that the national bus may continue on its way. The Government should be in control. It should inflate the tyres of the national bus, and send it round the country to distribute the national wealth equitably among the people who really produce it. If that policy were adopted people would immediately react favorably. They would realize that they had a country that was worth defending, probably more than any. other country in the world. Personally I believe that, to a considerable degree,
Australia is more worth defending than is any other country. Under a sane government it would be possible to increase the population of Australia nigh three-fold, by “the introduction of people of our own kith and kin, who would be easily assimilated in our community and would appreciate our national ideals. Our people, under such a government, would realize that they would be infinitely better off governing their own country in their own way. If the national wealth were more equitably distributed, the people, in general, would realize that health, happiness and contentment were possible in this land of sunshine. Under a sane policy designed to that end it would be possible to increase our birth-rate, abolish abortion, and put an end to the limitation of families. No country in the world would be equal to Australia if we could carry out the internal revolution that is needed. We should then, as it were, set up a beacon light of social and political progress which would be a guide to the whole earth. Australia would, in such circumstances, undoubtedly be the best country of the world in which to live.
– Is it not that now?
– Comparatively speaking, it is. Yet only last night, in this building, I introduced a deputation to a member of the Government, which requested that the standard of living of the workers in Canberra should not be lowered.
– Tell us all about it.
– Seeing that the honorable senator needs a little more enlightenment, I shall do so. I shall take honorable senators opposite on a personally-conducted tour. I invite Senator Dein to visit Surry Hills, Woolloomooloo and The Rocks, and enter the homes of the people. I invite him to step into hovels out of the windows of which he could shake hands with people across the street. In such places as these men and women and little children are to-day required to live. I invite honorable senators from Victoria to tour with me the districts of Richmond and Fitzroy. I ask Senator James McLachlan to accompany me to the gasworks districts of Brompton.
– I could tell the honorable senator something about that. I have been there a good deal more frequently than he has.
– Does the honorable senator propose to take us to Brisbane?
– I do, but first let me say that I invite Senator James McLachlan to tell me something about the Brompton district to which I have referred. If I have made any incorrect statement I shall be pleased to be set right. If the policy that I have advocated during the last 60 years, and which 1 hope to advocate for the rest of my natural life, has been wrong in principle, then I must regard myself as a national calamity. At any rate, the honorable senator is entitled to attempt to put me right. I have made three extensive tours of South Australia, and I know that had Senator Dein or I been raised in the Brompton slums we would not be here to-day. If those slums do not now exist it is due to the action of the South Australian people or of the Labour governments which have been in power m that State from time to time. Senator Dein suggested that I should mention Brisbane. If the honorable senator can spare the time early next year I shall take him on a personally-conducted tour of that city and show him homes which are equal to any to be found in any part of Australia, and then I shall permit him to show me what he suggests that he should see. He will not find slums in Brisbane like there are in some parts of Sydney. I shall be able to take him to places where anti-Labour governments allowed houses to be erected in such congestion that the children reared in them who had no possible opportunity to benefitby blue skies and green fields, but, thanks to Labour governments, those conditions do not now exist. There are no suburbs in Brisbane such as Surry Hills and Woolloomooloo in Sydney, if the honorable senator desires more information concerning Queensland I may inform him that in that State the basic wage is higher and the cost of living lower than in any other part of Australia. The birth rate is also higher than in any other State, with the possible exception of South Australia or Western Australia which, I believe, is- only a point above Queensland.
– Queensland has always had a bread tax.
– Such taxes are always imposed by governments which Senator Dein supports. A bread tax is deliberately inflicted upon the workers to allow Senator Dein, and those with whom he is associated, to escape their responsibilities. This Government, which has the audacity to impose a tax on bread and in that way deprive ill-nourished children of the food to which they are entitled, at the same time declines to impose a tax on dog biscuits!
We are not opposing the Government’s defence programme. We believe that it knows what is necessary and that it is tackling the problem in its own way, but too belatedly. It is the Government’s job and we propose to let it go on with it. There will be no semblance of opposition to this bill from this side of the chamber. We are pledged to the policy which the Leader of the Opposition in the House of Representatives (Mr. Curtin) outlined so clearly and so forcefully yesterday. We propose to stand four-square to that policy, and to do our share towards Australia’s adequate defence. We are, however, entirely opposed to the Government’s financial methods, and in particular to the manner in which it proposes to finance its defence expenditure. We contend that money should not be borrowed abroad and that there should be no profiteering, financial or physical, in any stage of this hideous game. We have always said that no one should be allowed by means’ of interest or by profit to benefit out of defence expenditure.
– Who said that any profiteering would be permitted?
– This Government has not done anything to make it impossible. It has not inserted a clause in any defence contract to prohibit profiteering. I do not expect for a moment that this country will , be better off in this regard under the guidance of this Government than will be the people in any other British speaking community. About six months ago the British Government had to take drastic action when it discovered that unscrupulous persons were making profits of from 100 per cent. to 400 per cent. as they did during the Great War. General Buller, who is not by any means a Labour man, wrote an article entitled “The Imperial Thieves’ Kitchen” in which he referred to the fact that during the Great. War embalmed American meat was being used, and that planes that could not fly were sent into service. Notwithstanding this we are informed that there was no profiteering. We have heard from the Government no more than pious platitudes. In the event of war this and other countries similarly situated will become a happy hunting ground for the few who can become rich at the expense of the poor. If money is to be borrowed loans should be raised internally; alternatively, taxes should be levied upon the wealthy. If sufficient cannot be raised in that way the Government should confer with the Commonwealth Bank Board, as was recommended by the Royal Commission on Monetary and Banking Systems, and devise the means by which the necessary finance can be made available. I suppose it is insistable that some expenditure will be incurred overseas, but it should be the policy of this Government to spend as much as is possible in Australia.
SenatorFOLL. - That is the policy of the Government.
– I am pleased to have that assurance, but I have some doubt. I believe that the Minister is sincere, but he is only one member of theCabinet and possibly is unable to influence his colleagues who act in the interests of Australian and overseas financiers.
– I listened with interest to the Minister (SenatorFoll) in moving the second reading of the bill, and I am sure that he was not responsible for the gibe about “some mysterious form of national credits “. I am still wondering whether honorable senators opposite have studied the recommendations of the Royal Commission on Monetary and Banking Systems, some of which I have from time to time brought under the notice of the Senate. That commission was appointed to inquire into the monetary and banking systems at present in operation in
Australia, and to report whether, in its opinion, any alterations of the present system are desirable in the interests of the people of Australia as a whole. The commission, which cost the taxpayers £27,000, held 105 public sessions, examined 200 witnesses and heard evidence which occupied 400 pages of printed matter. Some time ago I directed a question to the Prime Minister in which T suggested that credit could be issued by the Commonwealth Bank free of interest, and that he should instruct the Commonwealth Bank Board to issue sufficient credit free of interest to meet Australia’s defence expenditure. I received a reply stating that the Government ie not prepared to instruct the Commonwealth Bank Board to issue credit free of cost. My question was not answered. If the Government will not adopt the recommendation of the royal commission it should give its reasons for declining to do so. The Prime Minister further stated that the Government does not believe in the political control of banking. I again direct the attention of honorable senators to the following paragraph which is contained in the recommendations of the royal commission : -
The Commonwealth Bank has certain powers delegated to it by statute, and the board’s duty to the community is to exercise those powers to the best of its ability. Where there is a conflict between the Government’s view of what is best in the national interest, and the board’s view, the first essential is full anil frank discussion between the two authorities with a view to exploring the whole problem. In most cases this should ensure agreement on a policy to be carried out by the bank which it can reconcile with its duty to the community, and which has the approval of the Government. In cases in which it is clear beyond doubt that the differences are irreconcilable, the Government should give the bank an assurance that it accepts full responsibility for tlie proposed policy, and is in a position to take, and will take, any action necessary to implement it. It is then the duty of the bank to accept this assurance and to carry out the policy of the Government.
It will be seen that the Government has constitutional control of banking, but notwithstanding that the position has been so clearly stated by the commission which was appointed by the Government, the Prime Minister has stated most definitely that the Government does not believe in the political control of bank ing. The Commonwealth Bank was established by political action, and amending banking legislation was passed by the Bruce-Page Government. Although the commission has stated quite clearly the power which tlie Government possesses, the Government does not propose to act on its recommendations. The Prime Minister has stated from time to time that in the raising of money the Government does not propose to depart from orthodox methods. On previous occasions I have given the Senate some idea of the cost incurred in raising money overseas and cited the case in which Nivison & Company charged £2 7s. Id. per cent, to float a loan, whereas the Commonwealth Bank when under the control of the late Sir Denison Miller raised a loan under similar conditions for 14s. lOd. per cent. It would be interesting to learn when the Government proposes to benefit by experience. Apparently it is imbued with conservative ideals and proposes to remain in the same old groove. Nothing hurts a conservative more than a new idea. Although the Government proposes to expend £63,000,000 on defence, and the commission has said that money can be raised free of interest, the Government still adheres to orthodox and expensive methods. It proposes to raise overseas a portion of the money required for defence purposes, and apparently overlooks the fact that in doing so it will have to pay an exchange rate of 25 per cent. For some time a terrific fight has been proceeding between the five English banks in Australia controlled by tlie Bank of England, and certain Australian banks at the head of which is the Bank of New South “Wales. The British banking institutions are always endeavouring to get the biggest cut of the loan business, and the Australian banks are naturally jealous. If the money to be used for defence purposes is to be raised overseas, Australia will be at the mercy of the Bank of England, which directs the policy of certain English banks having branches in Australia. The Australian Government has no control over ‘the Bank of England, but, notwithstanding what the Prime Minister has said, it can control the Commonwealth Bank. The issue of debentures is another suggestion of the Bank of England. “When the Commonwealth Bank was to be established the Government apparently knew little about banking and suggested the issue of millions of pounds worth of bonds to provide the capital, when every one knows that a bank can be started without capital.
– Why not start one?
– I have already informed the honorable senator that those who establish banks without the approval of other banking institutions cannot get their cheques cleared. Certain wealthy American interests who were willing to establish a banking institution in Sydney found themselves up against the banking monopoly. I have already shown that money is not necessary when establishing a bank. During the Hoover regime the son of Andrew Mellon, the third richest man in the United States of America, who died leaving an estate worth £40,000,000, had his income for one year assessed at $600,000. He protested, but as is usual in these cases, he had to pay first. Subsequently he sued for a refund of $110,000. When under cross-examination on oath, he was asked by the Attorney-General if it were a fact that the greater part of his income during the years in question was derived from the profits of his bank. He replied in the affirmative. He was then asked by the Attorney-General, “ What is the paid-up capital of your bank”? He replied “My bank has no paid-up capital ; my father’s good name is the capital of my bank “. When that bank was first opened and depositors were invited to patronize it, it issued credit amounting to $700 for every $100 it received.
– Why not start a bank?
– The honorable senator does not understand these matters. Why should this Government disregard the findings of its own commission,” composed of such eminent men as the Honorable J. M. Napier, a Judge of the Supreme Court of South Australia; E. V. Nixon, C.M.G.; Professor R. C. Mills; the Honorable J. B. Chifley ; H. A. Pitt, (3.M.G., O.B.E., Director of Finance, Victorian State Treasury; and J. P. Abbott? This very conservative-minded commission accepted some extraordinary evidence in the early part of its investigations. I think I have already told honorable senators that when Sir Alfred Davidson was dealing with the decreased profits of the Bank of New South Wales, and the lowering of its dividend rates, he was asked if he would tell the commission what amount of money was placed to the secret reserves after dividend rates had been lowered. He replied that he hoped that the question would not be pressed, as he could not answer it without the consent of the London directors, and the chairman, a Judge of the Supreme Court, sat silent. As I have said before, there was no need for this Government to incur an expenditure of £23,000 to inquire into banking systems in Australia. It could have found out all that it required to know about the subject without even leaving the city of Melbourne, because the policy of banks regarding deposits and interest rates ie the same everywhere. Insurance offices work on the same plan. Yet this Banking Commission gallivanted around the country for twelve months in order to gain sufficient information to enable it to present a report; but to the surprise of the Lyons Government it brought in the fundamental finding that the Commonwealth Bank could issue money or credit, free of interest. The Government, however, totally disregards the recommendations of its own commission, and accepts the dictates of the private banks. It has said that it does not believe in the political control of banking, but it must face the position that, although it does not believe in the political control of banking, it accepts bank control of the Government, and, further, it has determined that bank control of government shall continue, whether it be in the interests of the taxpayers or not. Does not this lower the standard of living of the workers? The lowering of the standard of the rich does not mean any thing. It is the standards of the poor that matter. The banks could have made available the money necessary for this loan. What does the public know of the issue of this loan? Not 10 per cent, of the public’s money is in it. When, a few years ago, the Government raised a loan of £12,000,000 for farmers’ debt adjustment, practically the whole of the money was created by the banks. When the question was asked : “ What proportion of the £12,000,000 was supplied by the banks “ ? the answer was that it was not in the public interest to disclose the information. No one knows how much money is put into public loans by the banks. In the great Liberty Loan in the United States of America, for which Great Britain asked to be relieved of the responsibility of its share, not 5 per cent, of the people’s money was invested. Nobody in Great Britain knows anything about the operations of the Bank of England except in relation to its transactions with the British Government. Is it known generally that that hank financed the re-armament of Germany? The Bank of England to-day controls the Australian banks. That is why it is urged that this money should be borrowed overseas. Unless we are told the full facts, we can but go back to the stone-age era in regard to the borrowing of money. If I speak heatedly in regard to this matter it is because this state of affairs has been going on for many years. L have spoken to honorable senators in this chamber in regard to this matter, and they have been amazed when I have told them that this money is to be created by the banks. The Labour party has very little representation in Rotary. [ know that there is not a single Labour man a member of the Hobart branch. Nevertheless, Rotarians generally are responsible citizens of the community. That every loan creates a deposit, and the repayment of the loan cancels the deposit is axiomatic. Senator Dein interjected that the money borrowed by Sir Denison Miller was the money of the public. Sir Denison Miller raised £380,000,000. Does the honorable senator know that the whole of the money in Australia amounts to only £57,000,000? The banks mislead the public in their balance-sheets. This is what the Sydney Morning Herald., of the 15th October last, had to say in regard to bank interest -
The council of the Graziers’ Association is making strong representations to the Commonwealth Government concerning the rate of interest charged by the banks. Just what the Graziers’ Association considers the Government should do is left to conjecture, and, considering the human nature of the borrower, it should be a sound conjecture that the association desires the Government to put pressure on to the banks to reduce the rate. Therein the association overlooks the fact that the rate of interest is not determined by the banks but by . the lenders. The banks are no more than the intermediary between the lenders, who are the depositors with the banks”, and the borrowers. The banks borrow from the depositors and pay -them interest. The banks lend out the money which is deposited with them, charging a rate of interest which will cover the interest they pay plus the expenses of administering the bank and plus an amount which will give them some reward for their work as intermediary, and for their risk of loss of some of the amount borrowed from them. The rate of interest paid to depositorsis determined by the amount of money available and by the rate which is earned on Government bonds, and, to a less extent, on other securities. If a man with money finds that the rate of interest paid on deposits is not satisfactory, he will not put the money on deposit in a bank, but will use it to purchase Government bonds and, if the feeling becomes general, the amount of deposits will decrease and so the amount available for loans by the banks will decrease.
It is a fundamental principle of banking that the banks do not lend deposits at all. There is no need for them to do so. Under a system which was initiated and has been developed over the last 200 years, they create credit which is accepted in the form of cheques. Why loan deposits? The banks are not the intermediaries ; they do not lend deposits ; they merely .create the credit necessary to provide the money required by governments. It is time that honorable senators opposite realized, their responsibility to the taxpayers and said that this system would no longer be permitted to continue.
– The honorable senator has not yet convinced the members of his own side.
– All honorable senators must share equal responsibility in this matter. It concerns everybody because it affects the very lifeblood of the nation. We live on credit. No less than 99.3 per cent, of the world’s business is done on credit, only .7 per cent, being done on a cash basis. Who has control of that credit? The banks, which decide how much money shall be in existence at any time. When we talk about the poor prices of primary products we must realize that prices are regulated by the amount of money in circulation. The problem before the world to-day is to relate consumption to production. That was the finding of a commission . set up by tho House of Commons to inquire into this matter, presided over by Lord Macmillan. The commission further stated that unemployment is not due to over-production, as earlier commissions had determined, but to underconsumption. It said that money will have to be found from some source without increasing taxation to enable the people to purchase their requirements and thus keep them at work. There is only one way in which that can be done, and that is by the use of the national credit and the national dividend. I remember very well during the election campaign when the Prime Minister said that if his Government were returned he would set up a royal commission to inquire into banking systems. Yet, after the commission had sat for a lengthy period, and finally presented a report, and incurred an expenditure of £23,000, its recommendations were totally disregarded by the Government which brought it into existence. That is not statesmanship; it is deliberately playing into the hands of the banks.
– If every one had plenty of money no one would work and every one would starve to death.
– It is impossible to stir some conservative-minded men; they are content to follow the groove to perdition. In order to demonstrate to honorable senators that I am not alone in my opinions. I quote the following resolution passed unanimously by the Bank Officers Guild of London -
We wish to draw the attention of the directors of British banks to the growing public opinion that the present banking system as administered is quite out of touch with modern production, and we warn you that if you do not drastically and scientifically alter your system voluntarily you will be compelled to do so by economic pressure and public opinion.
I think that bankers know less about public opinion than does the man in the street. Every honorable senator who has served for a period in this chamber must take his share of the responsibility for pre sent conditions. The people have put us here to carry out their business, and if we cannot charge world conditions to governments to whom can they be charged? Is it any wonder, with world conditions as they are to-day, that people are attracted to Nazi-ism and Fascism? We are faced with the fact that we have no alternative but to throw overboard orthodox methods of finance. The British Empire stuck to orthodox methods of finance until it found itself £8,000,000,000 in debt and still forced to spend £1,500,000,000 on a defence scheme. Immediately that proposal was announced the price of armament shares went up by leaps and bounds. In the next war it will be found that the men in the frontline trenches will be in the safest place. I have no doubt that we shall find many of the young financiers enlisting to get away from the bombing of the cities. That is what they are frightened of. To-day, they have created a Frankenstein monster which threatens to destroy them. We have tolerated these inconsistencies for too long, and our only way out is by establishing community control of credit. Take profits out of war and you take the first step to peace. No armaments race could last a week but for bankcreated credit. I described the other day the methods employed in the raising of war loans in England during the last war, and pointed out how the banks persuaded people to buy bonds by mortgaging their property and, later, their bonds, and how, subsequently, the financial institutions deliberately deflated values by 50 per cent., while, at the same time, doubling the price of gold. Then, in the ensuing depression, the banks called up overdrafts and secured possession of the mortgagors’ property and bonds with the result that hundreds of thousands of people were ruined. Those institutions will grasp the first opportunity to repeat that action. But for the power they enforce, it would not be possible to bring about a depression; they have complete control of tho financial system. I, as an individual, can give credit, but I cannot create credit. When Sir Denison Miller raised Australia’s first war loan, he did not go the right way about the job, because the evils of the present financial system had not then been fully realized. It had not then been shown how public loans could be raised free of interest and without involving any increase of taxes. The greater part of the loan raised in Australia last year has been used in the payment . of our interest bill. Now we have an opportunity to obtain the use of £60,000,000 free of interest, but conservative minds who support the present banking system are determined that this money shall be raised in the old orthodox way. The other day, I explained how Australia could have been saved £700,000 a year on the two loan transactions handled by Sir Denison Miller. In introducing this measure, however, the Government has left no doubt that it intends to adhere to orthodox finance in raising the money it requires. Apparently, my previous i efforts to convince it of the evils of the existing system have been in vain. I repeat that we live in a dynamic age; stone-age methods, therefore, will have to go by the board. Dealing with the British parliamentary system of government quite recently, Dr. Goebbels, the Gorman Minister for Propaganda, stated that whilst in Great Britain delays of weeks and months were involved in any governmental change of policy, Germany quickly made up its mind and acted immediately. In the international crisis in September last, we witnessed the spectacle of the greatest empire of modern times, on which, we claim proudly, the sun never sets, going down on its knees to Herr Hitler in order to save Czechoslovakia. War was prevented on that occasion, not by Mr. Chamberlain, but by the people of Czechoslovakia, who made an heroic sacrifice in the interests of world peace. Recently, I attended a dinner at which I sat beside the Consul for Czechoslovakia, when, in the course of an address, the guest speaker, Mr. Hermann Black, a Rockefeller research scholar, declared that it was through the sacrifice made by the people of Czechoslovakia that war was avoided in September last. This Government, apparently, is determined to follow Britain’s example in adhering to orthodox methods of finance. Once again I urge it to adopt the recommendation made by the Royal Commission on Monetary and Banking Systems with regard to the release of credit, and thus bring itself up to date in the world of finance. Orthodox finance will have to go by the board, otherwise governments which ally themselves with it will be forced into subservience to more modern nations. I point out that neither Germany nor Italy has published a budget since 1935, and those two countries are the strongest powers in Europe to-day. Every government which adheres to the present financial system is tied to the money interests, which”, sooner or later, will bring about their collapse, because on every occasion a government seeks to take action not desired by those interests the latter do not fail to kick. It is noteworthy that France has had many governments within the last five months. I point out that when the Government of France depreciated the franc it enabled gold deposits in the Bank of France to be increased to the value of £126,000,000. That is the kind of system which Great Britain is up against. I suggest that France with be the next country in. which a dictatorship will be established. We saw what happened in Italy when the Orlando and Crispi Governments were floundering at the mercy of the moneyed interests. Mussolini stepped in, and said, “ To hell with democracy. I spurn its corpse.” A similar position has arisen to-day in France. I do not approve of dictatorships in any shape or form, but we must fight force with force, and the greatest force in the world to-day is the moneyed power.
– What happened to the German mark?
– Hermann Bernstein, one of the greatest of present-day German writers, has stated that had it not been for the deliberate debasement of of the mark in the interests of high finance, a Hitler would never have assumed power in Germany.
– - Is the honorable senator suggesting a similar remedy for Australia ?
– There is no analogy between the two countries; here we have a Commonwealth-owned bank, which has power to issue credit free of interest.
– That is what happened in Germany.
– I can only say to the honorable senator that I did not come to Canberra to learn political economy; I studied my job before I came here.
– The honorable senator came to teach.
– Yes, and, unfortunately, I have found some very backward pupils. I have said enough this morning to give honorable senators food for thought. If any honorable senator supports the Government’s proposals for the raising of this money after what I have said, I shall be obliged to question his mentality, if not his honesty of purpose.
– I intend to deal but briefly with this measure. I wholeheartedly support the Government’s defence policy, and shall support any further proposal which it might deem necessary to bring forward on the recommendation of its, military advisers in order to ensure the safety of Australia against attack. The time may arrive when even greater sacrifices will be required on the part of all sections of the community.
– From all sections?
– Yes, from all sections. The majority of the people of Australia are prepared to face whatever sacrifice may be necessary in order to ensure the safety of this country, and those who have the most to defend should not be allowed to escape their fair share of such sacrifices. Recent events in Europe, involving the fate of Czechoslovakia, which has something like two and a half times the population of Australia, have revealed the dangers to which all small nations are exposed to-day. Thank goodness, Australia’s position is different from that of small European countries. We are very fortunate in being a member of the British Commonwealth of Nations. Whatever security we enjoy to-day we owe entirely to our position as an integral part of the British Empire, and the protection we have enjoyed under the Union Jack which stands for liberty and freedom, and the protection of every part of that great empire to which we are so proud to belong. I support every endeavour being made by the Government to strengthen our defences at sea, on land and in the air. The Government has intimated that we require large fighting ships and more modern dockyards, and I wholeheartedly support its proposals in that respect. 1 believe that every section of the community is prepared to make whatever sacrifice is necessary for the fullest protection of Australia.
.- I move -
That all the words after “That” bp leftout with aview to insert in lieu thereof the following words: - “the bill be withdrawn and redrafted to provide that the £10,000.000 required to meet the expenditure specified in the schedule be raised in Australia by the imposition of direct taxation and by co-operation between the Commonwealth Bank and the Commonwealth Government.”
The amendment is in consonance with the platform of the Labour party. My leader has pointed out that the methods proposed to be applied by the Government in order to raise this money for an obviously necessary job are wrong. The Labour party has no illusions concerning the present international situation. Unfortunately, practically every nation is preparing to resist aggression, possible or otherwise. We realize, as my leader has said, that the Government must be in possession of information, which we do not expect it to disclose, but which leads it to believe that this country is in graver danger than the majority of the people now conceive. The Labour party stands for the adequate defence of Australia against not only actual aggression, but also possible aggression. Consequently, if we were in power we should, if our military experts advised us to do so, introduce a measure of this kind in circumstances similar to those existing to-day. We should take all of the precautions which are now being taken by the present Government, and our actions, I believe, would meet with opposition from only communistic or fascist elements. In such circumstances, the reply which I should make to those people would be a very simple one. I should point out to them that Soviet Russia, despite its aspirations for freedom and liberty, has, in order to protect itself adequately, established the mosthighly mechanized army in the world, and built up an air force superior to that of any other country.
Its forces, we are told, are capable of military miracles. These facts show that even Soviet Russia, the land of the new liberty, realizes that it has a bounden duty to see that its people are protected from every possible danger. A similar policy has been enunciated on behalf of the Labour party in both this chamber and the House of Representatives. As I have previously said, when dealing with defence, no one linn impugn to the Labour party a disregard of the nation’s safety, because, ultimately, when men must be found to man our navy and our fortifications they will be drawn from the ranks of the workers as were 95 per cent, of the great Australian Imperial Force, I join with my leader in saying that the Government made a great mistake in placing Mr. Hughes in charge of the recruiting campaign. It was a mistake for one obvious reason, and that a political one. Mr. Hughes was at one time a leader of the Labour party. He was a lion in the movement, which had lifted him from obscurity to greatness. He left the Labour party, and today he is placed in. charge of one of the most important operations ever launched in Australia, the enlistment of 70,000 men for our defence forces. This is a tremendous handicap on the undertaking, because Mr. Hughes is anathema to the labour men and women of Australia, to whom the Government will ultimately have to look for the success of its defence scheme. As I have said, the scheme has our support. The Labour party does not want compulsory training; it does not want conscription. Therefore, the only thing it can do is to support the voluntary recruiting campaign.
The Government is embarking upon a colossal defence scheme, involving the expenditure of £63,000,000 during the next three years. In this short session, Parliament has approved of expenditure amounting to millions of pounds in other directions. The payment of bounties to various industries has been approved, and the commitment of the country under national insurance will be heavy. In the midst of all this we read in this morning’s press that another Cabinet crisis has developed, and that the Government, which is fathering all this expenditure, is divided against itself. The Minister in charge of this bill should make an authoritative utterance regarding the position of the Government - whether it really means to carry out the undertakings to which it has committed the country. The party opposite has been in control of the Government for eight years. With the exception of two yeai’3 when the Scullin Government was in office, it has been in control for seventeen years, so that any lack of defence preparedness in Australia cannot be laid at the door of the Labour party. Now, at a time when prices are falling, when we are faced with a still uncompleted loan conversion operation for £68,000,000, when we have to find £63,000,000 for our defence programme, and when the fate of the national insurance scheme is hanging in the balance, we are informed that there is a- dispute in the Cabinet, and that certain Ministers may resign. The Leader of the Government in the Senate (Senator McLeay) should make a statement on the matter, not for the satisfaction of senators on this side of the House, but to inform the people whether the Lyons Government proposes to carry on with the work entrusted to it, or whether it is getting out. The people should know whether it intends to run away from the job as it did in 1929, when it passed over to the Labour party the task of reconstructing the whole financial and economic edifice. The previous Government left a legacy of debt, and every avenue of credit was closed. We should be told whether the Government proposes, on this occasion, to shoulder its responsibilities. I admit that it has brought forward a satisfactory defence plan on the lines of what the Labour party has been advocating for years. It proposes to enlarge the navy and to Strengthen the air force and militia.
– If the Labour party has supported that programme in tlie past, why not support it now ?
– Because we disagree with the method proposed for financing the programme. The newspapers this morning are full of -the most disquieting statements. The Government bludgeoned the National Health and Pensions Insurance Bill through Parliament with the help of a brutal majority. The flour tax was manoeuvred skilfully through Parliament at the dictation of a minority party of fifteen, which holds, eight positions in Cabinet. The Christmas box which it has given to the people of Australia is an increase by 76 per cent, of the price of a commodity which they cannot do without. Honorable senators opposite will say that three Labour governments agreed to the proposal. I do not admit that. This Government, by .the use of all sorts of propaganda, has been returned to office on three occasions. It is still in the saddle, hut it does not look as if it will stay there very long.
The Government has not stated what proportion of the £10,000,000 is to be raised overseas. It may be £3,000,000 or it may be the whole amount. The last occasion upon which money was borrowed overseas was in May, 1937, when a loan of £7,000,000 was floated. Of this, £2,000,000 was required for the purchase of defence equipment in Great Britain, and £5,000,000 for the redemption of Australian treasury-bills held by the Commonwealth Bank in London. The funding of ‘this £5,000,000 meant the transfer of a debt from the Commonwealth Bank to the public of Great Britain. The rate of interest paid on the treasury-bills was 2.5 per cent., whereas the rate paid under the loan is £3 16s. 6d. per cent. The loan is for eighteen years. Calculating the additional interest that will have to be paid during that period, the cost of raising the loan, and the exchange on the addition of interest, we find that this £5,000,000 will cost Australia £1,S45,000. It may he mentioned that this loan was a failure, as approximately 66 per cent, was left in the hands of the underwriters. So much for the vaunted restoration of credit by the Government. Despite this, however, it is now proposed to go on the London market again. I maintain that the money can be found in Australia. The Scullin Government was responsible for the biggest loan conversion operation ever carried out by any nation in the world, namely, the conversion of £546,000,000 at a reduction of interest by nearly 2 per cent. “We were told that it could not bc done, but it was done, and 98 per cent, of the bondholders converted voluntarily. They were told by the Government that they would have to convert, and they did so.
A review of some recent loan operations does not show the financial interests of Australia in a favorable light. Last year, the Government raised a loan of £10,250,000, of which £4,000,000 was required for defence purposes. Although this loan was fully subscribed, the Treasurer refused to state the amount of money that was subscribed by the Commonwealth Bank. There appears to be no doubt that, had the Commonwealth Bank not subscribed heavily to the loan - it is stated that the amount was £5,000,000 - the loan would not have been a success. Although part of the loan was for defence purposes, it is amazing that large financial institutions would not subscribe. Evidently they did not think it worth while to subscribe part of their money to protect the rest of the community. The only thing that counted with them was the rate of interest that was offering.
Comparing their attitude with that of the people of Great Britain, we find that part of the expenditure on defence in that country is being met by a conversion loan of £80,000,000 at 3 per cent, to be redeemed in 1954-58. The first national defence issue was in 1937 for £100,000,000, the interest rate being 24 per cent. redeemable in seven years’ time. Thus Great Britain has shown Australia how it is possible to raise money by internal loans.
It was stated by a government spokesman in the House of Representatives lastnight, that from 1922 to 1929 it was not possible to borrow on the Australian market. The Nationalist Government, which was in office during that time, went on the London market and attempted to float a loan; that issue was a failure. It made another attempt which also failed, and then the Government went out of office. While it was in office, Australia had indulged in an orgy of overseas borrowing. The ^Commonwealth and State governments together had borrowed £30,000,000 a year for a period of seven years. Then the flow of loan moneys dried up, prices of our export commodities dropped, and the depression of 1929-31 set in. The Labour Government had to take drastic steps to retrieve the situation, but members of the Nationalist party have not hesitated to make political capital out of the unfortunate position in which that government found itself. The Labour party is opposed to further borrowing overseas, because Australia has had bitter experience of that policy. Every year we have to pay overseas £29,000,000 in interest, approximately £2,500,000 a month. Default in respect of those payments would be calamitous. Default was warded off during the depression only by the courageous handling of the situation by the Scullin Government. Australia is the only nation in the world that has paid 100 per cent, on all its liabilities, even during the greatest economic crisis in its career.
Sitting suspended from 12.^5 to 2.15 p.m.
– When in December, 1937, overseas borrowing was again resorted to, there was a widespread feeling among the business community against the policy. In its issue of the 6th December, 1937, the Melbourne Age stated -
Every Australian knows that but for the borrowing orgy of the Bruce-Page regime the Commonwealth could have weathered the world depression without subjecting its people to the heart-breaking sacrifices that had to be borne. Although commodity prices collapsed, the colossal interest bill on overseas debts remained. To pay this bill three bales of wool, three bushels of wheat were required to supply the cash equivalent of what at the time the loans were - raised was represented by one bale or one bushel. Relief through conversions came tardily, and was relatively small. Australia paid every shilling that was due, and in doing so resolved that the only sane policy for the future was a steady reduction of the oversea debt - never an increase.
The Treasurer has not shown that it is impossible to finance the defence programme without resort to oversea borrowing; nor has he given any positive assurance that this will be the first and last of such loans.
In a leading article on the 4th May, 193S, the Melbourne Herald, which can scarcely be said to be hostile to the present Government, made the following comment on the failure of the attempt to float a loan in London: -
The first reaction of public opinion to the announcement of a London loan of £7,000,000 is one of astonishment. The Government will surely recognize the need of advancing more convincing reasons’ for its action than have hitherto been given. After many years oi experience of’ overseas borrowing - -largely rueful experience - we were supposed to have reached the firm conclusion that the policy must not be resumed, except through some dire necessity affecting our national credit and security.
The last Australian loan was offered on the London market in 1929, and was left on the hands of underwriters.
So much for the wonderful position of Australia in- London prior to the coming into power of a Labour Government in Australia !
The failure of itself was a distinct warning, if no others had been received, that we had reached the end of our external borrowing capacity. Accordingly, we faced, with creditable self-reliance, the duty of financing ourselves. For some years before 1929 we had received from British loans about £30,000,000 . every year.
Through five years of national poverty, when claims upon” public finance were abnormal, we managed to fight our way to progressive prosperity. The payment of overseas interest, amounting in the first lean years to about £25,000,000 a year, was put first. We had to provide for 30 per cent, unemployment; borrow locally from £20,000,000 to £20,000,000 each year for public works; meet a threatened deficit in 1931-32 (Commonwealth and State) of nearly £40,000,000, and continue to pay our way on falling revenues.
When loan money from overseas would have been welcome, we got along without it. Now when revenues abound, when unemployment has been reduced by at least two-thirds, and when there is a revival of profitable enterprise, we are being asked again to pledge .the national assets.
That newspaper appears to. have anticipated the action of the Government in introducing the bill now under discussion. On the 1st April, 1937, the Melbourne Age said - .
A return to external borrowing would conflict with and seriously impede the supreme purpose of national policy - a rapid development of secondary industries. The cessation of borrowing in London has had the effect of preventing a flood of imports and stimulating industrial growth, despite the difficulties and uncertainties caused by. meddling with the tariff. If there was a resumption of that form of borrowing imports necessarily would increase. To that extent Australian goods would not be required, and, consequently, Australian workmen would be displaced. We do not need, and cannot alford, increased imports. Nor can we afford to add anything to the huge interest bill which must be paid in sterling in London. The present obligation of £25,000,000 a year is the utmost that Australia can and should be required to bear.
Those quotations which support the amendment now before the Chair are typical of the views of business men throughout Australia. In the plan which has been submitted to Parliament and with which, in the main, the Labour party agrees, much has been made of the fact that in the manufacture of munitions, &c, preference will be given to State enterprises. I agree with my leader that there is reason to doubt the ability of the Government to control the manufacture of munitions by private enterprise. The experience of other countries shows that enormous profits are made by private manufacturers of munitions. Under the existing system, profit is the main consideration with manufacturers. Some recently published figures show what has happened in the Old Country, and what is likely to ‘happen if private enterprise be allowed to engage in the manufacture of munitions in Australia. The following statement will make my point clearer: -
Wherever possible, the Government should place the manufacture of arms and munitions with existing Commonwealth and State establishments which have competent engineers on their staffs. There is no necessity to go outside such establishments at all. Private enterprise should be allowed to do its own job, and not exploit the national situation for gain. History provides ample evidence that the manufacture of armaments by private enterprise cannot effectively be policed. During the recent crisis, the British Government had to intervene to prevent exorbitant prices from being charged by private enterprise for gas masks. If profiteering took place in connexion with small articles like gas masks, what can we expect in respect of bigger things? There are in Aus- tralia efficient government establishments which are capable of making all the requirements of our army.
– Everything made here will be under government control.
– The risk of profiteering can never be dissociated from the private manufacture of munitions. If the Government wants to have the full support of the people of Australia for its defence programme, it will place this work with governmental institutions and avoid the risk of profiteering by privateenterprise.
– The honorable senator is indulging in propaganda.
– I am as capable in that direction as is any other honorable senator, but I am not now indulging in propaganda. Australia has wellequipped government railway workshops in which large sums of the people’s money have been invested. The railway workshops of New South Wales and thimachinery therein on the 30th June. 1937, were valued at £5,000,000, whilst the employees numbered nearly 10,000. The railway workshops at Newport. Victoria, are valued at £1,456,000. whilst the total value of railway workshops in that State is set down ai £1,830,000. At Islington, the Government of South Australia has the most up-to-date railway workshops in the southern hemisphere. They were completely rebuilt some years ago, and are capable of turning out anything that may be required. Even the small State of Tasmania has railway workshops and machinery worth £314,000. Similarly, at Midland Junction, the Western Australian Government has a wonderful organization. The machinery in the railway workshops at Newport and Eveleigh could be converted to produce almost anything. The Government should makeuse of these establishments for the manufacture of munitions. When private enterprise enters this field, there is always suspicion that national interests are made subservient to private gain.
– The honorable senator himself is endeavouring to create suspicion.
– Experience has proved that there is ground for suspicion.
There was a time when the Commonwealth had its own woollen mills and clothing factory.
– There are more employees in those factories to-day than when they were under the control of the Government.
– The woollen mills were practically given away, as was also the Australian Commonwealth line of steamers which saved many millions of pounds to the primary producers of this country. To-day, those primary producers who raised no objection to the removal of the enterprise which protected them, are squealing about high freights. The woollen mills were a financial success; indeed, :it was that fact which led to their disposal.. I do not say that the Australian Government steamers were successful financially, but they provided a check on the greedy shipping interests which would have fleeced exporters. When one or two more members of the Ministry resign, and the Labour party occupies tho treasury bench, protection will again be given to the people. A Labour government would not allow private enterprise to engage in the manufacture of armaments.
– Does the honorable senator know anything of the history of State enterprise in Queensland?
– No Labour- man ever tires of hearing of the experiences of Queensland under Labour governments. I only wish that in some of the other States the people had the privileges which the men and women of Queensland enjoy under Labour administration. Queensland has the lowest cost of living and the highest wages, the best domestic legislation, the best hospitals and the best ambulances, all because for a long period La’bour has been in power. The word “ Queensland “ is music to the cars of a Victorian, because he visualizes the day when Victoria will enjoy something like the conditions that prevail in the wonderful State of Queensland.
I remind honorable senators of the last occasion when Australia had to arm. It was Labour that put the machinery in motion. It was a Labour Prime Minister who uttered the historic phrase “ The last man and the last shilling “. Labour gave to Australia its first navy, and instituted compulsory training. I concede that Labour also abolished it, but it did fo for financial reasons, with the support of every member of the then Opposition. Prices of our exports were collapsing; unemployment was rampant. Our experts told us that insolvency threatened unless expenditure could be curtailed. Our advisers, even our military advisers, indicated defence as an avenue for economy. The Prime Minister (Mr. Scullin) had no views on militarism, but he was faced with the stern necessity to eliminate all unessential expenditure. In that he had the support of every honorable member of both Houses of this Parliament.
– Was the Scullin Government run from outside Parliament?
– It was created by the astute leaders of the Nationalist party. After leading the country into a mire, and desiring to evade the responsibility of getting the country out of it, our opponents raised the arbitration issue, not in order to win the election, but to lose it. We foresee a repetition of the 1929 debacle. The men behind the scenes - not the men who are elected to Parliament because they are popular - are seeking to engineer it. The Government has heaped on the country a burden of £63,000,000 of expenditure for defence, and in the last six months has showered out bounties and bonuses at the expense of the people as a whole. The Ministry is facing ^another crisis even now. Do honorable senators opposite think that we cannot see that they want to “pass the buck “ again to the Labour party ? They cannot raise a “bean” in London. When they most recently approached the London market, 33 per cent, of the loan was left in the hands of the underwriters. We are astute enough to realize that in these circumstances we are soon likely to take over the ranks of government.
– Is the honorable senator afraid of that?
– No. My Leader and every honorable member in Opposition would welcome the opportunity to govern the Commonwealth, but not under the conditions which we faced on the last occasion. When Labour again forms a ministry, it will want a majority in both Houses of Parliament. When we are in power we shall not alter this Government’s defence programme in any way, but we shall alter the method of financing it. The Government has had a wonderful spin, having had overwhelming majorities in both Houses of Parliament, but even now, with a tremendous majority in the House of Representatives and a small majority in the Senate, which I observe is being carefully used, it is not achieving what we think that it should achieve. It is a bad thing that even to-day, despite differences of opinion in the Cabinet, the Government will not make some pronouncement to the electors that, with the support of this party, it is prepared to face all dangers and honour the promises that were made to the electors at the last three elections. Instead of doing that, honorable members opposite have their heads in the trough and are buffeting each other for Cabinet positions. The fact that Mr. Menzies, Mr. Brown, or Mr. “ Somebody “ is about to resign from the Cabinet is demoralizing and paralysing the Government.
The terms of our amendment are an expression of disapproval of the means which the Government is adopting in order to raise money for the defence of this country. This party, like the parties opposite, stands for the defence of Australia. It does not claim that it has a monopoly of love of this country. I do not think that the parties opposite would claim that they have. Senator Brand knows who the men are who will do the job when the call to arms comes. No honorable senator will say that I am wrong when I say that 98 per cent, of Australia’s armed forces will come from the working class, whether they be clerks or manual labourers.
– The honorable senators’ figures are inaccurate.
– I concede that tho necessary officer class from the Royal Military College at Duntroon, handpicked men, is generally not composed of members of the working class. The Government side of the Senate does not have a monopoly of capacity. We on this side stand four-square behind the platformthat we signed, and no one can justly accuse us of being lacking in love of unity. Properly officered, a government composed of men on this side of the House would arrange a different way to finance the expenditure necessary for the defence of Australia. Men on this side have as much capacity as have ministerialists, and have also made sacrifices to come into this Parliament. As a government we would ensure that those who have the most to defend should contribute most towards defence.
.- I commend the Government for its bold defence policy. I agree with the Leader of the Opposition (Senator Collings) that the- physical standard of the masses must be raised and that the cost of defence should be met* out of national wealth. If it be necessary to incur a huge expenditure on defence because of the insanity of the world, there should be no hesitation to restore universal training, in the event of the failure of the recruiting campaign. There are in the Commonwealth more than 1,250,000 male citizens of military age who are liable for home defence under section 59 of the Defence Act. Approximately 300,000 would be needed for active service. If they were well-officered, well-trained and well-equipped, a potential enemy would hesitate to cross the seas. For an enemy to achieve success in a campaign in Australia, his strength would need to exceed the Australian strength. The huge armada that would be needed to transport that number of troops would court disaster, and no aggressor nation would be likely to take the risk. But what guarantee have we that the Empire’s navy available in Pacific waters will be strong enough to keep an invading force bottled up in its own or neutral harbours ? There is no difference of opinion as to the protection that the Navy and a strong air force can give Australia, but we should make doubly sure of our safety by having behind those two services an army approaching the strength and standard of the Australian Imperial Force. The present voluntary system is unlikely to give us that standard. Before I retired from the Army five years, for eight years my duties took me all over Australia inspecting the Militia Forces, and I say unhesitatingly that the voluntary system falls short of the requirements. It is true that the Australian Imperial Force was a volunteer force, but there was a great national appeal which brought to the colours the flower of this country’s manhood. Should a national appeal be necessary for the home defence of thi.-! continent, the cream of the nation will respond without need for resort to seclion 59 of the Defence Act. There will be no breathing space of six months in which to make good any shortcomings. As a commander of the fighting side of the Australian Imperial Force from start to finish, I know the standard of efficiency at which our future defenders should aim. [ do not advocate universal training on the same lines as previously, because that system was irritating^ the young fellows who were obliged to attend drill on Saturday afternoons. A better system is to -get the young men into camp for a long period of intensive training, not only of the rank and file, but also of the leaders. The cost would be little more than that of the system which, is now being persevered with.
Until the world reverts to sanity we have no alternative but to meet the huge expenditure involved in the Government’s defence programme. I take this opportunity to repeat what I said in this chamber on the 30th November last during the debate on the Appropriation Bill -
Whether this special recruiting campaign be successful or not there must be a declaration that war profits will not be allowed - that wealth will be treated similarly with the sacrifices of time, energy and life. We must he certain that no advantages will come to any one in the community from the sacrifices which will have to be made by others.
Two honorable senators opposite referred to the number of workers who served with the Australian Imperial Forces.One said that 98 per cent, and the other 95 per cent, of the force were workers. The official figure is 63 per cent.
.- 1* compliment the Government on the proposals that were outlined yesterday by the Minister for Repatriation (Senator Foll), but I seriously disagree with the method of financing them. I have had no time thoroughly to examine the proposals, but I believe, with Senator Brand, that we should take into consideration the question of whether excess profits - are to be made out of this expenditure. Some time ago I asked whether it was the intention of the Minister for Defence (Mr. Street) to set up a committee to examine all defence contracts in order to ensure that the Government got value for its money.
– What need is there for that ? There is a Public Works Committee.
– That is not enough. We should have a special committee.
I doubt the efficiency of some of the heads of the defence forces. Many of them are efficient, but many are not. Some of them are conscientious; others are not. Attached to the InspectorGeneral’s Department there should be an efficiency expert who would ensure that the heads of the different sections of the Defence Department did their jobs properly. When the Scullin Government was in power it found that many officers were more concerned with their social duties than with their official duties. We should have an efficiency expert to see that these officer? do their jobs as they should be done. ] believe that Australian s’oldiers were the best that fought in the Great War, their higher efficiency being due to the fad that they possessed more self-reliance than soldiers of other nations. When an Australian soldier was confronted with a difficult task he did not, as a rule, require to seek advice from superior officers. He knew what had to be done and the best way in which to do it. The Government’s defence policy will not tend to increase the efficiency of Australian soldiers. 1 agree with other speakers on this side who claim that the standard of living in this country is being progressively lowered by such measures as the bread tax, and the so-called national insurance scheme. The best contribution which the Government could make towards the adequate defence of this country would be to increase the standard of living of the average worker. There would then be available all the soldiers that Australia required. 1 also agree with Senator Johnston and Senator Brand that, defence expenditure should be a charge on the Consolidated
Revenue. The Australian Labour party believes that defence works should be financed by the Commonwealth Bank, and that the necessary wages should come from Consolidated Revenue. There is a good deal of misunderstanding of the Labour party’s platform with regard to banking. Let me put it on record -
The Commonwealth Bank to be developed on the following lines: -
The followingis adopted as a declaration of policy and in amplification thereof.
The utilization of the real wealth of Australia to ensure a maximum standard of living consistent with the productive capacity of the Commonwealth through national control of its credit resources and the establishment of an efficient medium of exchange between production and consumption.
Could there be anything more practical than that? The Commonwealth Bank could quite easily make available the necessary funds to finance Australia’s defence programme, and it should be compelled to do so ; but maintenance costs, such as the payment of wages and salaries, should be drawn from Consolidated Revenue.
Some time ago, in connexion with defence proposals, I urged the adoption of what is known as “ national defence contributions”, a principle which has been adopted in Great Britain. Under that scheme those who can best afford to pay for defence, and who have the most to defend would be compelled to supply the necessary money. The Labour party does not object to steps being taken adequately to defend Australia in case of emergency, but it has serious objection to the method for financing expenditure contemplated in this legislation. The “national defence contribution” scheme was brought into operation about twelve months ago in England, and since this Government follows the lead of the British Government on most matters of policy, I suggest that it should do so in this matter. I take the following from an official statement showing how the scheme is working in England. It provides that -
That there shallbecharged on any profitsarising at any time during the five years commencing on the first day of April, 1937. from any trade or business of any description (including, in the case of bodies corporate whose functions consist wholly or mainly in the holding of investments or other property the holding of the investments or property), a tax not exceeding 5 per cent. of the amount of profits.
I draw attention to the fact that the tax provided is 5 per cent. of the amount of profits.
– That is not enough.
-If that is not enough then I am prepared to make it 25 per cent. or even 50 per cent. The British law provides that the tax is to continue for a period of five years, and shall be collected annually at the accounting periods of trades and businesses. It is a. charge on the profits of trades and businesses carried on in the United Kingdom, whether by companies, individuals or firms, or carried on outside the United Kingdom by companies, individuals and firms ordinarily resident in the United Kingdom. That is a much better system of financing defence expenditure on maintenance and wages, than is the one proposed in this legislation. I do not believe that Australia should borrow on the British market at all. The Commonwealth Bank is capable of financing out defence expenditure, and I contend that a scheme similar to the British national defence contribution should be instituted for maintenance purposes.
.- The Leader of the
Opposition (Senator Collings) stated this morning that the Labour party had a defence policy - the adequate defence of Australia. 1 do not doubt that for a moment. I submit that, in the comprehensive statement on the Government’s defence proposals read yesterday by the Minister for Repatriation (Senator Foll), there was nothing to indicate that any part of the money would be expended on anything but the defence of Australia. Therefore, this bill should be fully in accordance with the principles of the Labour party.
– We admit that. We are standing by the Government’s defence proposals. Our objection is to the methods by which they are being financed.
– Yesterday the Leader of the Opposition, and other honorable senators opposite, spoke of consternation existing in the ranks of the Government and its supporters. I do not know of any consternation, but I do know that there is considerable activity in regard to such important matters as defence. If, however, there is at the moment consternation in the ranks of Ministers, which I do not admit, my reply to the Leader of the Opposition is that, at times, there is also consternation in other high places in this Parliament. In all my experience, extending over a fairly lengthy period, I have never witnessed a spectacle to equal that which occurred in this chamber this week. With the exception of one man who was left to watch proceedings, all members of the Labour party went outside the Senate chamber to hold a party meeting. So far as I know, that was the first occasion on which such a thing has occurred in any part of the world.
– That is our business.
Senator JAMES McLACHLAN.And the good government of this country is the business of all members of this chamber.
– Order !
– If criticism of the Government is to be permitted, we on this side should be permitted to criticize the Labour party. We are heartily tired of being abused by members of the Opposition.
– At least, the Labour party formulates its own policy. It does not get it from outside organizations.
– While the party meeting to which 1 refer was in progress, the honorable senator who was left behind to watch proceedings rose to make a speech. One of his colleagues came in one door of the chamber and told him to sit down, and he was about to do so, when another member of his party came in and told him to continue.
– That is not true, but it will pass.
– It is absolutely true. The honorable senator who was told to sit down was heard to remark, “ There are too many captains on this ship “.
THE PRESIDENT.- Order !
– The honorable senator’s ship is being scuttled from the stoke-hold !
– No doubt the Leader of the Opposition would like to see the Government ship scuttled.
– It will not float much longer.
-I am satisfied that the people of Australia generally would much regret if it were scuttled.
– We will leave that to posterity to judge.
Senator JAMES McLACHLAN.The Leader of the Opposition this morning told us that six years ago the Prime Minister in his policy speech, mentioned the desirability of standardization of railway gauges as one phase of a public works policy to relieve unemployment, and in characteristic fashion the honorable gentleman twisted the Prime Minister’s statement of policy to suit his own” purposes.
– I suppose the honorable senator will admit that it would be possible to transport troops more rapidly over a standardized railway than over systems of different gauges?
– Certainly; and had the Leader of the Opposition emphasized that aspect of the Prime Minister’s statement of policy I would not have raised any objection.
But the honorable gentleman referred to that matter merely to stress his point about unemployment.
– Would the honorable senator support a proposal to standardize railway gauges?
Mid I doubt that many other responsible people would either, in the light of present-day development of transport methods. I am as anxious as is any other honorable senator to provide employment, but I resent the attitude of some members of this chamber. Ever since the beginning of this session we have been forced to listen, almost daily, to a tirade of abuse of the Government from honorable senators opposite on the subject of unemployment. At times there has been the suggestion, almost, that Government supporters are little better than inhuman monsters because they have not brought pressure on the Ministry to do more than has been done. We have been obliged to sit in this chamber hour after hour listening to a re-hash of everything that has been said on the subject of unemployment. One speaker referred to a false prophet who once said that hobnailed boots would never be seen in this Senate, meaning, [ suppose, that Labour representatives would never be returned to this chamber. Like the majority of Australians, I should not think less of a man merely because he happened to wear hobnailed boots. Many men who have been returned to Parliament from the ranks of Labour have done valuable work for their country, but they have not accomplished it by shouting and thumping a desk, and talking about people who are hungry and cold.
– They are still doing good work for their country.
– Honorable senators opposite constantly refer to the sufferings of the unemployed, but we on this side are just as humane and as solicitous for the. welfare of the unemployed as are members of the Opposition. After listening to a repetition of arguments on a subject of which one has not an intimate ,knowledge, one is inclined to conclude that the speaker is adhering to facts; but if the speaker eventually presents a case which one knows to be inaccurate, one then becomes dubious regarding, any statements that he may make. Members of the Opposition have been telling, us about the poverty that prevails in Sydney and Melbourne. I have no first-hand information about the conditions experienced in those cities; but the statement has been made by Senator Collings that misery and degradation prevail at Brompton, in South Australia. I am familiar with the conditions of the people in that suburb of Adelaide, and I claim that his remark was unwarranted. Some of the residents of Brompton are not blessed with much of this world’s goods, and unemployment is not unknown there : but I do not think that- 1 per cent, of the people of South Australia are hungry or cold on the coldest night. The State Government looks after the unemployed in that State. Although it cannot proride employment for all of those who are out of work, no member of the community is left without the necessaries of life. If the policy adopted in South Australia for the reduction of unemployment were applied to some of the other States, there would be little cause for complaint. The South Australian authorities recently provided about £20,000 for the purpose of inaugurating a policy of assistance to small industries. .As a result of this highly successful scheme, employment has been found for 300 men.
The statement made this morning by the Leader of the Opposition (Senator Collings) regarding the physical fitness of the young men who are asked to enlist in the militia forces, has been repeated by him on several occasions, and I think that it is unfair. He referred to the test through which recruits for the militia would have to pass, and he declared that a large number of them would be rejected on the ground of physical unfitness. I strongly resent that reflection on the young manhood of Australia. On the whole, our young men are not undernourished, but compare favorably with those of other countries.
– I was referring to young men who have never had a job since leaving school.
– There are no better manual workers in the world than those of Australia. Our athletes have given good accounts of themselves in many parts of the world. During the GreatWar, when the testing ground was in Europe, Australians proved themselves to be equal, if not superior, in all respects to the men of the other countries involved in that struggle. The statement that our young men are weaklings and underfed is inaccurate.
– The present Go- vernment is responsible for it.
Senator JAMES McLACHLAN.The criticism was unjustified, and therefore it is idle to suggest that the Government has evaded its responsibility. If honorable senators opposite desire a sympathetic hearing, they should not present unjustifiable statements.
-We do not want sympathy; we ask that work be provided for the unemployed.
Senator JAMES McLACHLAN.Why does not the Government in the honorable senator’s own State do something for them?
SenatorFraser. - It is endeavouring to do so.
– Let it continue in that effort. This is the National Parliament, and the responsibility for dealing with unemployment rests with the States. If a State is unable to satisfy the needs of the unemployed within its own borders, how can it play its proper part in connexion with the affairs of the Commonwealth? I resent the attempt by honorable senators opposite to saddle the Government and its supporters with responsibility for the poverty and degradation said to be associated with unemployment. Honororable senators on this side are just as humane as the members of the Opposition claim to be. We are anxious to help the unemployed. The defence works being undertaken will provide a great deal of employment. Instead of the criticism which has been directed against the Government from certain quarters, we should have heard commendation.
. This bill provides for a loan to assist in financing the Government’s defence programme. The money could be raised either by taxation or by borrowing.
Taxation results in a transference of spending power, whereas a loan involves the borrowing of goods and the placing of the whole burden of repayment on the shoulders of the workers. That is why the policy of borrowing is preferred by the Government to that of raising the money required by means of’ taxation. By taxation, spending power is transferred from those who are taxed to the Government; borrowing results in the whole of the burden being placed upon the workers. The national debt of Australia to-day totals £1,275,000,000. That is the result, in terms of money, of the policy of borrowing. But the result, in terms of the burden borne by the workers, is increased unemployment and the reduction of wages down to the level of the dole.
– Wages are being increased, and the honorable senator knows it.
– I was a member of a deputation in Canberra last night which drew attention to a decrease of wages.
– In the aggregate, in terms of gold, wages are going down and down; therefore, we can say that the policy of the Government is one of patriotism plus profit.
Senator James McLachlan remarked that honorable senators on the Government side should not be regarded as insincere or inhumane. I have never suggested that they lack sympathy with the workers, but they display a great lack of knowledge as to how to govern this country to the best advantage. I have no intention to introduce the personal element into the debate. I shall always direct my remarks to the arguments submitted in opposition to the case presented by honorable senators on this side . Under this bill it is proposed to increase the indebtedness of the nation, and, through that, to increase the impoverishment of the people. A recruiting campaign is in progress, and eligible young men are being asked to join the militia, but, at the same time, theyare denied the right to earn a decent livelihood, and will be bled white when the Government’s commitments have to be paid for. The recruiting campaign is not having the results which those associated with it had expected. The explanation is that the youth of the country is not prepared to accept the Government at its face value. Senator James McLachlan said that the Leader of the Opposition had exaggerated the true position when directing attention to the standards of living of the workers. ‘ It was suggested that Senator Sheehan had merely indulged in a rehash of the claims of the Labour party. I shall refer to statements made in the first progress report of the Slum Reclamation Committee which ‘investigated conditions in Victoria in 1936-37. The committee was composed of representatives of all political parties in the State Parliament and expert government officials, and after conducting an exhaustive investigation into the slum conditions in Victoria, reported that the annual infant death rate per 1,000 births from 1932 to 1936 in the inner suburbs was: - Fitzroy, 60.23; Collingwood, 64.84; Port Melbourne, 57.2 ; Richmond, 52.9 ; South Melbourne, 52.8 and the City of Melbourne, 51.7. In the outer suburbs where environment is more congenial and where the parents and children are more adequately fed and clothed, the death rate is lower, as will bo seen from the following figures:- Kew. 2S.2S; Brighton, 33.14; Camberwell, 34.42; Moorabbin, 35.93; Heidelberg, 36.66; Caulfield. 37.90; Williamstown, 3S.08 and Preston, 3S.62. Malnutrition undoubtedly exists; that charge is not a mere figment of the imagination, but is based on inquiries made by competent persons. Commenting upon the state of affairs which I have outlined, the committee stated -
Sordid surroundings are breeding an antisocial outlook and an instinctive resentment at what is regarded as inescapable. There is a tendency to regard the ugly and the mean as a normal heritage. Unconsciously, youth in the slums is allowing itself to be dominated by the belief that it must live down to environment. Even if the youth of the slums has not the initiative to become a major enemy of society, living in an atmosphere where law and good conduct offer no positive rewards or advantages, youth is more likely to drift into lawlessness, which appears to promise liberal rewards for little effort.
Mr. F. P. Morris, who, until recently, was in charge of the Children’s Court in Victoria, reported in 1936 -
Even granting that many parents are slumminded and that any house would become a hovel through their occupancy, the fact remains that children living under shocking adverse home conditions have a slender chance of becoming decent citizens . . . While these conditions exist, we are simply preparing children for the Children’s Court. After the children have appeared at the court, our probation officers find it more difficult to help them and their adverse environment makes reformative work impossible. The result is that they either drift along until they get into further trouble, or it becomes necessary to remove them at once for institutional care. It is not necessary to indicate the costliness of such methods; neither is it difficult to visualize the hopelessness of following up the institutional work’ when the children return to their sordid homes.
The charge of Senator James McLachlan that honorable senators on this side of the chamber have exaggerated the position cannot be sustained insofar as Victoria is concerned, and I know that similar conditions exist in every other State of the Commonwealth. It is due to conditions such as are mentioned in the report from which I have quoted that the physical standard of Australian youth is unsatisfactory, and for that reason the appeal for suitable recruits is not likely to be successful.’ In raising money for defence purposes the Government has had to decide between taxing the owners of goods or borrowing from such owners, and thus placing the whole of the burden of the repayment upon the shoulders of the workers. That is the policy in operation in Great Britain to-day, and it has produced conditions similar to those which prevail in Australia. According to authoritative reports preparations for defence in Great Britain are in as great a muddle as they are in Australia, due mainly to control by -private enterprise, the desire to make profits, and incompetent government. Naturally such conditions are resented by the British people, and that resentment has been expressed not only in the columns of the newspapers hut also by the people’s representatives in Parliament. There is dissatisfaction and discontent with respect to the ‘British Government in exactly the same way as there is with respect to this Government. The Statesman and Nation of the 29th October of this year, under the caption of “ Democracy and Rearmament “. stated -
The truth is- that British inefficiency in war preparation - and the same can be said of France - has been duo not to the democratic features of the Constitution, but to the oligarchical elements in it, which democrats have failed to hold in check. Faced with a demand from the State for arms or gas-masks or trenches, or anything else that is out of the ordinary way of business, the oligarchs who control our industries instinctively retort with an attempt to hold the community to ransom. They demand not merely a high profit on the goods which they are asked to make for the Government, but in addition compensation for disturbance - for the upsetting of their ordinary selling routine, and the possible loss of future markets through their working for the State. Unless they are heavily bribed, they refuse to set aside their other commitments in order to do what the State requires. The consequence is that there arc endless delays in carrying out the plans that have been made, and what is done is done only at a preposterously high cost to the taxpayers . . . The existing Government is grossly incompetent-
We can say with truth and conviction that the existing Government of Australia also is grossly incompetent - and in personnel and outlook utterly unsuited to undertaking the task of national economic organization. In a country of free institutions, this task demands not merely the acquiescence, but the positive co-operation of the trade unions. It requires that no sacrifice shall be asked of the ordinary citizen without an assurance that the wealth of the community is being mobilized equally with its man-power, and that the industrialist and the financier, equally with the man in the street, are being given their marching orders and prevented from exploiting the national necessity for their private advantage. In short, it requires a different government, capable of uniting behind it the friends of democracy, instead of driving them into more and more determined opposition . . . What we must demand is that, in order to prevent the burden from becoming quite unbearable, we shall be given good value for our money. But good value is out of the question without drastic measures to stop profiteering and to organize the vital industries directly under public control for the supplying of the national needs. The present Government is entirely incapable of inaugurating such a controlled national effort. The first task of democrats is to make away with it, and to entrust the task to men who can be relied upon not to use the need for mobilizing our resources as a pretext for betraying the democratic cause.
That is what the Statesman and Nation, an authoritative publication, had to say concerning the British Government. I do not say that the members of that Government are insincere, but they are lacking in the essential knowledge to accomplish the task before them. There is also dissension in this Government because Ministers are working at cross purposes. Preparation for the defence of Australia has been left until the last moment, and honorable senators on this side of the chamber would be lacking in their duty to the people if they did not direct attention to the weaknesses in the Government’s policy, because it is only by so doing that improvements can be effected. The policy of borrowing overseas has been resorted to in the interests of wealthy taxpayers, in order to give effect to patriotism plus profit. “We are asked to pass a bill to approve of the borrowing of £10,200,000, and to support a policy under which the people will be compelled to borrow goods and services for which they shall have to pay perpetual tribute Actually, the people borrow their own money. The process begins with the worker receiving in wages the cost of his subsistence, and after overhead charges have been paid, there remains a surplus of wealth which is appropriated by the owners in industry, the financiers and the private banks. The Government requires goods and services which are first made possible by the workers and then are lent to the Government. The result is that a huge interest bill is incurred, and as the amount of interest increases, a heavier burden is thrust upon the shoulders of the workers. But when we ask the Government to provide relief for the unemployed - not a dole, but relief adequate to enable them to live on a standard equal to that made possible by the basic wage and working conditions prescribed in awards - we are told that it cannot find the money necessary to do so. It asks, “ Where will the money come from?” The answer is that the community cannot pay approximately £2,000,000 monthly in interest on our public loans and, at the same time, provide the working community with the food, clothing and shelter it needs. When relief is denied to the unemployed the number of the workless continues to increase, leading to the establishment of slums of the kind to which I directed attention a few moments ago, in some of the worst of which the death rate of infants under one year is more than 66 per cent. That is how things work out when the government of acountry prefers to raise the money it requires by loans instead of by taxes. How is it possible to prepare adequately the defences of this country when we allow our manhood to deteriorate through semi-starvation or malnutrition? The safety of any country depends more on its .man-power than on guns and machines. A country can possess in abundance the most efficient weapons which human ingenuity can devise, but they arc practically useless if the man-power necessary to the use of them is not available. Man-power, therefore, is a much more important factor in the defence of a country than are guns and machines of war. This Government, however, is prepared to allow the efficiency of our man-power to deteriorate. Senator Brand agreed with honorable senators on this side that wo should not permit profits to bc made out of the manufacture of the war equipment we require. I suggest that he’ will be contradicting himself if he votes for tha proposal embodied in this measure to raise this money by a loan, because in that way we sha-11 allow profits to be made in the form of interest. I repeat that the main factor in the defence of this country is man-power. I” also contend that the method by which this Government proposes to strengthen our defences is not designed to improve our man-power by raising the living standards of tho workers; on the contrary, this policy may tend to impair the efficiency of our mail-power by reducing the people to the level of paupers. It is for that reason that honorable members on this side oppose the methods by which the Government proposes to raise this money; we say it should secure the money by taxes.
The Government has suggested that Australia is in danger of attack. However, although good reasons may exist for that belief, -we should not allow ourselves to be stampeded by fear; we .should not allow the shrewd financiers who are behind the present Government and who, at the moment, I might add, are now pulling the wires and breaking up political alignments within the Government, to capitalize our fears. Which nation is likely to attack Australia? It has been said that Germany may attack us. That may or may not be true, but I point out that, as the result of the policy of intense militarism which Germany has adopted, that country, sooner or later, will become a nation divided against itself. My reason for saying that is that any policy of intense militarization involves the complete segregation of the sexes and the breaking up of home life, which is the very foundation of a nation. It also involves an acceleration of production and. at the same time, an enormous and increasing waste of those capital goods which are produced for war purposes. Because armaments and other equipment of war begin to deteriorate almost as soon as they are completed, the impoverishment of the people is accelerated and internal ‘dissension becomes inevitable.
The PRESIDENT (Senator the Hon. J. B. Hayes). - I ask the honorable senator to confine himself to the question before the Chair.
– As it has been suggested that Germany may possibly attack Australia, I am endeavouring to show that the fears now being created by the Government in respect of defence are based either on a convenient political assumption, or on ignorance. I point out that astute men in England, who are watching international developments very closely, are of the same opinion as I am expressing at the moment. They have adopted, apparently, a policy of retreat, a policy of subordination to foreign nations, but, at the same time, they realize that if they can afford to wait long enough, the enemy which is likely to attack either England or Australia will defeat itself. Holding such a v]ew, I should be very foolish if I accepted without question the reasons advanced by the Government for this very belated effort in the preparation of our defences*.
asked what the Opposition has to say against the Government’s policy. I have little to say against the policy, but I have a great deal to say against the men who are in charge of it. On paper a policy may be excellent; it may provide for everything conceivable in a scheme of defence, such as ships, guns, fortifications, munitions, trained men, and perfect organization; but unless the men in charge of that policy are satisfactory, it will hot succeed. Oan we say that the men- in charge of the Government’s policy are capable? I give to ill em all credit for sincerity; hut can they place their record before us and say that they have done a good job? Even on the evidence of some of their own supporters they cannot say that. The Government consists of muddlers who, because they do not know their own minds, hold up .the business of the country. 1 am not inconsistent when I say that, whilst I have no great fault to find with the policy of the Government, I have no confidence in the men responsible for giving effect to it. In saying that, I am not influenced by personal motives. As individuals, the members of the Government may be excellent men, and wellmeaning citizens, hut as a team to implement an important policy and carry out a difficult job, they do not inspire confidence. They lack knowledge; if they know more, the results would be different. For instance, there would be a better response on the part of the workers to the Government’s appeal for recruits. As it it, the workers on whom the Government is dependent for the success of its defence policy are becoming more and more hostile. Why is that? One reason is the growing army of men who cannot obtain work. They are entitled to he hostile to the Government. I, could not imagine even- you, Mr. President, if unemployed, submitting without vigorous protest to the conditions which the unemployed arc asked to accept. What do vt* see on the waterfront to-day? Instead of seeking the co-operation of the men engaged, there, the Government proposes to enforce against them the provisions of the Transport Workers Act. What is the reason? It can only be that the Government desires to introduce industrial conscription by instalments. Only a government lacking in knowledge would do such a thing; if it understood how to get tho best results from the workers, it would act differently. I warn the Government that any attempt to extend the provisions of the Transport Workers Act will do more to defeat Australia, by disorganizing, demoralizing and rendering ineffective the man-power on which the defence of this country depends, than any enemy outside Australia is likely to do. We on this side are opposed to the policy of borrowing this money, because we know that that policy will destroy those things for which the Government claims to stand. A policy of borrowing will not only render the working community more ineffective than it otherwise would be, but it will also make the path of an enemy easier. If the best results are to he obtained, the Government must change its policy, not only as that policy appears on paper, but in its practical application. The Government cannot expect to obtain the enthusiastic support of the workers when they know that its policy will commit them to the payment of perpetual tribute to those from whom the money is borrowed. Already, approximately £2,000,000 a month has to be paid by Australia as interest on borrowed money. The policy of the Government as set out in this measure will add to the interest hill. It will, therefore, add to the burden on the workers. If it adds to their burden, the workers will become more hostile. If they become more hostile, the Government will probably attempt to introduce more coercive legislation. Should it introduce more coercive legislation, or enforce more strictly existing legislation, the Government will become just as much an enemy of this nation as any outside power which might attack us. I support the amendment, and hope that it will be carried. If the Government will not take any notice of what is said by honorable senators on this side of the chamber, surely it will not shut its eyes to the lessons of the past. If it remembers the lessons of the past, particularly those taught by the last war, it will not pursue a policy which has led to failure in the past, and will do so in the future.
– I support the amendment, because the Government has at its disposal better means of raising this money. It could obtain its requirements through the Commonwealth Bank. I am pleased that at last there is a move within the ranks of Government supporters to do something for the defence of Australia, and to compensate in some degree for its neglect in past years. It is regrettable, however, that the present bill should have been introduced. It is my considered opinion that most of the trouble which now exists among members of the parties represented in the Cabinet is the result of the Government having rushed certain legislation through the Parliament before the new senators, who had been elected by the people, took their seats in this chamber. I believe that it was only because it feared that further trouble would develop among its own supporters that the Government decided on an expansion of its previously-announced defence programme. Some time ago the sum of £17,000,000 was provided for defence purposes. According to a recent statement by the Minister, most of that money has already been expended, but I am not aware that, as the result, any considerable number of unemployed workers have been absorbed in industry. I wonder to what extent the expenditure of this additional £10,000,000 will relieve the problem of unemployment. When the Government acquiesced in the transfer, by the Broken Hill Proprietary Company Limited, of its steel works from Lithgow to Port Kembla, on the coast, it demonstrated its willingness to provide targets for any potential enemy. The Port Kembla works are within easy range of the guns on an enemy warship 25 or 30 miles away from the Australian coast. Instead of having such establishments in vulnerable positions near the coast, they should be situated in inland districts.
On several occasions I have urged the necessity to provide adequate stores of oil fuel in Australia. I do not know whether the Minister thought that he could stifle criticism by such a letter as that which he sent to me on the 2nd December, in which he stated -
On thu 6th October. 1938, when sneaking in the Senate, you referred to the question of the supply of fuel for aircraft, and stated that nothing of a practical nature had been done in connexion with this matter. .In view of the doubt which appears to exist in your mind, I. thought it desirable to let you know that this matter has not been overlooked, and, although I cannot furnish details of the action taken, 1 should like to inform you it receives continuous attention, and that supplies of petrol suitable for defence aircraft would be available in time of emergency.
I am not at all satisfied. I do not make this appeal for myself, or for political purposes; but I submit that adequate steps should be taken to ensure that there will be a sufficient supply of petrol and oil in time of emergency. I do not know whether this criticism was anticipated, but the Sydney Sun last night made a statement with regard to Newnes, claiming that a tremendous amount of moneyhad been spent in developmental work there. I do not think that very much progress has been made at Newnes, nor do 1 think that, if the Newnes field were fully operative, it would be able to produce anything like a sufficient supplyto meet Aust2-alia’s needs. There art; seven other oil shale deposits that also should be developed in the interests of the nation. Work on the Newnes field was pioneered by Messrs. Treganowan and Chambers, who carried out experiments with a view to placing production on a commercial basis. Mr. Treganowan was the proprietor of an independent oil refinery in Melbourne, and he was informed by the major oil companies that if he continued to operate at Newnes, supplies for his Melbourne refinery would be cut off. Senator A. J. McLachlan was then Minister in charge of Development. When the matter was referred to him he said that bc could take no action. As a result, Messrs. Treganowan and Chambers were forced to abandon their efforts at Newnes. We also know what happened at Newnes in connexion with Mr. Scott Fell’s activities. That gentleman was given a managerial position in one of the major oil companies, and the works at Newnes were closed down. The Broken Hill Proprietary Company Limited then purchased the Wolgan Valley plant, but found that economic production was impracticable. Now a lease of the Newnes shale oil deposits has been given to another private firm, established by Mr. Davis, of the Davis gelatine manufacturing firm. I hold that it is the responsibility of the Commonwealth Government to develop the shale deposits, because it is essential, from a defence point of view, that adequate oil supplies shall be available in time of emergency. Australia should be prepared to strike at invading forces long before they reach our shores. The great, industries at Port Kembla, Newcastle, and other parts of the coast, can be protected only if hostile vessels be kept out of gun range.
The success of the record-breaking Vickers- Wellesley bombers, which flew non-stop from Egypt to Darwin, demonstrates the potentialities of aircraft in war time, lt would be possible for a hostile power to establish a base 300 or 400 miles away from Australia, and destroy our capital cities from the air. A militia force of 70,000, 100,000, or even 120,000, which, 1 understand, has been suggested by an expert as being necessary, cannot assume the entire responsibility of defending this continent. There should be a long-range defence plan. Part of that plan should be the development, by the Commonwealth Government, of our oil resources. Not only should the Government assume control of the Newnes deposits, but operations should be commenced in the Wolgan Valley, at Capertee, and at o titer places around Muswellbrook. Immediate attention should be given to this vital matter. On the 16th November, I asked the Minister for Trade and Customs a question relating to the quantities of oil fuel imported to Australia, and the amount produced in Australia. The reply given by the Minister showed that whereas the quantity of oil fuel produced in Australia during 1937-33 was approximately 32,000,000 gallons, the consumption during that year amounted to approximately 480,000,000 gallons. This discloses a very serious situation, and I shall continue to bring it under the notice of the- Government until some action is taken. If the Government is not prepared to do something, it should make way for a government which is willing to take definite action in this direction, and will not tolerate obstruction by the major oil companies.
We have been told that because of the urgency of the defence problem it is necessary to borrow money overseas to finance the Government’s proposals. A war scare has been created, but our potential enemy has not been specifically identified. Neither have we been informed how we are going to defend ourselves against that enemy which, some years ago was referred to as’ the “Yellow Peril “.
Whilst the attention of the people is directed to this important subject of de fence, the Government has passed tho iniquitous bread tax, which will press unfairly and heavily upon relief workers, invalid and old-age pensioners and superannuated public servants.
Another aspect of our defence programme is the system of voluntary military training. The Government has decided to scud out a director of recruiting, with the object of securing the enlistment of sufficient militia-men to bring the total up to 70,000. This was the original estimate of the number required, but 1 understand that an expert has since expressed tho opinion that 120,000 will be necessary to ensure the safety of Australia. In furtherance of the plan to stimulate recruiting, a “Mr. Black” visited Newcastle recently.
– Who is this “Mr. Black”?
– Every one knows that the Minister for External Affairs (Mr. Hughes) was. for the time being, “ Mr. Black “. But it is impossible to disguise that right honorable gentleman. The Government has not been successful in its appeal for recruits, because, for one reason, there i3 a vast army of unemployed in this country. That army, I regret to state, is increasing daily, and those at present in employment are fearful lest they lose their jobs. A fear complex has been created amongst tho workers in New South Wales, at least, since it has became known that “ Mr. Black “ - the Minister for External Affairs - and the Prime Minister (Mr. Lyons) are urging that the captains of industry should force their employees to join tho militia. This is a serious step, bordering on intimidation. Boys seeking jobs are being asked - “ Are you in the militia ?” I am sure that this state of affairs will not be tolerated by the Australian people, who have always rejected proposals for conscription. This is why the recruiting campaign is not meeting with the success which the Government expected.
Senator James McLachlan says that there is no malnutrition in Australia. He is entirely wrong. Medical officers who, during the last seven years, have made annual examinations of Australian schoolchildren, report, a substantial percentage of cases of malnutrition which is purely starvation.
– No; it means incorrect feeding. “
– It means lack of food. I resent the suggestion that malnutrition is not prevalent in our crowded cities. For years the people were led to believe that unemployment was almost non-existent, but, eventually, the Premiers of New South “Wales and Victoria admitted that the unemployed throughout the Commonwealth totalled 100,000. The Opposition claims that the unemployed now number over 150,000, and the Government is doing nothing to provide work for them. Until they have means of obtaining necessary food, clothing and shelter, they should not be asked to join the militia forces. Large numbers of people’ are disgusted with the present treatment of the unemployed. A youth, nineteen years of age, recently committed suicide by hanging himself. He was one of many for whom work should have been found. If the voluntary system of enlistment should prove to be unsuccessful, the introduction of compulsory military training will probably be proposed. I have received a. large number of letters from various organizations, not associated with the Labour movement, urging that compulsory training should not be resorted to, and among the signatures are those of the following : -
Rev. Dr. E. E. V. Collocott, president, United Christian Peace Movement.
Rev. W. G. Coughlan, chairman, Church of longland Youth Fellowship, Sydney branch.
Rev. J. Evans, chairman, Australian Youth Council.
Rev. H, J. Willings, honorary secretary, Christian Socialist Movement.
I hope that the Government will not introduce compulsory training by administrative act while the Parliament is in recess.
One honorable senator has stated that the Bruce-Page Government showed no concern for the interests of the people when it sold the Australian Commonwealth Line of Steamers. Those vessels were built because of the high charges which shipping companies had imposed on the primary producers’ for carrying their produce to overseas markets during the Great War. A later government practically gave those ships away, and the person to whom they were sold afterwards received eighteen months’ imprisonment. The Commonwealth authorities have not collected more than one-sixth of the agreed purchase price. The government which virtually gave those vessels away was associated with one of the greatest swindles ever perpetrated. The circumstances to-day are similar to those prevailing when a Labour government found it necessary to establish the Australian Commonwealth Line of Steamers. The “Bay” steamers, which were built to replace the wooden vessels, catered for one-class passenger traffic, and their competition was keenly felt by the other lines. Mr. “ Spats “ Bruce did not care to travel on the one-class “ Bay “ steamers.
– The honorable senator is not very courageous in attacking a man who has no opportunity to reply to his criticism.
– When Mr. Bruce attacked the working class of this country by saying, “ They will have to take their belts in a couple of inches, and become used to unemployment “, the workers had no opportunity to reply. The present Government has made no attempt to collect the money which the purchaser agreed to pay for the vessels of the Australian Commonwealth Line. If the potential enemy, of which we have heard so much, were to materialize, or if a war broke out in Europe, the section represented by the Country party would find difficulty in having their produce conveyed to the world’s markets. The insurance and freight charges would rise to such anextent that no doubt another appeal would be made to help the producers to secure reasonable freight rates.
– Would any government be able to resist increases of insurance rates?
– Will tlie h’onorable senator tell me. to what extent freight charges between Australia and the overseas markets were raised during the Great War?
I regret that the Government has brought this measure down in the dying hours of the session. I hope that the Parliament will be summoned early next year to discuss matters of urgent national importance. The Government has been at fault in allowing the Parliament to remain in recess for many months in each year. The notice-paper of the House of Representatives to-day contains over twenty items, but the Parliament is to be closed, because the white ants are at work within the Cabinet. Ministers are seeking political salvation in recess. Every newspaper in the Commonwealth announced to-day that two Ministers of the Government are about to resign. Chaos reigns in Cabinet circles.
– The honorable senator must confine his remarks to the subject matter of the bill.
– When the Labour party is’ given an opportunity to control the affairs of the nation, it will establish a better record than that of the present Government over the last seven years. What .has become of the Government’s promises to launch a £20,000,000 housing scheme, to provide jobs for all who are unemployed, and to standardize the railway gauges? Few of the proposals outlined in the various policy speeches of the Government have been given effect. A vigorous public works policy should be launched, and a definite attempt made to discover flow oil in Australia..
– Why did the Labour party oppose the development of the Newnes oil shale deposit?
– The Labour party did not oppose the development of thai deposit, but it did object to the Government handing over the work to private enterprise. The Government played a political trick on the people by announcing, prior to the last general election, the expenditure of a large sum of money to develop Newnes in order to ensure the return of the honorable member for Macquarie (Mr. John Lawson). The Labour party wa3 strongly opposed to Davis, Fell and others being associated with the enterprise, because they considered that the work should have been undertaken by the Government. Senator Dein visited Lithgow and deliberately misrepresented the Labour party. The honorable member for Macquarie,” whose political life was then at stake, is a very worried man to-day, and it will be interesting to learn- the outcome of the dissension within the Cabinet. The Newnes deposit will never be developed successfully because of the influence and activities of the major oil companies which are anxious to protect their interests.
.- The trend of the debate on this bill reminds me of an expression of an American, who said, “ You Britishers are always trying to resuscitate the past, while we Americans ave desirous of pulverizing the future “. I have already had an opportunity to make some observations on the Government’s defence policy, but I desire to supplement them briefly to-day. The need for preparation for defence depends largely, if not wholly, upon our relations with other countries. When conditions internationally appear to be favorable, there is a tendency to ease up on defence expenditure, and when peaceful conditions are threatened the expenditure upon armaments is perforce increased. During the past few years the international situation has been unsettled and the Government is, rightly, if somewhat belatedly, taking effective steps to meet Australia’s defence needs. In this bill, provision is made for the appropriation of £10,200,000 to meet the expenditure outlined by the Minister for Defence (Mr. Street) yesterday, and I express my satisfaction with the general plan proposed. I made mention of the need for at least one battleship to strengthen the Australian Navy, but I understand that the Minister’s statement visualizes an imperial strategical naval unit based at Singapore which will afford adequate protection. At least it will have the same effect as the small British squadron which was stationed at Plymouth when an invasion of England by the French was once threatened. The scheme outlined is the result of the -advice of experts, and we are fortunate in having aa Minister for Defence a gentleman able to appreciate the value of the advice given to him, and who has the requisite ability and courage to give effect to the recommendations submitted to the Government. In these circumstances, I look forward “with a great deal of satisfaction to the future. A feature of our defence scheme which should commend itself to honorable senators generally is that it is based to a great degree upon co-operation with other portions of the Empire. There appears to be a consensus of opinion that we should endeavour to make our army a reality, and I was pleased to hear honorable senators opposite say that they support the voluntary system of enlistment. That being so, I appeal to them to join the committees which have been formed to stimulate recruiting. That will be the test of their sincerity. From what I know of some members of the Opposition in this chamber, they hope that the Government’s recruiting scheme will succeed. Senator Keane uttered a remark, I think rather thoughtlessly, which ought to be answered. He referred to the officer class, but in the Australian Imperial Force there was no such thing, and I shall cite some figures in support of my contention. A member of this Senate went overseas with 1,031 Australians, in which 150 civil occupations were represented, the principal ones being: - Labourers 199, farmers and farm hands 109, miners and prospectors 70, timber workers 64, clerks 60, carpenters and joiners 27, horse drivers 18, pearlers 17, grocers 16, engineers 13 and butchers 13.
– ‘And some have said that the workers are disloyal.
– I have never said so, and I would’ not support such a statement. The officer class consisted of accountants, assayers, bank clerks, barristers, blacksmiths, bushmen, carpenters, civil engineers, civil servants, clergymen, clerks, coachmen, commercial travellers, dentists, doctors, draughtsmen, electrical engineers, enginedrivers, engineers, farm hands, farmers, fitters, graziers, grocers, horse drivers, indent agents, inspector of the Society for the Prevention of Cruelty to Animals, insurance inspector, labourers, master plumbers, mechanics, miners, navvies, orchardists, painters, pearlers, policemen, postal assistants, railway assistants, sailors, salesmen, school teachers, sheep overseers, sleeper hewers, station hands, stationmasters, surveyors, tailors, telephone operators, wool experts and two of no occupation. As regards the share which various sections of a unit took in action, perhaps these figures will convey some information. Of the 1,031 mentioned, 29.4 per cent. of the officers were killed and 29.3 per cent, of other ranks. Those are the figures in respect of an Australian unit, with an excellent record. Statements calculated to create suspicion and thwart the efforts of those rendering a national service are to be deprecated.
– I desire to make a few observations on the subject-matter of the bill, because honorable senators on both sides of the chamber have discussed subjects irrelevant to the measure and to tlie amendment moved by the Leader of the Opposition (Senator Collings). The Leader of the Opposition in the House of Representatives (Mr. Curtin) outlined the defence policy of the Australian Labour party very clearly and forcefully, and reiterated that that party believes in the adequate defence of Australia. What is that adequate defence, and what is the line of demarcation between adequate and inadequate defence? I say that that can only be judged in the light of circumstances. This Government, with the knowledge in its possession of the international situation, is deciding to expend £63,000,000 during the next three years for the defence of this country. I am not in a position to say that it is wrong, nor am I in a position- to 6ay that it is right. The Government must accept the responsibility for that because of its knowledge of the position, and I have no desire to hinder its programme; but what I do say is that we are strongly opposed to the Government’s defence policy being financed by overseas borrowing. I know from what I have read and learned from the past that such a policy is not in the best interests of Australia. During the debate reference has been made to profiteering, and although some honorable senators opposite have said that the Government will ensure that the people shall not be exploited, I know from actual experience during tlie Great War that unless the most stringent measures be taken, private enterprise will again use every effort to profit at the expense of the workers. We do not stand for profiteering, and I am pleased that Senator Brand, who has a military experience, supports our view.
– No one stands for profiteering. »
– The Government does; otherwise it would raise the money necessary for defence in this country and not from the pawnbrokers of England. This bill does not show that any portion of the money that is to be borrowed will be borrowed in Australia. It is wrong for the Government to ask Parliament to give to it a blank. cheque.
Speaking in the House of Representatives on the 2nd December, 1937, as a private member, the Minister for Defence (Mr. Street) said -
There are one or two observations that 1 desire to make on this vote. I have noticed that invariably the opening speeches on the defence vote are conciliatory in tone. Both sides express the desire to co-operate for the best defence of this country.
If the workers of this country are asked to give their lives for its defence, is it too much to ask that those who have the greatest financial stake in the country shall be required to foot the bill? Yet, instead of asking the wealthy classes to pay by way of tax for the defence of their possessions, this Government has made remissions of taxes to them. For instance, it has remitted £1,500,000 of land tax, not to the pastoralists and other primary producers, but to the wealthy land-owners in the cities. It is not too much to ask that taxes be raised again in order to provide what is required. The Government claims to have reduced taxes by £5,000,000.
– That claim was made last year. Additional taxes have been imposed this year.
– Direct taxation lias been reduced, but indirect taxation has been increased. Profits are made by every manufacturer, big or small. Profits should be taxed. The British Government has imposed such a tax.
– I remind the honorable gentleman that in the last war an excess profits tax was imposed in this country, and that not all of it has been paid, because the people taxed could not afford it.
– Any profits over a certain level should be taxed. In order to show the degree to which the private banking institutions of Australia have made undue profits I cite the report of the Royal Commission on Monetary and Banking Systems, which was set up by this Government. The report states -
The balance-sheets of the trading banks for 1030 show that the total shareholders’ funds were £70,000,000. The Commonwealth quarterly statistics show that for the last quarter of 193(1, the sum of f 290,000,000 was deposited by the public in Australia with the trading banks. Of this amount, £110,000,000 earned no interest for the depositor, and So per cent, of the interest-bearing deposits of £180,000,000 were at rates of from 1 to 3 per cent.
During tlie period 1931 to 1935, the trading banks have not made unduly high profits ; their total net income, as determined by the. Commonwealth Taxation Commissioner, during that period was £14,150,000, representing an annual average of 7.53 per cent, on capital, and 4.10 per cent, on shareholders’ funds.
Prior to that period, however, the trading banks as a whole have made large profits. In the period, 1893 to 1930 - a period of 43 years, including two major depressions, one minor depression, and the war - the published figures show that they made a total profit of £106,548,000, being an annual average of 10.27 per cent, on paid capital, and 6.28 per cent, on shareholders’ funds. These figures do not include amounts placed to inner reserves, though the use of these reserves contributed to the profits. .
Taking the published figures for the year, 1910 to 1929 - a period of twenty years - the average yearly profit was £3,480,000, with average yearly dividends of £2,525,000. The average yearly amount disclosed as paid to reserves was £785,000. The total profit for all the trading banks during this period was £09,600,000, equal to an annual average of 13.97 per cent, on paid capital, and 8.24 per cent, on shareholders’ funds. These figures do not include amounts placed to inner reserves. For the five years, 1926 to 1930, the total net income of all the banks, as determined by the Commonwealth Taxation Commissioner, was £27.007,000. This represents an annual average of 15.09 per cent, on capital, and 8/42 per cent, on shareholders’ funds. in 192:’), tho average paid by all banks as dividends to shareholders was 16.01 per cent, on paid capital. This represents 8.75 per cent, on shareholders’ funds. In addition, some profits were placed to reserve.
The Government has no plan to prevent the making of excess profits by private ‘ manufacturers of armaments and ammunition in this country. During the war, I spent four years in the Ministry on Munitions and had to make returns every 24 hours to the Minister. My experience shows that it is extremely difficult to curtail profits once profiteering has started. All that I have heard from Ministers is that “ the Government will take action to prevent excess profits”; no statement has been made as to what action will be taken. Flans to prevent profiteering must be formulated before the evil starts.
I emphasize my strong disapproval of the raising of moneys overseas when there are people in this country who have all that is needed to provide the money required. I recently received a letter from a friend dealing with the financial policy of Germany, where the credit of that nation is being used for its armaments programme. I am just as sincere as honorable gentlemen opposite in my desire for the preservation of democracy in Australia. I want to preserve the liberty of Australian men and women. It will not be preserved if the Commonwealth Government is allowed to continue its financial policy.
.- I welcome the defence programme, because I believe that Australia is worth defending. There are points of difference between honorable senators on this side and honorable senators on the Government side as to how money should be expended on defence, and we on this side disagree entirely with the Government’s view that the money necessary to meet the expenditure should be raised overseas. We are not unmindful of the fact that the Government has at its disposal expert advice, which members of the Opposition do not possess. We should realize, however, that the most efficient equipment will be useless unless we have the necessary man-power. Honorable senators on this side agree with the Government’s decision to rely on the voluntary system in establishing a militia force of 70,000 men. We suggest that if these men were offered conditions similar to those enjoyed by members of the police forces in the various States, no difficulty whatever would he experienced in securing a much greater number. I have sufficient faith in the Australian people to believe that every man would readily respond to his coun try’s call should Australia be attacked, and that an adequate army would rapidly be available without any necessity to resort to conscription. The Minister has outlined the very comprehensive defence programme contemplated by the Government. Although its experts are of opinion that the southern States are the least liable to attack, 1 hope »that the defence of those States will not be entirely neglected. Modern aircraft development places every part of this country within reach of attack. That fact was forcibly brought home to us only quite recently when three Royal Air Force .bombers flew nonstop from Egypt to Australia. Furthermore, we cannot rely wholly upon anti-aircraft guns to withstand attack from the air. An invader could establish, temporarily, at any rate, bases in remote parts of this country from which to launch bombardments on the more densely populated centres.
Dealing specifically with the amendment moved by the Deputy Leader of the Opposition (Senator Keane), I’ urge the Government not to resume the policy of borrowing overseas which was adopted by the Bruce-Page Government with disastrous results to this country. The policy of that Government, all honorable senators are aware, was “borrow, boom and bust.” As the result of it, the people of Australia were obliged to face a long period of misery, starvation and stagnation. Similar consequences will follow any resumption of that policy by this Government. It is absolutely unfair for any Australian government to mortgage this country to overseas interests in order that war mongers and financiers may be enabled to make profits. The section of the community which will contribute’ most to the defence of this country should we ever be attacked will be the workers. They will be called upon to give their blood, and, if necessary, to make the supreme sacrifice. That being so, it is not unreasonable to insist that the wealthy sections of the community should be called upon to make some sacrifice. It has been said that there is not sufficient money in Australia to enable the Government to finance its programme by raising loans in this country, but as £230,000,000 is now on fixed deposit in our banks, such a statement is groundless, If the owners of that wealth were patriotically disposed, we should have no difficulty in financing this defence programme with Australian money.
– The bulk of that money is not just lying idle in the banks.
– It cannot be said to be lying idle so far as its owners are concerned, because so long as it remains on deposit interest is paid on it. Why should not these people be obliged to subscribe according to their means towards the cost of defending Australia? If the Government, as it appears to contemplate, adopts a policy of borrowing overseas, it will land this generation and succeeding generations in an inextricable muddle.
– The Commonwealth would still be in debt even if the money wore raised in Australia.
– No debt would be created if we raised the money we require by imposing taxes on those sections best able to pay them. If the wealthy sections of the community are not prepared to contribute voluntarily, they should be compelled, through taxation, to make their wealth available to the Govern.ment. When all is said and done, what will our men be fighting for if we are attacked? It will be to defend the asset3 of the wealthy people of this country. That being so, those people should he called upon to make some sacrifice. We cannot shut our eyes to the fact that over-populated and land-hungry countries overseas are casting envious eyes towards Australia. Consequently, we must look to our defences. It has been said that all sections of the community are now being taxed to the limit of their capacity. If this Government had not remitted various taxes to the wealthy interests over the last few years, it would not now require to raise this loan of £10,000,000.
– To what taxes is the honorable senator referring?
– To the taxes remitted by this Government to assurance and insurance companies and the shipping companies, including the superincome tax and land tax. Had they been retained, those taxes would have provided more than £7,000,000.
I protest against the complaint made by Senator James McLachlan that honorable senators on this side left only one man to hold the fort in this chamber while the remainder attended a caucus meeting. That was the first I had heard of such an arrangement, but, even if the honorable senator’s assertion be true, we should not have been guilty of anything worse than I witnessed this afternoon when only one Minister and one honorable senator opposite were present at one stage of this debate. Furthermore, I point out that, owing to the practice adopted by the Government in throwing measures at us without giving us any opportunity to study them, many honorable senators on this side are obliged to withdraw from the chamber in order to obtain information concerning such proposals. Only yesterday, we witnessed the spectacle of the first and second reading of a measure being agreed to before we had actually received copies of the measure.
– All of those bills were discussed in the House of Representatives.
– Whether or not any measure was discussed at length in the other chamber, our duty as honorable senators is to consider it fully. In this matter, I believe the Government is callously using its majority; it does not hesitate to disregard the rights of honorable senators on this side. The Leader of the Opposition was attacked by Senator James McLachlan for having said that a number of men in this country were underfed and physically unfit through no fault of their own. All I can say is that the honorable senator, who denied that statement, avoids going to. places where he will see such conditions. If he availed himself of the opportunities which honora’ble senators on this side of the chamber take, to visit the industrial areas and the slums, he would not make such an erratic assertion.
.- I speak with the object of drawing attention to three remarkable statements made by honorable senators to-day. These have been repeated, and probably will continue to be repeated so long as there are Labour senators in this chamber. The first is the slur that the Leader of the Opposition (Senator Collings) and some of his followers have cast upon the manhood of Australia, and incidentally upon their own supporters. They have held up to scorn the physical condition of Australia’s manhood. If they go to any of the big factories, or the saleyards, or walk down Bourke-street or Pitt-street, and watch the young fellows there, they will see some of the finest specimens of manhood to be found in any part of the world. Yet the Labour party continually pictures Australia’s manhood as degenerate, consisting of weaklings who could not stand up against an enemy, because they have not been properly fed. I cannot allow that sort of assertion to pass. It is true that in tho last generation a great proportion of tho flower of Australia’s manhood was lost during the Great War, and to that extent the present generation has been weakened. There was a gap which could not be filled, and. a certain lowering of the physical standard resulted, but I do not know what the supporters of honorable senators opposite think when they read of the slurs which have been cast on the physique of men such as I see coming out of factories, and on the football fields, in their thousands. It is said, also, by honorable senators opposite, that, if these men were given something to defend, they would defend it, but that they have nothing to fight for now. That, also, is a completely incorrect statement. Their conditions are better even now than are those of the inhabitants of any other country. The way in which the scientific word, malnutrition, has been misrepresented by honorable senators opposite is disgraceful. It was not used by Mr. Hughes and others with the meaning that honorable senators opposite are trying to give to it. Mr. Hughes said, not that the mothers and children did not have enough food, but that their diet was not chosen and balanced in a scientific way.
– A man who is on the dole, or even on the basic wage, cannot do much choosing.
– Any one listening to the honorable senator would think that practically every one was on the dole in Australia, although he knows as well as I do that before any dole was paid in Australia at all there were more men out of work than there are at the present time. He knows also that, owing to the payment of the dole, the ranks of the unemployed have been recruited from all kinds of people who thought that that was the easiest way to get a living. I have as much sympathy with men on sustenance, or with those who cannot get work, as any one else has, and if I could do anything to help them I would, but every one knows that the unemployment figures have been greatly inflated by the inclusion of men who formerly got a living somehow, but now prefer to take sustenance rather than look for work. 1 do not deny that there is unemployment. It is pitiable that men should be unemployed; but the Commonwealth Government cannot carry the whole responsibility for the fact that some men in Australia are unable to get work. Slurs such as I have described should not be cast upon the workers of Australia by honorable senators ‘opposite, who affect to represent them, but, in effect, run them down, describing them as weaklings and degenerates.
– I object to the honorable senator’s statement that we, on this side, refer to the workers of Australia as degenerates. It is a complete misrepresentation of anything that has been said.
Tho PRESIDENT.- I suggest that Senator Leckie should withdraw the remark to which exception has been taken.
– If the honorable senator thinks that I was attributing that statement to him, I withdraw any such suggestion. I was referring to the general impression that I obtained from listening to the speeches made by honorable senators of the Opposition. The third point to which I wish to take exception is the assertion that the Government wants its supporters to be allowed to make profits out of the manufacture of munitions in Australia. Every one knows that th? Government will insist that no one makes profits from the supply of war materials.
– There is nothing in this bill or any other to prevent it.
– I should have thought the honorable senator would have rather welcomed a bill of this kind, seeing that it will give work in abundance to the men who, he says, want work. ¥et, he and his supporters are raising all the objections they possibly can to the Government going on with their programme. It is absurd to say that the Government proposes to put the work of munition-making in the hands of a few manufacturers. How do honorable senators opposite square their statements with the claim, that they want men put into work? The Government is now prepared, in addition to all the other money raised and spent, to expend four-fifths of another £10,000,000 in Australia. Whatever else that does, it will provide work for Australians. I should have thought that honorable senators opposite would have jumped with joy when they learned that another £8,000,000 was to be placed in the hands of Australia’s workers. What becomes of the cry that our men have no work? All that honorable senators do is to oppose the scheme with all their power.
– No; we object to the way in which the Government is financing it.
– If there was any sincerity at all in honorable senators on the other side, they would not care very much how the programme was financed, but would be glad that money was provided to make work for Australian people. That should be quite sufficient for them. The other cry. that the money is going to be spent for the benefit of a few manufacturers, who will be allowed to make immense profits out of it, is so much “ flam “. The Deputy Leader of the Opposition (Senator Keane) urges that all munitions and armaments should be made in government workshops. That is a most futile proposal, made without any knowledge of industrial or factory conditions. If the honorable senator knew anything about present conditions in Great Britain, he would be aware, first, that the British Government is insisting that everything made in the way of munitions shall be supplied at cost, and that the figures are examined by officers nf government departments to see that no profits beyond the ordinary are made. The honorable senator would know also that, despite the tremendous expansion of the workshops of Great Britain, factories having been built all over the country in the hope of overtaking the lag in the manufacture of munitions and armaments, the British Government’8 programme is still behind. Any one who thinks for a moment that the government workshops at Newport, Sydney, Hobart, and Adelaide, or elsewhere in the Commonwealth, can turn out a one-hundredth portion of the munitions that would be needed in wartime, has not even the most elementary knowledge of what he is talking about. I say that as one who has had some experience in manufacture. The statements with which I have dealt, as made by honorable senators on the other side, are the three biggest fallacies ever uttered in this chamber, and that is mY.ing a great deal.
– I should not have spoken but for Senator Leckie’s speech, and particularly his remark that the Government was providing work in abundance. If ft is, our people are not getting it. In Western Australia the railway from Perth to Kalgoorlie is constructed on a gauge different from the trunk lines in any other part of the Commonwealth. If Western Australia was invaded, how long would it take the Government to transfer a division, that is 25,000 men, over there, to safeguard our wives, mothers and children? I hope Senator Leckie is quite right in predicting the provision of work in abundance, and that the conversion of the Perth-Kalgoorlie line to the 4-ft. 8$-in. gauge is one of the works to be undertaken in the immediate future:
– Who promised to convert it?
– The Government supported by the honorable senator.
– It was the Western Australian Government.
– I trust that the relaying of that line on the standard gauge will be a part of the work which is to be provided to help our people.
. I realize that those who support this proposal already have their minds made up, and that nothing that we on this side may say, however new it be, will alter their fixed determination to vote for the bill as it stands. I rise mainly because Senator Leckie resorted to the old political trick of misrepresentation and exaggeration in respect of statements made by Opposition senators. The honorable senator belongs to the old political school, the members of which have been successful for many years in inducing the people of Australia to support their policy by playing upon their fears and prejudices. That old dodge is resorted to time after time in this Parliament when important subjects are being discussed. The honorable senator said that we on this side have cast a slur on the manhood of Australia.
– That is true.
– It is no more true than is the charge that Labour’s defence policy would not adequately protect Australia.
– The Labour party has not a defence policy.
– The present defence policy of the Government very closely approximates the policy propounded by the Leader of the Labour party over twelve months ago during the election campaign. Notwithstanding that the policies of the Government and the Opposition are largely in agreement, there are some among our opponents who will not admit that the Labour party has a defence .policy. In the past, defence rightly occupied an important place in the discussions in this Parliament. Even before federation, it was a subject to which attention was given by the governments of the several colonies. To-day, the subject of defence has to be discussed in the light of happenings during recent years, and even during recent months. Yet, only in the dying hours of tlie session has this important matter been brought before us.
– The present proposal is merely a continuation of the policy which was enunciated some years ago.
– It is a subject which should have been discussed more fully, but, unfortunately, attempts are made to play upon the fears of the people. Honorable senators who have read of the debates which have taken place in other countries will realize how general is ihe contention that it is necessary to indulge in an orgy of expenditure on defence. On every hand, we hear of potential enemies, as though almost at any moment one or other of them might strike a blow. Those tricks are resorted to in order to induce tlie people to agree to heavy expenditure on armaments. Some weeks ago, I said that the Labour party desired that expenditure on defence should be confined to governmental activities, and that we should view with suspicion any proposal to make available large sums of money to enable private enterprise to engage in the supply of defence material. I said then that there was in operation in all countries an organization which sought to achieve its purpose by creating a sense of fear among the people.
– Not in Australia.
– Australia is not different from other countries. There is in operation in all countries an organization whose chief purpose is to instil fear into governments in order that the market for war materials may be expanded.
– What is the name of the Australian organization?
– I believe that, the Government and its advisers are not so gullible as are some honorable senators opposite, who say that it is impossible for these organizations to exist in Australia, and I trust that steps will be taken to deal with them.
– Why should they exist here?
– The tentacles of the armament ring extend to every country.
– There is no armament ring in Australia.
– It is the business of armament manufacturers to see that the expenditure on armaments is maintained.
– The honorable senator is drawing on his imagination.
– The Government has decided to go overseas for th* money required for the defence of Australia. Honorable senators opposite know that those who are associated with the manufacture of armaments have other interests. Indeed, wherever it is possible fo make profits, they exert their influence.
– That is not possible in Australia.
– In the opinion of Senator Dein, nothing is possible in Australia. According to him, it is not possible for Australians to provide for the defence of Australia other than by men being willing to lay down their lives. “We on this side believe that Australia is capable of fulfilling every function of defence; that the resources of the country are sufficient to finance to the fullest extent the country’s defences, and that Australian, artisans are capable of making every appliance necessary for the development of the continent.
– Who has said anything to the contrary?
– If honorable senators will study the statement read by the Minister, they will realize that the Government itself believes that it is possible for Australians to defend their country. Yet some honorable senators who profess to be supporters of the Government made speeches expressing a contrary view. As I have said, the present defence proposals of the Government are similar to those contained in the policy speech of the Leader of the Labour party. Moreover, articles in the newspapers published in the various capital cities of Australia reveal that we are getting back to where the Labour party stood many years ago. It was the Australian Labour party which first brought under the notice of the people of Australia the need for a defence policy.
– That was all to the good.
– I am pleased to hear Senator Herbert Hays say that there is some good in the Labour party. I recollect the participation of the honorable senator and others in an election campaign in Tasmania, during which he urged the electors of that State not to return Labour candidates to the Senate.
– Because their policy was to take a referendum before adopting defensive measures.
– Because it was said that our policy was one of isolation. Fortunately, the people of Tasmania ignored that advice and collec tively decided that the defence policy of the Labour party was in the best interests of Australia.
– Therefore they returned, the Prime Minister?
– Where the electoral boundaries are so carefully drawn that the people as a whole are prevented from expressing their view on matters of policy-
– That is the very thing which has not happened.
– Voting as a nation for the return of senators, the people of Australia declared in favour of the policy of the Labour party. It is for that reason that the Government is now putting the Labour policy forward as its own, and is endeavouring to throw the people off their balance. I should not have spoken on this measure but for a desire, to make clear the position of the Labour party in regard to defence, so that the opponents of that party may not again he able to hoodwink the people of Australia. It is known that within the last few hours we were within an ace of having n new government. Even at this moment the Government is afraid to bring forward legislative proposals which were to have been dealt with before the Parliament went into recess, because they might be defeated.
– The remarks of the honorable senator have nothing to do with the bill.
– The Senate is being, asked to agree to the expenditure of a large sum by a government which may not bc in existence on the morrow.
– The honorable senator has a wonderful imagination.
– There is nothing imaginative about that. I venture to predict that before the conclusion of this sitting the statements I am making will be found to be 100 per cent. correct. No one would appreciate more than those gentlemen who at present hold ministerial positions the assurance that they are to continue in office during the recess. Because it is possible that, early in the new year, we shall be facing the electors, I have considered it advisable to chastise honorable senators opposite for their misrepresentation of Labour’s policy. It would be impossible for one, no matter how logical, convincing or eloquent he might be, to convert our friends opposite from their support, by every means in their power, of those interests on the other side of the world which live by the profits they are able to make from the lending of money. We know that a portion of this loan is to be raised overseas. That is the policy of the Government, and it is the reason for our opposition to this measure. I trust that, when next we are asked to agree to the raising of loans abroad, Senator Herbert Hays will support honorable senators who sit on this side of the chamber.
– I shall be guided by the circumstances.
– That is a stock phrase of my friend and those who are associated with him; they are always guided by the circumstances, and the circumstances are “ generally favorable to their disavowal of statements that they made on other occasions.
The amendment of the Deputy Leader of the Opposition (Senator Keane) should be agreed to by the Senate; the measure should be withdrawn and redrafted, in order to make other provision for financing the expenditure contemplated. We all subscribe to the money being made available from the resources of Australia, through the medium of the Commonwealth Bank.
– The speech of the honorable senator who has just resumed his seat consisted of misrepresentation of the whole position. He knows quite well that borrowing overseas is not the policy of this Government. The bill does not provide that the money required shall be raised overseas, although it may be necessary to borrow a portion of it abroad. Every honorable senator opposite .has stated that . he believes in the defence policy of the Government. Not one of those who have spoken has objected to it. The Leader of the Opposition (Senator Collings), who is the mouth-piece of his party, has said, “ We have no quarrel with the Government ; we subscribe to its defence policy in detail “. Senator Sheehan has attributed to honorable senators on this side sentiments that they have neither expressed nor inferred. This
Government has not borrowed money overseas for many years past.
– A loan of £2,000,000 was raised overseas last year.
– That was to defray a portion of the cost of cruisers purchased in Great Britain. The Government has been charged with having provided employment for workers overseas at the expense of Australian artisans, when as a matter of fact the Minister (Senator Foll) has specifically stated that the naval construction work contemplated will be carried out at Cockatoo Island dockyard. Honorable senators have enlarged upon the making of profits in the manufacture of arms and munitions. Senator Sheehan professes to believe that there are in Australia war mongers who are anxious that this country should launch out on a big defence expenditure so that they may thereby make profits. The honorable senator has drawn on his imagination. It is wrong of him to impute motives to the citizens of this country, who are not imbued with the idea of making profits out of the manufacture of arms and ammunition. On several occasions in this chamber the Deputy Leader of the Opposition has complained that orders for the manufacture of munitions and other war material have not been placed with railway workshops, and has said that men who » are out of employment should be engaged on works for the defence of this country. Does Senator Sheehan deny that he said that there is an organization in Australia advocating the expenditure of large sums on munitions so * that they may thereby make profits? Such a statement cannot be substantiated. The honorable senator must know that there are no facts whatever, either direct or indirect to support his allegation. I was surprised that the honorable senator should make such a statement.
– I had not intended to take part in this debate, but a few points have been raised by honorable senators, particularly Senator Leckie, which should be cleared up. Senator Leckie accused the Leader of the Opposition of casting a slur upon the manhood of Australia. by saying that the average physical standard of our men was so unsatisfactory that large numbers were being rejected when they presented themselves for enlistment in the militia and police forces. The honorable gentleman went on to say that one had only to walk down Pittstreet, Sydney, or Bourke-street, Melbourne, to see what a fine stamp of man the average Australian is. I point out, however, that the effect of malnutrition and shortage of food cannot be detected by such a cursory examination. How can men who are forced to exist on a relief ration of 7s. 6d. a week be healthy and fit? One need only have h. passing knowledge of medicine to know that the effect of malnutrition or semistarvation is not outwardly in evidence for at least two or three generations. 1 have read that one of the chief causes of the decline and ultimate fall of the Roman Empire was the lowering of the health and physical standards of the soldiers, due to malnutrition. After seven or eight generations of undernourishment, it was -found that Roman soldiers had so declined in physique and stamina that they were unable to wear The heavy metal breast plates and helmets which their forefathers had been accustomed to wear. in battle. Instead they had to wear leather jerkins and lighter headpieces.
There can be no doubt that if present social conditions continue in Australia the physical standards of future Australian generations will seriously decline. The unemployed to-day cannot secure nourishing foods in sufficient quantities to maintain themselves in good physical condition. In some instances relief workers, each with a wife and two or three children, are forced to exist on 25s. a week. As single men are working, on an average, one week in four, and some only one. week in seven, their income is not sufficient to provide them with the food to keep their physical standard at a decent level. Only three or four weeks ago, I came in contact with a typical instance of the hopeless condition in which many workers are placed. Finding himself unable to secure employment, a man accepted a job in the State Forestry Department and was sent to work in a forest plantation near Bega. He was not in good physical condition at the time, but he knew that if he did not accept the job he would be ineligible for relief. He stayed away for about twelve months. About a month ago he interviewed” me and informed me that a doctor had told him that he could not go back to the afforestation work. I had the man thoroughly examined by a doctor who informed me that he could not undertake heavy work because he had developed tuberculosis. That, possibly, is an isolated case, but it brought home to my mind the danger that will arise in future if the living standard to which so many people in this country have to conform be not raised.
Senator Leckie denied that there could be any profiteering by private enterprise under the Government’s defence proposals, and stated that in Great Britain a check was kept upon munition factories to ensure that they were not making undue profit. I thought that was an extraordinary statement, because I understand that Senator Leckie has had many years of experience as a manufacturer. We have only to take our minds back to the recent international crisis, a couple of months ago, to recall that according to the daily _ press there was extraordinary profiteering in Great Britain. So I am forced to the conclusion that Senator Leckie did not know what he wa3 talking about when he said that definite checks were kept on private enterprise in Great Britain. It is common knowledge that the price of such things as sandbags rose sharply during the crisis.
– We all know that.
– And we saythat the same thing would happen in Australia in similar circumstances.
– Measures will be taken to prevent that sort of thing from happening here.
– But Senator Leckie, who is supposed to have reached the age of reason, and is credited with some knowledge of the manufacturing business, said that an effective check was kept in Britain on private manufacture of armaments. Yet, as I have stated., there was a great deal of profiteering in Britain when war threatened. This Government claims that profiteering will- not occur in Australia. That may be partly true,because there is no private manufacturer of armaments inthis country. I point out, however, that private companies are engaged in the manufacture of steel and other materials required for munitions. For instance the Broken Hill Proprietary Company Limited manufactures steel to be used for the production of guns and shells. How does the Government propose to check the profits made by that giant industrial concern? Already that organization has done very well out of the present world-wide war scare. So great is the demand for steel that the Broken Hill Proprietary Company Limited cannot guarantee the fulfilment of orders or state when deliveries will be made. It can only say that orders will be executed eventually at the company’s price. Other manufacturers requiring iron or steel are clamouring vainly for a reduction of prices. It is easy to imagine how this state of affairs would be accentuated in the event of war. We could also expect profiteering in connexion with many other items of defence equipment - such articles, for instance, as hats, boots, puttees and other items of military uniforms. I donot wish to introduce the personal note in this debate, but 1 cannot forget that some very pro minent gentlemen in the United Australia Party Consultative Council did well out of the last war.
– Does the honorable senator know of any one who did?
– Yes, and so does Senator Dein. The history of these men is well known.
– That is a base insinuation.
– It is true. I can prove it.
– Senator Herbert Hays said that the bill did not stipulate that the money should be borrowed overseas. I advise him to study the measure, and also the speech made by the Treasurer.
– Senator Herbert Hays set out the position as it was stated by the Treasurer. The Government is not committed to borrow the money in Australia or anywhere else.
- Mr. Casey, referring to the financial side of the Government’s defence programme, said -
Nothing could be more definite than that. Apparently, this Government contemplates once again approaching the London loan market.
– If the money can be raised here, it will be.
– Through the Commonwealth Bank?
– Certainly. It will be floated in the same manner as all loans are raised.
– If the Go vernment would accept the amendment moved by the Deputy Leader of the Opposition, there would be no need to go abroad for the money. Honorable senators must be aware that for many years prior to 1929 a policy of borrowing overseas was followed, and that Australia’s finances were reduced to such a state of muddle that the then Government was unprepared to face the situation. When the Scullin Labour Government assumed office in 1929, it found that short-term loans were falling due every two or three months. - Consequently, it had to use all the means in its power to meet the situation. If there is one lessonwhich we should have learned from the last depression, it is that Australia should keep out of the London loan market. We can control our internal borrowing; with the assistance of the Commonwealth Bank and by direct taxation the money now required could be made available, instead of expecting posterity to meet rapidly growing interest charges on money expended for the protection of the present generation.
Reference has been made to the system of voluntary military training now in operation and to the recruiting campaign. Apparently, Senator Brand hopes for the best. I, too, hope for the best, but I fear the worst. I do not think that the campaign to increase the Militia Forces to 70.000 will be successful.
– The honorable senator wants it to fail.
-. - As the Leader of the Opposition pointed out, the Minister for External Affairs (Mr. Hughes) - sometimes known as “Mr. Black” - who is in charge of the campaign, has a bad reputation with a majority of the people. They have no confidence in him.
– The Government hates him but does not dare to get rid of him.
– The right honorable gentleman was once thrown out of Cabinet, but he got back and now is in charge of the recruiting campaign.
– He is the most popular figure in New South Wales to-day.
– If that be so, I should hate to be the least popular.
– Because the Labour party fears him, it hates him.
– I do not hate him. I merely regard him as senile - an old man on the decline.
– He has a better record than the honorable senator will ever have.
– I would not like my record to be anything like that of the right honorable member for North Sydney. I hope that. I shall die a member of the party in which I began, and that my principles will not change as his did. I remind honorable senators that, in 1929, the right honorable gentleman tried to form the “ All for Australia “ party. His only concern is for himself.
Sitting suspended from 6. . 15 to 8 p.m.
Question put -
That the words proposed to be left out (Senator Keane’s amendment) he left out.
The Senate divided. (President - Senator the Hon. J. B. Hayes.)
Majority . . . . 2
Question so resolved in the negative.
Original question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Motion (by Senator McLeay) agreed to by an absolute majority of the whole number of senators present, and no dissentient voice: -
That the Sessional Order giving precedence to general business after 8 p.m. on Thursdays, be suspended until Thursday, 15th December. 1938.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Foll) read a first time.
– I move-:
That the bill be now read a second time.
The expanded defence programme, which has been discussed to-day, involves increased expenditure on ordinary services, apart from capital services. These increases relate mainly to expansion of the Permanent and Citizen Forces. The programme entails further expenditure in the current year, and it is necessary to obtain Parliamentary authority for the expenditure involved. The bill now before the Senate covers an additional expenditure of £1,320.000 from revenue this year. The financing of this extra amount from the budget at this late stage involves some re-casting of the budgetary position. In order to provide for the additional £1,320,000 in the budget for the current year, the Government proposes to charge to the Loan Fund a portion of the £1,618,000 provided in the budget for capital services under new works.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without requests or debate.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Foll) read a first time.
– I move -
That the bill be now read a second time.
The object of this measure is to appropriate for defence expenditure of a capital nature the sum of £3,494,733, which represents the excess receipts of the Consolidated Revenue Fund for the last financial year. Honorable senators may recollect that by the Defence Equipment Act 1934, a Defence Equipment Trust Account was established, and various amounts have since been paid into it, with the approval of Parliament, with the object of relieving the revenues of later years. The purposes for which amounts standing to the credit of this account may be used are: -
The balance in the Equipment Trust Account at the 30th June last was approximately £1,000,000, which is fully committed in respect of orders placed in 1937-38. This is apart from the balance of £400,000 remaining in the Civil Aviation Account, which is also fully committed. Of the total amount to be appropriated by this bill, the Government proposes that £2,494,733 be set aside to meet expenditure for the current year, leaving a balance in the trust account of £1,000,000, which will be available towards expenditure in 1939-40. Honorable senators will find the items of capital works on which this amount is proposed to be expended set out on page 299 of the Estimates. The policy of treating the excess receipts in this way has been approved by Parliament in the past, and I commend the measure to the Senate.
Question resolved in the affirmative.
Bill read a second time and passed through its remaining stages without amendment or debate.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Allan MacDonald) read a first time.
– I move -
That the bill be now read a second time.
The bill provides for the payment of a subsidy at the rate of 10s. a ton on all artificial fertilizers used in the production of primary products other than wheat during the year ending the 30th June, 1939. Payment will not be made on any quantity in excess of 10 tons of fertilizer used by any one primary producer, and for the purposes of this legislation a partnership or a group of persons working under a sharefarmingagreement is to be regarded as one primary producer. The subsidy first came into operation in December, 1932, and, excepting the period from the 1st December, 1933, to the 30th June, 1934, has been continued at varying rates since that date. The rates of subsidy, the total amount paid, and the quantity of fertilizer used in each year, have been -
For the year ended the 30th June, 1938, no subsidywill be payable in respect of any quantity in excess of 20 tons used by any individual producer. This provision is responsible for the reduction of the quantity on which it is estimated subsidy will bo paid and of the total amount of payment. The fertilizer subsidy scheme has proved to be one of the best forms of assistance to primary producers introduced by the Government. It has resulted in a remarkable increase of the use of artificial fertilizers, which has enabled substantial reductions of prices to be made by the manufacturers of artificial fertilizers, and it has also been of great benefit in demonstrating to primary producers the advantages to be derived from a wider use of fertilizers in primary production, particularly on soils which are deficient in plant foods. The reduction of the price of superphosphate since the introduction of the scheme, due to the increased output, has been approximately £1 a ton. The extension of top dressing of pastures has also proved of material benefit, by creating a permanent increase of productive activity.Whilst the Government realizes the value of this subsidy to primary producers generally, it is faced with the necessity to reduce expenditure because of the heavy demands on revenue in other directions. It is desired, however, that this form of assistance shall be continued, particularly to the users of small quantities of fertilizer, and it has been decided to continue the subsidy in respect of fertilizers used during the year ending the 30th June, 1939, but to pay it only on quantities up to 10 tons used by any individual producer. It is estimated that the cost of the subsidy will be £215,000.
– The Opposition will support the bill, but I propose to move an amendment in committee.
– In the past, the Government has paid a subsidy on fertilizers used in the production of primary products other than wheat on quantities up to 20 tons purchased by each grower. I regret that at a time when expenses have increased it has been found necessary to reduce the quantity to 10 tons. Even a small farmer may use more than that, and should he do so he will be deprived of the subsidy on the quantity in excess of 10 tons. The saving effected will be only £47,000, and as a member of the Country party I object to the reduction. I agree with everything that the Assistant Minister (Senator Allan MacDonald) has said in regard to the benefit which the subsidy has been to persons farming in a small way, but the reduction is paltry, and unworthy of a national government.
.- One clause in the measure is unjust. A farmer may sub-let his property to a partnership consisting of ten farmers who will conduct it on the share system, but, under this measure, the partnership will be entitled to subsidy on only 10 tons of fertilizer ; in other words, each of such share farmers will be entitled to only 1 ton of fertilizer, or a concession of 10s. I consider that absolutely absurd.
Question resolved in the affirmative.
Bill read a second time.
Clause 1 agreed to.
Clause 2 -
In this act unless the contrary intention appears - “share-farming agreement” means an agreement between two or more persons to contribute towards the production of primary produce other than wheat by the provision of either land, labour, seed, manure or plant and to divide among them the proceeds of such production.
– Yesterday, I directed attention to the fact that we are continually providing financial assistance to those engaged in different forms of primary production, and that advantage is taken of such help by persons who do not need it. In order to ensure that the subsidy shall be paid only to primary producers who need it, I move -
That after the definition of “ share-farming agreement”, the following definition be inserted: - “ Taxable income “ means a taxable income within the meaning of section 6 of the Income Tax Assessment Act 1936-38.
– The Government is unable to accept the amendment, because it is only consequential upon a further, and more vital, amendment which the Leader of the Opposition (Senator Collings) proposes to move in connexion with clause 4, with the object of restricting the payment of this subsidy.
Question put -
That the words proposed to be inserted (Senator Collings’ amendment) be inserted.
The committee divided. (Chariman - Senator James McLachlan.)
Majority . . 2
Question so resolved in the negative.
Am en d m ent nega tived .
Clause agreed to.
Clause 3 agreed to.
Clause 4 (Amount payable to each State).
– Had my amendment on clause 2 been accepted I intended to move that this clause be amended as follows : -
After line 38, insert the following proviso: - “ Provided further that in calculating the amount which may be paid to a State under this section any artificial manure used by a primary producer shall be excluded unless he has lodged with a prescribed authority a statutory declaration (together with a copy thereof) in accordance with the prescribed form stating -
It is obvious now why certain questions as to which members of this Parliament are getting any benefit from subsidies of this kind were not answered to-day. In view of the vote just taken, it is useless for me to proceed further with this amendment. Apparently those honorable senators who claim to represent the primary producers have no sympathy with them, and as we on this side cannot alter the voting, I do not propose to waste time by moving any amendment to this clause.
– I cannot allow the statement of the Leader of the Opposition (Senator Collings) to pass unchallenged. His object was to debar certain primary producers from participating in this subsidy.
– The Assistant Minister dare not tell us which member of Parliament drew the fertilizer subsidy.
– The object of this subsidy is not to assist necessitous primary producers, but to encourage the use of artificial fertilizer for the purpose of pasture improvement. I cannot justify the basis on which it is proposed to distribute this subsidy more succinctly than by pointing out that if farmers were debarred from participating in it on the score of income we might deny it to one farmer, who, because of his efficiency, is able to earn a comparatively large income whilst his neighbour, who, because of his inefficiency in allowing his soil to deteriorate is unable to earn as large an income, will be entitled to the subsidy. Considering the primary object of this assistance, such discrimination, would be most- unwarranted.
.- Wheat-growers will not be able to participate in this subsidy. It is, I suggest, being given as a sop to the growers of barley and oats, because assistance in another form has already been provided for wheat-growers.
– Pasture improvement comes into it.
– Yes, but the primary object of this measure is to assist the growers of barley and oats. The Government is very parsimonious in limiting this subsidy to 10s. a ton on the maximum of 10 tons of fertilizer to any one applicant.
– The Assistant Minister (Senator Allan MacDonald) said he refused to let pass unchallenged my previous statement; I decline to allow his alleged refutation of that statement to pass unchallenged. On to-day’s noticepaper appeared a question in the name of Senator Keane asking the Minister representing, the Minister for Commerce if he would supply the names of members of both Houses of this Parliament who had been, or will be, financially interested in tho “Wheat Assistance Bill, and the Assistant Minister refused to answer that question by saying that it was not advisable for him to do so. We object to any share of this subsidy, which will be provided out of the national exchequer, to which the whole of the people contribute, going into the pockets of rich farmers who are well able to afford to purchase any fertilizer they might require. The Assistant Minister cannot get away with that sort of subterfuge.
Clause agreed to.
Clauses 5 to 10 agreed to.
Preamble and title agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Allan MacDonald) read a first time.
– I move -
That the bill bc now read a second time.
The purpose of this bill is to provide that in the payment of the fertilizer subsidy in respect of fertilizer used during the year ended the 30th June, 193S, a partnership, or a group of persons who have entered into a sharefarming agreement, shall be deemed to be one primary producer. The bill makes the necessary amendments in the States Grants (Fertilizer) Act 1937 . to give effect to this decision. When the amendments to which I have referred were being made, it was found that a small amendment was necessary in sections 4 and 7 of the principal act in order to make it quite clear that the subsidy is payable on fertilizer used during the year in respect of which the subsidy is paid. The wording of the principal act was not quite clear on this point, as it provided that the subsidy was payable on fertilizer “ supplied for use during the year “ or “used in respect of the production during the year “. As this amendment is all that the bill proposes, I ask honorable senators to agree to its second reading.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Foll) read a first time.
– I move -
That the bill be now read a second time.
The bill is almost entirely a validating measure, and can be described generally as a measure to obviate collecting sales tax, in sonic cases retrospectively, where, in the circumstances, it would be manifestly unfair to collect it. In the first place, it seeks to validate certain exemptions authorized by the Government in anticipation of an amendment of the law. Secondly, it seeks to remove any doubt as to the validity of certain exemptions administratively allowed. The provisions of the bill which are outside those two objects are of minor importance, and consist mainly of corrections of a few inadvertent errors and omissions which occurred in the drafting of earlier legislation.
The exemptions authorized by the Government in anticipation of this bill are provided for by clause 3, paragraphs (&), (<0» (<0; 0’), fa), (0 and («) (new item 131). I can assure honorable senators that these are all cases in which the taxation of the goods affected would result in glaring anomalies. The validation of exemptions administratively allowed is provided for by clause 3, paragraphs (g), (h), (i), (g), (i), («) and (<;) (new item 132). The drafting corrections are contained in clause’ 3, paragraphs (d), (/«), (»), (o), (p), (r) and (a).
There are only two other matters dealt with by the bill. Tho first of these is dealt with in clause 3(a), which relates to the definition of “aids to manufacture’”’. This will bring the definition in the act into line with the amended definition of the 23rd December, 1936, in the Sales Tax Regulations, and will ensure uniform application of the exemption of “ aids to manufacture “ as between registered and unregistered persons. The second of these further matters relates to books and printed matter of an advertising nature, and is dealt with in clause 3(/). This amendment re-expresses the exemption of books and printed matter to exclude from exemption advertising publications of a kind originally intended to be excluded. The amendment is considered desirable in view of a sharp divergence of legal opinion as to the scope of the existing exclusion of “ advertising matter”. The amendment is not retrospective.
With minor exceptions, the intention of the bill is not to extend or curtail the sales tax exemptions which arc at present actually being allowed. It is designed merely to give a legal footing to the understanding of taxpayers and consumers as to what is covered by the existing exemptions. I commend the bill to the Senate.
Question resolved in tlie affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Foll) read a first time.
– I move -
That the bill be now read a second time.
The bill covers items of expenditure for the year ended the 30th June, 1937, for which no specific approval has yet been given by Parliament, and which has been met temporarily out of the provision for Treasurer’s Advance, pending submission to Parliament in the form of the bill now before the Senate.
The amount voted for advance to the Treasurer for 1936-37 was £2,000,000; of that amount £99S,583 was used for ordinary departmental services and war services payable from revenue, whilst £535,619 was used for additions, new works and buildings, particulars of which will be contained in a subsequent measure.
Parliament is now being asked to appropriate £99S,583, but the total of the original Appropriation Bill has been exceeded by only £72,261.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without requests or debate.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Foll) read a first time.
– I move -
That the bill be nowread a second time.
An appropriation of £535,619 for items of expenditure under “Additions, New Works, Buildings, &c.”, is provided for in this bill. This expenditure was met from the vote “ Advance to the Treasurer “ during the year 1936-37.
.- Was it not possible for this and the previous bill to have been brought before us sufficiently early to enable honorable senators to examine their contents? We are asked to authorize the expenditure of large sums ofmoney without having had an opportunity to acquaint ourselves with the nature of the expenditure. Surely there is some way by which these bills could have been brought before us earlier !
.- in reply - I have a good deal of sympathy with the honorable senator. This bill was introduced in the House of Representatives several months ago, but it was not received in the Senate until a few minutes ago. Consequently I was not able to give honorable senators more time to consider it. I agree that the Senate should have ample time to study all bills that come before it.
Question resolved in the affirmative.
Bill read a second time and passed through all its remaining stages without amendment or debate.
– I lay on the table of the Senate the report of the Air Accidents Investigation Commit tee on the accident to the Douglas Air Liner Kyeema on the 25th October last. - By leave - The duty of the committee was to inquire into the cause of the accident, and to recommend to the Minister the action to be taken.
Among the many aspects covered by the report may be mentioned the following: - Cause of the accident; administra tion of the Civil Aviation Board in relation to certain matters; actions and decisions of certain members of the board; suggestions for additional safeguards.
So far as administration is concerned, the report of the committee is necessarily based on a review of a portion only of the activities and responsibilities of the Civil Aviation Board. In view of the criticism of the board and its members which has been made by the committee, the Government proposes that the method of future administration by the newly constituted Civil Aviation Department, and the suitability of personnel for executive posts in that department,shall be fully investigated by an independent body before the Government proceeds with the development of the department. All the suggestions and recommendations of the committee will be given the fullest consideration. Copies of the report may be obtained by honorable senators on application to the Clerk of the Senate.
.- I move-
That the bill be now read a second time.
The object of the bill is to insure those engaged in the wheat industry against certain contingencies to which they are subject and which, in the past, have caused dire distress, not only to those directly engaged in the business of producing wheat, but also to thousands of persons who are directly or indirectly dependent upon the industry for their means of subsistence.
In years gone by, when the major countries of the world operated under conditions approximating freetrade, goods moved freely from one country to another, and price remained fairly stable, that, in itself, operating as a natural corrective of any violent fluctuation, except in the emergency of war.
In pre-war years, prices found their natural level, and remained stable for fairly lengthy periods. For example, for the ten years 1904-05 to 1913-14, the lowest average price in any one year was 3s.1d. and the highest price was 4s. 4d.
The average for the ten years’ period was about 3s. 8½d. Wheat-growers were able to adjust their costs to prices varying only within those margins. During this period the industry in Australia made steady rather than spectacular progress, production increasing from 54,000,000 bushels in 1904-5 to 103,000,000 bushels in 1913-14. The Australian farmer became the pride of the land. The industry was solvent; the farmers contented and happy.
During tho war high prices for wheat encouraged inflated land values, and the production of wheat in areas unsuited for the purpose. With the growth of economic nationalism after the war, with the increase of tariffs, and the imposition of quotas, prices began to fluctuate out of all proportion to the normal working of the law of supply and demand. Such fluctuations have caused chaos in the industry, and changed wheat-growing from being the safest industry in the Commonwealth to the most hazardous. In some States almost one-half the number of those engaged in farming have had to be controlled in some form or another. Millions of pounds has been paid out of Commonwealth revenue to assist the industry, and last week this Parliament passed legislation designed to increase the amount a bushel received by the farmer for his wheat.
I think that all honorable senators will agree that, during the last few years, the wheat industry has been in dire distress, the cause of the trouble being mainly the violence of price fluctuations. The extent to which prices have varied will be noted from the following figures, “which show that between the years 1931 and 1938, the highest price was 5s. 9d. a bushel and the lowest price 2s. Id. a bushel. The figures are: -
No industry can possibly stand such wide fluctuations of price. When wheat prices are high, the price of land moves up in sympathy. Farmers make commitments for the purchase of land and complement on the basis of wheat at that price. If, a3 so often happens, the price of wheat falls by 25 per cent, or 50 per cent., farmers are unable to meet their commitments, mortgagees and implement manufacturers re-possess the land or implements secured to them, and the farmer and his family walk destitute off the farm ; they have lost their life savings, and are untrained for any other avocation. If mortgagees and implement-makers are loath to re-possess, payments are postponed, interest accumulates, and when wheat again rises to a profitable level, the farmer is too heavily involved to be able* to rehabilitate himself. The picture I have painted is not. that of an isolated case; it typifies hundreds of hard-working Australians who have been the victims of price fluctuations.
All honorable senators will agree that an industry is able to plan much better when its prices remain fairly stable. Last week this Government introduced a plan to increase the price to the producer, but, as I mentioned during the debate on that bill, the scheme does not go far enough. It does not deal with the problem of price fluctuation. Although the bounty will vary, and be greater when the price is low than when the price is high, it will still permit a wide fluctuati on of the price of whea t. I have worked out a table showing the approximate effect of fluctuating prices. Honorable senators will notice in this table that tlie higher the price, the lower the amount of bounty paid, and, to that degree, there will be a tendency towards equalization. Taking n. crop of 12S,000,000 bushels, the following table shows the amount of bounty which would be paid : -
Honorable senators will notice that the table still permits fluctuations of from 2s. 9d. a bushel to 5s. 2d. a bushel. If wheat remained at” 5s 2d. a bushel for any considerable period, there would be. a tendency for farmers to go in for wheat-growing.
The purpose of this bill is to provide an equalized price. The basis of the scheme is that when wheat is more than 3s. 8d. a. bushel, the farmer shall pay to an equalization fund, half the difference between the price at which the merchant purchased the wheat, and 3s.8d. When the price falls below 3s. 8d. the farmer will draw out sufficient of his credits to bring his price up to 3s. 8d.
If he has not sufficient credits in the fund, the fund will have power to borrow, on behalf of the farmer, sufficient to bring his price up to 3s. 8d.
I have had prepared the following table showing how the scheme would have worked out had it been introduced in 1926-27 and continued up to the present time: -
The above figures have been prepared on an actuarial basis. They show that during that period, the farmer would never have received less than 3s. 8d. a bushel, or more than 4s. 6½d., and that the fund would now be in credit to the amount of £10,530,000. During that period, the farmer would have had to borrow in respect of two years, but those borrowings would subsequently have been repaid. The table has been prepared on the basis that the Commonwealth contributed a sum of 3d. a bushel per annum to the fund. I have taken out an average of the proceeds of the levy to be imposed under the Wheat Assistance Bill, which passed through thisParliament.last week, and I estimate that over a period of years, that bill will provide an average of 3d. a bushel for the wheat farmer. As I said previously, this payment will be likely to increase at times to as much as 7d., but as the price of wheat rises and the crop increases above the very low level of this year, the amount will be a diminishing one, and over a period of years, will average 3d. a bushel on all wheat produced and sold. Therefore, for the purpose of this table, I have assumed that 3d. a bushel will be paid into the fund on every bushel sold, and that the farmer, instead of receiving about 2s.10d. a bushel in one year, and, perhaps, 5s. 2d. in the next year, will get an equalized price of about 3s.8d. a bushel over the whole period.
I have also prepared, without the aid of an actuary, a rough table showing the price which would have been actually received over the sameperiod under the wheat legislation which was passed last week. Under the first table the assumption was that 3d. a bushel had been incorporated each year, and, under the second table, the actual amount incorporated was that whichI estimate would have been produced as the resultof that act. The second table is as follows: -
– How could this scheme affect the present act?
– The only alteration necessary would be to divert the funds which, under the present legislation, will.be paid to the States, and distributed on a production basis, to the board proposed under this measure, so that the funds instead of being administered by the States, would be administered by this board. The board could be a body corporate, which would have power to borrow, and, in years of low prices, could borrow sufficient to bring the price to each farmer up to 3s.8d. a bushel.
– It would have to be compulsory, like a compulsory pool.
– It would be in no sense a pool, but it would provide for individual farmers’ insurance. The money at all times would be the property of the farmer. The only restriction would be that, when the price payable to the farmer was over 3s.8d. a bushel, he would be compelled by law to provide a portion of that price as an insurance against the contingencies provided for in the bill. The insurance fund would be subsidized by the provision of the proceeds of the collections under the flour tax, which over an average period of years would approximate 3d. a bushel per annum.
SenatorFraser. - Would the provision dealing with the £500,000 be retained?
-That matter has been dealt with by this Parliament, and, as far as this bill is concerned, the money would, of course, be appropriated out of general revenue, being the proceeds of a particular tax. If at any time the Government altered that legislation, it would be necessary to obtain the money from other sources.
SenatorClothier. - Under this scheme the farmers would be guaranteed 3s. 8d. a bushel?
– Yes, over a period of years. If history repeated itself, this fund would be able to pay in every year at least 3s.8d. at outports.
I mentioned that the fund would be subsidized by the proceeds of the flour tax which would represent, over an average period of years, approximately 3d. a bushel. I submit that this would not be in any sense a gift to the industry. It would be a payment to compensate the industry for the disability that it suffers as the result of the protection of other industries. I think that it is generally agreed that the benefit of protection imposes a cost, because, wherever there is a benefit, there must be a cost. It has been found by economists, and it is agreed I think, by most Australians, thatthe export producers bear a very substantial proportion of that cost. In The Australian Tariff, at page 69, Professors J. B. Brigden, D. B. Copland and L. F. Giblin, and Messrs. Dyason and Wickens, stated -
Wo may infer that the net burden (of protection) on export industry averages about 8 per cent. and would be met by a rise in prices of9 per cent. This is probably very nearly true of wheat. Nine per cent. on a cost price of 3s.6d. is over 3d. a bushel.
Therefore, the payment into the fund of this amount, which, over a period of years, would average 3d. a bushel, would do nomore than compensate the wheat industry for the disability which it suffers as a result of the protection of other industries. In other words, the wheat industry would merely be placed within the category of industries which are protected to maintain an Australian standard. The wheat industry would step into the group of Australian protected industries.
I have commenced my second-reading speech on this bill because it involves im portant principles, and because I desire honorable senators to have an opportunity to consider them thoroughly. The memorandum which accompanies the bill explains its provisions, and the booklet, which most honorable senators have in their possession, will aid them in appreciating the principles of the measure. I ask leave to continue my remarks at a later date.
Leave granted; debate adjourned.
Senator McLEAY (South Australia -
Vice-President of the Executive Council). -by leave - In view of the statements recently made in the press and elsewhere, the Government desires to announce -
Under these circumstances, it is not necessary to proceed with the bill introduced in the House of Representatives, but a new amending bill will, as indicated, be brought forward in due course. The commission will confer with the approved societies regarding preliminary administration expenses incurred by the societies during the period up to the time of the commencement of contributions.
Motion (by Senator McLeay). - by leave - agreed to -
That leave of absence be granted to every member of the Senate from the determination of the sitting this day to the day on which the Senate next meets.
Motion (by Senator McLeay) agreed to-
That the Senate, at its rising, adjourn till a day and hour to be fixed by the President, which time of meeting shall be notified to each Senator by telegram or letter.
– I move-
That the Senate do now adjourn.
. - I am in entire agreement with the Leader of the Senate (Senator McLeay) in the kindly thoughts which he has expressed. On behalf of the Opposition, I extend to you, Mr. President, our best wishes for the Christmas period, and our thanks for the forbearance which you have shown in some of the difficulties which we have occasionally caused. We also extend our thanks to the members of the Parliamentary staff,including the Hansard staff, whose valuable and efficient services are much appreciated. The members of the Opposition extend to every honorable senator seasonable greetings. Perhaps the harshest thing we can say to honorable senators opposite is that we hope that we shall soon have the opportunity to extend to them, as members of the Opposition, the kind feelings which they have expressed concerning us. I am sure that the Leader of the Senate will join with me in expressing our thanks to those members of the parliamentary staff whose duties are outside the chamber, including the refreshment room staff, who, because of their efficiency, enable our work to be conducted smoothly. Although Senator Grant is our opponent politically, those who know him regret that he is ill. We are particularly sorry because we know the cause of his indisposition, but we trust that he will so.on regain his health and strength, and that he will be with us again when we re-assemble. The Deputy Leader of the Opposition (Senator Keane) desires tobe associated with the good wishes which I have expressed on behalf of the Opposition.
The PRESIDENT (Senator the Hon. J. B. Hayes). - I thank honorable senators ‘ on both sides of the chamber for their good wishes, and for the great assistance which they have given to me during a somewhat strenuous period of the session. I appreciate the kind remarks of honorable senators concerning my colleague, Senator Grant, and I shall see that they are conveyed to him. I believe that he hopes to be with us when we re-assemble. I thank the officers of the Senate, the Hansard staff, and the parliamentary staff generally for the services which they have rendered, and I trust that they will have a happy Christmas and a prosperous new year.
Question resolved in the affirmative.
The following papers were pre sented : -
Northern Territory - Policy of Development - Copy of Statement made in the House of Representatives on 8th December by the Minister for the Interior.
Northern Territory Acceptance Act and Northern Territory (Administration) Act-
Ordinance No. 15 of 1938 - Encouragement of Primary Production.
Crown Lands Ordinance - Regulations amended.
Protocol regarding the Immunities of the Bank for International Settlements - Brussels, 30th July, 1930.
Customs Act - Regulations amended - Statutory Rules 1938, No. 111.
Customs Act and Commerce (Trade Descriptions ) Act - Regulations - Statutory Rules 1938, No. 109. flour Tax (Wheat Industry Assistance) Assessment Act - Regulations - Statutory Rules 1938, No. 112.
Seat of Government Acceptance Act and Scat of Government (Administration) Act - Ordinances of 1938 -
No. 28 - Companies (Liquidation).
No. 29 - Money Lenders (No. 2).
No. 30 - Advisory Council.
No. 31 - Police Superannuation (No. 2).
No. 32 - Scat of Government (Administration ) .
No. 33- Industrial Board (No. 2).
Workmen’s Compensation Ordinance -
Workmen’s Compensation Rules.
Senate adjourned at 9.33 p.m. til) a day and hour to be fixed by the President.
Cite as: Australia, Senate, Debates, 8 December 1938, viewed 22 October 2017, <http://historichansard.net/senate/1938/19381208_senate_15_158/>.