13th Parliament · 1st Session
Mr. Speaker (Hon.G. H. Mackay) took the chair at 3 p.m., and read prayers.
Bill brought up by Mr. Latham, and road a first time.
Restrictionof Output-Attitude of Ministers
– Has the Minister for Commerce read the newspaper cablegrams to the effect that Mr. C. W. Peterson, publisher of the Farm and Ranch Review in Canada, suggested at a conference of wheat-growers that the four wheat-exporting countries of the world should confer with a view to endeavouring to adjust their acreage under crop in accordance with the reduced demand, and a statement by the Consul-General for Argentina to the effect that his Government would support such a proposal? Having regard to the improvement of: prices in the Smithfield market, which has followed the restriction of the export of- meat to the United Kingdom, will the Minister communicate with the governments of the wheat-exporting countries to ascertain if the suggestion made by Mr. Peterson is bona fide, and, if so, take the necessary action to co-operate with them?
– The cablegrams which the honorable member has mentioned have been tentatively mentioned in Cabinet, and will receive further consideration.
– Has the Prime Minister’s attention boon drawn to the following paragraph published inthe Castlemaine Mail, of the 22nd November : -
Behind the Federal Ministry’s vacillation is the activity of the Attorney-General (Mr. J. G. Latham), who is earning an unenviable repution as the most unsettling influence experienced in federal ministerial circles for a good many years. Ho told his Cabinet–
– Order ! The purpose of a question is to elicit information. The honorable member is not in order in reading newspaper statements or comments of a character which he himself would not be permitted to make when asking a question.
– I ask the Prime Minister whether it is true that the Attorney-General threatenedto resign from the Ministry if a bounty was paid to all wheat-growers on a production basis? If the statement is not true, will steps be taken to contradict it? Attention having been drawn to this statement, is the Attorney-General’s attack on the liberty of the press to be extended to suppress this class of propaganda?
– No member of the present Cabinet has threatened to resign because of any measure of government policy. I suggest to the honorable member that he might inquire who is the owner of the newspaper he has quoted, and whether the comment emanates from somebody with a political axe to grind.
– I ask the Minister for Commerce whether the newspaper statement is true that the Dairy Produce Export Control Board has instructed that 20 per cent, of the exportable surplus of butter shall be withheld from shipment, and that since the issue of this instruction the price of butter on the London market has fallen to the lowest level reached in the last 30 years?
– The Dairy Produce Export Control Board has decided to restrict the export of butter during the next few months, probably anticipating an improvement in prices similar to that which followed the restriction of meat exports. This matter is not subject to Ministerial control; the board is acting within its statutory powers.
INVALID AND OLD-AGE PENSIONS.
– Is the Prime Minister aware that the forms which invalid and old-age pensioners are required to fill in, are issued without an envelope, returned to the post office unenclosed, and there assembled in bundles to be sent to the head office of the Pensions Branch ? Will the right honorable gentleman issue instructions that an envelope be issued to the pensioner, so that personal and confidential information may not be disclosed to unauthorized persons?
– I am not aware of the method employed in collecting returns from pensioners, but I shall investigate the honorable member’s suggestion, with a view to the discontinuance of any practice that prevents the maintenance of due secrecy.
AUSTRALIAN REPRESENTATION IN LONDON.
– Has the Prime Minister read a newspaper statement that after the departure of the. right honorable member for Flinders (Mr. Bruce) from London in 1933, Australia will he represented there by a permanent official?
– [There is no truth in the report.
UNEMPLOYMENT RELIEF IN CANBERRA.
– Will the Minister for the Interior say whether there is any truth in the allegation that unemployed persons in the Federal Capital Territory have to become members of the Australian Workers Union before they are engaged in relief work? If that is the practice,will the Minister issue instructions that it shall not continue to apply to men receiving merely temporary employment ? .
– I am unaware that the circumstances are as they have been outlined by the honorable member, but I shall have inquiries made, with a view to taking action on the lines indicated by him.
Assistance to Industry
– Is it true that £5,000 is being allocated from revenue for the assistance of the bananagrowing industry? If so, is it proposed to expend any portion of that amount before parliamentary authority has been obtained for the expenditure?
– No amount has been allocated, because no revenue has been collected from the duty on bananas. It is not proposed to make any expenditure other than from the revenue that will be collected from that source.
– Will parliamentary authority be first obtained ?
– Parliament, of necessity, will in due course have an opportunity to deal with the matter.
– Is the Prime Minister aware that hundreds of pensioners in the northern districts of New South Wales arc refusing to sign form 43 issued by the pensions department, because they claim that by signing it they are surrendering their rights? Form 43 reads - 1 hereby undertake that I will not, at any time hereafter, transfer or mortgage any real property, or any estate or interest therein, of which I am now the owner, or of which I may hereafter become the owner, except with the prior consent in writing of the Commissioner of Pensions.
In view of the fact that the pensioner when he signs his form forfeits a right to which he as a citizen is entitled - I referto the control of his own property - will the Prime Minister withdraw the form providing for the undertaking that it covers?
– The form has been drawn up in conformity with legislation approved by this Parliament, and until that legislation has been varied in some way it must remain. The signing of this form does not take from the person who signs it his liberty to deal with his own property, unless he is making application for a pension from the Commonwealth.
– I move -
That the House at its rising adjourn until to-morrow at 10.30 a.m.
The Government desires to proceed with the business before the House without compelling honorable members to sit late at night, and it has been suggested that it will meet the convenience of honorable members if we meet in the morning, and so obviate late sittings.
. -While I am prepared to assist the Government in proceeding with the business before the House, I think that more consideration should be given to honorable members on this side of the chamber who may have grievances to ventilate on the motion for the adjournment of the House. Will the Prime Minister (Mr. Lyons) give theassurance that they shall have an opportunity to ventilate grievances without hindrance by the method which is usually adopted when a member of ‘ this party rises to speak, when members of the Government leave the chamber, and one honorable member then calls the attention of the Chair to the state of the House, for. the purpose of gagging the honorable member who is speaking by counting out the House?
– Before agreeing to the motion, I should like to make certain that the Government does not intend to compel the House to have all-night sittings and morning sittings as well. I am quite prepared to come earlier in the day, in accordance with the proposal of the Government, and even at 9 a.m., but I think it would be physically impossible to sit all day and until after midnight.
– I protest against the motion of the Prime Minister (Mr. Lyons), because I believe that in moving it he is making another endeavour to give effect to exhaustion tactics such as were adopted last week in order to force certain legislation through this House without giving honorable members an opportunity to give due consideration to it.
– The intention is to avoid that.
– Might I suggest to the Attorney-General (Mr. Latham) and his colleagues that if they were ready to carry out their election promises, they would be prepared to sit even through Christmas week, if necessary, in order to give due consideration to the measures that are before the House. Only recently, measures were rushed through ‘ this House in order to permit honorable members to attend the Melbourne Cup, and it is quite probable that the object of this motion is to speed up business so that honorable members may attend the cricket match in Sydney this week end. Bill after bill has been forced through this chamber without honorable members being given adequate opportunity to consider them, and because of that, amendment after amendment has since been introduced for the purpose of rectifying mistakes in the original legislation.
– The honorable member must deal with the motion before the Chair.
– I am endeavouring to show that the attempt of the Government to use exhaustion tactics to enable it to pass certain legislation through this chamber will not be to the ultimate benefit of the people of this country. Recent legislation has had to be frequently amended. One instance of such amendment is afforded by the Crimes Act, and we know how many times that has been amended-. I suggest to the Government that it should, if necessary, sit through Christmas and New Year, in order to attend seriously to the work of this country. The members of the party to which I belong are prepared to sit through Christmas in order to consider legislation, and we shall oppose this motion, to test whether honorable members are willing to adopt a similar attitude. As the- honorable member for Hunter (Mr. James) has pointed out, action has been taken by Government supporters on the motion for the adjournment to stifle discussion on matters of urgent importance to this country. No doubt those tactics will again be resorted to. The object of the Prime Minister in moving this motion is to rush through the business of this House so that he and his supporters, who are evidently in a holiday spirit, may enjoy themselves. I shall oppose the motion.
. - I hope, that if we agree to meet at 10.30 a.m. to-morrow, we shall at least escape an all-night sitting to-night. We should not pass legislation by methods of exhaustion; but I do not think that to meet at 10.30 a.m. is to adopt such methods. Legislation by exhaustion is obtained by sitting late at night. This practice is aggravated by the use of the guillotine. If Ministers can make it convenient for the House to meet in the morning, that is desirable. I take it that morning meetings are not the custom, because Ministers need the mornings in their offices to deal with departmental matters. Morning meetings, so far from curtailing the opportunities of honorable members to discuss matters, will add to them. What I object to is the sitting of the House all through the night. I cannot, for the life of me, see any justification for the argument that morning meetings will curtail the time for debate. I do hope that all possible steps will be taken to avoid all-night sittings.
– I am sorry that objection has been taken to my motion, for it was moved with a desire to meet the convenience of honorable members. The honorable member for East Sydney (Mr. Ward) has said that this is a process of legislation . by exhaustion, and he has suggested that, if necessary, Parliament should sit right through Christmas. Our experience of’ him is that, even if Parliament were sitting through Christmas, it would be sitting without him. He would probably be away, as he was last year, advocating the Lang plan in various parts of New South Wales. The honorable member for Hunter (Mr. James) has said that there should be opportunity for honorable members to ventilate grievances on the motion for the adjournment of the House. The Government is quite willing to grant reasonable facilities in that regard. The House has been counted out on only one or two occasions. But I remind honorable members who desire to ventilate grievances that they have a responsibility to other members. They should state their grievances concisely. If they do so no objection will be taken. In reply to the right honorable member for Cowper (Dr. Earle Page) and the Leader of the Opposition (Mr. Scullin), I intimate that the Government has no intention of asking honorable member? to sit very late to-night. We are quite prepared to agree to the adjournment of the House at a reasonable hour. If honorable members will reasonably assist the Government to discharge the business of the House, no hardship need be inflicted on any one. I have given an assurance that the guillotine will not be applied to the Financial Relief Bill, which is the most important measure we have to discuss.
Question resolved in the affirmative.
– I have received from the honorable member for Hindmarsh (Mr. Makin) an intimation that he desires to move the adjournment of the House this afternoon for the purpose of discussing a definite matter of urgent public importance, namely, “the serious position created by the continued descent of wages and conditions with particular reference to the recent award of Judge Drake-Brockman in the Commonwealth railways case, which creates hardship to the workers concerned and loss to community and business interests.”
Five honorable members having risen in support of the motion,
.- Although there was some demur from honorable members on the ministerial side of the chamber when the terms of my motion were read, I make neither apologies nor excuses for having introduced this subject, for it is of most serious moment and of tremendous coil”cern to the great body of the citizens of Australia. Considerable alarm has been caused by the retrogression of the wages and conditions of employment in Australia generally. Unfortunately, the enviable position which Australia once held of being an advanced country in regard; to the wages and conditions of her people has been lost. In world courts to-day the* opinion, is held that Australia is now one’ of the most backward countries in her’ industrial conditio ns and in the payment of those employed in the public services. I c may surprise some honorable members to know that this is so ; but the wages and conditions of our people have been so seriously impaired in the last year or two that we no longer enjoy the favorable reputation that was once ours. We have always regarded the standards of western countries as the basis upon which we should build, but to-day we are very much below the standards of many countries which a few years ago were below ours. The International Labour Office at Geneva regards Australia nowadays as one of the most retrogressive countries in regard to industrial conditions generally. This is deplorable to those honorable members, and to our citizens generally, who hitherto have regarded with pride and satisfaction the prominent position Australia used to enjoy in industrial affairs. We have always thought that we were setting an example to the world in our standards of living, but this is not the case to-day.
The recent award of Judge DrakeBrockman in the Commonwealth Sailways case justifies the most vigorous protest on the part of those who are jealous of the welfare of our working people. Surely all honorable members must admit by this time that a halt should be called in the ruinous policy of wage reduction which has been operating for the last year or two. About two years ago the Commonwealth Arbitration Court considered it necessary, in view of the economic and financial position of Australia, to make a 10 per cent, cut in all wages fixed by awards of the court. But those who imagined that by this means industry would be rehabilitated and prosperity revived, have been sadly disappointed. The disappointment has been so keen that even learned judges of the Arbitration Court Bench have remarked upon it, if not by direct statements, at least by hints. Chief Judge Dethridge, for instance, recently gave a hint on the subject, and Judge Drake-Brockman, during the hearing of the Railway Workers’ case, also suggested that the time might be opportune for a reconsideration of the 10 per cent. cut. That being so, there is the more reason for concern that the learned judge should in his award have made such a drastic downward revision of the wages and conditions of our railway workers. The judge departed altogether from the principles and methods which have governed the determination of the basic wage almost since the establishment of the court. Heretofore various “ loadings “ have been an essentia] factor in the determination of conditions and rates of pay. Now the isolated position in which men might be placed when doing their work, the lack of avenues for promotion, the lack of educational facilities for their children, and other disabilities are to be disregarded when rates of pay are being fixed. Honorable members on this side, and all concerned with the Labour movement, entertain grave fears about the reaction of this upon employees of the Commonwealth railway service and the workers generally. ‘ After the 30th June, 1933, ail allowances and other special privileges granted under the Commonwealth Railway Workers Award from the commencement of work on the Kalgoorlie to Port Augusta railway will automatically cease. The matter is to be left entirely to the discretion of the Railways Commissioner, in effect, the Government. It has been the practice that the basic wage shall be altered only by the fullArbitration Court. The new rate promulgated by Judge DrakeBrockman indicates a drastic innovation which must detrimentally affect all workers. The basic wage rate is reduced by ls. 3d. a day; from Ils. 2d. to 9s. lid. Guards and other members of train crews working on the line between Quorn and Alice Springs are to have their travelling allowances reduced by 50 per cent. That is an unwarranted reduction of rights which have been enjoyed by these employees ever since the line was constructed.
– Did I understand the honorable member to say that the basic wage for these men is being lowered ?
– Yes; by ls. 3d. a day.
– The determination is in accordance with the principles that the court has applied ever since it has been in existence.
– I am afraid that the honorable gentleman is not correctly informed. I ask him to read the award formulated by Judge Drake-Brockman, which disregards the usual practice of considering “ loading “.
– “ Loading “ is a different question from the basic wage.
– “ Loading “ has always been a determining factor in the fixing of wages and conditions. These men, on a proper computation in- accordance with the methods that applied in the past, would have received 12s. 3d. a day. They are now to be paid only 9s. lid. The previous rate was lis. 2d. a day, a reduction of ls. 3d. At the hearing of the case it was claimed that there has been a fall in the cost of living. An examination of statistics discloses that, in the last quarter, the cost of groceries “has actually increased by 4 per cent., and whereas rents were said to have fallen, they have really remained stationary. Mv colleagues and I have reason to believe that the figures compiled by the Statistician do not disclose the proper position. It is time that a thorough investigation was made into the method adopted in securing from traders the prices of commodities, and into the method of computation. There is intense dissatisfaction in South Australia concerning the present system. So strong is public feeling over this matter and the award of Judge DrakeBrockman, that indignation meetings have been hold at both Quorn and Port Augusta under the chairmanship of the mayors of those towns.
The constant reduction of wages and the lowering of conditions only intensify our troubles and destroy all hope of industry being rehabilitated, as they reduce the purchasing capacity of the people. We feel that the time has arrived to review the 10 per cent, cut in wages, and to return to the original rates. We have now had two years’ experience of wage cutting, and have found that, far from helping the country towards financial stability, the effect upon industry has been ruinous, and thousands of men have been thrown out of work. One of the worst features of this award is that it is for a five-year period. During these abnormal times, no award should be for a period of longer than two or, at most, three years. Anything might happen in that time to justify a revision of rates and conditions.
This is a matter which concerns, not only the Commonwealth railway employees, but other workers as well. A precedent has been created which will affect those in private employment. -The Government may say that it has no actual control over this matter, but it was this Government which amended the Financial Emergency Act, and removed the provision made by a Labour government that the basic wage should x not be less than £182 a year. This amendment paved the way for the award which Judge Drake-Brockman has just made. The Government authorized the Railways Commissioner to apply to the Arbitration Court for a variation of the existing award, the application was made, and the present award is the result. This is the last day upon which the judge will receive appeals against the award, and the Government should make it known that it does not desire the basic wage to be departed from.’ The Commonwealth railway employees and public works men are scattered in small communities over a wide area, and the Government should step in now to protect their interests against the operation of this harsh decision. The policy which the Government appears to be pursuing is merely intensifying Australia’s economic troubles.
– The honorable member’s time has expired.
– I am sure that honorable members on this side of the House, as well as those in Opposition, regret that it should be necessary to reduce wages. “We regret, not only the cutting down of wages, but the general cutting down of incomes which has taken place all over Australia, whether in the workshop, in the office, or on the farm. In this case, the reduction has been made by the Arbitration Court, which was established by this Parliament with the approval of all parties. When wages were rising, and when every application to the court was followed by an increase in wages, honorable members opposite were quite satisfied to accept the decisions of the Arbitration Court. For the last three years, however, it has been evident that wages and costs generally have been on the down grade, and this has been recognized by the court in its recent decision. The Commonwealth Railways Commissioner was anxious to present his case to the court some time ago so that costs might be reduced, and a more favorable balance-sheet presented. He applied to the last Government for permission to approach the court, but that permission was denied him. Arbitration is of no use if it is to work only one way. Honorable members must recognize that the wages of State employees have fallen considerably in the last two years, and this reduction of the wages of Commonwealth railway employees merely brings them more or less into line with the employees of State railways. On the 1st March, 1932, the Commissioner applied to the Government for permission to approach the court, and the following reply wa.s forwarded to him by the secretary to the Department of the Interior : -
Attention is invited to my memorandum of 27th March, 1931, on the question of the industrial position of the Commonwealth Railways employees.
Thu question of the Commonwealth Railways Commissioner approaching the Court of Conciliation and Arbitration was considered by Cabinet on 23rd February, 1932, -when Cabinet decided that the Commissioner should have a free hand to approach the Arbitration Court for any reduction or variation in the rates of pay and allowances and conditions of employment of Commonwealth Railways employees.
A memorandum, dated the 27th March, 1931, when the last Government was in power, contains the reply of that Government to the Commissioner’s application to present his case to the court. It is in these terms -
I am directed to refer to your letter No. Ind/194 of 24th March, 1931, addressed to the Assistant Minister for Transport, on the question of the industrial position of the employees engaged on Trans- Australian and Central Australian Railways.
In reply, I am to say that the question of your proposed submission to the Arbitration Court for a reduction in wages of Commonwealth Railways employees has been considered by Cabinet, which has decided that the present is not au opportune time to make a submission, and has decided that you he advised that the Government is opposed to the making of any application to the court at the present time.
The consequence was that the Commissioner did not go to the court, wages remained unaltered, and railway finances began to go from bad to worse. In all other branches of industry wages had, in the meantime, been reduced. Whether that was a good or a bad thing, is a point which we may argue upon some other occasion, but the fact remains that the Commonwealth Railways employees formed a sheltered community, unaffected by the general fall in wages all around them. When the Commissioner applied to the present Government for permission to apply to the court for a variation of the award, that permission was given, the application was made, and the court’s decision has now been received. The term of the draft award expires to-day, but I do not know whether the men have appealed against it. Evidently they are dissatisfied with the award which has been delivered, and the honorable member for Hindmarsh (Mr. Makin) this afternoon referred to the dissatisfaction which exists among the people at Quorn aud Port Augusta. The people living in those places are residents also of South Australia, and they ought to know that the wages of Commonwealth Railways employees, even after, this last reduction, are still ‘6d. a day higher than those paid to the State railway men in South Australia.
– That is not in accordance with the information I have received.
– Perhaps if the honorable member had been in possession of the facta he might have spoken differently to-day. ‘ The terms of the awards and agreements covering the Commonwealth Railway employees having expired, a plaint was filed in the Commonwealth Court by the Commonwealth Railways Commissioner, covering members of the following organizations engaged in connexion with the trans-Australian railways: The Australian Workers Union, the Australian Federated Union of Locomotive Engine Men, the Amalgamated Engineer ing Union, the Federated Society of Boiler Makers, Iron and Ship Builders, and Structural Iron and Steel Workers, the Federated Moulders (Metals) Union, the Plumbers and Gasfitters Employees Union, the Amalgamated Society of Carpenters and Joiners, the Austraiian Coach, Motor Car, Tramcar, Waggon Builders, Wheelwright and Rolling Stock Makers Employees Federation, the Electrical Trade Union and the Australian Society of Engineers. Counter claims were also filed by each of those organizations. The court proceedings commenced at Port Augusta on the 3rd August last and concluded on the 14th November. In addition to hearing evidence in court, His Honour made detailed inspections of the railways between Port Augusta and Alice Springs and Port Augusta and Kalgoorlie, and on these inspections the employees had every opportunity to make any representations to him that they desired. Throughout the proceedings the unions concerned were afforded every facility to conduct their case, and were adequately represented. In no instance did the local representatives conduct the proceedings before the court, the advocates being union officials who hold high executive positions and are well versed in industrial arbitration work. When the court proceedings commenced, the basic wage for the Commonwealth Railways service was 12s. 6d. a day, which, less the emergency reduction of 10 per cent., represented Ils. 3d. a day. As from the 1st November, in consequence of a decrease in the cost of living index-numbers, the basic wage fell to 12s. 4d. which, less the 10 per cent, emergency reduction, was equivalent to lis. Id. a day. Under the draft award the following base rates ,are provided: West of 1,021 miles, trans-Australian railway, 12s. Id. minus 10 per cent., equals 10s. 10$d. ; elsewhere on the trans-Australian and Central-Australian railways, lis. a day, minus 10 per cent, equals 9s. lid. a day. It will be seen, therefore, that in respect of employees west of 1,021 miles on the trans-Australian railway the draft award involves a decrease of 2d. a day, and for the other sections of the trans-Australian and Central- Australian railways a reduction of ls. 2d. a day.
Under awards of the Commonwealth Court, employees of the South Australian Railways Commissioner at present receive abasic wage, after the 10 per cent. emergency reduction, of 9s. 5d. a day, which is 6d. a day less than the minimum basic wage provided for in the Commonwealth Railways draft award. I have already stated that the employees of the Western Australian railways also receive a lower basic wage than that awarded to the Commonwealth Service. Of the 257 employees located at Port Augusta, less than twenty are employed in grades for which the basic wage only is paid.
– All others are reduced proportionately.
– That is so, but they will not feel the reduction as do. the men who are on the basic wage. In the Federal Capital Territory last week there were between 600 and 700 men who were earning no wage at all. Throughout the Commonwealth there are about 300,000 persons who are without work or wages. The House should know also that along the railways of the Commonwealth nearly all of the employees receive rates in excess of the basic wage, and in addition are granted an allowance. They are also extremely well treated in respect of the cost of living, being supplied with (a) residential accommodation, in most cases at nominal rentals, (6) groceries at prices not exceeding those fixed by the South Australian Retail Grocers Association for Adelaide and suburbs, (c) meat under contract at rates generally lower than those applying at Port Adelaide, (d) firewood free of charge where it is not obtainable locally, and (e) water free of charge. The draft award provides, amongst other things, for adjustments in the rates of pay in accordance with the cost of living index-numbers.
– Does that compensate them for the other disadvantages?
– I am sure that if the honorable member were employed on the railways he would appreciate the concessions I have mentioned.
– Would the Minister for the Interior care to be employed on the trans- Australian railway?
– I would much prefer to hold my present position, and I have no doubt that the honorable member would prefer to remain in this Parliament, even in opposition, rather than become a railway employee. I have hundreds of applications for a job which carries merely a living wage, and the Minister in charge of the Territories has informed me that over 1,600 applications have been received for a small position in New Guinea. The fact that the honorable member for Hindmarsh (Mr. Makin) and I are not prepared to don bowyangs and work on the Commonwealth railways does not dispose of the fact that there are throughout Australia thousands of men who would be glad of employment at the rates awarded by the court.
– The Commonwealth should not trade on the sufferings of humanity.
– No; nor should we disregard the circumstances . of the taxpayer. The greater the amount of money paid out to Commonwealth employees, the greater the burden on the taxpayers, many of whom have not the money with which to pay their taxes. I admit that the railway employees do not live in luxury, but their rates have been fixed after a fair and open inquiry by the Arbitration Court. The judge has been at considerable pains to allow the men to be heard, and the fact that he has awarded them 6d. a day in. excess of the wage paid to employees in like occupations on the South Australian railways . is proof that, he dealt with them at least justly. There is no reason why Commonwealth employees should be treated more generously than South Australian employees covered by awards of the court.
– I endorse the plea made by the honorable member for Hindmarsh (Mr. Makin), and I am surprised that the Minister for the Interior (Mr. Perkins) should so wholeheartedly defend the miserable basic wage of less than £3 a week. The employees on the transAustralian and Central Australia railways are working in two of the worst areas in Australia; yet the Minister has suggested that they should be grateful for not being required to pay for the water they drink. Have Ministers paused to consider whether the general reductions of wages have not caused industrial and economic reactions, which explain the desire of thousands of men to take jobs even at woefully inadequate wages. Two years ago, when we were dealing with the budgetary emergency, the leaders of the present Government assured the House and the community that they had no desire to cut real wages; and I believe that the Attorney-General (Mr. Latham) never anticipated that the stage would be reached when the Government would be attempting to do that. However small the basic wage fixed by the court, it is subject to a 10 per cent, reduction, and the lower the awarded wage, the harsher does the 10 per cent, cut become to the worker. The recent award by the Arbitration Court provides for the lowest rates of pay ever awarded by the court to railway employees in Australia. I am not in a position to dispute the statement by the Minister for the Interior, but I doubt whether the Western Australian railway employees receive a real wage that is less than that awarded to the federal employees. The Minister has referred to allowances in excess of award rates and conditions. When Commonwealth railway servants were sent to Alice Springs, they were granted an extra allowance because of the isolation and climatic conditions, and because they were transferred against their will, and had to submit to an upheaval of their domestic arrangements. The Government might well consider whether the time has not arrived for retracing some of the steps we have taken during the last two years. It is obvious that the judges in. the Federal Arbitration Court are beginning to doubt whether we should continue along the lines of deflation and reduction. Both the Chief Judge and Judge DrakeBrockman have questioned whether the experimental cut of 10 per cent, made two years ago has not done more harm than good. The Minister’s statement that hundreds of men are anxious to .accept such conditions as the court has awarded emphasizes the need for reconsideration of the economic and financial policy. The time is overdue for Parliament to do what the Government asked the Arbitration Court to do, namely, to take into con- sideration the economic circumstances of industry. The court was then given liberty, if it thought the circumstances of an industry warranted, to break down all the conditions that had been maintained since the commencement of the Federal Arbitration Court, and not only reduce wages in accordance with the cost of living index numbers, but also cut real wages. That experiment was resorted to because of the extraordinary budgetary position; it was not intended to be permanently engrafted on the arbitration system. We should now ask ourselves whether the experiment has been a mistake. The slashing of wages has taken more than £100,000,000 out of the wage3 fund of the workers under the jurisdiction of the Federal Arbitration Court, apart from others. That is the real reason for the existing depression. It explains why the storekeepers of Quorn and Port Augusta have telegraphed to the members representing them to urge them to take steps to have the award reviewed. There is a steadily increasing volume of public opinion that the wage slashing policy is accentuating the depression by diminishing the purchasing power of the greatest consuming section of the community, the great mass of wage workers. Every penny of the money extracted from the wage fund has been lost to the business people of this country. It is quite certain that, taking the law of averages, the wage-earner spends every penny of his wages as fast as he receives it in obtaining the legitimate requirements of his home life. Immediately his wage is reduced, every shop-keeper, business man, merchant, and manufacturer is adversely affected. We have nearly 500,000 people unemployed. I think that most honorable members who support the Government are not nearly so confident as they were two years ago that the solution of our difficulties is the reduction of costs, wages, and prices. The lowering of costs will not remedy our ills, and the proper course for us to take is to increase the demand for the goods and services that we produce. There are in Australia hundreds of factories with plant lying idle, not because costs are too high, but because there is. no demand for the articles produced in them. No manufacturer can risk pro- ducing either goods or services unless he is assured of a potential demand for them. Our trouble to-day is that we have lost the demand for our goods and services, and the difficulty is being accentuated by the gradual lowering of wages, and the consequent lessening of the purchasing power of the community. I hope that the Attorney-General (Mr. Latham) and the Minister for the Interior (Mr. Perkins) will have the position examined and reviewed. “We are all agreed and anxious that the primary producers should have the benefits of lower costs to enable them to compete on the overseas markets. But that the overseas market is at present ruined for the Australian producers, because of the glut of stocks for which there is no demand, is no reason why we should ruin our own home market by reducing the consuming power of our own people. That, I contend, is what we are doing to-day. In some ways this Government should give a lead to the Arbitration Court, and the judges themselves are suggesting that the time has arrived for it to do so. This Parliament did, a few years ago, confer greater powers upon the judges, and intimated in what way these powers should be exercised. We should now ask them to review the position in which they, by their awards, have placed this country, and if, as I contend, the deflation policy has been a failure, it should be abandoned.
– I propose to refer mainly to some of the more general aspects of this interesting question which has been brought before the House. I submit that most honorable members sympathize with the workers who have had their wages reduced.
– That will not help them.
– The honorable member is himself perfectly incapable of helping the workers. He and his colleagues are unable to do anything in this House except by way of interjection and obstruction. Although they apparently do not share my view, I repeat that honorable members generally have real sympathy with all workers who have suffered reduction of wages. In this matter, however, important principles are involved.
In the case referred to by the honorable member for Hindmarsh (Mr. Makin) a dispute has been heard before the Commonwealth Arbitration Court, and one side has not obtained what it desired. That frequently happens; indeed, it happens in most court proceedings. This Parliament is now asked to review the decision of the Arbitration Court in favour of those who failed to satisfy that tribunal that it was right or proper to grant their claim. To appeal to the Parliament from a decision of the court is, I suggest, rather dangerous, and the suggestion of the honorable member would, if adopted, involve a breach of an important principle which this Parliament ha3 accepted for many years - that these matters should be determined by the court, and should not be reviewed upon the floor of this House. It would be a hopeless position if, whenever one party was dissatisfied with an award, it were at liberty to appeal to the Parliament to have the matter determined upon political considerations. In this case those concerned are employees of the Commonwealth, and it would be possible for this Parliament, by legislation, to fix their wages. In industry generally that is not possible, because this Parliament has no power to legislate with respect to wages generally; and it has, by a considered series of legislative enactments, deliberately conferred upon the Arbitration Court the power and the duty of determining these questions in relation to Commonwealth employees. We are now asked to reverse that system. We are asked to say that the Parliament should give a direction to the tribunal in relation to the award that it should make or that, in the alternative, we should override the award by legislation or regulation.
– The Commonwealth Government is a party to the award.
– That is so. This Parliament has deliberately decided that where the Government is concerned in respect of wages and conditions of employment of government servants, the decision shall be - as in this case - left to the Commonwealth Arbitration Court.. We are now asked to over-rule an award of that court. The honorable member for Hindmarsh (Mr. Makin) referred to the terms of the award. Let us consider how far this Parliament is in a position to deal with the matters at issue in this case. It has already been mentioned by the Minister for the Interior that the basic wage fixed in this award is 6d. more than what is allowed in South Australia for identical work. The basic wage awarded is also higher than in the case of Western Australia. But let us consider the details of the award itself. West of a certain point on the Commonwealth railway system - the 1,021 mile mark - the wage is fixed on the Statistician’s index number for Kalgoorlie, which is 1,450, and that gives a monetary value of £3 12s. 6d. a week, or 12s. 6d. a day, which has been subjected to the universal 10 per cent. reduction. Elsewhere in the service, the basic wage and other wages with appropriate margins, are fixed on the figure for Port Augusta, taking into account, in addition to the figures which are used by the Commonwealth Statistician, the railway store prices for bread, groceries, and dairy produce.For the present quarter, that figure is 1,310 as against the Kalgoorlie figure of 1,450, and it gives a monetary value of £3 6s. a week or11s. a day, which is subject to the 10 per cent. reduction. In the case of the construction section, there is an extra payment of 3s. a week. I have set before honorable members the basis upon which the wage is arrived at, and, of course, with that basis some may agree and others may not. It is most unlikely that we would all agree. I doubt whether any one has the precise knowledge to arrive at a decision on the matter. There is always room for argument on these matters. Surely it is wiser to leave these matters to be determined by the appropriate tribunal than to have them determined upon the basis of political considerations in a legislative assembly. I call attention to this circumstance which I suggest is rather unfortunate. Awards are almost universally made in a provisional form, and awards in that form are indicated to the parties, and the parties are informed that if there are mistakes, or if they wish to submit further representations, the court will sit upon a particular day for the purpose of hearing them. That is precisely what was done in this case. The award was forwarded, to the parties with a letter which stated that it should be stressed that the minutes of the award may be subject to alteration before the award is finally drafted. This is the day upon which there is a right to speak to the minutes, and I suggest that it is wrong to bring this matter up in Parliament now.
I listened with interest to the remarks of the honorable member for Melbourne Ports (Mr. Holloway) and what he said must, within limits, command the acceptance of every honorable member. If there were more demand and more money, more goods would be sold, employment would increase, and we would all be better off. But does the honorable member seriously mean that on account of either benevolent or economic considerations wages should be paid which any industry is incapable of paying, if it is to maintain itself? I am quite aware that there is a difference between government enterprise and private industry, but the honorable member addressed himself to a more general question than that of government enterprise. His mind appeared to be running along the lines that if we paid higher wages generally, there would be more money to spend and a general stimulation of consuming power which would react to the advantage of industry generally. But honorable members must recognize that we have to look at this matter in the first instance from the point of view of the unfortunate citizen who is trying to produce goods in order to sell them. Unless he is able to conduct his business in such a way as would enable him at least to get bis money back, it is useless for him to carry on. It would be nice, of course, if the basic wage could be fixed at £10 a week, but the immediate result would be the complete destruction of industry and employment in the community. There must be some limit which determines what the appropriate wage should he, apart altogether from benevolent intention.
– There is a limit to everything.
– If benevolence and goodwill towards our fellow creatures is not the limit, where is a limit to be found ? In Australia we have, up to the present, adopted the principle - and I hope, generally speaking, that it will be continued - that there should be a living wage, and that has, up to the present, been adjusted in not too satisfactory a manner in relation to cost of living figures. But still, almost universally, that principle has been adopted for many years. It is impossible to solve our economic difficulties by increasing wages to standards which industry is unable to pay.
– The honorable member’s time has expired.
.- While sympathizing with the position that has been put forward by the honorable member for Hindmarsh (Mr. Makin), I think that this problem is being approached in the wrong way by attempting to attack the judgment of the court. I think that the right way is to attack the cause which makes the wage inadequate at present to purchase the same quantity of goods that it purchased, say, three or four years ago. I was struck with an article which appeared in the Monthly Summary of Australian Conditions, issued in October by the National Bank of Australasia Limited, which dealt with this very question. I quote the following paragraph from that article : - “While far-reaching adjustments, tending to rectify alterations in conditions which the general depression has brought in its train, have been made in many directions, it is clear that in some branches of our economic life resistance to necessary adjustments has retarded the movement towards a new and stable condition. During the past period of high prices, many items of costs were pushed up to unduly high levels, which have not been reduced since in proportion to the fall in other directions.
Wages and salaries have been reduced in keeping with the downward movement of an index based upon the cost of a limited range of commodities and housing. At the same time, a much larger number of necessities and conventional luxuries in the form of both goods and services shows no adequate lessening in cost. This fact is evident to the ordinary householder who finds that, while the official cost of living index is on a lower level, he is unable to translate the benefit he should derive from that factor into a corresponding reduction in the sum of his own outgoings. This refractory element in costs and prices constitutes one of the major problems of a period of depression and deflation, and a serious effort should be made to bring it into line with other economic factors. It is exemplified in the wide divergence between Melbourne wholesale prices of rural products and certain manufactured goods, shown in the index compiled by the
Those figures show that the price of in,dustrial goods has gone up, while that of other goods has gone down. It seems to me, therefore, that our attention should be centred upon the devising of ways and means of bringing the price of industrial goods down. The Tariff Board has already indicated one means by which this can be done. A few days ago I raised this very question in the House, and suggested that the Government should give some consideration to the protective incidence of the exchange. Obviously, the essential plant and equipment brought into Australia is affected by exchange and tariff costs, and this makes the price of goods very much higher than it need otherwise be. Unfortunately, many manufacturers in Australia are taking the fullest possible advantage of the exchange position. I realize, of course, that a good deal could be done to lower costs by providing for a better distribution of goods. I hope that the Government will not accept the advice of the Labour party, which is to attack the awards of the court, but that it will accept the advice of the Country party, which is to take effective steps to bring the price of manufactured goods more into conformity with the price of primary products. The newspapers yesterday indicated that in England butter had touched the lowest price for 30 years, and only a few weeks ago we learned that, at Chicago, wheat had touched the lowest price for 80 years. Quite obviously there is to be a period of nominal low wages, and in order to give those low wages the highest possible purchasing power we must bring about a reduction in the price of manufactured goods. To save the people from profiteers the Government should take into consideration the protective incidence of the tariff and the exchange, and try to rectify the position.
.- When I appealed to the electors of Grey for their support I intimated that, in accordance “with the policy of the party supporting this Government, I was in favour of the retention of industrial arbitration. I still favour the retention of industrial arbitration. It has been suggested that the Government should take steps to vary the railway workers’ award just given by the Arbitration Court, but I am not favorable to the adoption of that course. If the court is to be interfered with in any way, it should be by act of Parliament.
– The Government did not think so when the wages of certain public servants were under consideration recently.
– The Government’s action in relation to the Public Service was governed by the legislation passed by this Parliament. I was pleased to find from the figures quoted by the Minister for the Interior (Mr. Perkins) that the wages of the Commonwealth railway men will not fall below those paid to South Australian railway employees, for I know the conditions under which these men work, and do not think that they are at all comparable with those of the South Australian men. A few months ago I made representations to the then Minister for the Interior respecting the housing accommodation provided for certain of our railway men. In my opinion the conditions are not such as this. Government should provide for its employees. I was not surprised when the Minister for the Interior, in speaking to this motion, said that residential accommodation was made available to railway workmen in most cases at nominal rents. Any rent would be excessive for some of the accommodation provided for our railway men. The Government should endeavour to improve the conditions of its railway workers in this respect. I am favorable to the zoning system. I do not think that the special rates paid to men who live out along the east-west railway line should be lowered. Although the Minister for the Interior told’ us t) at the railway workers out there receive their goods at the prices ruling in Adelaide, we must realize that through living in those remote areas they are deprived of many of the amenities of life enjoyed by workers who reside in more favoured localities. They should, in my opinion, be granted some compensation on this account.
– Their allowances in this connexion are being reduced.
– The Government should give some consideration to that aspect of the subject. Men who are obliged to live in unpleasant places should be compensated for doing so. While the Government should not use its power unduly to alter any award of the Arbitration Court, it should use its administrative authority to see that injustices are not inflicted upon its employees. Prior to this discussion, I endeavoured to obtain some details of the wages of these employees, but the first specific information I got was that imparted to us this afternoon by the Minister. I do not think that as a member of this Parliament I am in a position to say whether the wages are reasonable or otherwise.
The honorable member for Melbourne Ports (Mr. Holloway) made the suggestion that although our primary producers must reduce costs on account of the competition they meet in the outside world this obligation should not apply to the sheltered industries of this country.
– That is not the whole of my argument on that point; I said that that was not the crux of the trouble.
– I suggest that it is almost impossible for primary producers to lower costs when the price of everything they purchase to carry on their business of production is still at a high level. It is also impossible for our primary producers to carry the whole of the burden of the reduction of costs necessary in Australia. Such reduction of costs must be spread over all Sections of the community. When we talk about the reduction of wages we should remember that the wages of the primary producers have been cut to the bone. But honorable members opposite have very little to say on that score, although our primary producers have enabled Australia to remain solvent. A great deal of complaint is heard about the reduction of the wages of industrialists because they are organized ; but not much is heard about the reduction of the wages of the primary producers, although they have been cut to the very bone, because they are not organized, and have no political significance.
However, I am sure that this Government does not wish to inflict injustice on any of its employees, and that it will look into the complaints that have been made.
.- -The honorable member for Hindmarsh (Mr. Makin) has rendered a service to Australia by introducing a discussion on this subject. I, like the honorable member for Melbourne Ports (Mr. Holloway), have been somewhat disappointed at the way Ministers have received the complaints that have been made. The Attorney-General (Mr. Latham) endeavoured to put honorable members on this side of the House in the wrong by suggesting that we were actuated by the desire to bring improper influence to bear upon the judges of the court. He even went so far >as to say that we had selected the wrong day on which to introduce this discussion. The purpose of the honorable member for Hindmarsh and those who support him is to place before this Parliament a grievance, and to direct attention to an injustice which is being inflicted upon certain employees of the Government. It does not necessarily follow that because an arbitration court has made an award the Government must adhere closely to the terms of it, for we know that the Arbitration Court fixes minimum and not maximum wages. Awards of the Arbitration Court which apply to private employment are at times varied when private employers agree to pay more than the minimum provided. It would be competent for this Government to instruct its representatives, in speaking to the minutes of this proposed award, to intimate that the Government desired a variation of the award, because it did not wish to cut the wages of the men to the bone. There would be nothing improper in the Government adopting that attitude, and it could not be said that by so doing it was attempting improperly to influence a judicial tribunal. There are precedents for such an act. “We know very well that only recently the Government declined to adhere to an award of the Public Service Arbitrator. Of course, it used the plea in that case that Parliament had given it the power to depart from the award. But that is not the only precedent. Some time ago, when the Commonwealth Arbitration Court made a 10 per cent, cut in the value of real wages, the Government of the day decided that this should not apply to the Commonwealth railway servants. If the previous Government could make such a decision this Government can make a similar one. When the award of the full Arbitration Court was applied several months later, a clause was embodied in a measure passed by this Parliament, the Financial Emergency Act, which provided that the reduction should not be applied to the basic wage paid to these men. I have no recollection of honorable members opposite protesting that that was an undue interference with the award of the court. If such a thing could be done in two instances, why cannot it be done now? The honorable member for Grey (Mr. McBride) is most inconsistent. When he first began his speech he said that he would not consider any interference with the court. But before he resumed his seat he urged the Government to consider aspects of the harsh treatment that was being meted out by the operation of the proposed award. He was “ yes “ and “ no “ inside seven minutes. As was indicated by the honorable member for Melbourne Ports (Mr. Holloway), the question is bigger than its application to this particular award. If it is right for the Government to review the application of taxation and other matters, it is right also that the matter of wages generally should be considered. I do not .suggest that there should be a separate commission for the purpose. Perhaps the court itself could be appointed a commission to review the subject of wages and conditions. The honorable member for Melbourne Ports advanced the irrefutable argument , that the more the purchasing power of the people is reduced the greater is the accentuation of the depression. The Attorney-General endeavoured to meet that argument with a reductio ad absurdum, “ Why not order a basic wage of £10 a week?” he asked, and he proceeded to answer that question by saying that there must be a limit to everything. .That is precisely what the honorable member for Melbourne Ports said. My colleagues and I ask that there shall be a reconsideration of the position, to determine whether we have not really got below a sound economic basic wage. 1 could never be convinced that we can get out of our troubles by bringing down the wages of the workers generally 1.0 per cent, below the standard that has prevailed, or even that which prevailed 25 years ago. I admit readily that when an economic crisis descends upon the world, and our national income is reduced, we cannot expect to maintain during its continuance all the standards which previously obtained. But when prices come down, as reflected in the cost of living, wages also come down automatically. This reduction of wages is as much as .the workers should be asked to contribute towards overcoming the depression. The argument was placed before the court that, while it was true that the increasing of wages had followed the rise in the cost of living upwards, the decreasing of wages must precede the fall in the cost of living, because costs cannot come down until wages have been reduced. The court unfortunately accepted that argument. Having done so, the logical thing was to insist that when a reduction of wages brings down the cost of living, the workers ought to receive the benefit of that, instead of being subjected to a further cut in wages. My Government adopted that principle in the case of those employees not receiving more than the basic wage who were in the Commonwealth Service, and applied the court’s award only to those who were on the higher rates, with a stipulation that there should be no reductions in wages due to the cost-of-living reduction until the costofliving fall had absorbed the 10 per cent. That arrangement was in operation until my Government went out of office.
A conference of the representatives of the Commonwealth and the various State Governments with eminent economists formulated what is termed the Premiers plan. The all-round reduction in wages of 20 per cent, was adopted. It was pointed out that the workers in private employment had suffered a. reduction of 12 per cent, due to the fall in the cost of living, plus a 10 per cent, reduction in real wages. My Government provided that the 20 per cent, reduction should apply to everything, including interest, except pensions, which were reduced by 13 per cent. That reduction was regarded as being sufficient to stabilize the position. But the workers in private employment have actually suffered a 30 per cent. cut. The time has arrived to review the position. If a general 20 per cent, reduction has proved insufficient, we must formulate a plan that will relieve the workers of some of the 30 per cent, cut to which they have been subjected, even if a portion of it has to be applied to bondholders and others. That was the basis upon which the whole reconstruction was approved last year. Those who support me will give the Government every assistance in formulating a new plan. . We ask the Government to consider the whole economic effect of this 10 per cent, reduction of real wages which has brought the purchasing power of wage-earners 10 per cent, below what it was in 1907.
The honorable member for Cowper (Dr. Earle Page) raised a question that would bear investigation, the relevant cost of primary and secondary production. I would not evade such an examination. It is time that we took stock of the relation of wages to purchasing power, as it affects the general prosperity of the community.
.- I desire to ally myself with the protest that has been made by the honorable member for Hindmarsh (Mr. Makin), at the instigation of the employees of the Commonwealth railways and the business people of Quorn and Port Augusta. It is unfair that, although they rose, honorable members of my party did not receive the call. I rose simultaneously with the honorable member for Melbourne Ports (Mr. Holloway) but he and three others have since received a call.
– When the honorable member for Hindmarsh (Mr. Makin) had . completed his speech, the Minister for the Interior rose to reply. He was followed by the honorable member for Melbourne’
Ports (Mr. Holloway), and the AttorneyGeneral (Mr. Latham). The Leader of the Opposition (Mr. Scullin) rose, in all, four times, but the honorable member for Hunter (Mr. James) had risen only once when I called the Leader of the Opposition. I consider that the position of the right honorable gentleman justifies me in giving him the first call.
– During the last election, supporters of the present Government used the cry “Vote for the United Australia Party and secure for yourselves good jobs at steady wages.” That promise has not been carried out. The Government has permitted the Commonwealth Commissioner for Railways to approach the Arbitration Court and seek a reduction of the wages paid to Commonwealth Railways employees. The Scullin Government refused the Commissioner authority to approach the* court. Employees of the Commonwealth railways have now suffered three reductions in wages. Under the Financial Emergency Act, men receiving £216 per annum were reduced by £45, which was equivalent to a loss of 20 per cent. The act provided that no adult married man should have his salary reduced below £182. That is now being ignored. There was the cost of living reduction, and now the present one, which is totally opposed to the promises made on the hustings’ by honorable members opposite.
It is interesting to note that business persons, probably supporters of the Government, have protested against these reductions,- realizing that they do not afford a solution of the economic problem. They know that the less money there is in circulation the smaller will be their turnover, with the result that they must discharge additional employees.
It was mentioned by the honorable member for Hindmarsh (Mr. Makin) that train crews travelling between Quorn and Alice Springs and Port Augusta and Kalgoorlie are to lose 50 per cent, of their travelling allowance. We know the hardship that employees who have to journey long distances have to suffer, and bow unfair it is to cut their allowance. The Government should certainly review the position. It should also review the position of the Arbitrator himself. At one time that gentleman was a Nationalist senator, and at present he receives £48 a week plus a travelling allowance of £2 2s. a day, or an annual salary, exclusive of the allowance, of £2,500. Yet, when asked to do so by the Scullin Government, he refused to submit to a reduction. It is most inconsistent and unfair that such a person should reduce the wages of these low paid men.
-Order! It has been the practice of this Parliament not to allow any criticism of, or any reflection to be cast on, the judiciary. I ask the honorable member to confine his remarks to the motion before the House.
– It is unfair that we are not allowed to mention these instances of injustice. These railway men have been more harshly treated than any other section of the community, and the Government should intervene and prevent a reduction.
The people of Australia have come to the conclusion that the statement of the Scullin Government that the reductions effected .under the Financial Emergency Act would place an additional 100,000 in employment has not, and cannot be justified. The then Prime Minister stated that the onus would be placed on the employers of Australia to prove that that reduction would result in improved conditions and prosperity. That has not happened. Unemployment is growing more rapidly than ever, because reduced wages mean that there is less money in circulation, and the purchasing power of the community is consequently lowered. When the turn-over is reduced, employers are compelled to cut costs, and they do so by discharging their employees. It is unfortunate that we are not permitted to explain to the people of Australia that a gross injustice is being inflicted on a group of the lowest paid workers in the community, by one of the highest paid persons in the employ of the Commonwealth, Judge Drake-Brockman, and it is a downright shame that he should be permitted- -
– Order ! The honorable member for Hunter (Mr. J James) has wilfully defied the authority of the Chair, and disregarded the warning given to him earlier. I ask him now to rise in his place and apologize for the attack that he has made on the judiciary, and for disregarding the ruling of the Chair.
– I do not know under what standing order–
– The honorable member must obey my ruling.
– All right, I shall obey it.
– The honorable member must not aggravate the offence. I ask him to express his regret for attacking the judiciary, and for disregarding the ruling of the Chair.
– I feel that I cannot express my regret for saying something that is true.
– I name the honorable member for Hunter.
– I suggest to the honorable member for Hunter that the Speaker has extended to him a great deal of latitude, and I make a final appeal to him to obey the Chair.
– It will be my practice in future, once an honorable member is named, to have action taken without any further warning being given. I shall endeavour to exercise the utmost patience before taking this extreme step, but, once taken, it will be final. On this occasion the honorable member for Hunter will be allowed a further opportunity to obey the ruling of the Chair. If he does so, his offence will be overlooked.
– I withdraw the statement objected to, and express my regret.
– The Attorney-General (Mr. Latham) and the Minister for the Interior (Mr. Perkins), replying to the case made out on behalf of the huge army of Commonwealth workers, said that the award complained of had been given by the Commonwealth Arbitration Court after hearing evidence from the parties concerned. That is so, but I maintain that the act under which the application was made to the court was loaded against the employees. The Minister for the Interior also said that the employees enjoyed important concessions through being able to purchase their supplies from the government stores. In the Northern Territory the Government operates similar stores, at which employees are sup posed to get supplies at concession rates; but, as a matter of fact, the prices charged are no lower than those in the ordinary retail stores at Darwin, and this, despite the fact that the government stores enjoy the advantage of trading on a cash basis, while the private stores give credit. It is clear, therefore, that the men gain nothing through dealing with the government stores. The conditions laid down in this award apply, for the time being, to the southern end of the north-south railway, but when the discretionary powers of the Commissioner are enlarged, as it is proposed to enlarge them, it will not be long before they apply to the whole line. This protest against the reduction of wages is well timed, in view of the Government’s recent action in remitting taxation to wealthy city land-owners. The policy of the Government seems to be to reduce the workers to the level of serfs. The Minister said that his department had received thousands of applications for the lower-paid jobs, and that is probably true. If the department paid only £1 a week it would still receive thousands of applications, but it is a cruel thing for the Government to employ the economic weapon at this time for the purpose of cutting down wages.
It is ironical that the man who framed this award should be the ex-chairman of the Employers Association. I have a vivid recollection of certain members of the judiciary quibbling over the reduction of their salaries under the Financial Emergency Act. Some of them refused point-blank to accept any reduction of their princely salaries, yet they are prepared to cut the wages of the workers without compunction. This award sweeps away the last vestige of justice in industrial matters. After the 30th June, 1933, the Commonwealth Railways Commissioner will have power to vary the conditions of employment on the railways in many important particulars. He will have power to refuse annual leave, and to abolish the provision relating to those employed in isolated places. Even the contractors engaged in building the line through some of those great sandy plains were unable to keep their men working all the time, because of the severe sandstorms; but the Commissioner will have power to keep the men at it all the time, and if they demur, there are thousands of others ready to step in and take their jobs. When wages are reduced, the reactionis felt in business circles. The honorable member for Grey (Mr. McBride) must admit that if, by cutting wages, we take a large sum of money out of the spending fund of the community, there will be less to go round than there was before. In the honorable member’s own electorate a butcher told me the other day that he was now selling all neck chops, because the workers could not afford to buy joints. He added that he was seriously thinking of crossing shorthorn cattle with giraffes, so that he would be able to get more neck chops. Many of the men who will be affected by this award are working at places six or seven hundred miles inland, far from any of the amenities of civilization. If they wish to educate their children, they must send them away from their place of employment, and this involves the upkeep of two homes. They are beginning to realize now that, if they apply for a transfer to a place near a school, it may be regarded as equivalent to sending in their resignation. The railways manager at Darwin is becoming too autocratic. At one time, a gang of men working in one of these outlandish places used to send one of their number in each fortnight to meet the train, and get a supply of fresh meat. The manager, intoxicated with his own power, has now ordered that this practice must cease, the excuse being the paltry saving which may be effected. In other places, the same man has, just to show his authority, blocked roads which did not cross the line and had been used for years. In other places, inquiries are made at the local stores regarding what the employees owe. I have proof of these facts. If it is found that a man owes a considerable sum of money he is dismissed, and one of the great army of unemployed takes his place. That is not the way to get the best out of men. The Government should not set up a dictatorship in the person of the manager, as has been done.
On previous occasions I have complained that the safety of the travelling public is being jeopardized by the economy campaign, under which ordinary maintenance work is being neglected on the Commonwealth railways. I brought this matter under the notice of the present Postmaster-General (Mr. Parkhill) when he was Minister for the Interior, but my statement was contradicted by the Commissioner. When the Minister recently toured Central and Northern Australia, I was able to demonstrate to him personally the truth of my assertions by drawing the dogs out of the sleepers with my fingers. Some day the Commonwealth railways authorities will have to accept responsibility for a serious accident.
– How many trains a day pass over the line?
– It is not a matter of how many trains pass over the line each day, but of the weight of the trains. If trains ran every day they would not be so heavily laden as when one runs only every fortnight. The authorities, in pursuance of. their economy campaign, try to get as much on to that fortnightly train as it will carry. The Commissioner has been told to cut costs to the bone, and he has kept on cutting until he has reached the marrow. The men working out on those sand-swept plains have been reduced to very low conditions, and the Commissioner, by virtue of the last award, has been empowered to make those conditions even more arduous. When the Labour party again assumes power, which will not be long, those conditions will be altered, and the workers will be given the conditions they were intended to have when the Arbitration Court was established.
Question resolved in the negative.
Assent to the following bills reported : -
Nauru Island Agreement Bill.
New Guinea Bill.
Public Works Committee Bill.
Wire and Wire Netting Bill.
The following papers were presented : -
Science and Industry Research Act - Sixth Annual Report of the Council for Scientific and Industrial Research, for year ended 30th June, 1932.
Seat of Government Acceptance Act and Seat of Government (Administration) Act - Ordinances of 1932 -
No. 20 - Trespass on Common wealth Lands.
No. 21 - Court of Petty Sessions.
– I move -
That the bill be now read a second time.
Recommendation No. ‘7 in the report of the committee appointed to inquire into war service homes reads -
Consideration to be given to the question of making arrangements to extend to persons granted assistance under the War Service Homes Act, but who are under the controlof State institutions, the same concessions as those vouchsafed to purchasers and borrowers under the direct control of the War Service Homes Commissioner (paragraph64).
By Act 33 of 1927, and at the request of the Victorian State Savings Bank, the homes which that body had provided as agents of the commission were transferred to the control of the Victorian State Savings Bank, and the relation of that body was changed from that of agent to that of principal.
Following the recommendations submitted by the Committee of Inquiry, the Victorian State Savings Bank was asked to extend the relief scheme to war service homes purchasers under its control. The bank, however, found itself unable to meet the Commonwealth’s request in this regard, as it felt that it would be involved in financial loss which it had not contemplated, and which it should not be called upon to bear. Negotiations were conducted with the bank with the object of formulating proposals under which it would still operate as principal, or alternatively as agent; and yet make available to its returned, soldier purchasers the concessions which are being extended to-day to purchasers under the direct control of the Commissioner. The bank, however, declined the various proposals, on the ground that it could not extend generous treatment to purchasers of war service homes and yet not make the same available to returned soldiers who are purchasing homes under other acts administered by the bank. It, therefore, requested that it be relieved of the obligations it had assumed under the existing agreement, and after careful consideration the Government has agreed to do that. Such is the purpose of the bill now before the House. It is purely amachinery measure, designed to effect the transfer to the commission of occupied war service homes controlled by the bank on the basis of the total sums owing by purchasers, and to require the bank to pay in cash the balances in respect of homes which have reverted owing to the default of the purchasers. All liability in respect of the reverted homes will be shouldered by the bank, which will retain the ownership of these properties, and pay to the Commonwealth the balance owing in respect of them, which will amount to approximately £184,000, subject to minor adjustments. Whilst the commission will require to increase its staff to handle the additional business, there will actually be a reduction of the total cost, to the extent of approximately £10,000, because of the discontinuance of payments to the bank . at the rate of 13s. per cent. on loan balances. This saving in expenditure is especially welcome at this period. The bill will enable the Commonwealth to extend to the 3,600 soldiers who are purchasing war service homes through the bank, that liberal relief scheme which was recently adopted by theGovernment, andis being applied to purchasers under thedirect control of theCommissioner.
Debate (on motion by Mr. Riley) adjourned.
– I move -
That thebill be now read a second time
When an amending war service homes bill was before the House in March last, I stated that as a result of representations made to me by honorable members, returned soldiers’ organizations and other bodies, the Government had decided to appoint a committee to inquire into and report upon the circumstances of purchasers and borrowers who were unable, owing to unemployment, &c., to carry out the contracts they had entered into. The committee has submitted its report, and copies have been made available to honorable members. The Government has adopted the recommendations made by the committee, and all are in operation except numbers 1 and 1 which necessitate legislation. No. 1 reads -
Where a purchaser or borrower satisfies the War Service Homes Commissioner that he is unable to pay the existing monthly instalment of the amount of any purchase money or advance, the term of such purchaser’s or borrower’s contract of sale or mortgage to be extended, according to the value of the security, to a maximum period of 45 years, the reduced monthly instalment payable by reason of any extension of the period of repayment to be calculated on the liability (including arrears) of the purchaser or borrower to the Commissioner as at 30th June. 1932.
The War Service Homes Act provides that the maximum loan term shall be as under -
In order to give effect to the committee’s recommendation to extend the term in any case where the facts and the estimated “ Life “ of the property justify such a course, it is necessary to amend section 29 of . the War Service Homes Act accordingly, and also to empower the Commissioner to vary any existing contracts or mortgages with the object of extending the term, and thus reducing the present instalment. In view of the urgent need of relief in necessitous cases, the Government arranged for the committee’s recommendation to operate from the 1st August, 1932, and consequently the bill has been made retrospective. Several cases have already been reviewed, with the result that the instalments have been reduced by varying amounts, rising, in some instances, to 50 per cent. of the instalment previously payable, and the burden of the existing arrears has been removed. In order to show clearly the effect of the
This brief explanation indicates the wisdom and value of the provision which honorable members are now requested to approve. The committee of inquiry in its report has stated that the War Service Homes Act provides the most liberal housing scheme in Australia, and that the generous provisions of the act and the sympathetic administration of it by the commission greatly increased the committee’s difficulty in finding a method of equitably reducing the statutory instalment. If this amendment is accepted by the House, the War Service Homes Act will be thus further liberalized, and the Commissioner will be enabled to extend even more generous treatment in those cases where it is deserved.
Debate (on motion by Mr. Riley) adjourned.
– I move -
That the bill be now read a second time.
I have already circulated a summary of the provisions of the bill, and I shall now briefly outline each of its provisions. The main object of the measure is to provide certain concessions to taxpayers by way of exemptions and deductions.
Clause 4e provides for the exemption of dividends paid out of interest derived by companies out of converted Commonwealth securities from the special tax on property income, and also from any increase in the normal tax since 1930. This is a logical extension of section 20 of the Commonwealth Debt Conversion
Act. The admitted purpose of that section, namely, the prevention of a further sacrifice of income already substantially depleted by the provisions of the Conversion Act, has been partially nullified where the holders of new securities are companies, inasmuch as, by virtue of the exemption of companies from the special tax on the interest from those securities, shareholders become subject to that tax on dividends paid out of such interest. The amendment will also extend to dividends paid out of interest on securities issued in connexion with future loans.
Clause 6 makes State unemployment relief taxes3 allowable as deductions. At present these taxes are allowable deductions where they are annually assessed, but not where they are collected from employers at the source. The amendment to remove this obvious anomaly will be applied retrospectively to assessments for the financial year 1930-31, and subsequent years.
Clause 5a removes the double taxation of interest paid by Australian companies to absentee depositors or debentureholders. Under the law as it stands, the Australian company is called upon to pay tax at the ordinary company rate on all interest so paid, and a rebate of the tax is allowed in the assessment issued to the absentee in respect of that interest, provided the absentee lodges a return. Where the absentee does not lodge a return - and this’ is by far the most common class of case - he is not entitled to a rebate of the tax paid by the company. This is a clear case of double taxation, which ought to be remedied, particularly in view of the fact that the Australian company frequently has to pay the tax on behalf of the absentee; and in the not uncommon class of case in which the debenture contract was entered into outside Australia, is unable to recoup itself for the tax so paid from moneys accruing due to the absentee.
Clause 3 extends for eight years, namely, until the 30th June, 1940, the exemption of income from primary production in the Northern Territory. The exemption was first granted in 1923 for five years, as from 1st July, 1922, and was extended in 1927 for a further period of five years: Primary producers are in no better position now than they were when the exemption was first granted, and they claim that owing to the general set-back occasioned by the present financial depression, it is essential that the exemption should be continued.
Clause 2 extends to residents of Norfolk Island and the Mandated Territories the concessions at present allowed to residentsof Papua. There appears to be no good, ground for the existing discrimination. The effect of the amendment will be toexempt residents of Norfolk Island and the Mandated Territories from incomederived in those territories, and to deem those residents to be residents of Australia for the purposes of the taxation of their Australian income. As the law stands, such persons are absentees, and are, therefore, not entitled to the general exemption and various concessional deductions in the assessment of their Australian income.
Clause 4, paragraph d, exempts funds created for scientific research work conducted in conjunction with a university or a public hospital. It is considered desirable to extend the existing exemption of the incomes of such institutions as universities and public hospitals to the income of trust funds created for the purpose of scientific research to be conducted in conjunction with such institutions. In order to provide for a particular case, the amendment will be made to apply to assessments for the financial year 1929-30, and all subsequent years.
Clause 4a exempts British war pensions received by residents of Australia. Such pensions were unexpectedly brought into the taxation field by the 1930 amendment of the law, which imposed tax on the ex-Australian income of Australian residents where such income was not subject to income tax outside Australia. The result in respect of’ British war pensions is somewhat out of keeping with the spirit which prompted the exemption of Australian war pensions. It is proposed to remedy the anomaly by exempting British war pensions retrospectively to the commencement of the operation of the 1930 amendment of the law, namely the 1st July, 1929.
Clause 8 applies the time limits imposed on the re-opening of assessments of a living taxpayer to assessments of a deceased taxpayer in respect of income derived in his lifetime. Under the exist- ing law there is no time limit on the reopening of the assessment issued to a deceased taxpayer in his lifetime if a right to re-open that assessment existed at the date of the taxpayer’s death. It has been pointed out that this results in hardship to beneficiaries in the estates of deceased taxpayers. It is considered that these complaints are justified, and there is no good reason for discriminating between the assessments of deceased taxpayers and the assessments of living taxpayers in this respect. The amendment will place both classes of assessments on the same basis, and will, at the same time, provide for the application of the same penalties for omitted income in both classes of case.
Clause 7 relates to the extension of the time limit within which taxpayers in certain cases may obtain refunds of tax. Except in cases of avoidance and evasion of tax, an assessment cannot at present be amended more than three years after the tax on the original assessment was due and payable. In complicated cases it is frequently found that the taxable income cannot be accurately determined within the time limit of three years. In such cases it is sometimes necessary to protect the revenue by increasing the assessment before the expiration of the time limit. After the expiration of the time limit, it may be found that the assessment is excessive, but it is not then possible to reduce the assessment unless the taxpayer has protected himself by lodging an objection against the increased assessment.
Mr.White. - The income tax officer is protecting himself against mistakes that may have taken place over a number of years.
– The bill also provides for the protection of the taxpaver.
Mr.White. - That form of protection is unfair to the taxpayer.
– The bill will enable reduced assessments to be made in these cases within a period of three years after the tax on the increased assessment was due and payable. It also contains certain provisions designed either to prevent loss of revenue or to save expense. These may be briefly stated as follows: -
Clause 4b disallows ex-Australian business losses of Australian residents who are not subject to Commonwealth tax on any profits they might derive from their ex-Australian business. The allowance of such losses is an unexpected result of the amendment of the law in 1930 for the purpose of taxing Australian residents on their ex-Australian income where that income is not subject to income tax outside Australia. The proposed amendment is designed to limit the allowance of ex-Australian losses, as was intended, to losses derivedfrom an ex-Australian business the profits of which when derived are subject to Commonwealth income tax.
Clause 5 b excludes the special tax on property incomes from the calculation of rebates allowable to shareholders on dividends in certain cases. The framing of the rebate provisions at a time when the special tax on property incomes was not in contemplation has resulted in the special tax being lost on dividends in cases where it was intended to fall. This position was partially remedied last year by section 3 of the Income Tax Assessment Act 1931 and the proposed amendment applies to cases not covered by that section. A similar amendment was intended by the former Administration which, however, was unable to carry out its intention owing to the change of government.
Clause 9 enables penalties to be provided for omitted income and excessive deductions to be imposed without the issue of two assessments. The penalty in such cases is, subject to remission, double the amount of difference between the tax properly payable and the tax assessed on the basis of the return lodged. Where omitted income is discovered before any assessment is issued, it is desirable that the Taxation Department should be able to add that penalty in the original assessment. The High Court has held, however, that the department must, first of all, issue an assessment on the basis of the return lodged, and then issue an amended assessment imposing the penalty. The proposed amendment will obviate the work and expense associated with the issue of two assessments.
The only other provision in the bill is clause 10, which is designed to protect mortgagors against attempts by mortgagees to pass on liability for income tax on mortgage interest. The proposed amendment supplements amendments made in 1930 and 1931 with the same object. Although it is probable that conveyancers, while keeping within the law, will in the long run, evade the effects of legislative provisions of this kind, it is considered that, in view of the heavy burden of the special tax on property incomes, a further attempt to protect mortgagors is justifiable, even if it should be successful only so far as existing mortgages are concerned.
Debate (on motion by Mr. Scullin) adjourned.
– I move -
That the bill bc now read a second time.
This bill proposes to amend the Bills of Exchange Act by inserting the following new section: - 88a. For the purposes of this division “ cheque “ includes a banker’s draft payable on demand drawn by or on behalf of a bank upon itself, whether payable at the head office or at some other office of the bank.
This provision deals with Division 2 of Part III. of the Bills of Exchange Act 1909-1912, which relates to the subject of crossed cheques. One provision is to the effect that a banker when he pays a crossed cheque must pay it in accordance with the crossing, and if he does thatthen he is in the same position as if he had paid it to- the true owner. The act also provides that if a crossed cheque is marked “not negotiable”, it becomes not negotiable in the strict sense, and any person who receives it shall not take, or be capable of giving to another person, a better title than the person from whom he received it had!. There is also a further provision for the protection of a collecting banker who collects a crossed cheque for a customer. These are important provisions which have long been part of the law relating to bills of exchange. They apply to cheques and cheques alone, and cheques can- be crossed so as to bring about the results which I have briefly outlined. There is a. definition of cheque as “ a bill of exchange drawn upon a banker payable on demand “ ; therefore a cheque is a particular kind of a bill of exchange. We have, therefore, to look at the definition of bill of exchange, and section 8 of the act provides -
A bill of exchange is an unconditional order in writing addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand, or at a fixed or determinable future time, a sum certain in money to or to the order of a specified person, or to bearer.
It will be seen therefore that a bill of exchange is an order in writing addressed by one person to another. As a cheque is defined as a particular kind of bill of exchange, it therefore follows that a cheque must be an unconditional order in writing addressed by one person to another, and in other respects must satisfy the requirements of the definition.
– Does that definition apply to all cheques?
– Yes. Before an order in writing requiring the payment of a sum of money can acquire the characteristics of a negotiable instrument it must satisfy these requirements, otherwise it is subject to the law relating to the assignment of choses in action under which the assignee cannot obtain a better title than the person from whom he received the instrument had. In the case of a crossed cheque which is marked “not negotiable “ a person cannot give a better title than he himself has ; but the negotiation of an ordinary cheque, as defined in the act, to a holder in due course gives that holder a good and sound title notwithstanding a defect in the title of the person from whom he receives it. That is the essence of the law of the negotiability of instruments. A cheque then, being a bill, of exchange, is an order addressed by one person to another. Some difficulties have arisen which have recently been dealt with by an act passed by the Parliament of Great Britain in 1932, of which this bill is practically a reproduction. Bankers’ drafts are not always drawn by a bank upon another bank. In- fact, generally, they are drawn upon another branch or the head office of the bank of issue, being drawn not upon another person, but. upon the same person who draws them. They are’ not cheques in the technical’ sense. In other words, when a bank draws a draft upon itself, say, a bank in Melbourne draws a draft upon its head office in Sydney or London, that is not an order addressed by one person to another, but an order addressed by a corporation to itself or by a person to himself, and therefore is not a cheque. That being so, the provision relating to crossed cheques and the special protection given to persons dealing in crossed cheques does not applyto bankers’ drafts drawn upon the head office or another branch of the bank. The object of this measure is to make it possible to apply those provisions, and to give the community generally the convenience resulting from the application of those provisions to bankers’ drafts. Accordingly, the bill provides that for the purpose of this division a cheque includes a banker’s draft payable on demand drawn by or on behalf of the bank upon itself whether payable at the head office or at a branch of the bank.
– What is the necessity for this amendment?
– Attention was called some years ago to these difficulties in the law. No particular local difficulty has arisen. It is a casus omissus in the legislation, and we are simply bringing the law up to date, and following what has been done by the Imperial Parliament in this connexion. It is not suggested that any particular crying evil exists. This amendment is merely in accordance with the true intention and general policy of the act, and it is accordingly thought desirable to extend this convenience to those who deal in bankers’ drafts. As the measure will afford an added protection, and be an additional convenience to the community, I commend it to the House.
Question resolved in the affirmative.
Bill read a second time.
– Will the AttorneyGeneral (Mr. Latham) make clear what protection this measure affords to the general public?
– The bill will give an added protection to the public. It will also facilitate the business of the banks, and in that way facilitate the business of the public. But it does not impose any burden upon anybody, increase the liability of anybody, or indeed have any prejudicial effect upon any section of the community.
Bill reported without amendment; report adopted.
Bill - by leave - read a third time.
In committee: Consideration resumed from the 25th November (vide page 3017).
Clauses 1 to 3 agreed to.
Clause 4 (Reduction of land tax).
.- I am opposed to this clause for the reasons I gave in my speech on the motion for the second reading of the bill, and for other reasons. Apart altogether from the fact that the Government has made considerable reductions in payments to public servants and invalid and old-age pensioners, I can see no justification . whatever, in view of the financial position of Australia, for this light-hearted proposal for a general reduction of land taxation. In my second-reading speech I drew attention to the fact that there had been a suspension in the payment of the principal due on our war debt to Great Britain for the last financial year, and for this financial year, under an agreement made between my Government and the Government of the United Kingdom, and that there had also been a suspension for one year of the interest clue, because of the Hoover moratorium. During the second-reading debate I pointed out that the Prime Minister (Mr. Lyons) had declared that if the war debt demands to which we were liable were made, it would affect the financial position to the extent of £5,000,000. The Prime Minister then said that this was not the case, but that only one-half of the financial year would be affected. To show that I was not wildly careless in my statement, I direct the attention of honorable members to the following paragraph which appeared in the Melbourne Argus on the 22nd November: -
Before leaving for Canberra last night, the Prime Minister (Mr. Lyons) said that if Great Britain were obliged to renew her war debt payments, the Commonwealth would almost certainly be called upon to make additional payments of nearly £5,000,000 this financial year.
An exactly similar paragraph appeared in the Sydney Morning Herald of that date. Further, on the same day the following report also appeared in the Melbourne Argus: -
The Attorney-General (Mr. Latham) said at Canberra last night that if Australia had to make payments of interest on war debts to Great Britain this financial year, the proposals already announced for remission of taxation would have to be reconsidered.
Although those statements were published on the 22nd November, the very next day honorable members were required to proceed with the debate on this bill, which provided for substantial remissions of taxation. Nothing could have happened between the 22nd and the 23rd November to re-assure the Government on this subject. Yet the proposed remission of taxation is apparently to be made. We all know that the Avar debt position is unsatisfactory at present. I know that the Prime Minister has made a later statement that, even if we have to pay the interest due to the British Government, a demand will be made for only six months’ interest, the British Government having agreed to forgo the interest due for the other six months of the year. The whole position in regard to the war debt makes it unwise to remit this taxation.
I also direct the attention of honorable members to the fact that land taxation is not emergency taxation. Last year, in a time of great emergency, the budget had to be balanced by most drastic methods, which involved the infliction of heavy emergency taxation. One might reasonably have supposed that, before remitting taxation which was not of an emergency nature, the Government would have restored the cuts made under the emergency legislation, and then have removed the emergency taxation that was imposed. The federal land tax was first imposed in 1910-11. In 1914-15, after the outbreak of the war, the rate of tax was increased. In 1918-19, a sur-tax of 20 per cent. was imposed to assist in meeting our war obligations. In 1922-23, the sur-tax was removed. In 1927-28, a reduction of 10 per cent. was made in the rate of the land tax. Now it is proposed to make a further reduction of 331/3 per cent. in the rate of tax.
– That is more than offset by the improved value of the land.
– If the value of the laud has improved, the carrying capacity of it must have improved, so that that is no warrant for a further reduction of this taxation. Surely the higher value of land presupposes a higher return from it ! If not, this higher value is due to speculators buying land and holding it against legitimate land purchasers. But it is not correct to say that the reduction of rate is justified by the higher value of the land. The two subjects are not related. An increase in the value of land would increase the. return from this taxation; but that is no justification for reducing the rate of taxation now. The reduction of 10 per cent. made in 1927-28 was justified on the ground that in the preceding year the Commonwealth had a net surplus of £2,500,000. Reductions were also made in income taxation in 1927-28. I recall that when the proposal to reduce the rate of land taxation was made, I urged the Government to apply its surplus to the reduction of our indebtedness, and not to grant a reduction of taxation, for at that time the taxpayers could afford to pay the taxation that was being imposed. But instead of doing this, the government of the day even increased our oversea indebtedness, and now in our time of great difficulty we are called upon to find the interest on this increased debt. In the year following the reduction of the and taxby 10 per cent., the Commonwealth had a deficit of £2,600,000, and it has had a deficit practically every year since then. Land taxation was imposed deliberately by this Parliament in 1910-11 in a normal period because it was believed to be a legitimate means of obtaining revenue, and the legislation which imposed it has not since been repealed, though there have been both increases and decreases in the rate of the tax. The increases made under abnormal war conditions have since been remitted, and it may be said that this taxation is now approximately what it was in normal times.
One would expect that the firstclass of taxation to be remitted would be the emergency taxation, but instead of lifting this, the Government has seen fit to propose the remission of taxation which has been collected for a quarter of a century, and has always been regarded as a legitimate source of revenue. Although a reduction of 33-J per cent, is proposed in this direction, very grave hardships are being allowed to remain upon the poor people of this community.
– It is the emergency conditions which make the lifting of this taxation necessary.
– Not at all. Any hardship which is falling upon our landowners on account of the emergency conditions of the present time can be lifted from them under the provisions of clause 5. It cannot be said that our banking institutions, for example, have felt tha depression to any great extent, for they have maintained their dividends and profits. Many people engaged in various enterprises in our cities are in the same position. “We know very well that, except in the last year or two, land values have increased tremendously. Our large land-owners have not been hit to anything like the same extent as the working man, the ordinary business man, and the farmer who produces from the land. Any such land-owners as have been hard hit can be granted relief under the liberal extension that is being made by clause 5 of this bill to section 66 of the Land Tax Assessment Act. There is no warrant whatever for a general reduction of 33-J per cent, j.n the rate of land taxation.
When this Parliament was faced last year with a probable deficit of £20,000,000, the Government of the day was forced to do drastic things to meet the situation ; but this year the budgetary position is very different. Except for the uncertainty in regard to our overseas payments, it may be said that the budget is balanced. In these circumstances, a reduction of taxation to the extent of £2,500,000, including the proposed reduction of land taxation, which has been in operation for a quarter of a century, is entirely unjustified, particularly when recent amendments rob our public servants and invalid and old-age pensioners of more than £1,000,000. This Government has upset the whole basis of our previous legislation, and is handing out what might be called largesse to the wealthy land-owners of this country. The plan adopted by my government with the object of spreading the sacrifices evenly over the whole community has been seriously unbalanced by the actions of this Government. The introduction of this legislation is a thwarting of the will of the people of this country which is causing a storm of resentment. If the bill is passed it will inflict very great hardship on a most deserving section of our people. There is no reason why the Government should lift taxation from people who are well able to pay it.
– I also am at a loss to understand why the Government is proposing to reduce the rate of land tax by 33f per cent. I agree with the Leader of the Opposition (Mr. Scullin) that ample provision has been made for cases of hardship. I have been surprised that the provisions of section 66 of the Land Tax Assessment Act have not been more largely availed of by the taxpayers of this country, for they were placed in the act to provide relief to persons who were affected by drought and other adverse . conditions. More sympathetic treatment should have been meted out in the administration of that section. When we realize that practically two-thirds of this tax is collected from lands in our city areas it is the more difficult to determine why the reduction is being made. In recent times I have seen reports of companies carrying on most successfully in metropolitan areas. Those concerns own large city properties and contribute to this tax, but they have not reduced their rates of dividend to their shareholders.
– Will the honorable member name them?
– I do not intend to furnish the names here, but the honorable member will find the information he seeks if he examines the financial columns of newspapers recently issued.
– Such companies are very few in number.
– That may be so at present, but those concerns own valuable city properties and are making splendid profits. Two-thirds of thi3 tax is collected on city properties. In a table given in the last report by the Commissioner of Taxation, the number of taxpayers is given as follows : -
Those in the country who pay the tax number between 7,000 and 10,000. These figures show that only a small percentage of rural land-holders, and, certainly, no small farmers, pay the federal tax.
In the earlier operation of the act leaseholds came under the definition of “ taxable area “. I am prepared to admit that, in recent years, many leasehold properties have not been profit-producing, but in previous years they were, and will be so again. There are a large number of leaseholders in Queensland and certain parts of New South Wales and Western Australia. Clause 5 provides considerable relief in cases of hardship, and there is no justification for this remission of tax of 331/3 per cent.
I shall vote against clause 7, for it proposes to remit taxes to some of the wealthiest and most fortunate people in the community. I agree with the sentiments expressed by the Leader of the Opposition (Mr. Scullin) that if we are to give concessions, other fields of endeavour should come under review. If land-owners are hard up against it they can obtain relief under section 66, which has not been most liberally interpreted in the past. It is unfair to the people generally that we should relinquish onethird of the taxes that are gathered from the richest people.
.- I intend to support the proposal of the Government set out in clause 4. The Leader of the Opposition (Mr. Scullin) stated that the position in regard to war debt obligations made it inadvisable to remit this taxation. I am. sure that, if the moratorium on British war debts is lifted, this remission of taxation will assist us more than anything else. Two things are at present killing our great exporting industries, the lowness of the prices obtaining overseas for our products, and the high cost of conducting those enterprises. Undoubtedly, land tax assists greatly in causing those high costs, both directly and indirectly. The Wool Com mittee made definite recommendations so far as direct costs are concerned. Two-thirds of the property subject to land tax is now located in the cities, and it must be remembered that the one-third now represented by country properties produces more revenue than the half produced by country properties in 1910.
– There were no valuations then.
– Even in . 1920 when there were plenty of valuations, the amount of land tax paid on country properties was greater than that paid on country holdings when the tax was first imposed in 1910. ,
I hope that this reduction is the first step towards the repeal of land tax, which adversely affects industry. Because of an increase in its business, a big manufacturing concern might find it advisable to extend its ground area. In doing so its property, perhaps, becomes liable to a quadrupled land tax, while its plant is doubled.
In another debate to-day, honorable members declared that wages have not the same purchasing power as they used to have. That is largely due to the big increase in distributing costs, to which land tax has added considerably. The federal land tax is the clumsiest instrument ever devised for taxation or subdivision, and in practice imposes hardships upon the efficient farmer. If he used superphosphate, a practice we are trying to encourage by granting a bounty, and improved the capacity of his land, he would find its unimproved value increased, and accordingly have to pay increased land tax. Similarly with manufacturers and distributors. Nothing could help our primary and secondary industries more than the remission of land tax, except perhaps certain action in connexion with the tariff. I believe that by providing cheaper interest rates this proposal to repeal or reduce the federal land tax will bring about a revival of activity in rural industries. The report of the Wool Committee indicated that out of the total cost of11d. to produce a pound of wool no less than 41/2d. is represented by interest. Mortgages on rural lands have been yielding 7 per cent., and 8 per cent., and even higher rates. By’ some means or other we must reduce those rates to 3 per cent, or 4 per cent. What opportunity is there of doing so at present? Men with money who take a mortgage on rural lands are faced with the possibility of having to take possession under certain circumstances, and to pay relatively enormous land taxes. In addition, if the person to whom they lend the money is unable to meet his commitments, arrears of land tax become a first charge on the property, thus reducing ‘the own er’s equity and tending to reduce the value of the mortgage. If we are to get out of the depression we must, in our Federal and. State Parliaments, take every step that is humanly possible to bring down interest rates, particularly those connected with rural industry.
Land tax was introduced by the Fisher Government in order to bring about the subdivision of big estates, not as a revenue tax. There is no doubt that, whatever effect it may have had in that direction in the early years, it has had little recently. In those days the prices of our exports were on a parity with the prices of our industrial products. Today, the prices for rural products are hopelessly down in comparison with those of industrial products, and we must do something to meet the position. In 1914, to prevent the further aggregation of big estates, the Labour party put a tax on Crown leaseholds. Before, there had been some difficulty in regard to the taxing and valuation of the land, and the innovation placed the valuation generally in a hopeless position. No fewer than three royal commissions were appointed to determine a satisfactory basis of valuation. “Ultimately, the act was repealed, and after litigation extending over six years, the Commonwealth found that it had not collected much more than when the tax was discontinued in 1917.
What is the unimproved value of land is a highly contentious question. There are various schools of thought, some believing that valuations should be on a sale basis, others that it should be on a productivity basis. But no two men agree on the matter. We find that, in the same district, one property may be valued at JE2 per acre, while properties nearby, of the same geological formation, is valued at £4 an acre, the difference being accounted for by the fact that, in the second instance, a sale has taken place at a specific price, which has been used in making the valuation. When I was Treasurer, in order to avoid anomalies of this kind, valuation boards were appointed, on which sat men who were actually engaged in the industries conducted on the land concerned, and an immediate improvement was effected. An attempt was also made to improve the position by having triennial valuations made. Before that, the department was continually revising valuations, and a man might get a bill for retrospective taxation covering ten years. The value of city and country , land has been dropping steadily during the last three years, but, owing to the difficulties of administration, owners are being taxed as much now as in prosperous times.
I cannot see any solution of the problem except to abolish the tax altogether. It is essential, at any rate, that something be done. The Wool Investigation Committee approached this matter with an unbiased mind, and, after a full inquiry, has advanced five concrete reasons why the tax should be either drastically amended or abolished. In the course of its report it States -
I suggest that the Federal Government, which has increased the sphere of its taxation very widely during recent years, should abandon land taxation to the
State authorities, which can differentiate between the various classes of land. Some land, such as that near a railway, ought, perhaps, to be subdivided, while other land cannot be economically worked in small blocks. The State land authorities are primarily concerned with development, and can discriminate between the efficient and inefficient use of land. The Commonwealth cannot discriminate between States or parts of a State, and cannot, therefore, exclude from taxation stud farms, for instance.
I hope that the Government, moved by a desire to lif t the burden off the backs of the primary producers so that they may continue exporting, will do something to mitigate the harshness of this land tax. Even in the cities the effect of the tax is to increase costs by adding to the overhead charges of the big manufacturing and distributing concerns. I trust that the Government will not stop at this third reduction of the tax, but will eventually abolish it altogether.
– I support this clause. I shall endeavour to show, not only why this taxation should be reduced by one-third, but why it should be removed altogether. I suggest that the same action should be taken by the the Commonwealth Government as was taken recently by the Government ‘of New Zealand, which realized that there was a point beyond which it was dangerous to push taxation on land. That Government, after a full inquiry, substituted for the old tax on values, a flat-rate tax. The Leader of the Opposition (Mr. Scullin) said that the Commonwealth land tax was not an emergency tax ; that it was brought into being to break up large estates. The object of the Government at that time was to force the people on to the land, and to effect closer settlement. This policy has been pursued from quite early times. From the making of free grants of land in 1788, to the passing of the Robertson Land Act of 1861 - the free selection before survey act - there was a desire to induce people to take up small holdings. That act did not achieve the object for which it was framed, and so the Commonwealth Land Act was introduced in 1910-11 to break up the large estates. Unfortunately, the act was made to apply to classes of land to which it should never have applied. It was made to apply to city land, and I do not think it was ever intended to apply to city properties, nor is it desirable that city properties should be subdivided to frontages of 20 feet. If they are reduced to that width, city buildings will become too narrow, and the measure will prove irritating to the commercial community. In support of my contention that the act was not intended to reduce the size of city holdings, but merely to bring in revenue, I shall quote figures showing the effect of the tax since 1911-12 in the city and in the country. At the present time, roughly 68 per cent. of the Commonwealth land tax is paid on city property, and 32 per cent. on country property. In 1911-12, the position was almost exactly the reverse, 68 per cent. of the tax being paid by the country and 32 per cent. by the city. The actual amount of tax collected in 1911-12 was £919,805 from the country, and £525,455 from the city, whereas now the figures are £920,307 from the country, and £1,950,567 from the city. This act has been made too sweeping in its application. No distinction was made between arable and arid lands. When it was proposed to break up large estates, the object was to give the smaller men a chance of obtaining holdings, not too large to work, but large enough to be comfortable on. The land tax, however, applies to land which is only suitable for the production of wool on a large scale, such as poor, stony, arid land, which cannot be profitably worked in small areas. It is evident, from an analysis of the figures, that the tax has already achieved its object by breaking up most of the large estates which could be suitably subdivided. In 1910-11, as a result of the operation of the tax, £9,000,000 worth of land was withdrawn from the taxable field ; but in 1929-30, the value of such land withdrawn was only £2,041,584.
Sitting suspended from 6.15 to 8 p.m.
– The figures I have mentioned prove that this tax has reached the limit of its effectiveness in the breaking up of large estates, because of the extent of property which has been withdrawn from the taxable field. That is a strong argument in favour of the total abolition of the tax. The Leader of the Opposition (Mr. Scullin) pointed out that this tax was imposed in the first place for the purpose of breaking up large estates, but it gradually developed into a straightout revenue tax. In 1910-11 the rate was 3£d. in the £1; in 1914-15 it rose to 5d. In 1918-19 a super tax was imposed which increased the rate by 20 per cent. It is true that in 1927-28 the tax was reduced by 10 per cent., but that was largely offset by the increases in city property values, brought about by a natural prosperity in commercial life. The imposition of a land tax to break up large estates in the city was stupid. One of its effects has been the subdivision of urban properties into lots with frontages of 20 feet, that certainly do not add to the architectural beauty of our cities. In addition, the Scullin Government deliberately taxed golf clubs. These sporting bodies contribute largely to employment, and, unfortunately, are the only sporting bodies except the racing clubs that are liable to this tax. Golf-courses often occupy arid or swampy country, or reserves under municipal control. In this and other ways the tax has been utilized as a means of adding to the revenues of the Commonwealth. It also makes an anomalous differentiation between investors in land and investors in other property. A man w’ho has invested in bonds pays only on the interest which they yield, but an investor in land pays, when he can, on the whole value of his property. Unfortunately, many of these investors are not in a position to pay the tax. Members of the Opposition have said that the huge blocks of offices in the cities are a fit subject for land taxation. As a result of the widespread depression, at least four-fifths of this office space is idle. Formerly it was occupied mainly by agents and small business men, who gave a good deal of employment, particularly to youths and girls. The income of the property-owner, because of the reduced rentals, has been sadly depleted, but he still has to pay rates and the federal land tax. Scathing reference has been made also to chain stores and large proprietary stores in the cities. Honorable members opposite should take into consideration the fact that the ordi nary business man opening a store in the suburbs gets the full advantage of the land tax exemption, but a big retail store establishing branches in the various suburbs, and acquiring a large number of small properties, would pay a ridiculously high tax on their aggregate value. Unfortunately, members of the Opposition fail to recognize that this tax is passed on to the consumers whom they claim to represent. Indirectly it is reflected in the cost of production. The consumer pays more for his goods, the cost of living is increased, and the worker is deprived of comforts that he is entitled to have.
A few figures will illustrate the incidence of the land tax upon city property. A huge manufacturing concern in Sydney has sustained a loss of £140,000 in two years. The nature of the business necessitates the use of a large area of land, with solid foundations for heavy machinery. On top of its losses, the business has had to pay many thousands of pounds, in federal land tax. By imposing very high duties on imports, the Labour party has protected the manufacturer, but the same party takes from him all the advantage of this protection by imposing and supporting a heavy land tax. It gives with one hand and takes away with the other. I know of a big owner of Sydney property whose net losses over a period of five years, were £4,721, exclusive of land tax; yet he had to pay in land tax in the first four years, £23,992. This tax disregards the incapacity of an industry to pay, and following upon trading losses, has a strangling effect. Sir Arthur Rickard, in the course of a deputation which advocated the repeal of the federal land tax, mentioned some facts which are based on his 31 years’ experience in the subdivision of land. The six large companies he controls have paid, in six years, Commonwealth land tax amounting to £59,000, and the aggregate dividends on a capital of slightly less than £1,000,000 was £107,000. These subdivisions would have taken place in recent years if no Commonwealth land tax had been in operation. The tax interferes with the natural expansion of trade. If a manufacturer or retailer buys an adjoining block of land in order to extend operations, lie may double the area of his holding, but because of the aggregation and graduation of land tax his tax liability may be increased four or five times. The tax on many properties in the city df Sydney amounts to 10s. a foot weekly, regardless of the fact that the owners are suffering heavy trade losses. Employment cannot be provided or maintained while such a strangling tax is imposed on the commercial community. It is a tax on production at the source; it differentiates between investors in land and investors in other classes of property ; it discourages the development of private enterprise upon which the Government is depending for a solution of the unemployment problem - I have in mind especially the building trade - and it definitely lessens the purchasing power of the community.
– The honorable member’s time has expired.
.- This clause is merely a sop to the Country party for its loyal support of the Government from time to time. We are told that the remission of land taxation will help the struggling farmers, whom members of the Country party are supposed particularly to represent. The Leader of the Opposition (Mr. Scullin) quoted statistics from the report of the Commissioner for Taxation showing that only one-third of the land taxation is paid by ‘ country lands, the other two-thirds being paid by town lands. I have waited in vain to hear any supporter of the Government’s proposals refute that statement. The struggling farmer for whom such piteous appeals are made does not pay Commonwealth land tax. There is an exemption of £5,000 in respect of the unimproved value of land, in addition to exemptions for improvements. The owner of a wheat farm of 600 acres valued at £8,000 would enjoy exemption of £3,000 in respect of improvements, and £5,000 in respect of the unimproved value, and, therefore, would not be taxable. A man with a property worth £10,000 would pay tax amounting to £4 per annum; the owner of a property worth £20,000 would pay £16 per annum. It will thus be seen that this measure gives no relief to a farmer with a pro perty valued at £8,000, but gives a rebate of 27s. per annum to the owner of a property valued at £10,000, £5 10s. in respect of a property worth £20,000, and £1,000 in respect of a property worth £100,000. But owners of property worth £100,000 are not struggling fanners; they are big city landlords and corporations, and the Government, by this proposed remission, is acknowledging its indebtedness to the wealthy city interests that contribute largely to the election funds of the United Australia Party. What are the city interests ? They are the banking institutions, the shipping companies, the insurance companies, commercial interests, land and mortgage companies, and big city firms like Anthony Hordern’s and Sydney Snow Limited, which own great blocks of land stretching from one street to another in the capital cities of Australia. Those are the interests who will receive the benefit of this relief from taxation. What I resent is the fact that this remission of taxation is being made at the expense of the invalid and old-age pensioners. The wealthy city interests are to receive relief to the extent of £700,000 while the pensioners are to lose a similar amount. This is being done by the Government under the pretext of helping the struggling farmer. The Government first proposed to reduce pensions by £1,200,000, but as a result of the agitation that was thus caused among the pensioners, the press, and even some of the rebellious members on the Government side of the House, including the honorable member for Macquarie (Mr. John Lawson) it saw fit to modify its proposal.
– I remind the honorable member that clause 4 relates to land tax and not to the attitude of the supporters of the Government in respect of old-age pensions.
– I claim that as the remission of land taxation is to be made at the expense of the old-age and invalid pensioners, I am in order in referring to the pensions.
– The honorable member must confine his remarks strictly to the clause under discussion.
– Clause 4 provides that the amount of tax for which any taxpayer would be liable in pursuance of the act, shall be reduced, by one-third. I suggest that the clause be amended by substituting for the word “ taxpayer “ the word “ farmer” thus ensuring that the farmers themselves and not the big city interests shall receive the benefit of this relief. The Leader of the Country party has given this bill his blessing. He cares not how the pensioners suffer, nor how the wealthy interests benefit, so long as the wealthy farmer gets some relief. This national Parliament should be more humane in its legislation. The invalid and old-age pensioners are suffering acutely under the Financial Emergency Act, and surely they should receive some relief at a time when this country can afford to reduce the taxes upon the wealthy people. Our laws should be equitable, and the burden of sacrifice should be spread equally over the whole of the community, yet this Government is actually taking money from the poor to give it to the rich. That is not in accordance with the law of humanity or Christianity.
– Dick Turpin used to take money from the rich to give it to the poor.
– If Dick Turpin or Ned Kelly were aliveto-day they would be ashamed to associate with the supporters of the Government. Why should we benefit the big wealthy corporations who exploit the people in regard to the necessaries of life. The Sussex-street spielers, who farm the farmers, are to receive the benefit of a. remission of land tax. The Leader of the Opposition quoted figures which clearly showed that two-thirds of this relief will be given to the city interests and only one-third to the farmers, and then only to farmers with property valued in excess of £8,000.
.- It seems to be forgotten by honorable members opposite that this relief in respect of land tax will definitely assist employment. Attacks have been made upon city land owners as if they were a menace to the community. The honorable member for Maribyrnong (Mr. Fenton) referred to corporations which, he said, made enormous profits during the depression. Few businesses, whether wholesale or retail, have made profits during the last three years. To those that have made profits credit is due for their efficient management, and their foresight in putting aside in previous years reserves for a period of depression. Many small concerns have already faced the bankruptcy court. Scarcely a business can carry on without a bank overdraft. Many of them, like the man on the land, are in dire needI pointed out in my second-reading speech that the equity of a person in a city property may be small indeed. In fact, a trader may have paid a deposit on a city property to enable him to hold his position when rents were rising. He is, therefore, in a worse position than a tenant who can move into another property at a lower rental. In that instance the property is not an asset but a liability. A trader may have a city property with a 50 foot frontage valued at, say, £280 a foot, the total value of the property being £14,000, and although his equity in it may be £500 or £1,000, his land tax, after the deduction of the £5,000 exemption, would amount to at least £1 a week. The proposed relief from taxation will be of definite benefit to a man like that. Men areunemployed only because it is not profitable to employ them. Therefore, if we can give relief to trading concerns, thus allowing them to employ others, we shall be definitely helping to place this country on the road to prosperity. This reduction of federal land taxation by 331/3 per cent. will be welcome, indeed. Some honorable members have contended that this legislation will benefit mostly city interests; but, as a matter of fact, the scales are slightly in favour of country interests.
– There should be no discrimination.
– I agree with the honorable member, and I am drawing the attention of the Government to an anomaly in this legislation which should be rectified so as to place city and country interests on the same basis. I have received the following letter from the Taxpayers Association of Victoria: -
On behalf of the Commonwealth Committee appointed at the interstate deputation which interviewed the Prime Minister on 29th July, to press for the abolition of federal land tax, I desire to express the intense dismay of the 54 organizations represented at such deputation that the wording of section 5 of the bill relating to cases of hardship strictly limits relief to persons owning land upon which agricultural pursuits are carried on.
Evidence was given this week by one city laud-owner before the Federal Land Tax Board of Review that on many occasions he had unsuccessfully offered to sell his land, with improvements, well below the price fixed by the department as representing the unimproved value of the site alone, and that his property had shown a loss for successive years.
Innumerable instances have been quoted where the returns from land in urban areas have been seriously impaired. Public reports of sales show that city values have diminished by more than 50 per cent, in some cases, yet city land-owners - who pay three-fifths of the present tax assessed - will be deprived of relief unless they can prove penury or bankruptcy.
Moreover, when section 66 of the act was formerly amended, it was clearly stated by the then Treasurer that, where a piece of land produced no income, no tax would be assessed thereon. It was ultimately found that even the Privy Council could not reverse a decision of the Hardships Board (which consists of three public servants primarily interested in the collection of revenue).
Speaking for all persons liable to pay federal land tax, we earnestly ask that Parliament should not introduce discriminatory legislation which would give relief to a country landowner and withhold such benefit from a person owning land in urban areas.
I ask the Attorney-General to explain to honorable members why this anomaly has crept into the bill. It may be that paragraph a of clause 5 will cover the position. This slight remission of taxation is a splendid gesture to an overtaxed people, and is certainly welcome to both city and country interests.
.- I am opposed to clause 4, because it is a tragedy that this Government should set about making remissions of taxation to wealthy land-holders within city areas while thousands of our people are living on the dole. Apart altogether from pensioners arid the workers who have had their wages reduced, we are entitled to give consideration to a big section of the community - 28 per cent, or 29 per cent. - which has no income, no means of livelihood, and no prospects. The members of the Country party have said that this legislation will be of great benefit to the producers of this country; other honorable members have said that by giving relief from taxation, it will provide employment. The honorable member for Balaclava (Mr. White) referred to the value of the equity which a trader held in a city property.
The experience of governments which desire to resume land for railway or closer settlement purposes is that a very high price is invariably asked for the areas required. A man may value a block of land at £100 an acre under such conditions. When he goes to a land court, the valuation may be reduced to £20 an acre, but it probably would be found that the shire valuation would be £10, and the valuation for land tax purposes £6 or £8 an acre. The honorable gentleman has also said that it is impossible to get for land the price at which it is valued for land tax purposes; but I point out to him that the Queensland Government is prepared to acquire land at the price at which it is valued for land tax purposes.
We have been told that the remission of this taxation is intended to promote employment; but on account of the uncertainty of the continuation of the Hoover moratorium, the Government seems to have made up its mind to reduce the amount of money available for unemployment relief. We were informed in the press this morning that the unemployed of Canberra intend to march to Parliament House to-morrow morning, and wait upon the Prime Minister or the Minister for the Interior. This seems to suggest that the Government has already intimated in some way that the amount of work thought to be available for the unemployed in the Federal Capital Territory is not so great as people imagined. In these circumstances, it is deplorable that relief from land taxation to the extent of £700,000 should be granted to people who do not need it. If this relief were being granted to the primary producers one could understand if; but it is being granted to the banking institutions, and certain wealthy mercantile interests in the big cities, who batten on the real primary producers of this country as the drones live on the working bee of a hive. To-day, the honorable member for Oxley (Mr. Baker) asked the Treasurer the following questions: -
The replies he received were -
No statistics aru available showing the respective amounts assessed for this year in respect of land over £100,000, £50,000 and £10,000 in unimproved value.
Those figures show conclusively that twothirds of the relief being granted by the remission of this taxation will benefit wealthy city interests. It is distressing beyond words that the poor people of Australia - the halt, the maimed, and the blind - should be called upon to suffer reductions of over £1,000,000 in pensions in order that things might be made easier for people who are already well off. Any one who regularly reads the Wild Cat column of the Sydney Bulletin knows that our wealthy city interests are maintaining their financial position most successfully.
In. all the circumstances, one is entitled to describe this bill as class legislation of the most objectionable kind. I do not think that any fair-minded man, whatever his political opinions may be, will approve of this proposal. If the Government has more money than is necessary for the purposes of government and will not grant relief to the people most in need of it, let it make funds available to the State Governments for unemployment relief schemes and for the reduction of transport and other charges to primary producers.
Australia’s trouble is that she has spent her money in bricks and mortar in our cities instead of in the development of her country lands. The members of the Country party will tell us that the remission of this taxation is a, friendly gesture towards country people; but the primary producers will want more than gestures. Our wheat, wool, and meat producers will not appreciate the fact that two-thirds of the land tax being remitted will benefit city interests. Perhaps we may be told by these honorable gentlemen that there are deserving cases; if so, I reply that these could be met by the liberalizing of the provisions of section 66 of the Land Tax Assessment Act. It is time that the members of the Country party ceased straddling the rail, and demanded some action from the Government that would be reallY valuable to country interests; but apparently they are too intent on finding a means of fusing with the Government party.
If revenue were flowing into the Treasury, as it did in 1926, 1927, and 1928, the reduction of taxation would be appreciated; but our condition is very different now from what it was then. If the Hoover moratorium is cancelled, the Government may have to make another effort to balance its budget. What will it do then? Shall we be asked to agree to still further reductions in pensions and Public Service salaries? I am sure that if the people who suffered reductions of up to 25 per cent, in income under the provisions of our financial emergency legislation had known that, within a few months, the Government would be granting remissions of land taxation to the extent of £700,000, they would have made a great outcry. They suffered the reductions imposed upon them quietly because they believed that by doing so that would assist the rehabilitation of industry, and help to make employment available to those who were out of work. The Leader of the Scullin Government submitted the Premiers plan for the favorable consideration of this Parliament on the ground that it provided for equality of sacrifice ; but he did not mention any proposal to remit taxation. This Government seems to have made the remission of taxation the first plank in its platform. Every one realizes that this is class legislation of the most virulent kind. It is calculated to cause revolt in this country faster than any other method that could be adopted. The policy of the Government appears to be to starve the masses, and to fatten the wealthy sections of the community; but that policy will soon have an effect that it was not intended to have. Legislation of this kind makes more converts to communism than the preaching of all the Communist agitators and the showing of any number of films like “ The Five Year Plan “. If the Government desires to give relief to people, why does it not implement a policy which will make possible the remission of such heavy general taxation as the unemployment relief taxation? Instead of doing so it acquiesces in assaults upon the basic wage, and consents to the limitation of the few allowances enjoyedby its own workers who live among the sand and flies on the East-West railway.
– The honorable member has exhausted his time.
– As I have done considerable research work on this subject, I may be excused for speaking again at this stage. In my previous address I dealt with city conditions and, as my time was limited, I could not elaborate my argument; but the figures supplied should receive the serious consideration of the committee. 1 desire now to make a few observations on country conditions. Our wool and wheat-growers and primary producers generally have suffered hardships similar to those suffered by various city interests. We know that five-sixths of the capital of primary producers is invested in land. For this reason, I contend that the federal land tax is actually a tax on capital. It must be paid irrespective of the losses sustained by primary producers in their business. If the tax is not paid immediate’y, it eventually becomes confiscatory in its effects, and is like a millstone around a producer’s neck. On page 26 of the report of the Wool Inquiry Committee, details are given of the land tax assessment for the last five years and the amount of arrears and fines outstanding. In 1928 the assessment was £2,875,019, and the amount outstanding in. fines and arrears, £34,621, while in 1932 the assessment was £2,476,361, and the amount of tax and fines outstanding, £714,593. That proves conclusively that the tax is becoming so onerous that those engaged in primary production and commercial life are unable to meet it. Producers will have to give up their holdings and gravitate to the cities.
Honorable members who have examined the detailed reports submitted by our statisticians know that 97 per cent. of our exports come from the land, 50 per cent. from sheep. It is also estimated that the wool industry finds employment for up wards of 80,000 families. So that it is worthy of some consideration. That industry has to compete on the markets of the world with such countries as South America and South Africa, where there are low tariffs, exceptionally low freights and labour conditions, and no land tax. Yet we expect it to thrive under those conditions. Unless we lighten the burden that is impossible.
I have information disclosing that for the last three years a certain sheep station has paid 44.5 per cent. of the value of its total wool clip to meet federal land tax. In addition to other taxes, a certain grazier had to pay £18,000 per annum on a gross income of £32,000. Worked out on the value of the clip, that meant that out of every £10 that he received for a bale of wool, £6 went to meet taxation. A certain famous merino stud on the Riverina, excellently managed, equipped with most up-to-date appliances, and with a record known throughout the world, received71/2d. a lb. gross for its clip, out of which it had to pay 4d. in land tax. How is it possible to preserve intact these splendid properties, which are the backbone of our wool industry? Honorable members opposite, who claim to represent the working people, demand greater luxuries, higher wages, and better conditions for the workers. They must realize that our national wealth will be cut off at the source if the position of our wool-growers is made more onerous.
– What is the honorable member’s authority for the figures he has given ?
– The honorable member will find them in the evidence tendered to the Wool Committee, also in various reports submitted by the Commissioner for Taxation.
– The figures submitted to the Wool Committee were absolutely faked.
– I assure the honorable member that mine are based on good authority. A certain large landowner lost £4,721 in five years, yet he was called upon to pay £23,992 in land tax.
– What is the value of his property?
– Unfortunately, I have not that information, but I can tell the Leader of the Opposition how he can obtain it. Certain of these figures have been supplied by the Taxpayers Association, which takes full responsibility for them. Information has been supplied to me of a property in Queensland which paid Federal and State land tax to the amount of £16,000 in ten years.
– I am prepared to tell the honorable member where he may obtain the information later. The net return to the owner was £75 per. annum, which worked out at 4s. Id. a day, on which amount he had to feed, clothe, and educate his family, as well as carry out improvements and repairs.
Originally the object of this tax was to break up big holdings and force people from the cities into the country. In that direction it has been ineffective, for 57 per cent. of the population of Victoria is in Melbourne, and I daresay the same proportion obtains in New South Wales. Compare that with the following figures relating to the percentage of people living in other capital cities of the world : -
London - 11 per cent.
Paris - 7 per cent.
Berlin - 6 per cent.
Tokio - 3 per cent.
New York - 5 per cent.
The taxes placed upon our primary producers are forcing them to relinquish their holdings, and go to the cities. It is not right to expect these people to suffer hardships of drought and the difficult conditions associated with outback life when they have such a negligible return. Yet honorable members say that our wool will always find a market and provide a national income. If they are not careful their class-biased legislation and desire to nationalize everything will cause us to lose the markets on which they rely to provide employment for the persons whom they represent.
.- I shall deal with a few of the unsound arguments advanced by honorable members opposite, who support this remission of land tax which favours a wealthy section of the community. The honorable member for Balaclava (Mr. White) said that it will increase employment, hut failed to advance any argument in support of his contention. He said that many businesses are now operating at a loss, and quoted figures to prove that that was so ; but he argued that this remission of taxation will result in commodities being sold for less. It would have been more logical to argue that the remission of taxation will be used to meet losses sustained in business.
– It amounts to the same thing, for employment will be created.
– I shall endeavour to prove that it will increase rather than decrease unemployment. This £700,000 will be taken from a section which is less able to bear the burden, our invalid and old-age pensioners. By reducing the purchasing power of those unfortunate people the Government will, indirectly, increase unemployment. Honorable members opposite always try to cloud the issue by saying that such measures as this will decrease the cost of living and afford a measure of relief to the workers. I remember their arguments recently when we were dealing with a bill designed to upset the determinations of the Public Service Arbitrator, and reduce wages.
– The honorable member must confine his remarks to the clause.
– I am showing that every reduction in the purchasing power of the people results in increased unemployment, and am pointing out the inconsistency of the line of reasoning of honorable members opposite. On every occasion when there has been a cut in wages or pensions, decreasing the purchasing power of the people, honorable members opposite have endeavoured to justify the action by saying that it would result in increased employment. Surely no honorable member who has examined the latest figures supplied by the Commonwealth Statistician will deny that there has been an increase in unemployment. Therefore, the policy of the Government in the past has tended to increase, and not decrease unemployment.
– The policy of the Government in the past has nothing to do with, the clause, to which the honorable member must confine his attention.
– The honorable member for Wentworth (Mr. E. J. Harrison) wandered as far afield as Japan.
– Order ! The honorable member will proceed to deal with the clause.
– It is lamentable that the Government has proposed to relieve this wealthy section of* the community at the expense of the invalid and old-age pensioners. From time to time, honorable members opposite talk of budget equilibrium. The Government must obtain more . revenue, and the £700,000 that it presents to the wealthy will be taken from the poor. That is a short-sighted policy.
It has been pointed out by honorable members on this side that the clause is designed to assist wealthy city interests. Listening to the honorable member for Wentworth, I realized that he was probably handling the brief of Sir James Murdoch, with whose firm he was associated before being elected to parliament.. No doubt Sir James Murdoch will benefit considerably by the operation of the clause. I am satisfied that this is a concession to the big land-holders in the city in return for past services to the Government. Because of that I shall vote against it. I agree with the honorable member for Kennedy (Mr. Riordan) that it would be desirable to assist the community by. lightening taxation, if the revenues permitted, but it is improper to relieve one section at the expense of another which can ill afford to bear the additional burden.
The honorable member for Wentworth spoke of the wool industry, and how those connected with it have spent their lives outback in trying to earn a pittance. As a matter of fact, the actual wool producers, the workers themselves, after a life of toil and hardship have frequently to go to the cities and accept a pension. The honorable member quoted figures proving that to-day there is a larger proportion of the population in the cities than in the country. That is true. Because of the introduction of improved methods of production, the primary industries are not able to employ any more men. The honorable member for Went worth (Mr. E. J. Harrison) suggested that the land tax was responsible for 57 per cent, of the population of Australia being in the cities. He, and other honorable members who share his opinions, have stated that the land tax v/as intended to break up large estates. That may be true, but the fact is that a large amount of revenue is obtained from the tax, and if we cut it by one-third, the revenue must be found elsewhere. Those honorable members who promised that relief would be given to the pensioners as soon as economic conditions permitted will find it hard to justify the Christmas gift of £700,000 to the wealthy taxpayers. Seeking to justify their support of this measure, they have been driven to pretend that this remission of taxation will benefit the workers by providing more employment, although they have not demonstrated how it will have that effect. The honorable member for Balaclava (Mr. White), it is true, tried to show that the effect of the reduction would be to bring down costs and prices, so that employers would be able to take on more men. I agree with the opinions expressed by the honorable member for Kennedy (Mr. Riordan), and I, and those associated with me, are not prepared to support the action of the Government in giving this Christmas box to its friends outside Parliament.
– This proposal to reduce the land tax by one-third in the case of all interests, both city and country, has naturally aroused a good deal of comment, and some opposition. The land tax, as imposed by our federal legislation, is the product of a theory which looks very well on paper. Indeed, I am inclined to think that all unimproved land value taxation is based on a theoretical and hypothetical foundation. It is necessary, before imposing the tax, to ascertain something that never existed, to determine a value that is not there, to value land on the basis that it is in some condition other than the improved condition in which it actually is. There are those who say that the taxation of unimproved land values would remedy all our economic’ troubles. I have not been able to satisfy, myself that such an assumption is justified.
In the case of the Commonwealth land tax, we are acquainted with the history of the measure. We know that it was introduced in the first place for the purpose of breaking up large estates, and, in the second place, to obtain revenue, particularly in the cities. It is based on the view that nobody should own land of an unimproved value greater than £5,000, or, if he does, he should pay for it, and the more he owns the more he should pay, until it becomes impossible for him to hold any more. The history of Australia, particularly during the sixties and ‘seventies, shows that land aggregation had become a real evil at that time, and was preventing the development of the country. Perhaps the evil still prevailed in 1910, when the Commonwealth land tax was introduced; but, in so far as the purpose of the tax was to break up large estates, it will be admitted, I think, that it has by this time achieved its object. The present effect of the tax is to impose a severe burden on the wool industry, and others. The wool industry is covered more particularly in the next clause, under which a special concession is made for the purpose of assisting rural industries. This concession is of special value to the wool industry, because most of the tax paid on country land is undoubtedly derived from the areas on which wool is produced. This clause makes a reduction all round of one-third in respect of both city and country lands. It has been asked why, at a time when reductions are being made in social services, this remission of taxation should be granted. This is a question which properly demands an answer. The Government’s proposal is based on the view that the land tax at the present time, by reason of its amount, is gravely hampering enterprise, both in the city and in the country, and is, therefore, interfering seriously with employment. I accept for purposes .of illustration the figure which has been quoted by honorable members on the other side, that the amendment of the act will mean the remission of £700,000 to the taxpayers. The Government believes that it is in the interests of the community as a whole that this money should be left in the hands of the taxpayers, rather than that it should be collected and spent by the
Government. It is also better in the interests of those who depend on the social services which the community provides, but cannot provide adequately unless it is prosperous. I admit that there is room for a difference of opinion on this point; but the view I have stated seems to me to be reasonable. My own view of the matter may be illustrated by a recent experience. Last week I met a man, who turned out to be a large owner of suburban property. He told me that the effect of the Commonwealth land tax, combined with the reductions of rent and the uncertainty of obtaining tenants, was such that he was receiving practically no income from his property. Because of the state of his health, he was unable to work, and he depended on the income from his property to maintain himself. He said that if this remission of taxation were agreed to, he would be able immediately to give employment to a considerable number of men in painting and repairing houses in Melbourne and its suburbs. ‘ That is merely one illustration, and I have no doubt that there are many others. It seems to me that it must almost inevitably follow that the money which is not extracted by taxation will be spent in the community in one way or another. At the present time, it is probable that the money will be- spent in such a way as to provide the maximum of employment and a profitable return. It is unlikely that it will be spent in buying luxury goods. All the probabilities are in favour of this money fructifying through the channels of employment to provide more work in increasing volume as time goes on.
When honorable members refer to wealthy taxpayers, I think of some of the wealthy taxpayers whom I happen to know. I am not familiar with the financial affairs of many of them, but one I do happen to know something about. This man is well known throughout the Commonwealth as a philanthropist. No one could properly describe him as a selfish or self-seeking man. He owned a large office building, and was getting a good return from it, but he was ill-advised, and bought another similar building, with the result that he is now losing money on both. That is the reward of his enterprise, and he is very sorry that he made the second purchase. He had no idea of the effect that the aggregation of property in his hands would have on the rate of land tax he would be called upon to pay. The Commonwealth is now collecting a great deal more money from him because the two properties happen to be in his hands instead of in separate ownership. I do not at the present time share with some honorable members their dread of the aggregation of property. I admit that we must be on our guard against the wealth of the country getting into a few hands to such a degree -as to allow its possessors really to control the lives of the people, but it can hardly be suggested that this position has been reached in Australia. It would be a very fine thing if we had some more big enterprises than we have. For example, I think that one of the finest institutions in Australia is the Sunshine Harvester Works. It employs hundreds of men, and I should like to see it employing hundreds more; but concerns of that kind can be established and operated only when there is a considerable amount of money behind them. Unless we encourage such enterprises, they will not be able to render that service to our people that otherwise they would be capable of doing. We should encourage enterprise in Australia, rather than repress it. Speaking generally, it is better for people who earn money to spend it than for governments to spend it. Governments must recognize their obligations also in fair measure to those who are unable to support themselves because of the vicissitudes of life. That, I believe, is being done in the Commonwealth under existing legislation to a greater extent than in any other country in the world, despite the depression. If that be a fair view - and I submit that it is - then let us not be anxious to prevent the success in our own cities of large scale enterprises. Let us rather support and encourage them, not because we want individuals to become wealthy, but because large and successful enterprises are the best providers of employment, are a monument to the energy and capacity of our people, and redound to the well-being of all sections of the community. In view of these considerations I ask hon- orable members to accept the reduction of the land tax by one-third as a proposal which is likely to promote in a real sense the welfare of the people as a whole.
.- The Attorney-General (Mr. Latham) has just told us a story about some man whom he knew who would be able to employ a number of men at painting houses if he obtained a remission of his land tax. If that be true, we should probably be able to provide employment for a great many more men by abolishing the tax altogether, and if we abolished all taxes there would be work in plenty for every one.
The honorable member for Wentworth (Mr. E. J. Harrison) quoted some figures regarding tax assessments for the year 1930. I suggest to him that he must have obtained his information from some ona who knows more about the matter than does the Commonwealth Commissioner of Taxes. Last week, the honorable member for Oxley (Mr. Baker) asked the Prime Minister (Mr. Lyons) a question on this subject, and the answer he received was quoted to-night by the honorable member for Kennedy (Mr. Riordan). The figures furnished by the Commissioner are, I understand, the latest available. I do not believe that the Taxpayers Association is able to get information that is not available to the Prime Minister. The honorable member for Wentworth is merely broadcasting another bedtime story which would not bear much investigation. It is true there are in the cities thousands of empty offices and houses, but that is due not to the land tax, but to the diminished purchasing power of the community.
– The incomes of the owners of the properties are affected.
– No doubt the people whom the honorable member represents are affected, but they have already had a good rake-off. The fact that amongst the thousands out of employment are men trained in commerce, and others qualified to practise medicine, law, and other professions, is not attributable to the land tax, but rather to the policy of deflation and the reduced spending power of the people, which this Government is seeking further to diminish. The honorable member for Wentworth said that we must compete in the markets of the world against countries with low wages and poorer standards of living. No doubt he would like to see our own. people reduced to the same level. I am sorry that he did not compare the cost of shearing sheep in Australia with the cost in other countries. I believe that the shearing rates are lower here than elsewhere. But if the wages costs were entirely eliminated Australian wool-growers would not be able to compete in the markets of the world at the present prices of wool.
– The shearing rate in New Zealand is only about £1 per 100.
– The rate may be low and the cost high. An employer may pay low wages, and yet be paying dearly for inefficient labour. Our experience in the last two years has taught honorable members, even many of those who two years ago believed in a policy of deflation, that we have made a mistake. The late Mr. P. G. Stewart admitted in reply to an interjection by me that the wheatgrowers could not compete in the markets of the world to-day even if all the work on the farm were done for nothing. That applies also to wool-growing. Neither wool nor wheat can be produced profitably in Australia at the present time. If the wool-grower were freed of shearing and transport costs he could not produce wool profitably to-day. The remission of one-third of the land tax will not put one additional man in a job. If it yields any advantage it will be merely by reducing the losses sustained by owners. It is idle to ask men to employ labour or to produce commodities for sale in the markets of the world so long as the present prices obtain. The honorable member for Wentworth referred to a property in Queensland, but he did not mention its location, so that honorable members would have an opportunity to express an opinion as to whether the value he quoted was real. Usually the value on which land tax is assessed by the Commissioner is that placed on the property by the owner. The honorable member for Kennedy has rightly stated that there are always two valuations of a property, that of the buyer and that of the seller. The value placed on a property by an owner desiring to sell is higher than the Government valuation and often is at. least 100 per cent, more than the valuation for rating purposes by the local authorities. The Government has no right to remit any land taxation, while it continues its present policy of reduc-ing the wages of its own employees, and the pensions of the aged and infirm.
.- My experience in this Parliament has convinced me that the business of politics is knowing and deciding who should pay taxes and who should receive concessions. By clause 4 the . Government is trying to shift the burden of taxation from a class of people of whom many are well able to bear it. The honorable member for Wentworth spoke as if he were unaware of the fact that the next clause makes adequate provision for holders of large country properties who, because of the fall in the prices of their produce, are iri financial difficulties. Honorable members have argued that this land tax restricts employment and enterprise, because when a factory owner expands his operations he is penalized by increased taxation. As I listened to these contentions I asked myself why should we have any taxation at all. Is Australia in debt to the extent of £1,110,000,000? Has it a floating debt of £100,000,000 at the present time? I have been waiting for the Attorney-General and others to deal with that aspect of these proposals. The talcing away of £700,000 from the weakest and poorest section of the community, simultaneously making concessions to a wealthy section, is serious enough; but I have been waiting for some member of the Ministry to justify this remission of taxation in view of the present financial position. Not one of them has dared to deal with that aspect of the matter. During my second-reading speech I pointed out that for the protection of property in Australia our people have incurred a war debt of £268,000,000, and I contended then, as I contend now, that the property protected at such cost should bear its full share of the burden. Several honorable members defended this remission on the ground that it would increase employment. I question that. In the country districts, in South Australia, at any rate, men are available for from 5s. to 10s. a week and keep; therefore, the wage burden is not the principal one. The £700,000 which has been taken from the old-age pensioners would have been expended principally in the purchase of food and raiment, and I defy any honorable member to disprove my statement that greater employment would be provided by the distribution of the half-crowns of the pensioners than by the remission of taxation to land holders, many of whom are wealthy. The money that is being given to these landlords, instead of being used to provide more employment, will be expended on Rolls Royce motor cars, and champagne suppers, and on further overdressing of people who are already overdressed. The honorable member for Corio (Mr. Casey) said that it was politically immoral for us to champion the cause of the old-age pensioners. If that is politically immoral then it must also be politically immoral for honorable members who hold big areas of land to advocate in this chamber a reduction of land taxation which, if agreed to, would give them considerable financial relief. If one action is politically immoral the other is equally so. The AttorneyGeneral (Mr. Latham) instanced a case in which a man owned a large block of offices from which he was making a profit. He then purchased another property, and became involved in financial difficulties. The honorable member for Grey (Mr. McBride) took me to task for criticizing the actions of certain squatters and farmers who purchased additional land during the boom period. My answer to that honorable gentleman is that some people would say that in the case mentioned by the Attorney-General the man displayed enterprise, but in my opinion it waa nothing but greed. The Attorney-General also said that, in some circumstances, the aggregation of wealth was desirable. I contend that the conflict of the future will be between institutions controlled by the Government and those controlled by combines. On every hand, we can. see evidences of the development of that conflict, which will have to be ultimately settled. I recognize in the federal land tax a deterrent to the aggregation of wealth in the form of land. As I pointed out in my second-reading speech, as the result of the fictitious prosperity of the post-war period, the aggregation of land gradually took place, and we have now an opportunity, while the prices of commodities are low, to give effect to the original intention of the act, which was to break up large estates in this country. I ask honorable members did this proposal for the remission of land tax emanate from the Premiers plan? Did it have a place as any one of Lyons’ nine points? It certainly had no place in the policy speech of the Prime Minister (Mr. Lyons) or in the Premiers plan. This is a special concession to wealthy interests, and it will be the means of destroying that fine spirit which was in evidence throughout the community generally when every section of the community was called upon to accept the principle of equality of sacrifice. There is no equality of sacrifice in the Government’s proposal, because it aims at benefiting the wealthy interests at the expense of the poorer section of the community.
.- It is extraordinary to see honorable members, allegedly representative of the people, rising one after another, speaking their views, and using briefs which have been supplied to them by their supporters. “We had to-night one of the most degrading spectacles ever witnessed in this chamber when an honorable member carried the privilege that he enjoys in the law courts into this chamber, and used a brief on behalf of his wealthy clients.
– If that reference is to the Attorney-General (Mr. Latham), who is at present absent from the chamber, I consider that it is offensive, and ask that it be withdrawn.
– Any suggestion that an honorable member is behaving in a degrading way is distinctly out of order.
– I withdraw the remark. The Attorney-General .referred to taxation upon the unimproved value of land. He said that it was the product of a theory; but he afterwards stated that there was no further necessity for it because it had achieved its object.
– Therefore it could not have been merely a theory.
– That is so. The brief used by the Attorney-General tonight was the brief provided by the representatives of the moneyed classes when the federal land tax was first introduced into this chamber. The principles which were then laid down to prevent the aggregation of large estates, whether in the country or city, are the same to-day. Only a few months ago, according to the Prime Minister, this Government was faced with a financial crisis unparalleled in the history of Australia. To remedy the position, it made reductions in the payments to the poor unfortunate pensioners of this country, and in the wages and salaries of public servants. Shortly afterwards, it found itself in a position, not to make restitution to those sections of the community, but to use the money that it had taken from them for the benefit of an exclusive class of the community - the wool brokers and pastoralists, the shipping interests, the banks who each year have paid dividends of 9 per cent., 10 per cent., or 12 per cent., the coal barons, and the Colonial Sugar Refining Company, which has always paid a dividend of 12 per cent. Those are the institutions on behalf of which honorable members on the opposite side of the chamber are pleading tonight. The honorable member for Wentworth (Mr. E. J. Harrison) quoted a set of faked figures.
– That remark is offensive to me, and I ask that it be withdrawn.
– If the honorable member for Darling has accused the honorable member for Wentworth (Mr. E. J. Harrison) of faking figures, the remark must be withdrawn.
– I have merely stated that the figures quoted by the honorable member forWentworth were faked figures, and the honorable member has no right to ask that that statement be withdrawn.
– If the remark complained of refers to figures which appear in the report of theWool Committee, it cannot be regarded as offensive.
– The AttorneyGeneral stated that the land tax had achieved its object. I submit that it has done no such thing. The honorable mem- ber also gave an illustration of the necessity for not abandoning the land tax. He spoke on behalf of a man who is welltodo, so well-to-do that he has acquired the reputation of being a great benefactor in this country. That man owned a suite of offices from which he received rents which allowed him to distribute wealth to all and sundry, and, in consequence, his name became widely known throughout the land. But he wanted to make more money so as to be a greater benefactor, but was caught in the toils of the land tax which was imposed for the. purpose of catching such men. Since the introduction of the graduated land tax, £138,000,000 worth of land has been withdrawn from the field of that tax. We must keep in mind all the time the fact that only those people who have land of an improved value of £5,000 and over are affected by this tax. But there is still £300,000,000 worth of land which is, and should be, taxable. The honorable member for Wentworth quoted figures to assist his case. With pathos in his voice, he painted a woeful picture of the position of an unfortunate person or company which has paid in dividends in four years the sum of £23,900. I wish I had half the troubles of that company. Its annual tax averaged £5,975. That means that the company has unimproved land to the value of £205,000, which is altogether too much for any person or company to hold. It cannot hold that amount of land to the interest of the nation. The company has in that property an asset of at least £250,000, and yet the honorable member for Wentworth cries aloud to the heavens that great wrong has been done to it. Only the honorable member himself would have the audacity and impertinence to paint such a picture in this National Parliament. Then again, the honorable member referred to land tax which amounted to £26 a foot of land frontage. On the face of it, great hardship seems to be imposed on this allegedly inoffensive person. A frontage of 55 feet at £26 a foot would pay £1,360, which means that the company in question has a property the unimproved value of which is £75,000, and which, with the building upon it, would be worth probably £250,000. There would have to be a substantial building to carry the capital cost of the land. Does it impose any hardship upon a company which can afford to pay up to £75,000 for a block of land to pay such taxation? It certainly does not. To-night, the AttorneyGeneral took up the position of counsel for the defence of the wealthy, and the case that he put up for the relief of those “who are best able to bear taxation was one of the greatest political ramps ever experienced in this country.
I come now to the report of the Wool Committee. It was decided at a meeting in Sydney some months ago that a wool inquiry committee must be appointed. This was hurriedly done, and the terms of reference loosely drawn. As a matter of fact, the committee had no power whatever. The honorable member for Wentworth quoted certain figures from the report of this committee. I want to show that the figures were faked, and that the report is nothing but a smokescreen. I quote the following paragraph from the report of the minority committee, which is signed by Mr. E. W. Grayndler : -
In regard to the question of costs, the basis from which these were taken was from the summaries covering some668 properties. Of this number, 485 were in respect of New South Wales, Victoria, South Australia and Tasmania, and 89 in respect of Western Australia. The above returns and summaries were submitted as evidence to the Commonwealth Arbitration Court this year for the purpose of securing a reductiou of shearing labour.
It is apparent from the beginning that the figures in this report are tainted.
– Order ! The honorable member may not refer to the figures in that way.
– The honorable member for Wentworth quoted from these very figures, and I want to show that they are faked.
– Order ! The honorable member may refer to any figures which relate to land taxation, but he may not quote figures which he himself says are faked.
– I rise to a point of order. The honorable member is merely drawing attention to certain, figures quoted by the honorable member for Wentworth, in order to contest their accuracy, and I submit that he is entitled to do so.
– The honorable member for Darling stated that the figures were tainted, and . I called him to order for doing so. I have no desire to restrict the honorable member unduly, but he must connect his remarks with the subject under discussion.
– The honorable member for Wentworth was allowed to quote these figures, and I submit that I am entitled to do so.
– I called the honorable member to order for referring to the figures as tainted and faked.
– Mr. Grayndler said in that report -
I objected to these particular 485 and 89 returns being used in this inquiry, as the Australian Workers Union had objected to them being accepted by the court, for the following reasons: -
The returns did not disclose the name of the owner, or name or location of the property. Each bore a number only.
It was for this reason that I assailed the figures. The honorable member for Wentworth gave the report of the Wool Inquiry Committee as his authority for certain statements, and I submit that the quotations which I have made from the minority report of that committee show that his authority was not reliable. Mr. Grayndler also said of the figures supplied -
– Who is this Mr. Grayndler ?
– If the honorable member for Fawkner does not know, he ought to know.
– The honorable member’s time has expired.
– I desire to make a personal explanation. The honorable member for Darling (Mr. Blakeley) has somewhat misrepresented my position. I was challenged to give my authority for certain statements which I made in reference to city properties, and I give my authority as Metters in one case, and Sir Arthur Rickard in another.I was also asked for my authority for certain statements which I made in regard to country lands, and I give it as the report of the Wool Inquiry Committee and the secretary of the Taxpayers Association, Mr. P. D. Rowe. The Taxpayers Association is a thoroughly representative body, and the secretary of it gave me full liberty to use the figures which I quoted. To the best of my knowledge, the figures that I quoted were not tainted or faked in any way.
– The Wool Inquiry Committee, to which reference has been made in this debate, was not thoroughly representative of the real wool-growers of Australia. Its members represented, in the main, the city interests who really shear the woolgrowers. The honorable member for Wentworth (Mr. E. J. Harrison) said that the stud sheep breeders should be relieved of taxation. Unfortunately, those very people are, to some extent, responsible for the present difficulties of the Australian wool industry, for they exported some of our best stud stock to South Africa. It was only after the advent to office of a Labour government that an embargo was placed upon the export of stud sheep from this country. Even though this measure may grant some relief to wealthy stud sheep breeders, it will not assist the real woolgrowers of Australia who carry 4,000 or 5,000 sheep on anything up to a 10,000 acre holding. Something has been said about the suburban pastoralists.
– In Woolloomooloo, for instance.
– Many men in Woolloomooloo are just as worthy citizens as the honorable member for Balaclava (Mr. White) and they should not be held up to ridicule simply because they have to live in Woolloomooloo. A wool-grower who carries 5,000 sheep on a 10,000 or 12,000 acre block in Queensland does not pay much land tax. As a matter of fact 5,000 sheep would not give him a living to-day. He would not be as well off as a man earning £8 or £10 a week in the city. He is at a disadvantage in every respect. If he does not send his children away to school for their primary education he must keep a governess, and if he desires them to receive a secondary education he is forced to send them to the city. Exemption from land taxation will be of no value whatever to him. It will merely help such organizations as the New Zealand Loam, and Mercantile Company, Dalgety and. Company, Goldsbrough, Mort and Company, and such organizations, the shareholders of which batten on the primary producers. The Leader of the Opposition (Mr. Scullin) showed clearly that a man who held a grazing property worth £8,000 paid only £1 16s. a year in federal land tax. The rent of a pastoral lease, even when wool was up to 3s. per lb., would be l1/2d. to 3d. an acre a year on the average. For a pastoral lease extending over 30 years, and with wool at 3s. per lb., the rent would be only 30s. an acre for the full term of the lease. A man with a property of 10,000 acres, worth £15,000, unimproved value, would need more than three times that area to make the same living with wool at l0d. per lb. - and many graziers will be lucky if they get l0d. a lb. for their wool this year. Exemption from land taxation does not mean anything to a man in that position. The honorable member for Wentworth said that there were many city land-holders who deserved relief, but the position of the city land-holders is nothing like so serious as that of the wheat and woolgrower. Take, for instance, a company like the United Insurance Company. In 1922 its profits amounted to £58,862, whereas in 1931 they amounted to £42,639. The following figures are taken from the returns of J. Fielding and Company: -
That was a bad year, and the firm was able to pay only 15 per cent dividend. It was almost on the verge of bankruptcy. Yet such concerns will get greater advantage from this legislation than will the real producers. I am amazed that the Country party should support the Government in putting over one of the biggest ramps known in history. The Adelaide Electric Light Company made these insignificant net profits -
– That is a monopoly.
– Cannot this Government deal with monopolies? Has there been a reduction of 22-J per cent, in the commodities handled by that company? Then come to the newspapers which stand behind this Government, for instance the Herald and Weekly Times Limited, whose net profits are as follows: -
Those are the sections that will obtain a reward and relief at the expense of invalid and old-age pensioners, and persons who are on the dole. If this Government really desired to give relief to primary producers it would set about giving employment to the workers. To-day it pays from £10,000.000 to £12,000,000 in unemployed relief, yet, as a sop for electioneering purposes, it is handing out this £700,000 to its friends. Only a few months ago the Government took £1,252,000 from the oldage pensioners. It has the audacity to term this a “ relief “ measure designed allegedly to assist invalid and old-age pensioners and provide “ relief “ to primary producers by way of a bounty, which pleases nobody. The money that is being refunded to invalid and old-age pensioners was pinched from them recently, just as the Government burgled the public servants. Had the Government desired, it could have given real relief by making the money available for the relief of unemployment in productive industries. I hope that the Leader of the Country party will not allow this to be put over the primary producers, but that he will endeavour to fight for those on behalf of whom he represents. He must remember that the supporters of the present Government upset in the Senate a bill introduced by the Scullin Government that would have given far greater relief to the primary producers than anything contemplated in this measure.
.- I desire to proceed further in my indictment of the report of the Wool Committee, which has been submitted as Exhibit “ A “ to show the position into which the squatters of Australia have got as per the story of the honorable member for Wentworth (Mr. E. J. Harrison) and his
Majesty’s Attorney-General (Mr. Latham), who is counsel for the defence of the wealthy squatters and big business men. Upon that report, apparently, the action of the Government is based. The excuse for this liberal concession is the dreadful “ condition of the wool-growers. Incidentally, while giving relief to the wealthy squatters, the Government is providing infinitely greater relief to the great shipping and other city interests.
The Wool Committee’s report contains a minority report by Mr. Grayndler from which I have already quoted. Mr. Grayndler makes these interesting comments -
After the first few sittings of the committee and taking note of the kind of evidence the graziers were wheeling up to us and the trend of the inquiry generally, I caine to the conclusion that the inquiry would be a farce and was being dominated by the big men in the Graziers Association Council, who did not want any deep probe into the industry that would reveal the grip that the brokers and buyers had on the wool industry.
It soon dawned on me that the committee was a farce and that nothing short of a royal commission would get at the real facts, and by protecting witnesses compel evidence that would expose the hands of big pastoralists who are shareholders in brokers firms and finance institutions who lend money to wool-growers great and small and have them in their power all the time mid who buy the wool of the small and average wool-grower and rebate it and get a big rake-off in the higher prices they obtain in other sales.
– That is not correct.
– It is only too true. Mr. Grayndler continues -
The small and average wool-grower-
Who is not affected by this legislation - is being fleeced by the combinations that buy and sell their wool, and those financial institutions who through the banks finance the grower between seasons. When the committee sat to finalize . their report I attended on the last two sittings for a time at each and had my copy of the draft report. I saw at once that the committee had accepted Mr. Allan’s statistics.
Mr. Allan is the secretary of the Graziers Association-
– On a point of order. I am unable to find any of the comments in the minority report by Mr. Grayndler from which the honorable member states he is reading.
– That is not a point of order. ‘
– I am quoting from the comments of Mr. Grayndler, which continue - whichhe had placed before the Federal Arbitration Court, and to which I objected to when he tendered them to the committee at its first sitting. The committee did not investigate these returns, and in fact had no means of doing so, but accepted them from the graziers as gospel. They took 485 returns of the graziers for the purpose of averaging the value per sheep area. They fixed this averago at £4 8s. 3d. The values alleged from these returns so far as New South Wales is concerned were stated as follows: - £219 8s. for the western division (your electorate mostly) to £6 19s. 7d. for southern Riverina. The Victorian average was £6 14s. 7d. per sheep area. What chance would there be of making wool pay if a sheep has to earn that annually from an average of 8 lb. of wool per sheep? But what astonished me at the time was that the committee while using the graziers’ returns as a base for their calculations of the cost of production per lb. of wool, did not rely on them, but instead searched the archives for other figures and discovered that in 1910 on an appeal case on federal land tax the Supreme Court of New South Wales and the High Court accepted that a typical improved freehold property was £3 5s. per sheep area, and if stock and plant be added a reasonable value they said would be £3 15s. per sheep area.
All these figures up to £6 14s. 7d. per sheep area have been resurrected, after being faked for the edification of the judges of the Arbitration Court, to put up another case to impress this Parliament. I have quoted from a letter from Mr, Grayndler supplementing his report, to which I have previously referred. Despite what the honorable member for Fawkner (Mr. Maxwell), the AttorneyGeneral (Mr. Latham), the honorable member for Wentworth (Mr. E. J. Harrison), the honorable member for Corio (Mr. Casey), and any others opposite might say, this Government is greasing the fat pig. These people with properties valued at from £250,000 to practically £2,000,000 deserve no consideration from this legislature, particularly at a time when the economic position of the country is desperate. I should dearly love to know what took place in the negotiations between the vested interests of Sydney, Melbourne, and other capitals and the representatives of this Government. Evidently those interests wielded sufficient influence to compel this Government to indulge in a species of highway robbery which is to be deprecated.
– On a point of order. The honorable member suggested that the Government was guilty of highway robbery, which is an offensive term, and, I submit, should be withdrawn.
– The illustration is not a happy one, but the remark applied to the Government and not to honorable members, and the Prime Minister (Mr. Lyons) has taken no exception to it.
– If the statement referred to the Government, I ask that it be withdrawn.
– I withdraw it. The honorable gentleman was somewhat tardy in defending the honour of his Government. The Government recently made a raid on invalid and old-age pensions and the salaries of public servants, giving the excuse that the country was on the verge of bankruptcy, and that that was the only way in which its honour could be preserved. Almost immediately afterwards it introduced this bill, which gives liberal concessions to wealthy interests in the community. No matter how honorable members may try to defend the action of the Government, the fact remains that it has permitted the interest of the poorer classes of the community tobe attacked, and money to foe taken from them in order that the wealthy classes may benefit.
Question - That the clause be agreed to - put. The committee divided. (Chairman - Mr. Bell.)
Majority . . . . 21
Question so resolved in the affirmative.
Clause 5 -
Section sixty-six of the Land Tax Assessment Act 1010-1930 is amended by omitting from sub-section] all words from and including the words “ that a taxpayer “ to and including the words “ seriously impaired “ and inserting in their stead the following paragraphs . . .
Section proposed to he amended - 66 (1.) in any case where it is shown to the satisfaction of a board consisting of the Commissioner, the Secretary to the Treasury and the Comptroller-General of Customs, or of such substitutes for any or all of them as the Minister from time to time appoints, that a taxpayer liable to pay land tax has become bankrupt or insolvent, or has suffered such a loss that the exaction of the full amount of tax will entail serious hardship, or that, by reason of drought or adverse seasons or other adverse conditions, the returns from any land owned by him upon which he carries on agricultural or pastoral pursuits have been seriously impaired, the board may release such taxpayer wholly or in part from his liability for land tox . . .
.- I move -
That all the words after the word “ amended’” be omitted with a view to insert in lieu thereof the following words: - “ (a) by omitting from sub-section 1. the words ‘ the Comptroller-General of Customs ‘, and inserting in their stead the words ‘one member to represent the interests of taxpayers, who shallbe appointed by the Governor-General and shall hold office for the same term and under the same conditions as those provided in Fart V. of this act for a member of the Valuation Board.’”
The board, as at present constituted, consists of three officials. Two of them, the Secretary to the Treasury and the Commissioner for Taxation, have proved in practicetobe . filled with a strong instinct to collect’ the utmost amount of revenue which the law permits them to take from the taxpayers. Some years ago, when the hoard was constituted in the same way as it is to-day, but when the personnel of the substitutes was different, it was not subject to the same amount of criticism as it is to-day. In recent years the action of the board has given rise to the belief that it is out to strain the law, to the extent of depriving taxpayers not only of some of their legal rights, but almost of their right to be heard. In moving this amendment for the reconstitution of theboard, I do not impute any motives of an improper character to the members of the present board. I make no suggestion that those gentlemen have ever acted in any venal or dishonest way, but, as an honorable member near me has just interjected, they have been trained as bloodhounds, and. the nature of the bloodhound, I presume, is as constant as the spots of a leopard. The result is that the fairness of the board has become subject to a good deal of suspicion, and the board itself to widespread disrespect. It would be quite a reasonable thing for the Government to have one of the three members of the board an appointee chosen by itself, but one who would yet particularly represent the interest of the taxpayers. Part V. of the act, which deals with the hearing of appeals against assessments, introduces this principle of representation of the taxpayers. In this connexion, the Appeal Board is much more liberal in its constitution than the Hardship Board would be if this amendment were accepted. The Appeal Board consists of an impartial chairman, a representative of the department, and one of the taxpayers. On the Hardship Board, which makes concessions as a matter of grace, I ask only that one member should represent the taxpayers. The other two would still be the Commissioner of Taxation and the Secretary of the Treasury, or their substitutes.
– Is it necessary that the three members shall he present to consider cases ?
– The act provides that the chairman may refer an application to one member of the board of review for investigation and report: My amendment would not preclude the appointment of substitutes who would act in the capital cities where the appeals are heard, and those substitutes could be replaced by others in the same way as substitutes may be appointed for the official members of the board. That, I think, would be a reasonable concession to equitable practice. At present the members of the board are judges and advocates in one, and they seem to be intent upon getting as much revenue as can be screwed out of the taxpayers. My amendment does not go very far, but, in the interests of the public, I think that the Government ought to accept it.
– Since the honorable member for. Wakefield (Mr. Hawker) informed the Government that he was going to move this amendment, we have given careful consideration to it. While we may not be satisfied with the general attitude of the Hardships Board up to the present, I should like to point out that there are objections to the honorable member’s proposals. In the first place, the board, at the present time, costs the Commonwealth practically nothing. The officials who sit upon it receive their ordinary salaries, and there is very little additional outlay. If a representative of the taxpayers were appointed, substantial feeswould have to be paid to him, and probably travellingallowances as well. It would be necessary to appoint some one possessing high qualifications, and his services would have to be adequately remunerated. That is the least of the objections, but there are others. For instance, I do not think that the taxpayers themselves who are in difficulties would care to have the details of theircases made known to a member of the outside public. It is a different matter when those details are laid before officials who are sworn to secrecy. The suggestion that substitutes might be appointed to act in place of the taxpayers’ nominee would, if put into effect, make the position even worse, because i t would increase the . number of persons who would be made acquainted with the private affairs of the taxpayers. Apart from the views of the taxpayer himself there are objections to members of the outside public becoming aware of the internal details of taxation administration. Whilst at times there may not have been that degree of concession to taxpayers in difficulties which was desirable, the present Administration, is undoubtedly sympathetic, and I am confi dent that taxpayers will in future have no ground for complaint. In view of the probable cost involved and the other objectionable features to which I have drawn attention, the Government cannot accept the amendment.
.- As a general principle I agree that in all proceedings that are in the nature of arbitration the parties concerned should be represented. In connexion with the valuation of lands there is a board of review on which the taxpayer is represented. There should always be a wageearner . on a tribunal . determining wages and conditions of labour, and wherever practicable a representative of the workers should sit on. the board controlling an industry. But I draw a distinction between arbitration proceedings and the determination of the relief to be granted in. cases of hardship. In these proceedings, there will be no dispute as to valuations and assessments, and there is no more logical reason . for giving representation to the taxpayers on the Hardship Board than there is for giving representation to pension claimants on the body administering pensions. Moreover, I agree with the Prime Minister that many taxpayers would refrain from appearing before the board ifthe most intimate details of their business affairs were to be made known to persons other than high officials or their substitutes. ‘ We could depend on the representative of appellants against land valuations or tax assessments to do the fair thing, but, to allowa private person toshare the tremendous discretionary power vested in the Hardships Board in the handling of the public funds, would be dangerous. When the board was established Parliament deliberately selected the heads of the three big financial departments - the Comptroller-General of Customs, the Secretary of the Treasury, and the Commissioner of Taxation, or their representatives, who also would be high officials - because they could be depended upon to safeguard the revenues from exploitation.
– Even . if an outside representative were appointed the official representatives would still be in a majority of two to one.
– If there is any weight in that argument the amendment would be of little value. It may be said that an outside representative would possess special knowledge not enjoyed by departmental officers. Such outside knowledge might be of value in determining a disputed valuation or assessment, but not in determining a matter of hardship. The board will have before it all the details of the claimant’s position, his assets, income and liabilities, and will not need the expert assistance of a landowner to decide whether the case is genuinely one of hardship. The adoption of the amendment would be a grave departure from a principle that has never previously been challenged in the 25 years in which it has been in operation. I have taken a keen interest in taxation matters, and it is a significant fact that never in my public life has any taxpayer written to me to complain of the personnel of the board, oi’ of any legitimate claim failing to receive sympathetic consideration.
.- I do not object to relief being granted to taxpayers who can prove that they are suffering hardship or are in financial difficulties, but I contrast the consideration proposed to be extended to them with the lack of sympathy with another section of the community which is suffering hardships. I desire to deal equitably with all sections. We should not give relief to one section and refuse it to another. By recent enactments considerable hardship has been inflicted on people who have endeavoured to provide for their old age by purchasing property. I have previously stated the circumstances of a man at Kurri Kurri who drew out of the bank £1,050, representing the savings of a lifetime, and invested it in land which he subdivided into 29 blocks. He sold only two blocks, for £100. His rates and taxes on the property amount to £29 a year; he obtains no revenue from it, but his pension has been reduced to 3s. a week. Is not he suffering hardship? In mentioning the injustices that are inflicted upon pensioners, we are accused of exploiting them for political purposes. The Government is exploiting them by its unfair discrimination between them and the wealthier sections of the community.
– Order ! The honorable member will have an opportunity to deal with that subject on a later clause.
– I shall oppose the remission of taxation to land-owners who are suffering hardship, so long as the Government refuses similar consideration to the old-age pensioners who also are suffering hardship, and who, in order to secure relief, must hand over their properties to the Government.
– Section 66 was placed in the act to give relief in certain definite cases of hardship; it was understood by Parliament that it would give a full measure of relief to persons whose land had been unprofitable owing to drought. Unfortunately, experience showed that the section was not being operated in the spirit in which it was conceived. Consequently certain amendments were made to ensure the observance of that spirit. One amendment was made by me as Treasurer in 1927, which . provided that in the case of a man .with several holdings of land, if one holding were subject to drought and no income was received from it, that holding would not be taken into account in the aggregation for the purpose of tax assessment. That provision was inserted in the act to make it absolutely clear that in such instances no real discretion was left to the Hardship Board. If the facts could be proved, the board automatically “operated ; but to secure that, in those instances a certain amount ‘of judicial discretion would be exercised, sub-section 4 of section 27 was inserted in the act in 1927. It reads-
In every ease in which the amount of tax from Which the taxpayer applies to be released is not less than five hundred pounds, the board shall, and, in any case in which the amount of tax from which the taxpayer applies to he released is less than five hundred pounds, the board may refer the application to a member of the board of review constituted under the Income Tax Assessment Act 1922-1925.
Therefore, all cases in which the remission of the tax was desired was more than £500, had to be submitted by the Hardship Board to the Board of Review, but in any case in which the remission desired was less than that amount, the Hardship Board could, at its dis- cretion, make it. Looking at the list of remissions which I have been able to obtain through the courtesy of the Attorney-General - I find that the amounts which have been remitted vary from £1 5s. 3d. to £99, £138 and £404. I would be perfectly satisfied with the position of the Hardship Board if the wording of the section itself was clear, that cases of actual hardship, actual loss from the result of drought, and from the loss consequent on low prices ruling for primary products would without question be taken into account in respect of remissions of taxation. The facts should be considered, not by the Hardship Board, but by the Board of Review, the final decision to be with the Hardship Board.
.- I wish to say two or three words in respect of the proposal of the honorable member for Wakefield (Mr. Hawker). I appreciate the fact that he makes no personal complaint against the important officers who have hitherto been members of the Hardship Board, and I do not think that it is in any spirit of complaint against any individuals that some of us are strongly disposed to sympathize with the honorable member. My own view is that in a matter of this kind citizens with grievances should be permitted to bring their hardships before at least one person who is a citizen like themselves. The fact that our public servants are an honorable and extremely able body of men is no guarantee that they will understand the position of an ordinary struggling citizen. The public servant, particularly the successful public servant, is a man who by his career, has been isolated from the ordinary struggle of the market place. Probably for many years he has shaped his career in accordance with ambitions that are peculiar to the service in which he finds himself, and honour and ability are no guarantee that in the position of a member . of the board he will understand or sympathize with the position of the citizen on whom he is called to sit in judgment. The whole of the safeguards of the British Constitution and the British methods of government depend on ultimate control by ordinary unofficial citizens. In the criminal courts, no matter what may be done by the judge, who is an official, or by others who may be regarded as officials, the ultimate judgment rests with the body of citizens in the jury box. Wherever we turn, we find that it is the right of the citizen to be judged by his peers, who are the real protectors of every liberty and privilege that he enjoys. I do not suppose that the honorable member for Hunter (Mr. James) doubts that there are innumerable instances of genuine hardships among those who are on the land. If a struggling farmer has to appear only before three official heads of departments - gentlemen who look back upon a long, successful, and honorable life spent in extracting the last farthing from the taxpayer - he cannot expect to obtain much relief. He goes from one official to another. He has not even the advantage of appeal from Phillip drunk to Phillip sober, for the heads of our departments “are men of such decorous conduct that generous impulses are not likely to emanate from them. In those circumstances, I think that the suggestion of the honorable member for Wakefield is a valuable one. This matter has recently been brought under my notice’ for various reasons which I shall not inflict upon the committee at this stage. The principle is sound, that the ordinary undistinguished citizen who has a hardship should be able to take it before a tribunal upon which is one man whose position is similar to his own, to whom he can appeal and speak as one human being to another.
– Various views have been expressed as to the nature of the. tribunal which is supposed to hold the balance between public and private interests. I admit that I have never been enthusiastic about the presence of an advocate upon any tribunal. Advocates are better upon the floor of the court than upon the bench. I have had the experience of appearing before many tribunals, and the most unsatisfactory was a tribunal of three commissioners - one appointed by each party, and an umpire. It was painful to see the two arbitrators doing their duty by their clients. Last year, there were 93 applications before the board, involving a sum of £37,772 in taxation, and the board gave relief to the extent of £7,700. If it could be suggested that the members of that board were incompetent and unfair, and were only looking after the revenue of the Commonwealth, then there would be a case for the appointment of a different kind of tribunal altogether. But that can hardly be seriously suggested. I have made some inquiry as to the work of the tribunal, and I find that in quite a numbers of cases the facts did not justify relief, because the persons concerned, although they would have liked to obtain relief, were really able to pay the tax. The fact that in the year which ended with December, 1931, only £7,700 was’ remitted out of a total of £37,772 of remissions applied for, shows that there must have been a number of cases in which no real hardship was being felt, and in which the persons concerned were able to pay. There is this element in the matter to consider. The honorable member for Wakefield believes that in certain cases, there should be a representative of the interests concerned upon the tribunal that is to adjudicate. It seems to me that we might have on some tribunals such persons as assessors, whose advice would be valuable, and useful. But would the appointment of an advocate to the tribunal make for a proper decision as between public and private interests? If it is said that no public servant can deal fairly with private interests, that is a general statement which I suggest experience does not bear out. This proposal is worded in a rather interesting fashion. The proposed new member of the board is to represent the interests of the taxpayer. What exactly does that mean? Does it mean the interests of the taxpayers who are appearing before the tribunal and want. to be non-taxpayers, or the interests of . the taxpayers who naturally want to reduce their own tax by making the other fellow pay. The real object, I have no doubt, is to put on the tribunal a man to represent the interests of the person appearing before the tribunal. Is it a sound principle? Even if honorable members believe that there should be some nonofficial representative on the board, do they believe that that representative should have a direction and charter to represent and to promote the interests of the person who is applying for a concession? If honorable members do think it desirable to have a non-official representative on the board to represent the interests of. the taxpayers, I suggest that the words “ to represent the interests of the taxpayers “ should be struck out ; otherwise the person appointed to the tribunal would almost inevitably regard himself as being there for the purpose of putting the case of the taxpayer appearing before the board. Surely that should be done not from the bench, but from the floor of the tribunal. Accordingly, apart from considerations of cost, I put it to the committee that this proposal has in it an element which should not be acceptable to the committee.
– Clause 5 provides for release from land tax in cases of hardship, but paragraph 3 of that clause discriminates between the primary producer and tha city land-owners. As two-thirds of the Commonwealth land tax is paid by city land-owners, some consideration should be given to that section of the community in cases of hardship. Hardship is just as prevalent in the city as in the country. Reductions of rent have involved the city property owners in substantial losses. The low price of primary products has also caused much unprofitable trading to city people. I ask the Government to consider the elimination of the words “owing to low prices in respect of primary products “ with the object of allowing relief to be given to all landowners in distress.
.- I regret that the Government’ is not willing to accept an amendment along the lines I have proposed, for it would allow a representative to sit on the board who would not be an advocate for the taxgatherer. I entirely agree with the Attorney-General that a tribunal which consists of advocates is not a satisfactory tribunal. This tribunal consists entirely of advocates for the tax gatherer. Every taxpayer who has had experience of the working of it knows that this is so. It is “ eye wash “ to say that the effort to balance the advocacy alters the principle. I would welcome any amendment drafted by an officer of the AttorneyGeneral’s Department to provide for what
I desire; but I think that I have made my meaning clear. If my proposal were agreed to, a well-known inequity would be remedied. I regret that the Prune Minister has not accepted the amendment, because one of the reasons he gave in opposition to it has so palpably the imprint of the official mind upon it. It is said that, there would be a danger of the private affairs of taxpayers becoming public if a non-official member were on the board, but I point out that there is provision for non-official members on the Income Tax Board of Review. Moreover sub-section 4 of section 66 of the Land Tax Assessment Act provides that -
In every case in which the amount of tax from which the taxpayer applied to be released u not less than Five hundred pounds, the board shall, and in any case in which the amount of tax from which the taxpayer applies to be released is less than Five hundred pounds, the board may refer the application to a member of a Board of Review constituted under thu Income Tax Assessment Act 1922- 1D25.
If these is no danger of a breach of confidence in these circumstances, there should bc no danger of it if a similar provision were made in regard to the Hardships Board. I sympathize with the Prime Minister because of the amount of work he ‘has to do; but I. regret that, through overwork, he has brushed this amendment aside as of no consequence. My proposal is intended to remedy a genuine grievance. Representatives of the largest organization of taxpayers in Austrafia - I refer to the Graziers Association - have asked that the constitution of this board shall be altered. There is a very general disinclination on the part of members of this organization to go before a tribunal on which, to use the words of the Attorney-General, which so aptly fit the case, “ the judges have been trained as advocates for the other side “. If the Government cannot now see its way clear to accept my amendment in the form in which I have submitted it, I hope that it will give further consideration to the subject before the bill is finally passed by the members of another place.
.- I also direct attention to the phrase in paragraph c of this clause, which reads, “ owing to low prices in respect of primary products “. The present low price of primary products is likely to continue for some time. The Government should, therefore, consider whether it is wise to assist the primary producers by bounties or otherwise to such an extent that they may put additional areas under cultivation and so remove themselves still further from thu possibility of having to pay land taxation aud so limit the revenue. It is desirable that the Government should tell us exactly how far it proposes to go in this direction. Surely honorable members realize that, although the price of certain of our primary products has fallen, the area under the cultivation has mcn ! This is a matter which requires more attention than it is receiving.
.- In my experience the public servants of this country have always dealt equitably with the matters submitted to them, and we should be careful before we accept any amendment of the kind suggested, for the acceptance of it would undoubtedly lead to similar requests in many other directions. It would be far better for ug to watch carefully the operation of thu provision for a year or two. If we find that it docs not work smoothly, an alteration can be made later. 1 should like to know whether paragraph a of this clause will cover taxpayers generally who are liable to pay land taxation. ‘
– I think it does.
.- There is ambiguity in clause 5. Would the Commissioner, in considering whether an applicant is entitled to relief under this hardship provision, be restricted in his investigation to the consideration of the particular property in respect of which land tax has been’ imposed? Supposing that a man has a property which has been returning him a handsome profit for years, and on which, because of drought and low prices, he has sustained a substantial loss, would he, by reason of that fact, be entitled to relief, although at the same time he might have other enterprises returning a satisfactory profit? Would he not, on proving the facts set out in sub-section b, bc entitled to relief irrespective of anything else connected with his financial position?
-The Commissioner is allowed to exercise bis discretion in all cases.
Bill returned from the Senate without amendment.
House adjourned at 11.14 p.m.
The following answers to questions were circulated: -
r asked the Treasurer, upon notice -
– The answers to the honorable member’s questions are as follow : -
No statistics are available showing the respective amounts assessed for this year in respect of lands over £100,000, £50,000,and £10,000 in unimproved value.
Death ok Military Trainee.
Mr.Francis. - On the 23rd November, the honorable member for Dalley (Mr.Rosevear) asked ifI would make available the papers and reports relating to Robert John Saunders, a trainee, who died shortly after returning from a military camp. I now desire to inform the honorable member that the file will be laid on the table of the Library for his perusal.
Cite as: Australia, House of Representatives, Debates, 29 November 1932, viewed 22 October 2017, <http://historichansard.net/hofreps/1932/19321129_reps_13_137/>.