Senate
14 September 1939

15th Parliament · 1st Session

  1. Senate
  2. 15th Parliament
  3. 1939

The President (Senator the Hon J. B. Hayes) took the chair at 3 p.m., and read prayers.

page 529

QUESTION

EXPORT OF APPLES AND PEARS

Senator ALLAN MacDONALD:
WESTERN AUSTRALIA

– Is the Minister for Commerce aware that the existing freight contract relating to the export of apples and pears to the United Kingdom has been suspended as from the 4th September? Can he give an assurance to the representatives of the apple and pear growers that every consideration will be given to the provision of adequate refrigerated space for the export of their fruit?

Senator McLEAY:
Minister for Commerce · SOUTH AUSTRALIA · UAP

– The answer to both questions is in the affirmative.

page 529

WHEAT AND BARLEY

Assistance to Growers

Senator JAMES McLACHLAN:
SOUTH AUSTRALIA · UAP

–

Seeing that the Government has decided to acquire all wheat now held in Australia, except that held by farmers, will the Minister for Commerce inform the Senate what advance the Government intends to make to farmers, and whether the Minister will see that the initial advance is as high as possible? What action does the Government propose to take to protect the interests of farmers who have been forced to sell their wheat since the outbreak of war at prices much lower than those ruling to-day, or the figure they would he likely to receive from the pool ? Does the Government propose to treat wheat now held in Australia as a pool separate from the 1939-40 crop? In view of the difficulties in making sales of barley overseas, and the fact that home consumption sales will be considerably below the cost of production, will the Government consider the matter of fixing a reasonable homeconsumption price for this grain. Will the Government consider the question of having barley graded on the following lines : - No. 1 quality, No. 2 quality, and feed quality?

Senator McLEAY:
UAP

-I can assure the honorable senator that all those matters are receiving the earnest consideration of the Government. A body known as the Central Wheat Committee has been set up. The members are now in Canberra, and they will consider these matters to-morrow. Members of the Cabinet have also given careful consideration to the points raised. As the questions asked are of much concern to a large number of people, I suggest that the honorable senator should place them on the noticepaper, so that I may furnish replies in detail.

SenatorFRASER.- In view of the fact that a Central Wheat Committee has been appointed and that the personnel includes representatives of the wheat agents, will the Government give further consideration to the wheatgrowers in Western Australia by giving them directrepresentation on the board through their organization?

Senator McLEAY:

– I point out that the committee consists of nine members, two of whom represent the wheat-growers. The Government does not propose to increase the central committee beyond that number. I have asked the Government of Western Australia to nominate a panel of five in that State, and the appointment of that body should ensure that all interests in Western Australia will be protected.

Senator Gibson:

– Will that be a State advisory committee?

Senator McLEAY:

– The State committees will act under the jurisdiction of the central committee in an advisory and supervisory capacity.

Senator FRASER:
WESTERN AUSTRALIA

– Is it a fact that the State Government will appoint only one representative on the panel of five, and that the Commonwealth Government will appoint the other four?

Senator McLEAY:

-Commonwealth Ministers in consultation with the Ministers for Agriculture in the States will make the selection, but I can assure honorable senators that nominations by the State Ministers will carry due weight.

page 530

QUESTION

PRICES OF COMMODITIES

Preventionofprofiteering

Senator FOLL:
QUEENSLAND · NAT; UAP from 1931

– On the 13th Septem ber, Senator Cameron asked the Minister representing the Treasurer the following questions : -

  1. In connexion with the Government’s scheme for price control during the war, does it intend to take any action against any person or persons controlling industry suspected of, or known to be responsible for, deliberately restricting the production of commodities with the intention of increasing prices or maintaining prices which are already high?
  2. Docs the Government propose to have the prices of commodities fixed from time to time during the war whereby producers will be protected from the competition of those who employ cheap sweated labour, and consumers from producers who control monopolies!

The Treasurer has supplied the following answer to the honorable senator’s questions : -

Existing legislation makes adequate provision for dealing with profiteering and the Government will not hesitate to use its powers to protect both consumers and producers from exploitation.

page 530

QUESTION

REFUGEE MIGRANTS

Senator AYLETT:
TASMANIA

– Will the Minister for the Interior state whether the Government is still admitting refugee migrants notwithstanding the existence of a state of war? If the answer is in the negative, what is the position with regard to refugees now en route to Australia?

Senator FOLL:
Minister for the Interior · QUEENSLAND · UAP

– The migration of refugees from enemy countries, from which most of them have been coming, will cease, but any refugee migrants or others now on the water or who have received landing permits-

SenatorCollings. - Will probably be interned.

Senator FOLL:

– Not necessarily. Many of them are so pleased to escape from the conditions that they have experienced in Europe that they will probably be glad to become loyal Australians.

Senator ARMSTRONG:
NEW SOUTH WALES

– How many refugee migrants have been interned?

Senator FOLL:

– I cannot give that information.

page 530

QUESTION

WAR BOOK

Senator BROWN:
QUEENSLAND

– Will the Minister representing the Minister for Defence state when the War Book will be available?

Senator FOLL:
UAP

– I do not think that it will be made available at all.

Senator BROWN:

– I referred, not to the book containing secret documents, but to the one containing information for the guidance of the general public.

Senator FOLL:

-I thought that the honorable senator referred to the War Book which contains confidential instructions as to what is to be done in an emergency. I shall make inquiries and sec whether the book to which the honorable senator refers can be made available to him.

page 530

QUESTION

WAR FINANCE

CreationofCredit.

Senator DARCEY:
TASMANIA

asked the Minister representing the Prime Minister, upon notice -

  1. In view of the urgent need to ensure the adequate defence of Australia, and as the interest burden on the existing national debt absorbs so high a proportion of national revenue, will the Prime Minister, to ensure that our people shall not inherit a legacy of war debts, take immediate steps to instruct the Commonwealth Bank Board to make available to the Government whatever money is necessury to finance Australia’s war activity, in accordance with the statement in the report of the Royal Commission on the Monetary and Banking Systems of Australia, paragraph 504, as follows: -Because of this power, the Commonwealth Bank can lend to the governments or to others in a variety of ways, and it can even make money available to governments or to others free of any charge “ ?
  2. If the Prime Minister will not take this stop, will he state his reason ?
Senator McLEAY:
UAP

– I refer the honorable senator to the statement on this subject, made by the Treasurer (Mr. Menzies) when delivering his budget speech on the 8th September. On that occasion, the right honorable gentleman said -

A great deal of the agitation is founded upon a quotation of which all honorable members have heard, from the report of the Royal Commission on Banking. After referring to the power of the Commonwealth Bank to create money by printing and issuing notes as legal tender, paragraph 504 of that report goes on to state -

Because of this power, the Commonwealth Bank is able to increase the cash of the trading banks in the ways we have pointed out above. Because of this power, too, the Commonwealth Bank can increase the cash reserves of the trading banks: for example, it can buy securities or other property, it can lend to the governments or to others in a variety of ways, and it can even make money available to governments or to others free of any charge.

That most satisfying statement is torn from its context and presented to us, and then we are asked in effect: “What sort of people are you? You have been told by a royal commission that you can obtain any amount of money without charge. Why don’t you get it? “ The belief, apparently, is that if we did get money in this way the result would be thatwe would have no taxes, no public borrowings, and, to put it in the old phrase, “ everything in the garden would be lovely “. Of course, there is no exercise better understood, even here, than the exercise of taking a statement out of its context. That is what has been done in this case, because if honorable members will read on in the report, they will find an amplification of that statement, which, of course, exposes its limitations as clearly as can be. I do not propose to read the exact passages in the report, but I commend to honorable members the succeeding paragraphs down to paragraph 513. The position, of course, is that exactly the same kind of limitation exists upon the power of the Commonwealth Bank to inject credit into the financial structure, as exists in relation to its power to print notes and make them legal tender. When the point of prudence is passed then prices and costs are increased, and the value of the money in cir culation is diminished. Consequently, what any central bank has to do in any country is to adjust its credit policy to what it believes to be the economic circumstances of the moment, always keeping in mind the position of the trading banks; the position of credit facilities in the community; the degree to which there may be an excess of unemployment over what might be described as the irreducible minimum; and the extent to which prices are moving up or down. When it does all these things, then, if it is a good and competent central bunk, itcan be trusted to exercise its powers in such a way as to iron out both the acute booms which occur from time to time, and those serious depressions from which we periodically suffer.

page 531

QUESTION

PRICE OF GOLD

Effect on Cost of Living.

Senator CAMERON:
VICTORIA

asked the Minister representing the Treasurer, upon notice -

  1. To what extent, if any, will the present increased price of gold affect adversely the cost of living of persons in receipt of fixed incomes, pensions and rates of wages which are not adjusted periodically in accordance with the cost-of-living figures?
  2. If the cost of living is, or the persons referred to are, affected adversely, is it the intention of the Government to take any action in the matter?
Senator McLEAY:
UAP

– The Treasurer has supplied the following answers : -

  1. The cost of living is not directly affected by the increased price of gold. The increased price of gold is a reflection of the depreciation of Australian currency in terms of “ neutral “ foreign currencies outside the sterling area. To the extent that we continue to import from countries outside the sterling area goods the cost of which enters into the Australian cost of living, some increases may be expected in the future, but it is not considered likely that the effect on the cost of living will be substantial so far as the ordinary necessaries of life of the average Australian family are concerned. The increased price of gold is unlikely to have any direct effect on the cost of the commodities imported from countries within the sterling area.
  2. Should there be any slight increase of the cost of living of “ persons in receipt of fixed incomes, pensions and rates of wages which are not adjusted periodically in accordance with the cost-of-living figures “ because of the factors referred to, it is unlikely that the Government could take any effective action other than to see that any increases of price were fully justified by real increases of cost. The Government has already announced in outline the measures it proposes to take in order to control prices and prevent profiteering. A Controller of Prices has been appointed, and proclamations have already been issued to control the prices of many commodities. The administrative machinery is now being rapidly established, and the public may have every confidence that prompt action will be taken to implement the Government’s price-control policy.

page 532

CAPTAIN T. P. CONWAY

Senator BRAND:
VICTORIA

– I should like an assurance from the Leader of the Senate that the motion standing in my name -

That the report of the select committee appointed to inquire into and report upon the discharge of Captain T. P. Conway from the Australian Military Forces be adopted, will he dealt with before the Senate goes into recess. A week has elapsed since the report of the select committee was presented. Should the Senate rise this afternoon, there will be no opportunity to discuss the motion this week.

Senator McLEAY:
UAP

– If I can assist the honorable senator, I shall do so, but I am not certain what urgent . business has still to be dealt with.

page 532

QUESTION

ESTIMATES AND BUDGET PAPERS 1939-40

Debate resumed from the 13th September (vide page 472), on motion by Senator McLeay -

That the papers be printed.

Senator COURTICE:
Queensland

– The discussion on this motion has already ranged over a wide field, and I do not propose to traverse the ground that has already been well covered by honorable senators, particularly those on this side of the chamber. I am, however, disappointed at the general attitude of honorable senators opposite. At the outset of the discussion, the Opposition stated clearly that it was prepared to co-operate to the fullest extent with the Government in meeting the difficulties that confront the nation at this time. Because they are unable to understand the motives which actuate us, honorable senators opposite practically sneer at the offer of the Labour party to co-operate with the Government. I trust, however, that as the result of this debate, they will be satisfied that the Opposition sincerely desires to assist the Government in the difficult times ahead. Perhaps, however, the present attitude of ministerial senators is not inconsistent with their general attitude towards the

Labour party. Apparently some of them are content to remain nothing more than party hacks in spite of the present period of crisis.

In view of the exceptional circumstances existing at the moment, the budget proposals are reasonable. I realize, of course, that this budget is only of a tentative nature, and that supplementary proposals will be introduced in the near future. The Government’s new taxation proposals appear to me to be fairly well balanced. I urge the Government, however, to be constantly on the alert and to remain prepared for all possible developments in the present crisis. It must not be caught off its guard as happened at the commencement of the last war. In this connexion, I refer particularly to the prevention of profiteering. The Labour party will do everything possible to assist the Government to protect the people who would like to be assured that we are determined to see that the burdens arising from the war shall be distributed fairly, the greater share of the load being placed on the shoulders of those best able to bear it. If the Government adopts that policy, it will have no difficulty in securing the co-operation, not only of the Labour party but also of the people as a whole. I assure Senator Dein that the Labour party is sincere in its offer to co-operate with the Government. In a time like the present all sections of the community must sink their differences and put forth their best efforts for the common good. I agree with the Leader of the Opposition (Senator Collings) that the best way in which the Opposition can play its part is by retaining its separate entity and keeping constant watch on the administration of the Government.

Senator Dein:

– A national government would not prevent, adverse criticism by the rank and file.

Senator COURTICE:

– A government composed of representatives of different parties would have greater difficulty in coming to prompt decisions. Thus the implementing of a national policy might be impeded. Much has been said as to the part which Australia can best play in order to help Great Britain in the present war. I cannot speak as an expert on that matter, but I commend to the Government the views expressed by

Senator Brand, a veteran soldier. We should be reluctant to adopt any proposal which would deplete this country of its manhood. An adequate population is one of our best safeguards. It is impossible to assess the real loss to the nation that resulted from our casualties in the last war, when 60,000 Australians made the supreme sacrifice. It cannot bc denied that the loss of so many men, the cream of our manhood, very seriously affected the growth of our population. We should now bear that experience in mind, and do our utmost, despite the clamouring of certain people, to avoid any move which would deplete this country of its young men. Our soldiers should not be sent out of this country on active service, unless such action be absolutely unavoidable. We must at ali times encourage the increase of our population if we hope to hold this country. That fact is emphasized in the present circumstances. Nevertheless, all of us feel that Australia must be prepared to do its utmost to win this struggle. Our hands are clean, and our consciences clear. We know that everything has been done during the last few years by the peoples of the British Commonwealth of Nations to avert the disaster which has fallen upon the world.

Much has been said in this debate concerning the financing of Australia’s defence activities. On the one hand the ultra conservatives suggest that we can carry on as we did years ago, and allow powerful financial interests to exact just as much as they like from the national resources of the country and the energies of the people. I remind those honorable senators that the people of Australia will no longer stand for such a system. We must immediately discard all ideas of that kind. Unfortunately, however, this Government has not lifted a finger to prevent the exploitation of our industries by big financial institutions, although such exploitation has played a big part in retarding industrial development. I urge the Government in the present crisis to maintain interest rates at a reasonable level. It is ridiculous to suggest that in some mysterious way wealth can be tapped from a hidden spring upon which we can draw whenever we feel disposed. That is nonsense, and the sooner we cease think ing that money can be obtained in that way the better it will be for all concerned. I believe that there is a reservoir of credit upon which we can operate, but I say deliberately that that reservoir can be replenished only by the energy, sacrifice and hard work of the people. When that reserve is tapped it must not be depleted unduly. There are occasions when the credit of this country is considerable, and in the event of adversity it can be used to a. reasonable degree. But I believe that as a general principle we must earn all we possess, and that a reserve of credit is produced only by hard work. If the Government will view our economic and financial position from that standpoint that should be to our advantage. I cannot understand the attitude of those whom we designate conservatives. Every reform has emanated from the workers or their representatives, and any innovation in the interests of the people has never had the support of the conservative section of the community. Any reform that we have gained has been due to the work of the common people.

Senator Dein:

– We represent the common people.

Senator COURTICE:

- Senator James McLachlan said a few days ago “ Why, of course, we can find money in time of war because we are in danger “. During the depression period many farmers and workers were faced with financial disaster; but some of those who are now supporting this Government refrained from assisting to tap the reserve of credit that was available.

Senator A J McLACHLAN:
SOUTH AUSTRALIA · NAT

– The spring was nearly dry at that time.

Senator COURTICE:

– Since then the Royal Commission on Monetary and Banking Systems has reported that our reserve of credit was greater at that time than it va3 said to be, and it is evident that the ‘Commonwealth Bank could have treated the Scullin Government more sympathetically than it did and thereby obviated a great deal of suffering. The party then in opposition did not act in the best interests of the country. I have great regard for the ability of Mr. Scullin and Mr. Theodore, and when the Scullin Government was in power those two gentlemen were greatly concerned with the economic position of the farmers and the workers. That Government did all that it could to prevent the importation of commodities not actually required, in an endeavour to bring about financial equilibrium and to rehabilitate industry in Australia. The Scullin Government bitterly assailed the action of Sir Robert Gibson, who at that time was Chairman of the Commonwealth Bank Board, when he refused to accede to its request. The Scullin Government sent the following communication to the board : -

The Commonwealth Government feels that you should be informed that the Government cannot be deflected from its definite policy by the unwarranted action of the Bank Board.

The Government intends to proceed with its parliamentary programme.

The programme included the raising of £18,000,000 by a fiduciary issue through the Commonwealth Bank, and the export of the Commonwealth Bank’s gold reserves to London, to meet Australia’s debts falling due there. Sir Robert Gibson opposed both proposals, which were subsequently defeated in the Senate. The Scullin Ministry’s attack on the Commonwealth Bank Board was at that time described by leaders of- the Opposition as an event of supreme importance. The then leader of the Opposition, Mr. Latham (now Sir John), said that they were fundamentally wrong. “ If they were made the basis of Government policy,” he said, “they would wreck the whole financial and economic structure of the community.” The move was described at the time by the leader of the Country Party (Dr. Page), as an “attempt to smash the Commonwealth Bank and the monetary system of the country.” Obstructed by the Senate, the Scullin Ministry went to the people in December for a mandate to control the Commonwealth Bank.

Senator Dein:

– It was not the Senate at all; the members of the Labour party were responsible.

Senator COURTICE:

– Those who opposed the Scullin Government failed to appreciate the serious position in which the people were placed during the depression period, and eventually took advantage of the circumstances to defeat the Government. Had they adopted the attitude which Senator Dein and others say is justified in time of war, a great deal of suffering would have been avoided.

Senator Allan MacDonald:

– Some members of the Labour party assisted to defeat the Scullin Government.

Senator Keane:

– The then Leader of the Opposition had a brother on the Bank Board and he primed the Opposition.

Senator Foll:

– That is not so.

Senator COURTICE:

– Those who opposed the Scullin Government did not do anything to assist the Commonwealth during the depression. They did not pay sufficient regard to the interests of people who were in the industrial firing line - the workers and their wives and children as well as the many thousands of persons engaged in farming pursuits. The Scullin Government’s proposal to extend credit in order to tap the socalled reservoir of social credit was fully justified, and the Opposition would have been right in supporting it. The recovery which Australia made from the depression was due mainly to the financial emergency legislation introduced and passed by the Scullin Administration. The country is now reaping the benefit of that policy.

Senator Gibson:

– Does not the honorable senator mean the policy of the Commonwealth Bank Board?

Senator COURTICE:

– No ; I mean the policy of the Scullin Government. If the policy outlined by Mr. Theodore, the then Treasurer, had been adopted, a great deal of suffering by the people would have been averted and this country would have benefited enormously, because commodity prices would have been maintained at a reasonable level and the severity of the depression would have been lessened. The programme was essentially sound, and well calculated to meet the very difficult situation in which Australia was then placed.

We on this side are anxious to conserve the finances of this country. I believe that the Government is doing the right thing in presenting a balanced budget. Senator Keane mentioned yesterday that the total tax burden on the people of Australia was no less a sum than £120,000,000 yearly. There must be a limit to the amount to be taken from the people, and it .would not be wise for the

Government, especially in this national emergency, to attempt to get by taxation all the money it requires. I believe however, that before it taps the reservoir of national credit it should take effective measures to prevent the making of excess profits in any form of industry. In this emergency the wealthy interests should contribute to the fullest extent possible to the national exchequer. I know, of course, that it will be necessary to borrow some portion of the money required for the prosecution of the war, but every person in the community should be required to bear his fair share of the burden.

Senator Collings:

– The honorable senator means that the Government should secure its loan requirements in Australia.

Senator COURTICE:

– Tes ; but sometimes it may be of advantage to float loans outside Australia. I know that on this matter my colleagues are not in complete agreement with mc. In some circumstances, production in Australia may be seriously retarded because of our inability to export our products; if we owed a little money to overseas financial interests they would be willing to purchase our products and thus promote national development.

Senator Gibson:

– I am inclined to go across the chamber and join the honorable senator.

Senator COURTICE:

– That would be better than my going over to join Senator Gibson.

Having a very vivid memory of the hardship inflicted on the people of this country during the last war owing to the robbery that was perpetrated by profiteering concerns, I emphasize the need for measures to prevent profiteering now. If the Government wishes to ensure the co-operation of the people, it should make it clear that profiteering in any form will be severely dealt with.

Senator Foll:

– We have already taken steps to do that.

Senator COURTICE:

– I know that the Government has stated its intention to check profiteering. The announcement made by the Prime Minister (Mr. Menzies) to that effect has given much satisfaction to the people generally, but

I warn the Government that it will experience much difficulty in checking this evil.

Senator Dein:

– The honorable senator’s party should have agreed to be represented in the Government. It could then have seen that this phase of government policy was carried out.

Senator COURTICE:

– It is impossible at this stage to envisage all the difficulties that will beset the Commonwealth in this war. For my part, I am prepared to trust the Government, but at the same time I intend to keep an eye on it. The Labour party believes that it can best serve Australia in this crisis by remaining the official Opposition. At no other time in our history have the people of this country been so united in their determination to protect and safeguard all those democratic principles which they hold dear. I am anxious that the Government should not make any mistakes. If it can convince the people that it will do its best and that no section will be injured in the process, I am sure that all classes will respond readily to any appeal that may he made to them.

The Government, I hope, will take steps to safeguard our primary industries. The cotton-growing industry of Queensland is of very great potential value to the Commonwealth. Our experience in connexion with the sugar industry indicates the wisdom of giving cottongrowers adequate protection. When proposals were made to establish sugargrowing in Queensland, people with short vision suggested that we could obtain our requirements on better terms from other countries which employ cheap labour; but, fortunately, others with wider vision of the possibilities were not deterred. Consequently, Ave now have in Northern Queensland a well-established industry giving employment to between 30,000 and 40,000 people, who would be ready and able to defend that part of the Australian continent in time of trouble. But for their efforts, that part of Northern Queensland would to-day be a wilderness. The Queensland sugar industry has reached a state of efficiency second to none in the world. The cotton industry, if properly developed, would be a great asset to Australia. At the present time we import about twothirds of our requirements of cotton. Other primary industries are experiencing difficult times because they are dependent on overseas markets. Cabinet Ministers who have had no practical experience of industry are apt to deal with industrial problems merely from the economic aspect. If the sugar industry had been viewed in that light it would not have been developed to the state of efficiency that obtains to-day. I understand that the Tariff Board has made a report with regard to the cotton industry, and 1 remind the Government that unless the bounty is renewed the industry will pass out of existence. Has Senator Foll any information to give to the Senate as to the attitude the Government intends to adopt with regard to this industry?

Senator Foll:

– The manager of the Cotton Board visited Canberra a few days ago, and I arranged for him an appointment with the Minister for Commerce.

Senator COURTICE:

– I am glad to hear that. I assure the Government that ,the Labour party is sincere in its desire to assist the nation in the present crisis, and it urges the Government to see that no interests, great or small, are allowed to make big profits at the expense of the people.

Senator LAMP:
Tasmania

.- Realizing that the Government has a heavy task ahead of it, I shall not take up much time in submitting proposals that could well be postponed, but I intend to refer to several matters that vitally* affect the welfare of Tasmania. Much has been heard in the last eighteen months about the need for the decentralization of industry, and for the population of those parts of Australia that it is most necessary to defend. Tasmania has the greatest hydro-electric scheme in the southern hemisphere, and it could supply the whole of the power required to manufacture the equipment required for defence purposes. The water power that could be commercially developed is 1,750,000 horse-power. A complete survey of the power available has not been made, but several schemes that could be put into operation have been surveyed.

The principal schemes surveyed, other than those already developed are -

Electrical power has proved economical for the development of industries that operate continuously, such as electrochemical and metallurgical works, because it is necessary for each machine to have its own dynamo and to be operated independently of the rest of the plant. The consumers of power in Tasmania include the following: -

The total maximum demand on the system is 89,914 horse-power. If Australia is the potential manufacturer of defence equipment for the Pacific, steps should be taken to utilize the almost unlimited water-power available in Tasmania. For small industries power is made available at rates down to fiveeighths of a penny a unit. Large users of power are given special rates, which sometimes cover little more than production and transmission costs. The shalefields at Latrobe, in the Mersey valley, should be developed for the purpose of converting the shale into bitumen. The dusting process that has been developed in Switzerland has proved most efficient, and it could be employed in Tasmania, which could provide all the bitumen needed in Australia for road making.

It is essential that the residents of Flinders Island should be provided with improved communication with the mainland, and with Tasmania. As Senator Aylett has already explained, the present service between the island and Tasmania is available only twice a week. The residents would be satisfied if this service were extended to the mainland. I think that the best way to meet the situation would be to provide an aeroplane service from Launceston to Melbourne via Flinders Island, and to have the return journey made via King Island and Smithton. With regard to the request for a post office at Whitemark, the residents are prepared to provide the necessary site. The postmaster at Flinders Island is a returned soldier, and a most energetic and efficient business man. Being postmaster, he is in a good position to anticipate the business needs of the people. The petition in favour of a new post office was signed by 99 per cent. of the inhabitants of the island, the only opponent of the proposal being the postmaster himself. This request is an urgent one, and should be granted without delay.

Some time ago I drew attention to the impossibility of carrying on telephone conversations satisfactorily in the boxes provided on the tram-line between Mowbray and Sandhill, Launceston. There is a great deal of traffic along this tramline, and, if the service is to be efficient, closed boxes should be provided. I also draw attention to the practice of closing telephone offices during the dinner hour. In most places in the country, these offices are shut from 1 to 2 p.m. Arrangements should be made to continue the service during the luncheon hour, and also to extend the closing hour from 7 till 8 o’clock .

In May of this year manufacturers in the north of Tasmania who desired to tender for certain defence supplies were unable to get blue prints and conditions of tender in time to submit quotations. I quote from the Launceston Examiner of the 9 th May-

A Launceston manufacturer said that he had obtained a sample box and had put in the only Tasmanian tender, although he had only secured the sample box. after firms in Hobart had finished with it. Later, tenders had been called for the manufacture of depth-charge boxes. He had written to the Contracts Board in Hobart, asking for a sample box but had been advised that blue prints and detailed specifications only were available, and that they would be sent in a few days.

He waited for a week before the blue prints arrived. As they contained a lot of detail, it took him longer than usual to prepare estimates. There should be a system whereby samples, rather than blue prints, could be made available at the same time in different manufacturing centres in each State. I hope that these representations will be considered by the Government.

Senator ASHLEY:
New South Wales

– The tragedy associated with this debate is the fact that, for the second time in 25 years, Australia is at war and that the duty of finding the money necessary to prosecute the war successfully devolves upon the Government. It is strange that when disaster overtakes a nation ample funds can be found for war purposes.

Senator Herbebt Hays:

– Not always ample funds.

Senator ASHLEY:

– I admit that Australia must finance its war obligations, but I contend that its social obligations also should be met. There must be no restriction ofsocial progress. If money can be found to wage war, money should also be found in time orpeace to improve the lot of the people. Eighteen months ago, when active preparations for war were being commenced, the estimated expenditure was set down at between £30,000,000 and £40,000,000. Since then the estimated war expenditure has grown to over £80,000,000. It was said at that time that the expenditure of such a large sum of money on defence would provide employment. That statement was welcomed by the Opposition, which understood the satisfaction with which men who had been out of employment for many years looked forward to economic security for the three years over which the work was to have been spread.

Senator Wilson:

– How does the number of unemployed at Lithgow to-day compare with the figures for two years ago?

Senator ASHLEY:

– The number of unemployed there has not been reduced by 20 per cent. There are 500 unemployed at Lithgow to-day.

Senator Wilson:

– How many are in employment there?

Senator ASHLEY:

– I understand that since the declaration of war an additional 100 men have been given employment, making a total of about 700. The men in employment have been working two shifts, and some of them have been paid from £2 to £5 a week overtime, while hundreds of others in the town have been unemployed. On representations being made to the Minister for Supply and Development (Mr. Casey), he promised to rectify matters as soon as foremen could be trained to take charge of a third shift. It seems strange that men who have been working in the factory for 15, 18 or 20 years are not available to act as foremen. I believe that there are in the factory at the present time sufficient trained men to enable a third shift to be worked immediately.

Senator Wilson:

– The Government’s claim that more employment would be provided has been fulfilled at Lithgow.

Senator ASHLEY:

– Yes, since the war began.

Senator Wilson:

– And before that time also.

Senator ASHLEY:

– Before the outbreak of hostilities, there was a slight improvement of the employment position. I do not deny that Lithgow and other parts of the Commonwealth have benefited from the Government’s defence policy. The difference between the Government and the Opposition is that, whilst the Government acknowledges that it can readily obtain money to prosecute a war, the Opposition contends that it should also be able to find money to provide employment in time of peace. Unlike the Government, the Opposition refuses to put the claims of the unemployed in the background. Whenever a suggestion for social advancement, or the provision of employment, is made, the Government replies that funds are not available for the purpose. Owing to the increased defence expenditure, the State governments have been asked to curtail expenditure on public works. That policy, and the whittling down of loan moneys for semigovernmental bodies, will increase unemployment. Shires and municipalities in New South Wales have been operating under what is known as the Spooner scheme. I shall not speak. of the advantages or disadvantages of that scheme - there is much to be said on both sidesbut the fact that in the past those semigovernmental bodies have been able to borrow money for public works, and that now borrowing by them has been curtailed, means that unemployment will increase. . In the light of those facts, what chance have many people in our midst to earn a livelihood ? Yet many of them will be called upon to defend Australia during the war. I claim that the Government has the obligation to provide work and sustenance for the future defenders of the nation, so that they may be physically fit to defend their country.

Senator Wilson:

– Others besides the unemployed will defend Australia.

Senator ASHLEY:

– Not all of the defenders will be “ blue-bloods “. It is time that the Government dropped its parrot cry, “ Lack of finance “, when suggestions are made that certain things be done in order to provide work for the unemployed.

Senator HERBERT Hays:

– The same complaint is made in respect of employment by private employers.

Senator ASHLEY:

– The fault lies with the Government. Side by side with defence, there must be social progress and the development of the national life. There is plenty of work to be done ; roads and railways could be built, and other projects undertaken which, in addition to providing employment, would be of great value in the defence of Australia. Figures have been cited by honorable senators opposite in respect of unemployment which are at variance with those submitted by honorable senators on this side. On the Commonwealth Statistician’s return for the June quarter it is reliably estimated that there are from 175,000 to 200,000 unemployed in this country. That is a colossal figure. During the four years, 1935 to 1939, the State governments asked for loan moneys totalling £51,000,000, but they received only £28,000,000. Recently the Premier of Victoria, who is not a Labour man, stated that owing to the lack of loan money, the works programme of his government in respect of school and harbour buildings was seriously in arrears, whilst the water supply authorities in that State reported that many structures essential to water supply systems were in a deplorable, and even a dangerous, condition. The position, is much the same in some of the other States, particularly in New South Wales. Invariably the failure of the States to keep their works programme up to date is attributed to lack of finance. In view of that fact, the only solution of this problem lies in the contention advanced by the Labour party that the credit needed for essential undertakings must be made available through the Commonwealth Bank. In his budget speech the Treasurer (Mr. Menzies) states -

It may be that undue expansion is forced on governments during a war. At such a time when our very existence is threatened it is not possible to dwell upon the fine points of financial orthodoxy, but we must subsequently pay the price for every extension that goes beyond certain round limits.

All parties acknowledge that invariably inflation occurs in a time of war. However, this Government contends that owing to the price we must pay for inflation in times of war we are unable in times of peace to extend social services or to relieve unemployment. All of us agree that in a time of war it is not possible to adhere strictly to financial orthodoxy. However, we on this side contend that that argument should also apply in respect of the extension of social services and economic advancement in a time of peace. The Treasurer went on to refer to paragraph 504 of the report of the Royal Commission on Monetary and Banking Systems, which deals with the powers of the Commonwealth Bank to extend credit; in effect, he endeavoured to dispute the implication contained in that paragraph by referring honorable senators to paragraphs 505 to 513. He made no reference, however, to paragraphs 528, 529 and 530 of that report. In view of the connexion between those paragraphs and paragraph 504, which has been so frequently referred to in this debate, I intend to read them. They are as follows: - 504. Because of this power, the Commonwealth Bank is able to increase the cash of the trading banks in the ways wo have pointed out above. Because of this power, too, the Commonwealth Bank can increase the cash reserves of the trading banks; for example, it can buy securities or other property, it can lond to the Governments or to others in a variety of ways, and it can even make money available to Governments or to others free of any charge. 528. There are limitations on the power or a central bank to reduce fluctuations and to maintain reasonable stability in the internal economy. Too much should not be expected, even from the most enlightened policy of an all-powerful central bank. Much will depend upon the relations established between the Commonwealth Bank and the Commonwealth Government, which is responsible formonetary policy. In Australia the Federal Parliament is given, by Section 51 of the Constitution, “ power to make laws for the peace, order and good government of the Commonwealth with respect to: (xii) Currency, coinage, and legal tender; and (xiii) banking, other than State banking; also State banking extending beyond the limits of the State concerned, the incorporation of banks, and the issue of paper money “. In part, the responsibility for monetary policy is delegated to the Commonwealth Bank by the Federal Parliament in the legislation under this section establishing the Bank and conferring upon it certain powers, but iu part the responsibility is with the Commonwealth Government. 529. Where responsibility is divided between two authorities, the question may arise as to which authority is to decide upon monetary policy. An answer to this question might be to provide that the Commonwealth Bank shall bc at all times under ‘the direction of thu Government. In this case there can be no conflict between the two authorities. But where the Commonwealth Bank is not under this direction, the question arises as to which view is to prevail if the Government’s view and that of the Bank differ on a matter of monetary policy. An answer to this question might be that, in exercising the authority delegated by Parliament, the Commonwealth Bank should be entirely independent and should refuse to accept direction from the Government. Then, if the Government is determined upon a policy which the Bank Board will not accept, the Government will have to obtain any legislation required, and if necessary appoint a board which will carryout that policy. 530. Neither of these answers commends itself to us. In our view, the proper relations between the two authorities arc these. The Federal Parliament is ultimately responsible for monetary policy, and the Government of the day is the executive of the Parliament. 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 and 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 Ban!: 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 the proposed policy, and is in n position to take, and will take, any action necessary to implement it It is then the duty of thu Bank to accept this assurance and to carry out the policy of the Government. This does not imply that there should at any time be interference by the Government or by any member of the Government, in the administration of the Commonwealth Bank. Once the question of authority” is decided, there should be little difficulty in preserving close and cordial relations between the Commonwealth Government and the Commonwealth Bank.

I askleave to continue my remarks later.

Leave granted ; debate adjourned.

SALES TAX BILLS (Nos. 1 to 9) 1939.

Bills received from the House of Representatives.

Suspension of Standing Orders.

Motion (by Senator Foll) agreed to-

That so much of the Standing Orders be suspended as would prevent the questions with regard to the several stages for the passage through the Senate of all or several of the Sales Tax Bills Nos. 1 to 9 being put in one motion, at each stage, and the consideration of all or several of such bills together in committee of the whole.

Standing and Sessional Orders suspended.

Bills (on motionby Senator Foll) read a first time.

Second Reading.

Senator FOLL:
Minister for the Interior · Queensland · UAP

– I move -

That the bills be now read a second time.

Honorable senators were informed in the budget speech of the proposal of the Government to raise a portion of the additional revenue required during this financial year by an increase of the rate of sales tax, and that this decision was arrived at only after alternative proposals for obtaining the required revenue by reducing the exemptions had been seriously and earnestly considered. It was thought more desirable not to bring within the range of the sales tax those goods which are now exempt, including foodstuffs required by the people, and also commodities used by primary producers, many of whom are experiencing difficulty. The new rate of 6 per cent. operates on and from the 9 th September. The proposal is in accord with the procedure ordinarily followed when a change of rate is proposed, and is designed to prevent the dislocation of trade which would inevitably occur should there be any delay between the date of the announcement of the Government’s intentions and the date on which its policy became effective. The new rate will apply to all taxable transactions and operations in goods effected or done on and after Saturday, the 9th September, and also will apply in respect of goods imported on and after that date.

I appreciate the action of Senator Ashley in discontinuing his speech on the Estimates and budget papers in order to enable me to introduce these urgent measures.

Senator COLLINGS:
QueenslandLeader of the Opposition

– The Opposition will not oppose the passage of these sales tax bills. When speaking on the Estimates and budget papers, I mentioned that we prefer direct taxation to this form of indirect taxation, and I think that every subsequent speaker on this side of the chamber who mentioned the subject supported my remarks in that respect. It is interesting to note that between 1931-32 and 1938-39 the amount collected in income tax has been over £81,000,000 and that that collected in the form of sales tax has been £70,000,000, so that the amount collected in this form is within £11,000,000 of the amount received in income tax. This is one of the means by which the Government proposes to assist to meet its immediate financial needs, and as the bills are urgent and passed through the House of Representatives on the voices, we do not intend to oppose them.

Question resolved in the affirmative.

Bills read a second time, and passed through their remaining stages without requests or debate.

page 540

QUESTION

ESTIMATES AND BUDGET PAPERS 1939-40

Debate resumed.

Senator ASHLEY:
New South Wales

– The paragraphs which I read before my remarks were interrupted show quite clearly that the Commonwealth Parliament is ultimately responsible for the monetary policy of the nation. That contention is borne out by economists and financial authorities. Professor Copland said in 1938-

It is inevitable, in a federation, that the Federal Government must he responsible ultimately for the monetary policy, as it is for defence.

Labour goes further. We say that the Government is responsible not only for the monetary and defence policies of the nation, but also for the employment of its future defenders. Professor Copland also expressed this opinion -

No government can absolve itself from the ultimate responsibility for the banking policy. Much of the political objection to the monetary policy in recent years has arisen from a refusal to recognize this fundamental fact. Governments have denied their responsibility on the ground that banking policy must be a matter for bankers alone and should be excluded from the political field . . . We curry the doctrine of no political interference with banking to the extent of stifling official discussion of vital matters . . . Banking is more than mere finance; it is a social function which should be controlled in the permanent interest of the people.

In this debate we have heard many references to the report of the Royal Commission on Monetary and Banking Systems, which cost £22,400. When the former Prime Minister (the late Mr. Lyons) announced the personnel of that commission lie said -

The Government has given very careful consideration to the selection of the personnel of the commission and has been fortunate in securing the services of men of high standing and wide experience who will, I have no doubt, command the confidence of the public and ensure an impartial inquiry. The terms of reference have been made as wide as possible in order that the commission shall not be in any way restricted in its important task.

In paragraph 530 of its report, the commission stated - in cases where it is clear beyond doubt that the differences are irreconcilable, the Government should give the bank an assurance that it accepts full responsibility for the proposed policy, and is in a position to take, and will take, any action necessary to implement it. lt is then the duty of the bank to accept this assurance and to carry out the policy of the Government.

Ft is quite evident that the Government does not intend to implement the major recommendations of the commission, because if it does so it would arouse the hostility of the private trading banks which pay regard to their own interests rather than the interests of the nation.

M!uch has been said in this debate on the subject of credit expansion, which Labour senators have consistently advocated. Recently the Melbourne Argus expressed this view in its leading columns -

Defence and developmental expenditure on a large scale will mean a much increased volume of transactions. Consequently credit must be expanded to facilitate this increase. The Commonwealth Bank Board as the central banking authority can effect this expansion quickly and safely. There is not the slightest danger in this course.

No one will suggest that the Argus represents the views of the Labour party.

On the subject of land tax, which also lias been discussed in this debate, I pointout that the land tax was reduced in 1932-33 by 33£ per cent, and in the following year by 16$ per cent., making a total reduction of 50 per cent. The accumulated value of the remissions of land tax in the seven years from 1932-33 to 193S-39 was approximately £9,000,000. Now that it is necessary to find more money for defence, the Government proposes to increase the tax on incomes from persona] exertion and also the property tax, the sales tax and customs and excise duties. It does not, however, propose an increase of the land tax. The report of the Royal Commission on Taxation disclosed that 67 per cent, of the land tax is obtained from wealthy city owners, who have always received the consideration of this Government. The decision not to increase the rate of tax on land indicates the enormous influence exerted by life assurance companies, large manufacturing companies, shipping combines and other concerns upon anti-Labour governments, whether they be the United Australia party or a combination of United Australia party and United Country party. Small farmers would not be affected by an increase of the land tax because property to an unimproved value of £5,000 and certain improvements is exempt.

Recently the Premier of Victoria, Mr. Dunstan, stated that in Victoria alone over 500,000 acres of fertile land suitable for closer settlement was tied up in big estates. There are similar large estates in New South Wales and other States. The Government discriminates, in its taxation proposals, in the interests of its wealthy friends, and to the detriment of the people generally. As the direct result of this policy, land and property owners, life assurance companies and shipping companies benefited to the amount of £35,000,000 in the six years 1932-33 to 1937-38. Land owners benefited by £8,800,000, other property owners by £16,000,000, companies by £5,600,000, life assurance companies by £4,500,000, and shipping companies by £150,000. When the Government needed £3,184,000 to balance its budget in 1937-38 it obtained £135,000 by an increase of 11 per cent, on land tax, the balance being obtained from sales tax and excise duties. In 1932-33 there was a reduction of the arbitrary assessment of ships owned abroad from 7£ per cent, to 5 per cent. That involved an annual remission of £25.000, so that ship-owners have benefited during the past six years to the amount of £150,000. Why has not the Government reinstated that tax of 7^ per cent. ? It has imposed additional indirect, burdens on the people through the sales tax and excise duties. In 1933-34 an adjustment was made in regard to life assurance company taxation, by providing that tax should bp payable only on excess incomes after allowing a deduction of 4 per cent. No taxation measures are directed against the major combines in Australia such as the Broken Hill Proprietary Company Limited, which last year paid bonuses amounting to nearly £1,500,000.

Senator Dein:

– Those bonuses were taxable.

Senator ASHLEY:

– The company had so much money that it returned £4,500,000 to its shareholders. Every person holding 100 shares was given an additional 66 shares. This company receives from the Government of New South Wales in railway rebates the sum of £250,000 annually.

Senator Wilson:

– It treats its employees better than any other company in Australia does.

Senator ASHLEY:

– I doubt that. A cardinal principle of taxation is that a tax should be imposed only in accordance with the capacity of the people to bear it; but the present Government has ignored that principle in times of peace, and is prepared to do so now, while the country is at war. The sales tax was introduced as an emergency measure during the last, depression. Since 1931-32. the Government has collected from this source approximately £8,000,000 a year. Last year the sales tax was increased from 4 per cent, to 5 per cent., the explanation offered by the Government being that additional revenue was required for defence purposes. This year the Government proposes to collect by sales tax £11,000,000, the highest sum ever raised from this source. Almost every year direct and indirect taxes are increased, and. the incidence of this taxation is such that it falls heavily on the working classes.

When the flour tax was introduced, it was shown that a working man with five or six grown children would need to purchase from three to four loaves of bread daily. This tax, therefore, meant an increased expenditure by a man on the basic wage or on relief work of 4d. a day, 2s. 4d. a week, or approximately £6 a year. The head of a family earning a large salary would be in a position to purchase any foodstuffs which the members of his family might desire, and, as his family would probably eat only half of the quantity of bread consumed by the family of a man on the basic wage, the extra, tax would fall less heavily upon him. It is interesting to note the following remarks of Professor Giblin: -

No one, in general, would willingly raise the price of the necessaries of life. All tradition is against it. When, however, an important primary industry like dairying is threatened with disaster on account of a fall in world prices, it is felt to be reasonable that the whole community should contribute to help it over the lean times. Such a contribution is felt, by the public and the press, to be made by a home price. Each consumer is called upon to do his share to sustain the threatened industry.

This conception of the home price as sharing among all the nation the burden of assisting a distressed industry will be seen on consideration to be entirely mistaken. We may first, however, assume that the burden is really spread over all consumers, and note one or two consequences.

A tax on any necessity is bad, because it exacts a much higher rate of taxation from the poor than from the rich. It is particularly bad when the commodity is used by children as much, or even more than, by adults, as with sugar, butter and bread. In such a case the tax becomes regressive to an appalling degree. A bachelor with an income of £1,000 per annum would pay an additional 15s. per annum through the home price of butter. He would contribute less than one-fifth of a penny in the fi of his income to relieve the depressed industry. A basic wage earner, with wife and three children, would contribute over £3, or about 5d. in the £.1 of his income. . . .

The Minister for External Affairs (Sir Henry Gullett) once made a statement which supports my argument. Referring to the obligation of the rich to contribute more than the poor towards the cost of defence, he said -

It was for the rich man more than for any other class that the war was fought. Because he had so much at stake the rich man should continue to contribute heavily towards the cost of war.

Professor Porteus recently remarked -

Indirect taxation might, and often did, fall more heavily on the poor than the rich.

A leading article in the Melbourne Herald of the 22nd September, 1938, contained the following observation -

The insidious indirect tax makes life harder for families with small or moderate incomes. lt is responsible for putting much more on to prices at different stages of production than accrues to the tax collector.

Senator Dein:

– All customs duties do that.

Senator ASHLEY:

– I am glad that supporters of the Government agree that indirect taxes bear more harshly on the workers than on the rich.

Another and very insidious form of taxation is that imposed through the medium of the post office. According to the profit and loss account of the Postal Department for the year ended the 30th June, 1938 - and I take it that the figures will be similar this year - there was a surplus of £3,533,476. I contend that any public utility that shows a surplus indirectly taxes the people. The surplus mentioned was obtained after deducting about £1,500,000 for interest payments and slightly over £1,000,000 for payment into the sinking fund.

Senator Wilson:

– Does the honorable senator suggest that that hits the working man hard? * Extension of time granted.’*

Senator ASHLEY:

– When Senator A. J. McLachlan was Postmaster-General, I made representations to him in connexion with some urgent and necessary work in country districts. He promised that the work would be put in hand as speedily as possible, but so far nothing has been done. Why was not some of this surplus used to carry out that work? I suggest that some of the postal charge* be reduced, and that telephone rents be lowered as the first step in that direction. Many small farmers in country districts have installed telephones solely in order to meet cases of emergency, such as sickness in the family. They do not use the telephone more than, perhaps, a dozen times a. year. I know of telephone subscribers who have paid £20 or £25 as rent for an instrument which costs only about £2 10s.

Senator Gibson:

– Every telephone requires some miles of wire.

Senator ASHLEY:

– Failing a reduction of telephone rents the PostmasterGeneral should use a portion of the surplus to improve the condition of some of the buildings under his control. Or, the just claim of unofficial postmasters for higher remuneration could be met. Only yesterday I received the following complaint from, some postal employees -

Could you please give me any information re the reclassification of postal clerks, PostmasterGeneral’s Department. This classification has been promised for about twelve months. At present the position seems rather unjust, as I understand it has been postponed indefinitely. I. would appreciate attention to this matter.

Possibly the department claims that that reclassification has been held up for the reason that funds are not available. How can that be so when the department shows a surplus of over £3,000,000 on its year’s operations ?

Yesterday Senator Clothier complained of the allocation of contracts for Defence Department requirements. Early this year there was a complaint from manufacturers of clothing in New South Wales as to the distribution of orders. A contract was let in Victoria, for 16,000 tunics, which eventually were sent to New South Wales to be sewn. The manufacturers in New South Wales claim, with justification, that the sewing of those tunics threw the work of their factories out of balance; while certain of their operatives were busily engaged sewing the garments, the cutlers were idle. .There have been complaints also in relation to boots. As was pointed out yesterday by Senator Clothier, a contract for 77,000 pairs of boots was distributed between two States; Victoria received. orders for 6,000 pairs and manufacturers in South Australia were given contracts for the remainder. The president of the New South Wales Shoe Manufacturers Association stated -

It costs me 5d. a pair to ship a woman’s light shoe from Sydney to Adelaide. What will it cost the Government to send a pair of military boots from Adelaide to Brisbane? While the Government has saved, say, 2d. a pair on the tender prices, it will cost about Od. a pair extra in freight.

I support the claim of Senator Clothier that, provided prices are reasonable, the defence requirements of each State shall be supplied by manufacturers in that State. It would be foolish to accept a tender which, while saving 2d. a pair in one direction, costs 9d. a pair more in another direction, the net effect being a loss of 7d. a pair.

Senator Foll:

– It should not cost 9d. a pair to send boots by sea in bulk.

Senator ASHLEY:

– Even if the freight were only 4d. a pair, it would not be a sound business proposition. I do not think that boots could be carried, even by sea, from Adelaide to Brisbane for 2d. a pair.

Senator Foll:

– Many manufacturers will not quote for these goods.

Senator ASHLEY:

– Then, why has this complaint been received from the president of the New South Wales Shoe Manufacturers Association ‘( The complaint in respect of clothing was not an isolated one. Manufacturers have a right to participate in orders for the State in which they are established, so long as their prices are comparable with prices in the other States. In considering tenders, the Government should also have regard to the fact that the standard of living varies in the different States. A State should not be penalized because the cost of living within its borders is higher than in an adjoining State. We must adopt a national outlook in these matters. I do not suggest that expenditure as between States should be on a £1 for £1 basis, but it should be apportioned on the basis of population, and the amount contributed to the. cost of defence.

I am sorry that Senator Wilson is not in the chamber, for I now wish to deal with wheat. The honorable senator does not yet appear to have formulated a definite policy in respect of wheat. It would appear that, like another famous politician, he is adopting a “ Yes-No “ policy. Yesterday, he was asked his opinion regarding the’ limitation of production, and he replied that it may be necessary to limit production and it may not be necessary to peg production. That was a most vague answer. The honorable senator has adopted a portion of the policy of the Labour party; I suggest that he adopt the whole of it. The Labour party contends that, in respect of industries which are financed by governments, production should be limited. Wealthy farmers who are operating on thousands of acres should not be allowed to participate in this assistance. The growers themselves suggest that production should be pegged, or that assistance should be limited to a maximum individual output of 3,000 bushels.

The main complaint voiced by honorable senators opposite in this debate was that the Labour party declined to participate in the formation of a national government for the duration of the war. The crisis arose a fortnight ago, and it is interesting to note that, although the members of the Country party have remained silent, no criticism has been levelled against them by honorable sena.- tors opposite. For the last two or three days members of that party have been wrangling in caucus over the choice of a leader. They have had a real Donny- brook fair. It was said that Sir Earle Page intended to resign the leadership of that party in order to clear the way for a coalition government, and as the result of .that rumour we noticed anxious looks on the faces of some honorable senators opposite who, apparently, are fearful that they will be obliged to relinquish minis*terial office.

Defining its stand in the present crisis, the Labour party declared^

In this crisis, facing the reality of war. the Labour party stands for its platform. 1hn platform is clear. We stand for the maintenance of Australia as an integral part of thu British Commonwealth of Nations. Therefore the party will cio all that is possible to safeguard Australia and, at the same time having regard to its platform, will do its utmost to maintain the integrity of the British Commonwealth.

I challenge the Government to say that it has had as sincere an offer of cooperation from the Country party. Yet honorable senators opposite have levelled no criticism against that party. Indeed, two or three of them did no more than utilize this debate as an opportunity to vilify the Labour party for refusing to join the Menzies Government. One suggested that the Government washed the Labour party not merely to join the Ministry, hut also to participate in the actual administration of the country in the present crisis. That is a candid admission that the Ministry is incapable of governing in a time of emergency.

We have been told that the Government proposes to purchase the wheat crop and will make an initial advance of1s. a bushel. In view of the serious position confronting the wheat industry, I urge the Government to increase that first payment to 2s. No section of our primary producers is facing such difficulties as are the wheat-growers. They are on the brink of disaster.

Senator E B Johnston:

– Make the price 2s. 6d.

Senator ASHLEY:

– Seeing that the Country party has refused to join in a coalition government, the honorable senator is in a better position than I am to make the Government increase this first payment. We are told that the British Government has agreed to take the whole of our wool clip. On this point I draw the attention of the Government to the fact that in one factory alone in Sydney 500 wool and basil workers have been dismissed. Therefore, I urge it to retain sufficient wool in Australia to ensure that the employment of workers in this industry will not be jeopardized. Furthermore, an announcement has emanated from the wool brokers of Great Britain that Japanese buyers are concerned about the Commonwealth’s decision to sell the whole of our clip to Great Britain. We should retain as far as is possible our present trade with all countries which remain neutral in this war. In a time of peril we should do nothing that would antagonize a friendly nation.

I support the request made by Senator Cameron for assistance on behalf of South African war veterans, most of whom are now in their declining years.

I feel sure that it will have the sympathy of those honorable senators opposite who served in the last war. I appeal particularly to the Assistant Minister (Senator Collett) to support this request. We ask merely that the Government shall do as much, and no more, to assist the South African war veterans as it is doing for returned men who fought in the last war.

Debate (on motion by Senator Dein) adjourned.

page 545

SPECIAL ADJOURNMENT

Motion (by Senator Foll) agreed to -

That the Senate at its rising adjourn till Wednesday next at3 p.m.

page 545

ADJOURNMENT

Centralwoolcommittee - Australian Wheat Board

Motion (by Senator Foll) proposed -

That the Senate do now adjourn.

Senator E B JOHNSTON:
Western Australia

– I wish to say a few words concerning appointments to the Central Wool Committee.

Senator GIBSON:
VICTORIA · CP

– Does the honorable senator mean the Australian Wheat Board ?

Senator E B JOHNSTON:

– No. I may say. in passing, that the appointments to the Australian Wheat Board are apparently regarded as satisfactory. I was glad to notice among the appointees Mr. Teasdale, who is probably the leading authority in the Commonwealth on matters relating to the handling and marketing of wheat. I regret that the Government has not appointed to the Central Wool Committee a nominee of the Australian Wool Producers Federation or any one with a. knowledge of Western Australia, which comprises about one-third of the Commonwealth. The nominee of the Commonwealth on the committee is Mr. A. F. Bell, C.M.G., who is to be the chairman, and the executive member is Mr. N. W. Yeo. The growers’ representatives are Mr. J. P. Abbott, Mr. B. T. Boyd and Mr. B. A. N Cole. Mr. Cole, who, I understand, possesses excellent qualifications, is a member of the Australian Wool Producers Federation, but he is not the nominee of that body. He will be the only member of the committee to represent the small growers. The brokers’ representatives are Mr. F. N. Young, Mr. M. J. Carson and Mr. T. S. Cheadle. The buyers’ representative is Mr. J. R. McGregor, and the manufacturers’ representative is Mr. F. C. Laycock.

Senator Gibson:

– Mr. Laycock is a big grower.

Senator E B JOHNSTON:

– He may be. No nominee of the Australian Wool Producers Federation has been appointed, and the committee, consisting of ten members, does not include one representative of Western Australia.

Senator Sheehan:

– Another injustice to Western Australia.

Senator E B JOHNSTON:

– Yes. When a committee consisting of ten members is appointed to deal with one of our largest industries, surely Western Australia is entitled to representation. This matter lias been taken up by interested persons throughout the wool-growing districts of Western Australia, and I have before me a number of telegrams in which the main complaint is that a representative of the Wool Producers Federation has not been appointed a member of the committee. In several of these telegrams a request is made that the secretary of the Australian Wool Producers Federation, Mr. Eric Hitchens, should be appointed as an additional growers’ representative. I strongly support this nomination, as Mr. Hitchens has every qualification to fully represent the small growers. If the Government, agreed to such an appointment, the small growers would have only two representatives, because Mr. Cole is the only other member who can be regarded as representing their interests.

Senator Gibson:

– Cannot those who represent the large growers also represent the small growers?

Senator E B JOHNSTON:

– The small growers consider that they have a right to nominate at least one of the ten members of the committee, but they have been denied that right.

Senator Cooper:

– Are not the small growers affiliated with other organizations?

Senator E B JOHNSTON:

– The small growers belong to a separate organization.

Senator COOPER:

– Is that not affiliated with other organizations?

Senator E B JOHNSTON:

– A number of small growers’ associations are affiliated.

Senator Foll:

– The persons appointed are to represent the industry as a whole.

Senator E B JOHNSTON:

– The small growers consider that they have a right to direct representation. One telegram I have received from Western Australia reads -

Strong organized agitation against Government supporters inevitable if Minister persists in refusal extend representation.

Senator Sheehan:

– How many members of the United Australia party represent Western Australia?

Senator E B JOHNSTON:

– At a time of crisis all honorable senators on this side of the chamber are Government supporters. The following telegram shows the way in which a very important organization regards the action of the Government in this respect -

Wool executive resolved to-day, request Country party refuse coalesce with Menzies Government unless additional representative of small growers nominee of Wool Producers Federation is appointed on Central Wool Committee.

This is a matter of extreme importance to the small wool-growers. Only a few weeks ago the Assistant Minister for Commerce (Senator McBride) visited the wool-growing districts of Western Australia where he met a large number of growers, some of whom are directly responsible for the resolution contained in the telegram which I have just read. With the support of the honorable member for Swan (Mr. Gregory), and the honorable member for Forrest (Mr. Prowse) I have endeavoured to get the Government to make an additional appointment, that of Mr. Eric Hitchens. I have also urged that in appointing boards and committees to control primary products, at least one representative of Western Australia should be appointed. Many persons resident in Western Australia have a good knowledge of the conditions in the eastern States, but only a few living in the eastern portion of Australia have any knowledge of the conditions in Western Australia. The Government should appoint a Western Australian to every board, committee or pool handling and marketing primary products. Mr. J. P.

Abbott, who was a member of the Royal Commission on Banking and Monetary Systems, submitted a minority report in which he recommended that, owing to the different conditions existing in Western Australia, a resident of Western Australia should be appointed to the Commonwealth Bank Board. Mr. Abbott is not a Western Australian, but he is an intelligent and fair-minded man. A vacancy occurred recently on the Commonwealth Bank Board, and although several prominent Western Australians were nominated to fill the position, Mr. Abbott’s recommendation was ignored On all important bodies such as the Central Wool Committee a representative of Western Australia should be appointed. T trust that the Government will appoint, to the Central Wool Committee a representative of the small wool-growers in the person of Mr. Hitchens.

Senator CUNNINGHAM:
Western Australia

– I direct the attention of the Minister for Commerce (Senator MeLeay) to the fact [hat in the appointment of an Australian Wheat Board, the Western Australian Wheat and Wool Growers Union, which is the largest organization of the wheat-growers in Western Australia, has been ignored. The union has not received ‘ any communication whatever from .the Government in connexion with the personnel of the hoard. I have received telegrams objecting to the Government’s proposals. ‘Senator Johnston said thai Mr. Teasdale has been appointed to the Wheat Board, but in my opinion and in the opinion of the Western Australian wheat-growers, that is a political appointment, because that gentleman is associated with a political organization in Western Australia.

Senator Foll:

– But he has extensive knowledge of the wheat industry.

Senator CUNNINGHAM:

– He has had nothing whatever to do with the activities of the Western Australian Wheat and Wool Growers Union, the representatives of which have token a very active part in making requests on behalf of the wheat-growers. On this occasion its representations have been ignored.

Senator Uppill:

– Is not Mr. Teasdale a wheat-grower?

Senator CUNNINGHAM:

– He may be; but he is not a member of the Western Australian Wheat, and Wool Growers Union. He is a member of the Country party and of the Primary Producers Association, but he is not a member of the Wheat and Wool Growers Union. That body is not represented on either the Australian Wheat Board or the Central Wool Committee. I ask the Government to reconsider its decision with a view to meeting the request of the Western Australian Wheat and Wool Growers Union, which represents a majority of the growers in that State. The organization is not connected with the Labour movement, and I am not therefore dealing with the subject from a political viewpoint. 1 trust that the Government will arrange for the organization to be represented on the Australian. Wheat Board and on the Central Wool Committee respectively. It is interesting to note that Louis Dreyfus and Company and John Darling and Sons, which are buying and selling agent1?, ure to lie represented on the Australian Wheat Board. Representation has been given to other than wheat-growers. As a Commonwealth committee is to control the acquisition and sale of the wheatcrop to the British Government, buying and selling agents should not be represented on the board. If their assistance should be required, the board could confer with them. Mr. McPherson is to represent the Commonwealth Government, but a consumers representative also should be appointed ; otherwise the board, will be an unsatisfactory body to both growers and consumers. I hope that the Ministry will review the personnel and appoint to the board a representative of the wheatgrowers, of Western Australia.

Senator McBRIDE:
Minister without portfolio assisting the Minister for Commerce · South AustraliaAssistant Minister for Commerce · UAP

.. - I assure Senators Johnston and Cunningham that the Government gave very careful consideration to the personnel of the Central Wool Committee and the Aus-, tralian Wheat Board in order to ensure that, all sections of the people would have adequate representation. The wheat-growers have on the hoard the president of the Wheat-growers Union, and another wheat-grower from South

Australia with an intimate knowledge of all the problems associated with the industry. It is entirely erroneous to suppose that wheat-merchandising firms, as such, have their representatives; but obviously it is necessary to appoint men possessing a thorough knowledge of marketing problems. The gentlemen referred to wore selected solely because of their thorough technical knowledge of wheat-marketing difficulties. I think the Government is fortunate to have secured their services, because the board will deal with not only the wheat already harvested this year, but also with the production in the coming season. I would also point out that wool-growers are represented on the Central Wool Committee by Mr. J. B. Abbott, president of the Graziers Association of New South Wales and chairman of the Australian Wool-growers Council, and Mr. Boyd, vice-chairman of that body. Mr. Cole, another member, is a wool-grower of wide experience. In 1932, he very ably carried out an important investigation of problems associated with the pastoral industry. He also is on the executive of the Australian “Wool-growers Federation, a body composed entirely of the smaller wool-growers of Australia.

Senator E B Johnston:

– The Government might appoint Mr. Hitchens

Senator McBride:

- -Mr. Kitchens is secretary of the Australian Wool-growers Federation, of the executive of which, as 1° have said, Mr. Cole is a member. Whilst I have no doubt of Mr. Hitchens’ ability, I suggest that the small wool-growers are ably represented by the gentlemen who have been appointed. As to the suggestion that there should be a representative of the consumers on the Australian Wheat Board, I would point out that the consumers are protected, inasmuch as the price is fixed for all wheat required for home consumption. As the board will have nothing whatever to do with fixing the price of wheat for home consumption, it was not considered necessary to appoint a direct representative of the consumers. I ask honorable senators to bear in mind the very many interests that are involved, and I hope that they will not feel aggrieved because the persons whose qualifications they have mentioned were not selected. I repeat that the Government gave this matter its earnest consideration. If all the interests that have been mentioned were represented on the board, it would be an unwieldly, and, I suggest, an inefficient body to deal with the many intricate problems which will arise in the handling and marketing of Australia’s principal primary product during the war. The Government is convinced that the persons appointed will carry out their duties to the entire satisfaction of the producers and consumers alike.

Question resolved in the affirmative.

page 548

PAPERS

The following papers were presented : -

Commonwealth Public Service Act - Appointment - Department of the Treasury - K. M. Fraser.

Landa Acquisition Act - Land acquired at Pymble, New South Wales - For Postal purposes.

Science and Industry Research Act - Regulations amended - Statutory Rules 1930, No. 83.

Australian Soldiers’ Repatriation Act - War Pensions Entitlement Appeal Tribunals - Report for year ended 30th June, 1939.

Senate adjourned at 6.13 p.m.

Cite as: Australia, Senate, Debates, 14 September 1939, viewed 22 October 2017, <http://historichansard.net/senate/1939/19390914_senate_15_161/>.

View PDF View XML View in Voyant