13th Parliament · 1st Session
Mr. Speaker (Hon. G.H. Mackay) took the chair at . 10.30 a.m., and read prayers.
– Has the Prime Minister read in the press the statement of Mr. A. W. Turner, who was’ a commissioner of the Government Savings Bank of New SouthWales when that institution closed its doors, which reads -
The withdrawalswhich ultimatelyexhausted the bank’s cash reserves,great asthey were, were caused in the first placebyyears of government interference withthe management and funds of the bank.
The fears were real and alarming. The wind of suspicion was sown. Many factsencouraged its growth, and in due course the whirlwind was reaped.
Will the right honorable gentleman inform the House whether such a statement is likely to he more reliable than that broadcast a few nights ago by the ex-Premier of New South Wales, who smashed the bank?
– I have not seen the statement to which the honorable member refers, but I should say that the opinion of a commissioner of the bank ought to carry some weight.
Importation of Tobacco - Geological and Mineral Possibilities
– Is the Minister for Customs aware that cheapblack tobacco registered under the British brand “ Beaconsfield “ is used in large quantities in the Northern Territory, a good deal of it being supplied to the natives? Is this” tobacco made in Australia? If not, is duty paid on it?
– I shall obtain the information sought by the honorable member. I haveno doubt that if this tobacco is manufactured in Australia, excise duty is paid on it. If the honorable member has any further information on the matter, I ask him to furnish the department with it.
– Will the Minister for Customs ascertain whether it is a fact that the administration of the Northern Territory is importing, free of duty, a considerable quantity of this tobacco?
– I should think that that would be very improbable. Any tobacco imported into Australia pays a duty of 3s. 6d. per lb. If the honorable m em bor knows of smuggling having been going on, I shall be glad if he will place the facts before the department.
– Is the administration allowed to import it?
– Certainly not.
– This week the Ministor for the Interior stated that Dr. Woolnough will shortly return to Canberra. Will the honorable gentleman make arrangements for this official to address members of this Parliament on the geological and mineral possibilities of the Northern Territory, concerning which his knowledge is extensive?
– I shall have very much pleasure in endeavouring to make iiic arrangements suggested.
Postponement ok General Election.
– In view of the position that exists in Europe to-day, and of the possibility of events similar to those of August, 10.14, does the Prime Minister not think that the Government would be acting wisely in not rushing to the Governor-General for a dissolution of Parliament until the position is clarified, for once allowing the interests of the nation to take precedence over a supposed party advantage?
– In following the course proposed the Government has never had any intention to take a party advantage. I have made it quite clear that, in our opinion, there is no more merit in this Parliament existing for three months beyond what may be regarded as its life, than in being dissolved three months before that time. I do not think that the honorable member for Angas, or any other member of this Parliament, can know what events may transpire from what has occurred in Austria. He is no more concerned about the position than is the Government, nor can he give it closer consideration than the Government is devoting to it at the present time.
– Can the Assistant Minister for Defence say whether the Department of Defence has in mind the transfer of the aerodrome and landing ground from Essen doi. to Fisherman’s Bend, Port Melbourne, as is stated in a section of the press?
– If the honorable member will place his question on the notice-paper I shall endeavour to obtain an answer for him before the House goes i.i’lo recess.
– Is the Minister for Trade and Customs yet able to make has promised statement with respect to the result of the trade negotiations between the Commonwealth Government and the Government of Belgium?
– I have made frequent statements on this subject, and honorable members are fairly well acquainted with the progress of events. In connexion with the making of a trade treaty with Belgium, the Government is faced with very much the same position as exists in the case of Italy. Considerable time has been spent in conducting negotiations with the Government of the United Kingdom, because there are very few concessions that Australia is able to make. A further communication was received this morning, and during the course of the day the Government will endeavour to resolve the difficulty with which it is confronted. As I said yesterday, it is hoped that a satisfactory agreement will fee arrived at before the House rises.
– The majority of the public and private buildings in Melbourne are being renovated in preparation for the centenary celebrations that are to be held in that city later in the year. The Melbourne General Egg
Office is in a dilapidated condition, and I shall be glad to have the assurance of the Postmaster-General that its renovation will be undertaken.
– I very readily assure the honorable member that his representations will be taken into consideration, and that an endeavour will be made to meet his wishes.
The following paper was presented: -
Motion (by Mr. Stewart) agreed to -
That he have leave to bring in a bill for an act to amend section seven of the Navigation Act 1912-1926.
Order of the day for the resumption of the debate on the motion for the second reading of this bill read, and (on. motion by Mr. Mabb) discharged.
Motion (by Mr. Mark) - by leave - agreed to -
That he have leave to bring in a bill for an act to amend sections 22, 20, 27b, 29, 39, 45w, 45k, and 45t of, and the 2nd and 5,th schedules to, the Australian Soldiers’ Repatriation Act 1920-1931, to repeal section 40 of that act, and to amend that act in relation to pensions payable to returned soldiers suffering from pulmonary tuberculosis.
Bill brought up, and read a first time.
– by leave - I move -
That the bill be now read a second time.
The object underlying the substitution of this measure for that which has been discharged from the notice-paper, is the desire of the Government to incorporate the. amendment proposed by the honorable member for Henty (Sir Henry Gullett), and to insert additional clauses, which will not only liberalize to a considerable extent the existing provisions but also give statutory authority to an allowance that at present is being paid by regulation to soldiers suffering from loss of vision in one eye. I shall confine my remarks to these new clauses, which the Government confidently anticipates will receive the unanimous and wholehearted approval of the House.
In section 26 of the principal act, it is provided that repatriation boards in each State shall have power to determine whether the death or incapacity is due to war service, and the extent of dependency in cases of dependants. It is regarded as desirable to amend this section as proposed in clause 3 of the bill, so that the vast amount of administrative routine detail that is submitted from time to time in connexion with the reviews, assessments, continuations, and other necessary action may be dealt with more expeditiously. In cases of suspension, when the department is unable to locate an ex-soldier, considerable delay and confusion are occasioned, and the Government wishes to remedy this undesirable state of affairs.
Section 27b (1) of the principal act provides that, when a pension is reinstated after cancellation, such reinstatement shall operate from the date of
Application only, while section 27n (2) provides that, when a pension h,as been voluntarily relinquished, any restoration shall also date only from the date of the application for restoration. Clause 4 of this bill liberalizes this section by empowering the commission to grant a period of arrears, not exceeding three months, in these cases. In clause 9 of the bill, it is proposed to increase the powers of the Appeal Tribunal and the Assessment Appeal Tribunal so that arrears for specified periods may be granted under certain circumstances.
In this way, not only will the administration of the commission be brought more nearly into line with the extended powers suggested for the tribunals, but delays and inconvenience to the soldier will also be avoided.
Section 29 of the principal act provides that if a pensioner fails to attend at the time and place fixed for review of his case, his pension may be cancelled, and any pensions payable to his dependants shall not be continued for more than twelve months from the date fixed for the review. Experience has shown that this section operates harshly in some cases. For instance, where a man deserts his wife and family, or for some reason declines to present himself for review, the commission has no option but to discontinue payment of pensions to the member’s dependants, and, as some honorable members are aware, such cancellation has caused distress.
In clause 5 it is proposed to give the commission authority to continue paying pensions to dependants when the incapacity of the soldier is of a permanent nature. Clause 9 is designed to meet a case, the circumstances of which were outlined by the honorable member for Henty in his speech in this House on Tuesday evening last.
Former soldiers who, as a result of war service, suffer loss of vision in one eye, now receive by regulation an allowance at the rate of 6s. a week. Prior to the passing of the Financial Emergency Act, this amount was 7s. 6d. per week, and honorable members will recollect that, in his recent budget speech, the Prime Minister (Mr. Lyons) announced that this 20 per cent. reduction was to be restored. The Government now proposes to include this allowance in the fifth schedule to the act, and thus obtain legislative sanction for the benefit. Approximately 1,550 cases are involved, and the annual liability is in the neighbourhood of £30,000.
Honorable members will perceive that the Government has made a genuine effort to make even more liberal an act which qualified, experienced, and independent observers agree is already extremely generous. As such an object must appeal to all honorable members, the Government makes no apology for withdrawing the previous bill and submitting this one ; nor is it necessary for me to make any further explanation on behalf of those whom it is intended to assist.
Debate (on motion by Mr. Forde) adjourned.
In committee (Consideration of Senate’s amendments) :
Amendment No. 1.
Clause 31 -
Sections 218 to 227 inclusive of the Principal Act are repealed and the following sections inserted in their stead: - 221. (4.) The master of any ship which proceeds, or attempts to proceed, to sea in contravention ofthis18 section shallbe guilty of anoffence.
Senate’s amendment. - Leave out “ 18”.
– I move -
That the amendment be agreed to.
I do not think that honorable members will have much difficulty in assenting to this amendment. While it is regrettable that honorable members have not retained copies of the bill supplied to them when the measure was before the House on a previous occasion, I think that I shall be able to make the position sufficiently clear to allay any fears they may have. The amendment contemplates the elimination from clause 31 of the figure “ 18 “ which was entirely redundant, and was placed there by a printer’s error.
– It is true that this bill has been already discussed in this chamber, but we are entitled to have copies of it placed before us again, so that we may study the effect of the Senate’s amendments. The responsibility for the error which required the first amendment has been placed on the printer, but, seeing that the amendments themselves have been placed before us only a few minutes ago, and that we are not in possession of the bill itself, we cannot even say whether the responsibility has been rightly placed or not. This navigation bill is of great importance to my electorate, and I am therefore entitled to full information regarding it on that ground, if on no other. I was not satisfied with the bill in the first place, because the Minister refused to give consideration to recommendations regarding any matter outside the scope of the Conventions. Certain Australian organizations had supplied the Minister with full details of requested amendments, but they were brushed aside. In the circumstances, I am not prepared to allow the Senate’s amendments to go through without the closest scrutiny.
– No doubt some of the confusion and dissatisfaction that is making itself felt over these amendments arises from the order in which the documents were presented to us. First the amendments were tabled, and then, some little time later, from another receptacle the bill itself appeared. I think that wo should be able to deal with this matter quite shortly if the Minister would revive our recollections by a short statement of just what it is intended that this bill should do.
– That would not be in order at this stage.
– All right, have your own way about it. However, if that cannot be done, I feel inclined to oppose the amendment.
– Though it is designed only to correct a printer’s error?
– Although I am not briefed, I feel that I should say a word in behalfof the absent printer. I have a quasi-professional standing in the matter, and I hope that, as a reward for my labours, I may be admitted into the chapel. In any case, as one who was responsible for the original navigation act, I am not going to have it messed about by any one without knowing what is being done. During my momentary absence from the chamber this bill somehow got through the House. Now it is before us again, and I do not propose to be side-tracked by this utterly uncalledfor reflection on the absent printer. I waited on the Minister during the period of the incubation of this bill, and I should like to know what happened regarding the subject-matter of our interview.
– Honorable members might have substantial ground for objection if the bill had been sprung upon them without notice, but it has already been passed by this chamber. The Senate’s amendments make no alterations of the principles of the measure. The first is due to a printer’s error; the second makes an alteration of the wording of a clause without affecting its sense, and the third is of a somewhat similar character.
– When the bill was under discussion in this chamber - and I think it was agreed to unanimously - the Minister, in reply to a question put by me, said that later he would bring down regulations dealing with objections I had taken to the principal act. May Ibe assured that those matters will be dealt with later by regulations?
– Th en I am satisfied.
Motion agreed to.
Amendment No. 2.
Senate’s amendment. - Leave out the clause, insert the following new clause: - “42. Section two hundred and sixty-nine a of the Principal Act is amended -
by omitting from paragraph (a) of sub-section (1.) the words “the wireless danger call specified in schedule IV. to this Act, followed, as provided in that Schedule’, and inserting in theirstead the words the prescribed safety signal, followed ‘ :
by omitting from sub-section (2.) the words ‘ wireless danger call’ and inserting in their stead the words prescribed safety signal’;
by omitting from sub-section (4.) the words ‘the wireless distress call specified in Schedule IV. to this Act,’ and inserting in their stead the words ‘ any signal of distress by wireless telegraphy.’; and
by adding at the end thereof the following sub-section : - (6.) The Governor-General may make regulations, not inconsistent with this Act, prescribing all matters necessary or convenient to be prescribed for the carrying out or giving effect to the provisions of this section and of Articles 34 and 44 (so far as the last-mentioned refers to safety messages) of the Safety Conventionand of Regulation XLVI. of the regulations annexed thereto, relating to the report of dangers to navigation,’ “.
Motion (by Mr. Stewart) proposed : -
That the amendment be agreed to.
, - This amendment seems to raise an important issue. Apparently it will not be necessary to install wireless on ships, but some kind of safety signal can be used instead. We should have information from the Minister on this point.
– Tie arneildment merely makes au alteration in. terminology. The original provision in the bil] was based on a Convention of five or six years ago, and referred to Iiic, “wireless danger call”. Since that time the Radio Communications Conference lias been held at Madrid and the expression “ safety signal “ has been adopted. There is no variation whatever of the liability under the measure that is calculated to endanger the safety of life. The object is merely to alter a term which was in common use five or six years ago to one which is more up to date.
Motion agreed to.
Amendment No. 3.
Schedule VI., Annex II. -
Senate’s amendment. - Leave out all words after “ SEA.* “( first occurring).
“1.1.6 1. - This amendment eliminates from the bill the set. of regulations as suggested at the conference held iri 1929, but. which were not unanimously agreed to on that occasion. It was decided that Great Britain, the principal maritime nation represented at the conference, should conduct certain negotiations with other maritime nations with a view to the adoption of regulations- that would be unanimously accepted, and these negotiations are now approaching finality. No doubt certain of the regulations in the original measure will be slightly varied with the unanimous consent of nil 1he nations concerned. We do not wish to have regulations that will be slightly varied, and we now propose to excise them, leaving the way open for the provision of a new set of regulations when unanimity has been reached. I move -
That the amendment lie agreed to.
Motion agreed to.
Amendment No. 4.
Schedule VI., Annex II. -
Senate** amendment. - Insert footnote - “ * Note. - This Annex to the Convention for the Safety of Life at Sca contains the International Regulations for Preventing Collisions at Sca together with the amendments which the Contracting Parties to the Convention agree are desirable (See Art. 40 supra). As the amendments have not been made at the date of the enactment of this Schedule the regulations as appearing in Annex II. of the Convention are not reproduced.”.
– It is merely proposed to insert a footnote setting out the facts as I have stated them. I move -
That the amendment be agreed to.
Motion agreed to.
Resolution reported ; report adopted.
Debate resumed from the 24th July (vide page 615), on motion by Mr. Casey -
That the bill bc now read a second time.
.- The money to he raised under this bill is to be expended on postal works, of which, I think, the House will approve. Many investigations have been made in the past with a view to the manufacture of postal requisites in Australia instead of importing them. Will the Postmaster-General indicate what are the materials required for these works, and where they arc to be procured ?
– I desire to afford the House as much information as I have in my possession regarding the proposed postal works. The sum of £785,000 will be spent in providing telephone exchange services, including the expansion of plant to provide for new subscribers, internal exchange plant, underground cables, aerial lines, and the wiring and fitting of apparatus. Generally, the expenditure will be incurred in providing telephone services for new subscribers. On trunk line services the expenditure will amount to £215,000. There will be additional trunk lines and carrier circuits, and repeater systems will be installed to improve transmission. These additions are necessary to make the trunk line services more effective. It is somewhat extraordinary to find that, despite the depression, which had a marked effect on practically all the other branches of the postal service, it did not to any serious extent affect the trunk line services’, which have been working at fairly heavy pressure, all the time. During the last two or three years an effort has been made to keep down the outgoing expenses of the Post Office, in order to obtain as much revenue as possible. Contracts have not been so readily placed as they ordinarily would have been, and every effort has been made during the years of depression to utilize the existing machinery to the full by getting out of it the last atom of efficiency. So the expenditure on renewals as the result of the savings effected in the past two or three years is a little higher at this stage than might ordinarily have been expected. This huge business undertaking conducted by the Government has a tremendous turnover, and a considerable expenditure is necessary in order to maintain its income-earning power.
A request has been made that I should state the amount to be spent in the purchase of Australian-made goods to meet the requirements of the postal department. I made inquiries from the officers of the department on the point and was informed that while it was difficult to give a very reliable estimate, it was expected that, about £700,000 would be spent on plant and apparatus apart from buildings, and that about £400,000 of that sum would be spent on goods of Australian manufacture. All this work is done by tender and contract, and the tender form specifies Australian materials wherever possible. It must be remembered that Australian manufacturers enjoy the advantage of concessions of duty and certain other concessions which are religiously given. Australian material is invariably used where that is possible. I hold strong views on this subject and pay personal attention to it.
An amount of £182,000 is being provided for the general extension of postal buildings throughout the Commonwealth, but £60,000 of that amount is for buildings for the national broadcasting services. The building of seven broadcasting stations was authorized in the last financial year, and the preliminary work in connexion with them has been done; but the main expenditure will take place this year. The cost of the mechanical services required for these stations is £208,000, and that of the buildings is £60,000, which amount, as I have already explained, will come out of the £182,000 provided in the bill for the general extension of postal buildings.
The honorable member for Angas (Mr. Gabb) asked a question respecting the construction of new buildings for post offices. It is not intended to launch a comprehensive building programme in that connexion this year. Where new buildings are necessary they will be erected ; but the policy of the department for a good many years has been to give service rather than to provide ornate buildings. That policy will be continued. It is considered more desirable, for example, to extend the telephone service into newly developing country areas, than to erect postal buildings where services of an efficient character are already being provided. The honorable member for Swan (Mr. Gregory) referred to the extension of the services of the department for a considerable distance into a new developing agricultural area. It will be appreciated, also, that the gold-mining developments at Wiluna have rendered considerable expenditure necessary in that locality. When the financial position becomes easier, additional attention can be given to the construction of new buildings for post offices.
– Is full provision being made for a sinking fund for the extinction of this loan, for the money is being spent, to a considerable extent, on wasting assets ?
– Since I have been in such close contact with the Postal Department I have experienced considerable pride in the general nature of its financial arrangements. Five per cent. is paid regularly year by year on all loan moneys expended on postal work. In addition to that, considerable profits have been made by the department in the last two years. I should be happy if it were possible to use those profits for extending the services of the department, and increasing the salaries and emoluments of postal officers; but in Australia, as in other countries of the world, the profits from the postal services have to be paid into Consolidated Revenue in order to avoid the imposition of additional taxation upon the people.
– Those profits help to balance the losses on the Commonwealth railways.
– And to provide bounties for primary producers.
Mr. ARCHDALE PARKHILL That is so. In Great Britain £11,000,000 from the profits from the Post Office was paid into Consolidated Revenue last year. Bearing in mind the relative volume of the operations of the departments in Australia and Great Britain our profits compare favourably with those of the old country.
– A sinking fund is also provided in the financial scheme of the Postal Department for loans of this kind.
– That is so. Two per cent, is paid annually into the sinking fund to wipe off loans of this kind in a 30-year period.
– Is li per cent, paid in addition to the ordinary $ per cent.
– Yes. Honorable members may accept these proposals with equanimity, knowing that by doing so they will enable the services to be greatly improved.
.- Since I have been a member of this Parliament I have seen a revolution in the efficiency of the trunk-line telephone services throughout the Commonwealth, and I am sure that the improvements have advantageously affected the revenue. As I am quick to criticize a department when it fails to render service. I feel that I ought on this occasion to express my appreciation pf the work that has been done in this respect. The staff and equipment of” the trunk-line telephone branch of the service are, in many cases, extraordinarily efficient. Recently I spoke from Canberra to Broken Hill, as did the Postmaster-General, and our conversation was broadcast. The new apparatus that had been installed amplified our voices over the 1,600 miles there and the 1,600 miles back to such an extent that we had to hold the receivers away from our ears. I consider that to be a miraculous development, seeing that ten years ago there was no service at all. I also had an ordinary telephone conversation a couple of weeks ago from Canberra to Broken Hill, and on that occasion, also, the voices came through so loudly that I had to hold the receiver at least an inch away from my ear. I feel justified, therefore, in paying a tribute to those responsible for the installation and management of this service.
On the other hand, I have made frequent attempts to carry on a trunk-line conversation from Cobar to Sydney, and from Cobar to Canberra. On five occasions I have completely failed to receive the voice that I wished to hear. It is quite wrong for the Postmaster-General’s Department to demand payment for services on such occasions. If it is not possible to guarantee the service prospective customers should be informed of the fact. I can see no difference between a State instrumentality and an ordinary racecourse “ spieler “ taking money under false pretences. My experience in trying to make the trunk-line telephone connexion between Cobar and Sydney and between Cobar and Canberra has been so unsatisfactory that, for the last eighteen months, I have not attempted to use the service, but have transacted all my business from Nyngan, in preference to Cobar. I have directed the attention of the department to this matter so often that I have become tired of doing so. While it is annoying for a visitor who wants to use the telephone once in every six months or so, and cannot do so, it is extremely irritating for those who need to use the service regularly, and can only hear -buzzes aud other weird noises, instead of the voice that they wish to hear.
– Has the department made any explanation of the failure to give reasonable service?
– Yes; it has informed me that it would not pay to install the necessary copper wire on the line in lieu of the iron wire at present in use. I agree, of course, that, generally speaking, the services rendered by the PostmasterGeneral’s Department in this regard should be on an economic basis. It would be quite wrong, for instance, to spend large sums of money in providing trunk-line telephone services if there were no prospect of ever receiving a return sufficient to pay interest, and sinking fund on the expenditure. But the mining industry of Cobar is developing to such an extent that this expenditure would be amply justified. To-day 150 men are employed on the two big mines working in the district. I refer to the Occidental, on which a capital expenditure of £100,000 is being made, and the New Cobar, ou which n like expenditure is also being incurred. When expensive mining machinery and plant are being installed in such circumstances, it is frequently necessary for the mine managers anr! mining engineers to hold telephone conversations, i ask the PostmasterGeneral to look into this matter with the object of improving the service.
I wish now to direct attention to the necessity for providing a more efficient telephone service from Bourke to Wanaaring, covering the western corner of New South Wale3. I cannot claim that such a service would bring in any substantial return; but people in such remote districts are entitled to some consideration.
I direct attention, also, to the splendid service being rendered to outback people by those in charge of the Ear West Children’s Health Scheme. This organization provides free medical treatment for the children of parents living in the far outback who cannot afford to send their children to Sydney or Melbourne, or even an appropriate country centre, for the necessary attention. The organization has already instituted a travelling clinic, and is now arranging for the regular operation of an aeroplane medical service. They are engaged in an honorary capacity and thousands of children have; been restored to normal, health as the result of their activities. As the flying doctor’s head-quarters are situated at Bourke, it is desirable that improved telephonic facilities be installed in that locality. In these matters, of course, we are confronted with the economic aspect - whether any proposed expense is justified. I am not suggesting that the PostmasterGeneral should assume responsibility for looking after the health of the people; his job is to provide us with efficient telephonic, telegraphic and postal services; but a very large number of people are settled in this district, and for the preservation of their health they are entitled to an efficient service.
– The provision of better facilities there is now under consideration.
– Two years ago it was decided to erect a regional broadcasting station at Dubbo. I can appre ciate the fact that technical difficulties and other factors operate against the establishment of stations in certain localities. At any rate they present a very difficult problem to the technicians of the Postal Department. The physical features of a district in which a broadcasting station is situated have a great effect upon the efficiency of the service rendered. But I understand that a suitable site has been selected at Dubbo and I ask the Minister when it is proposed to make a start with the work, and when the people of western New South Wales may expect to benefit by the service.
.- In regard to the Postal Department some honorable members are much too prone to censure and much too chary to praise. I take this opportunity to express my appreciation of the courtesy and attention which I have always received from postal officials in Australia. I know of no organization or institution where the administration has been so efficient as that of Mr. Kitto, the Deputy Director of .Posts and Telegraphs, Sydney. In the British Post Office the casual fashion in which attendants look after the public is a standing joke. In Australia the position is the very reverse. Recently, in Perth, some trouble occurred in regard to steamships not arriving on time during a holiday period. The postal officials went to a great deal of trouble to help people out of the difficulty thus created, and I should particularly like to express my appreciation of the action of the Superintendent of Mails and the telegraph officials. They went to an enormous amount of trouble in their own time to meet the difficulty. It is only fair that when the opportunity is afforded we should hot fail to express these views.
On a recent visit to Queensland I had business to transact at Townsville and found (lie postal buildings there in a state of dilapidation. That a public building should be allowed to get into that condition is a disgrace. I hope that the Minister will see that the Townsville Post Office, as well as the Melbourne General Post Office, is put in a decent state of repair.
.- The Postmaster-General (Mr. Parkhill) has informed us that the material to be purchased by his department in the expenditure of these loan funds will cost about £700,000, and that of this sum about £400,000 will be spent in the purchase of articles made in Australia.
– A great deal of the material used in the post office is not manufactured in Australia, but as far as possible Australian materials will be used in all the works to be put in hand.
– The works, I understand, are to be carried out by tender, and it seems to me that if the amount to be expended in Australia has already been determined, the Minister has already agreed upon the principle of giving the work to Australian manufacturers, so far as it is possible to do so.
– As much of the material as possible will be purchased in Australia.
– I arn glad to know that the department proposes to place all orders for materials in Australia subject, I understand, to standards of quality being maintained.
About eighteen months ago I visited Tamworth, and noticed that a repeater service had been installed at the Tamworth post office. I was surprised to notice the number of empty benches in the exchange. Men who, prior to the installation of a repeater service, had been in employment for a number of years were deprived of their employment as the result of this innovation. I know from my personal knowledge that one man who bad been temporarily employed at that post office for twelve .years lost his employment, together with a number of others, when the repeater was installed. It is only logical that the tide of progress should not be stemmed .because of the probable effect upon the occupations of the workers, but it is sad to think that every innovation which is introduced usually results in some men being thrown out of employment. This is particularly noticeable to-day in the post office. That raises the point as to whether we are wise in proceeding any further than’ is necessary in regard to these improvements - whether the humane side is not of greater importance than mechanical efficiency. It is not an argument in which we could cross political swords, but is merely a matter of common reasoning. Nevertheless, it is clear and apparently inevitable that the more progress we make the greater the suffering and misery imposed upon certain people who are deprived of their occupations.
– That aspect of the matter is not lost sight of by the Postal Department.
– I am glad to hear the Minister say that. Everybody is anxious to see that men are kept in employment. I know that in regard to automatic telephone exchanges, the department has gone to great pains to see that the girls formerly employed on the manual exchanges are found other employment.
I should like to know from the Minister who determines the actual .sites upon which new post offices are erected? When the old post office at Broadway, Sydney, had to be demolished, owing to the widening of the street, a new site had to be selected. 1 am unable to understand why it was decided to construct the new post office in Shepherd-street, while there was a vacant block of land available in George-street west at the corner of Shepherd-street. I think it was a great mistake to shift the post office into a side street, instead of preserving the alignment of the main street. As a result of the widening of George-street, a number of fine new .buildings have been erected, and the corner block, where the old post office stood, is now vacant, and the new post office is in a side street. It is extremely gratifying to learn that extensions are to be made to our postal facilities, that more employment is to bc provided, and that the bulk of the requirements will be turned out by Australian labour.
.- I commend the policy announced by the Postmaster-General (Mr. Parkhill), and his statement that he proposes to endeavour to provide better facilities in country districts rather than to expend the appropriation on expensive post offices. I do not consider that country people could be given any greater facility than that which is furnished by the telephone system. It is essential at harvest time, and particularly in case of illness. Just as short lines of railway running into country districts ultimately assist as feeders to make the whole system payable, so telephonic extensions gradually bring to the department better returns. Although I have often forwarded to the department applications for buildings in country centres, I have always considered that the telephone service should be given precedence. In a number of places, something might be done for the convenience and the comfort of the employees. Particularly is this the case at Koorda, where the building is constructed of asbestos sheeting, which is extremely cold in winter and excessively warm in summer.
An honorable member opposite has referred to concessions being given to primary producers by the expenditure of loan money. The Postmaster-General, however, has stated that a considerable proportion of the amount to be voted will be expended on goods manufactured in Australia, and has pointed out that, in addition to the customs duties sanctioned by this Parliament, the manufacturers are to bo given still further concessions. I want the people to realize not only that capital expenditure is being increased by these concessions, but also that thos* concessions are being enjoyed by a monopolistic concern which in the past has een able to wield so great a political influence that it has been able to obtain prices far higher than the cost of manufacture in any other country.” We produce copper for the manufacture of copper wire, and I understand that the cost of labour amounts to only 2 per cent., yet when I. made inquiries into the matter a few years ago I found that the prices in Australia were as much as 90 per cent, greater than the cost of production in other countries which had to purchase the copper from this country. I do not think that any organization has profited to so great an extent as the Australian Metal Company, not only in the contracts it has been able to obtain, but also by the influence it has wielded in order to secure the most extraordinary prices. When this Parliament fixes a duty which is considered adequate, no further concession should be given. The value of the concessions enjoyed by primary producers is greatly exaggerated in view of the largely-increased cost of the works that are carried out.
.- I think all honorable members will agree that, generally, the Postmaster-General’s Department is very well conducted, and that efficiency and courtesy are the guiding principles of the large army of postal officials throughout Australia. The Queensland Deputy Director is a man of outstanding qualifications, and in any remarks that I may make concerning directions in which the policy of the department might be liberalized, I cast no reflection upon him, because he is dependent upon the money provided by this Parliament.
I wish to repeat the request that I have made on a number of occasions for the establishment of automatic telephone exchanges in important centres in Queensland, notably at Rockhampton, a city that has a population of 30,000. The mechanical telephone exchange has been in operation there for about 20 years, and although the service given by it is reasonably good a great deal of trouble will be experienced if an automatic exchange is not soon established. This matter has been brought before both the Deputy Director in Queensland and the PostmasterGeneral, but so far action has not been taken because the necessary funds have not been available. I have been assured by the Deputy Director that no member of the present staff would be dismissed ; that those who were not required for trunk line work would be placed in some other position. 1 trust that the Postmaster-General will see that no dismissals result from the installation of automatic exchanges.
The conduct of the Postal Department furnishes an example of the efficiency with which a nationalized concern may be run. With the passage of time doubtless other great State utilities will be taken over by the Commonwealth.
I wish to advocate the cause of people who live in closer settlement areas in back-blocks. I have particularly in mind the important closer settlement districts of Monto, the centre of the Northern Burnett area, and Biloela, in the Callide Valley.. These centres have grown up in the last eight or ten years, and are fairly prosperous. The postal and telephonic services are being carried on in shabby buildings that do not ensure either the convenience or the secrecy that is necessary. The request for official post offices has so far been made in vain, the ground of the refusal being that money was not available for the work. I hope that the PostmasterGeneral will personally investigate the matter to see whether this provision may be made.
In considering the question of buildings I should like the honorable gentleman to have regard for the necessity for establishing septic tank systems in large cities like Rockhampton and Bundaberg, where to-day the most primitive methods are employed. All the State Government buildings in Rockhampton have the septic tank system. If there is buoyancy in the revenues of the Postal Department and of the Commonwealth generally, this request cannot be refused on the ground that the financial position will not permit of its being granted.
I also urge the Postmaster-General to consider the disabilities under which wireless listeners in the Bundaberg district are suffering. They are in what is known as a fading zone, being approximately half-way between the A class station 4QG in Brisbane, and the big relay station 4RK in Rockhampton. The reception is so indifferent that I strongly advocate the establishment of a relay station.
I also ask that sympathetic consideration be given to the case of the large army of allowance postmastersand postmistresses, who at present are very greatly underpaid.
– I take this opportunity to express appreciation of the work of the Postal Department, and to congratulate the Postmaster-General (Mr. Parkhill) upon his able administration. From the highest to the lowest official, excellent service is rendered. I hope that the expenditure of this loan money will be the means of relieving some of the unemployment that at present exists. During the depression many buildings were allowed to get, into a dilapidated state, but I am pleased to know that the finances are now sufficiently healthy to enable many of these necessary works to be undertaken.
Though I realize that it is desirable to extend postal facilities in country districts, I appeal to the PostmasterGeneral to devote some of this money to the improvement of the post office at Parkside. The present building is very old, and is inadequate to meet the requirements of this important district. There are other post offices in the district which need attention also, and I should like the Postmaster-General to obtain a report from his deputy in Adelaide regarding necessary improvements. In the main, I have no complaint against the Postal Department, because, though I have not always been successful in the requests I have made, I have always been treated in a reasonable manner. I hope that, as time goes on, many of the matters which I have put forward will receive favorable consideration.
.- I am sure that the Postmaster-General (Mr. Parkhill) will agree with me that one thing dear to his heart, as it is to mine, is the unanimity of approval which we have heard in this chamber regarding the success of the government-owned postal services. Reference has been made to the wonderful improvement of telephone and telegraph services in Australia within recent years, and we should not let this occasion pass without paying a tribute to that wonderful officer, Mr. H. P. Brown. Apart from the debatable point whether he should be receiving more salary or less, we are all in agreement that he has an extraordinary grip of his work. It is possible to-day, by means of the carrier-wave system, to conduct a conversation between Sydney, on the Pacific coast of Australia, and Perth, on the distant shores of the Indian Ocean. When I was a lad of sixteen I was employed by the old Victorian Telephone Company, in Ballarat, and it was extremely difficult to conduct a conversation between the central office, and Farmer’s bacon factory, situated a mile distant. Speech sounded over the telephone like the buzzing of a fly, and it required a trained ear to translate it into recognizable syllables.
The Minister referred to the extension of automatic telephone services in country districts. None has yet been installed inWestern Australia, and I should like to see the service extended to that State, if only to let the people become aware of the improvements that have recently taken place. The increase of business in the telephone branch, and particularly over trunk lines, while very creditable, has, to some extent, taken place at the expense of the telegraph branch, in which there was a deficit of £101,588 on a total expenditure of £1,250,000. On the other hand, the expenditure on the telephone branch amounted to approximately £2,500,000. Another thing which has interfered with the earning capacity of the telegraph branch is the use of dictaphones in country newspaper offices. The proprietors of country newspapers were allowed to install dictaphones, which work in conjunction with the trunk line services, so that a pressman in Melbourne can, in a few minutes, and at a cost of a few pence, supply all the news of the day to a newspaper office in Mildura. In this way the telegraph branch is robbed of revenue to which it is entitled. I know that the Minister has taken a pretty firm stand against extending these privileges, which have been enjoyed at the expense of the general taxpayer.
– Does not the honorable member think that country newspapers should enjoy the benefit of new inventions?
– Yes, but not at the expense of the taxpayers. I trust that the Postmaster-General will take steps to have additional wireless broadcasting stations erected in Western Australia. Perhaps another station could be erected at Kalgoorlie; but it may be found that a station situated in Central Australia would serve all the outback portions of Western Australia. People in the outback have been charged 17s. 6d. a year for their radio licences, though this has now been reduced to 15s., and they are entitled to some service. Many subscribers are not able to pick up successfully broadcasts from the A class stations, because they are on the long-wave length and so far distant, and they have to recondition their sets so as to be able to pick up short-wave broadcasts from Java. It ought to be possible to have a synchronized long-wave and short-wave service from national stations.
While I agree that every effort should be made to extend mail services in the country, the Postmaster-General should not overlook the importance of providing adequate, and even impressive, postal buildings in the various centres. In the country practically the only symbol of federation the people see is the post office building. In Western Australia, where there is a strong tendency toward secession, this aspect of the matter is particularly important. Even though on some matters the people may not feel too kindly disposed towards the Commonwealth, they cannot but be impressed at the sight of the magnificent post office building, and the Commonwealth Bank building, in the City of Perth. Those buildings are a constant reminder to them that, over and abovetheir own State Government, there is the greater and more important Commonwealth Government, which stands for Australia as a whole. Many districts in Western Australia are growing very rapidly, and the need for improved postal facilities is urgent. In many places the business of the post office is conducted in some country storekeeper’s shed - a state of affairs which should be remedied as quickly as possible. I appeal to the Postmaster-General to realize the wonderfully rapid expansion that is taking place on many gold-fields of Western Australia, and the consequent need for improved postal facilities. The population in a successful gold-field grows very rapidly, so I hope the Minister will lend an indulgent ear to applications from those places.
I am aware that, on this bill, I am not permitted to discuss district allowances; but I cannot refrain from pointing out that they are entirely inadequate in the more distant parts of Western Australia.
– I commend the PostmasterGeneral (Mr. Parkhill) for his decision to develop outback postal and telephone services, which do so much to compensate people for the inconvenience of country life. I remind him that two years ago a sum of £3,000 was placed on the Estimates by his predecessor for the remodelling of the Edgecliff post office. I am becoming rather apprehensive regarding this vote. Is it intended to use the money for the extension of country postal services, or has the Edgecliff post office simply been overlooked? I ask the Minister to look into this matter with his usual courtesy, in order to sec what can be done about it.
Because of the extension of flat life, many of the suburban areas of Sydney are developing so rapidly that they have overtaken the existing postal facilities. Recently I was approached by a deputation of residents of North Bondi, who presented a petition, signed by 600 persons, asking that a semi-official post office be opened in that district. Flat life is increasing in the suburban districts, and additional facilities must be granted. I commend the Postmaster-General, the Director of Postal Services and the deputy directors for the general efficiency of the department.
– I am pleased to hear the eulogistic remarks of honorable members on all sides con- cerning the efficiency of the Postal Department. No honorable member has suggested that the post office should be handed over to private enterprise, which plainly demonstrates that we unanimously agree that this instrumentality should be under the control of the Government. My only regret is that honorable members opposite are not prepared to go further in support of Labour’s policy of State control of all activities. I have received the following letter from Mr. H. Rowland, honorary secretary of the East Hills branch of the Australian Labour party : -
The members of the East Hills branch of the Australian Labour party wish you to bring up on the floor of the House to have money orders and wireless licences issued at East Hills Post Office; also a public telephone installed at Mrs. Bitmead’s, corner of Picnic Point-road and Doris-street, Panama. Both these matters are of advantage to the district anda necessity to the people in case of accidents or any person taking suddenly ill, as the nearest telephone is one mile from the corner of Doris-street and Picnic Pointroad.
The George’s River district is a growing one. I succeeded in obtaining the erection of a small post office there, but the
Government has not yet decided to permit it to issue money orders and wireless licences. This places the residents at a distinct disadvantage. There is no railway from George’s River to Bankstown, and thebus fare is1s 4d.
– No doubt the honorable member is tempted to discuss postal matters generally, but I ask him to restricthis remarks to the subject-matter of thebill.
– I could bring a number of other requests for improved postal services under the notice of the Minister, but I shall content myself by urging him to give earnest consideration to the matters that I have raised. I will place the others before the Minister.
– I also would like to express my appreciation- of the efficiency of postal officials generally throughout Australia, and of the commendable manner in which the Postmaster-General administers his department I would point out that the residents of South Coogee are insistent in their demand for extra postal facilities, and, if the Minister will be good enough to make further investigation regarding their request, he will agree, I think, that it is a reasonable one. The new type of telephone receiver which was recently issued is much preferable to that formerly supplied, but as the cost to the subscriber is £4 10s. for each instrument it seems to me that the price might well be reduced.
– I congratulate the Postmaster-General (Mr. Parkhill) upon his enterprise in regard to the expenditure contemplated under this bill. Long-distance telephone calls are often of a. very private nature, and subscribers frequently complain that the head-box cabinets now in use fail to ensure privacy. Sorrell, in my electorate, is a centre of some commercial, importance, and stands at the junction of several mail routes. When the Postmaster-General visited the local post office he remarked that in Great Britain such a building would be regarded with veneration. “ Ruins like this “, he said, “ are of great value to any country. You should keep them to show your visitors “. An inspection of the interior of the premises, however, revealed the fact that the accommodation is totally inadequate for the requirements of the district A new post office should be erected. The department already owns a suitable site in the tow-n. When the Minister for Defence (Senator Pearce) was recently in Sorrell, he was impressed by the general’ cleanliness of the town, but he was assured that the residents were not proud of their post office.
,- It is gratifying to know that a large proportion of the material required for the contemplated postal works will be manufactured in Australia, thereby providing additional employment. I have no doubt that more suitable sites for post offices than have been obtained in the past would have been made available if the municipal authorities had been consulted regarding them. The Postmaster-General (Mr. Parkhill) may be disposed to argue that it is desirable that post offices which do not compete with one another, as grocery shops do, should be placed in such positions as would enable them to give the greatest possible convenience to the public. The Northcote post, office in my electorate is located on a main street, but its position is not the most suitable that could have been selected. Instructions should be issued that before new post offices are built the advice of the local governing authorities should be obtained regarding the sites. The Minister is to be commended upon the policy of acquiring blocks in close proximity to main thoroughfares.
I join with other honorable members in commending the PostmasterGeneral for the careful consideration given by him to requests made to the department from time to time. I recently presented a petition from the City of Northcote aud from Preston asking for the establishment of a branch post office in a newsagent’s shop in the centre of a large shopping area. I trust that the Minister will give this matter his close attention. I am not quite sure if the general convenience of the public, in some respects, is met to the same extent as it was a few years ago. Until recently stamps were commonly sold at news agents’ and other shops. Earlier in the day I referred to the need for renovating the Melbourne General Post Office, to which matter the Postmaster-General said he would give earnest consideration. This necessary work has previously been mentioned by the honorable member for Melbourne (Dr. Maloney) and the honorable member for Melbourne Ports (Mr. Holloway). I again urge the Minister to give it his early consideration.
.- The success that has been achieved in the Department of the Postmaster-General has already been stressed by honorable members of all parties. It is most encouraging to members of the Labour party to see this demonstration of the truth of their argument that such enterprises should be government controlled. It may be contended, of course, that the post office is peculiarly suitable for government control ; but it must be remembered that until fairly recent years the National Telephone Company of Great Britain controlled the telephone services of that conn try. Even the most ardent advocate of private enterprise would hardly suggest, to-day, that the Postal Department should be placed under private enterprise. It would be an absurdity to have half a dozen different post offices, controlled by different companies, operating within a stone’s throw of each other. Yet that is precisely the situation with the . banking institutions of Australia. I hope that the great success of the post office as a public utility will lead, in the near future, to the bringing of other public utilities, such as banking, under public control.
– Order ! The honorable member may not continue to discuss subjects that are outside the scope of the bill.
– As I have made the point I wished to make, I shall not continue to do so.
-Order ! The honorable member waa permitted to make a few opening remarks in anticipation that he would subsequently confine himself strictly to the bill; but he is now proceeding deliberately to commit a breach of the Standing Orders.
– I did not intend to transgress the Standing Orders.
I wish to draw the attention of the Postmaster-General (Mr. Parkhill) to the necessity for providing a new post office in South Brisbane. When the honorable gentleman was in Brisbane recently, he courteously invited the honorable member for Brisbane (Mr. George Lawson) and myself to join him in a tour of inspection of available sites. He saw the present South Brisbane post office building and was sympathetic towards the suggestion that a new building should be built in a more suitable part of the suburb. The present building is in an out of the way street, and is so inconveniently situated that many people seeking the South Brisbane post office arrive at the Woolloongabba post office, quite a distance from the centre of business in South Brisbane. The department has purchased a block of land for £3,000 in a most suitable locality for the erection of a post office, and I ask that earnest consideration be given to the construction of the building in the current financial year.
– I am strongly in favour of the erection of post office buildings which will be a credit to the Government, the people, and the department. To-day the PostmasterGeneral (Mr. Parkhill) has been overwhelmed with complimentary remarks. Apparently everything in the postal garden is lovely. At any rate no honorable member has cared or dared to say otherwise. I wish, however, to direct attention to a practice of the department which is anything but lovely. The post office building in Hobart is dignified and occupies «in excellent site in the city, to which it is undoubtedly a credit. But, unfortunately, whenever the Government is about to float a loan, or when Christmas or some other special season is approaching, the Hobart post office building is disfigured with most unlovely placards and signs. While I have no wish to detract from the efficiency of the post office, in the handling of mails and in the provision of services generally, I should like to see a little more attention given to aesthetic considerations in its management. Surely some other publicity method could be devised which would not necessitate the disfiguring of the post office building. If advertisements are necessary, let them be placed in a situation suitable for them that will not detract from the beauty of the city, or of the post office building. No doubt the kind of thing that is done in Hobart in this respect is done in .other cities. I appeal to the Postmaster-General to take steps to have these practices discontinued.
.- I thoroughly agree with the remarks of the honorable member for Denison (Mr. Hutchin). Aesthetic considerations should certainly receive some attention in both the construction aud maintenance of permanent public buildings. I have always felt that the post office should be used as a means of service, and not as a means of taxation. The fact that sinking funds have now been established in connexion, with all post office loans ensures that money borrowed for improving the facilities of the post office will not become a dead-weight of debt on the community. That is a matter for satisfaction. It would be most unfortunate if the Postmaster-General’s Department were to become simply another taxing agency. That would undoubtedly have a tendency to injure the completeness of the service that it should render. In the United States of America, all profits that are made hy the Postal Department are used to reduce charges or to improve the service given. These, however, are strange times, and I suppose that we shall have to continue our present practice for a while.
I endorse the remarks of honorable members who have spoken about the increased efficiency of the service of this department. I was glad to hear the Postmaster-General (Mr. Parkhill) express the view that it was important to provide necessary postal, telegraphic, and telephonic facilities for people living in outback and isolated areas. This, 1 submit, is necessary, not only from the point of view of the people living in such places, but also from that of the people living in the cities who wish to do business with such country areas. There is something to be said for putting in hand immediately the erection of new post offices in places where the department is at present occupying rented buildings. Such work would provide employment for people, and ultimately save rental charges to the department, and so would he economic.
Question resolved in the affirmative.
Bill read a second time.
. - . I assure honorable members who have made requests to me during this debate that the Hansard report of their remarks will be carefully considered by the departmental officers.
I have noted the observations of the honorable member for Darling (Mr. Blakeley) in regard to the CobarCanberra trunk line telephone service.While the department generally adopts the principle that new services of this kind shall be required to provide a fair return, that is not an invariable rule. Consideration is always paid to the particular needs of the areas to be served.
The honorable member for West Sydney (Mr. Beasley) asked how far the use of mechanical appliances in the post office was depriving people of employment. I wish to make the attitude of the department on this important matter quite clear. When automatic telephone exchanges are installed, every possible endeavour is made to transfer the displaced telephone attendants to some other branch of the Service. When requests of honorable members for the installation of automatic telephone exchanges are refused, or not approved as quickly as they wish, it is because the department takes into account three principal considerations: - First, the expense involved ; secondly, the desire to exhaust the efficiency of the existing services; and thirdly, the welfare of the employees who would be displaced from their employment by the provision of the automatic facilities. The last mentioned consideration has been an important factor in the refusal to make some automatic installations. In the case of country automatic telephones the displacement of employees is not usually a serious consideration, for such exchanges are almost invariably installed in small local centres where no telephone exchange facilities have previously existed. Between 25 and 30 of these exchanges are at present on order. The first of the installations will be put into operation without delay. 1 regret that I am not able at the moment to furnish a list of the places that will be served in this way.
I have noted the remarks of the honorable member for Werriwa (Mr. McNicoll) regarding the necessities of the post office at Townsville; and provision has already been made on the Estimates for certain work to be done at Rockhampton.
– I trust that the Minister will not overlook the need for post offices in certain localities because honorable members have refrained from participating in this debate.
– The right honorable member may rest assured that consideration will be given to all requirements. I have referred to these specific cases because they have been brought under my notice.
– Is the PostmasterGeneral able to make any reference to the position regarding unofficial post offices ?
– I shall do so. I wish to acknowledge with thanks the generous references that have been made to the excellent work done by departmental officers throughout the Service. It affords me great pleasure to add my tribute of admiration to the work of the officers of the department, from the lowest grade up to the highest official, Mr. H. P. Brown. Most efficient and patriotic service has been given by the whole staff, and ever since I have been in charge of the department my admiration has been growing for the men and women who do the work, often for rates of pay that are not at all high. The esprit de corps in the Service is something to be proud of, and I have been glad to hear the general expressions of approval of the service of the officers. Not the least valuable service, by any means, is that given inpart time at unofficial post offices. I direct attention to the fact that, in addition to the 5 per cent. restoration of wages and salaries that will be given to public officers generally, another 2½ per cent. will be given to unofficial post-masters in the country. As these officers did not suffer cost of living reductions this restoration will bring their remuneration up to very nearly the figure that obtained prior to the financial emergency reductions.
– Can the PostmasterGeneral give me any information about the wirelessbroadcasting station at Bundaberg?
– I can only promise the honorable member that I shall make inquiries into the subject.
Perhaps I should make it clear that the increase in expenditure on post office works this year over the expenditure of last year is not £1,000,000, but £400,000. The money is being provided out of loan.
In conclusion, I again assure honorable members that I shall see that the fullest consideration is given to the requests that have been made. I again express my appreciation of the goodwill that has been shown not only to departmental officers, but also to myself.
– I wish to join in the congratulations that have been offered to the departmental officers, and to say how I appreciate the uniform courtesy that is extended to customers of the department, particularly in country districts where the service is often rendered by unofficial post-masters and postmistresses. These persons give a tremendous amount of voluntary work to the department.
I wish again to urge the PostmasterGeneral to see that when telegraph and telephone lines are constructed through private property adequate compensation is paid to land-owners for any injury occasioned to their property. Section 90 of the act provides that this shall be done. I hope the Postmaster-General will personally look into the case that I brought under his notice recently. If he does so he will see that the facts have been quite accurately stated.
I wish also to ask that further consideration be given to the request of a deputation that asked, some time ago, for additional post office facilities at Toowoomba. That town, with a population of 30,000 people in its environs, has only one post office. It has been requested that an additional post office be erected at a centre which would serve, it is understood, not less than 10,000 people, and I hope that this will be granted.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
Sitting suspended from 12.57 to 2.15 p.m.
Bill received from the Senate and (on motion by Mr. Lyons for Mr. Latham) read a first time.
Bill returned from the Senate without amendment.
In committee : Consideration resumed from the 13th July(vide page 550).
Clauses 1 and 2 agreed to.
Section four of the Principal Act is amended -
by inserting after the definitionof “Company” the following definition: - “‘Dividend”’ means any distribution made by a company to its shareholders whether in money, shares or other property, out of its profits, but does not include a reversionary bonus on a policy of life assurance;”
– The Government has circulated a number of amendments, the first two of which deal with the definition of “ dividend “. I move -
That the proposed new definition of “Dividend “ be amended by leaving out the word “ shares “ and by inserting after the word “profits” the following words “and includes the paid up value of shares distributed by a company to its shareholders to the extent to which the paid up value represents the capitalization of the whole or any part of the profits of the company “.
In order to forestall criticism, I may state at once that it is necessary to add to the list of definitions in the principal act the new definitions appearing in this clause. The altered definition of “ dividend “ is inserted because some of the provisions of the bill require a more precis e expression of the term. It has become necessary to make the term cover all types of distribution by a company of its profits, “hether in cash or kind, or even by the process of crediting a shareholder in its books with a sum of money. All those features are now covered by the new definition of “ dividend “. It has become necessary also to define the word “ paid “, because in this bill “paid “ is. being taken to mean either a credit in the books of a company or a distribution. That definition is, to that extent, coupled with the redefinition of the term “ dividend “. The amendment of the definition of “shareholder” is simply a refinement, on what appears in the principal act, and its object is to merge the term “ stockholder “ and the term “member” in the one definition of “shareholder”. Then “special properly lax” is separately defined, merely because it has not been defined before. In this way a great deal of verbiage will be avoided. The definition of “year of income” is merely an improvement in drafting in order to shorten subsequent references.
– Does the Assistant Treasurer think that the definition is inclusive? As proposed to be amended, it will provide that “dividend” means any distribution made by a company to its shareholders, whether in money . or other property.
– - As proposed to be amended, the definition will read - “ Dividend “ menus any distribution made by a company to its shareholders, whether in money or other property, out of its profits, and includes the paid up vh lue of sharps distributed by n company to its shareholders to the extent to which the paid up value represents the capitalization of the whole or any part of the profits of the company, but does not include a reversionary bonus on a policy of life assurance.
Dr. EARLE PAGE (Cowper) T2.25].- I desire to assist the Government to dispose of its business in the quickest possible time, but is it absolutely imperative to pass this measure before Parliament rises? In the past, we have found that taxation measures need a great amount of close study, and, even when they have received it, sections which do not really carry out the intention of Parliament, and, therefore, require alteration, have been incorporated. It will be regrettable, if it becomes necessary for Parliament to deal with this measure after it has been circulated in its present form without giv ing the tax-paying public the opportunity to examine the amendments now tabled. I rose simply to ask the Minister, first, whether it is imperative that the measure should be passed before Parliament rises, and, secondly, whether it is not possible to allow the amendments, copies of” which we have now received for the first time, to’ be subjected to some outside scrutiny before Parliament deals with them.
Mr. CASEY (Corio- Assistant Treasurer) [2.27J. - If the country as a whole is to be given the benefit of the simplifications that will arise from this reform measure, it is necessary to put it through within the lifetime of this Parliament. It might be just possible, if the House met at the earliest convenient moment after the elections, to get the measure through in time to base upon it the assessments to be made at the. end of the year ; but it is extremely doubtful whether that could be done. I suggest that, in this instance, there is not that necessity for delay which might possibly have arisen in the past, seeing that the first report of the Royal Commission on Taxation, upon which this bill is fairly strictly based, has been in the hands of the public and honorable members already for over a year. The commission’s recommendations have been closely examined by a wide range of people. The second reading of the bill was moved by me over three weeks ago, and I then gave the undertaking that an adequate period would he allowed before the committee stage was entered upon. During the interval, the bill has been subjected to what I may well call the fierce light of public criticism, and the Government has received, both from deputations and in writing, many representations regarding the two principal aspects of the reforms contained in it, and has given them close consideration. The Government has also had the benefit of the continuous presence of Mr. Nixon, one of the members of the commission. As the committee goes through these amendments, and I am able to explain them, I think honorable members will see that, wherever they are important, they are easily understandable. The. bill has been long enough in the hands of honorable members to be fairly thoroughly understood, and the right honorable member for Cowper (Dr.
Earle Page) need have no great anxiety lest it should not carry out at least the intentions of the Government.
– There is a great deal of force in what the right honorable member for Cowper (Dr. Earle Page) has said, and the explanation of the Assistant Treasurer (Mr. Casey) has not removed the objections that the right honorable member put forward. The measure is admittedly based on the recommendations of a royal commission, and we must assume that those recommendations were embodied in the bill as originally tabled. We are given to understand that the amendments now circulated by the Government are not in any way in conflict with the commission’s recommendations, but we are entitled to be informed how it happens that they were not made part of the original draft of the bill, since they are admittedly in conformity with the recommendations of the royal commission upon- which the bill was drafted. If these amendments can be agreed to without criticism, then much of the objection of the right honorable gentleman falls to the ground; but if as a result of criticism of these amendments there is a doubt that the bill will not be passed at all, it would be far better to allow the bill to pass in its original form. We are assured that so far the amendments contained in the bill itself are designed to elucidate more or less, or to remove, word limitations in the act, and to assist in interpreting some of those mysterious gestures so frequently made in the Treasury. For my own part, I venture to hope that the other amendments now circulated for the first time, which introduce something more than mere verbal amendments, are allowed to stand. over, while permitting those which involve no controversy to pass.
.- When the bill was introduced I sent a copy of it to Mr. L. E. Home, secretary of the Taxpayers Association in Western Australia, with the object of obtaining expert advice upon it, the bill being obviously one upon which only expert advice is worthy of consideration. In acknowledging the receipt of a copy of the bill, Mr. Home wrote as follows: -
The bill is, without any exception, the worst bit of drafting that I have yet seen, and con tains. . more complexity, confusion, contradiction and “ disorderly assembly of words “ than any other taxation act passed since 1915.
– I very much doubt his expertness.
– The letter continues-
I am anxious to see the second-reading speech, in order to learn if the Assistant Treasurer can explain the meaning of some of the provisions. You will, I hope, not overlook the fact that Mr. Casey gave an undertaking that there should be an interval of 30 days “between the second reading and the committee stage, and, as Parliament is announced to adjourn about the 10th August, it appears to be probable that the committee stage will not be reached until after the elections.
The writer did not go any further into the matter, because he assumed that the bill would not be passed before the House was dissolved.
– That is his individual opinion.
– Yes; but, as an old taxation officer, he is quite capable of offering an expert opinion on taxation matters. I suggest tha-t the further amendments are an additional reason for not forcing the bill through at this stage. We are accustomed, particularly towards the end of a session-
– The Chair has allowed honorable members to make an appeal to the Minister to delay the passage of the bill ; but there can be no debate at this stage as to whether the bill itself should be proceeded with or not.
– I have received a telegram from the gentleman mentioned by the honorable member for Perth (Mr. Nairn), in which he says (that I gave a promise that 30 days would be allowed to elapse from the introduction of this bill to the resumption of the debate on it. What I said was that I would allow an adequate time to elapse. Over three weeks have now gone :by. and I think that sufficient time to justify me in saying that my undertaking has been carried out. The extravagant language used in the letter read by the honorable member for Perth, in my opinion, bears its own condemnation. If the Taxpayers Association of Western Australia has not had sufficient time to make all the representations it desired, all the taxpayers’ associations in the other States closer to
Canberra have had plenty of time to make most voluminous representations, and have sent representatives to Canberra who have been in close touch with Treasury officials, and with Mr. Nixon, a member of the Royal Commission on Taxation. Indeed it was as an outcome of these deliberations that the Government has brought down some of the amendments now before the committee. Mainly these amendments are important from a drafting point of view, but two of them represent a definite liberalization of the bill. No case has been made, out for any further delay in passing this bill.
– I do not think that a case has been made out for holding up the bill any further. I suggest that the so-called expert opinion read by the honorable member for Perth (Mr. Nairn) is more partisan than expert. I have always endeavoured to bring to bear on measures of this kind an impartial mind, and to hold the balance fairly between the need for the protection of the revenue and the interests of the taxpayers generally. These amendments are designed to simplify our taxation law. The man is no,t. yet born who could make our taxation legislation absolutely simple. I pay tribute to the services rendered by Mr. Nixon. The advice which he has so readily given to honorable members has been most appreciated. I have rarely discussed taxation problems with a man who has shown himself less prejudiced. Some of these amendments embody new principles which should have been incorporated in our income tax law when it was originally drafted. For instance, it is now proposed to treat the distribution of profits from shares just as though they wore a dividend. Companies which distribute bonus shares evade to a large extent the payment of income tax. These amendments are designed to ensure that tax shall be paid on such shares. Particularly in times of heavy imposts it is essential that income tax should be paid by everybody in proportion to the income received. If there is any loophole whereby people may form companies and succeed in evading taxation, it should be closed up; otherwise somebody else has to pay more than his fair share. In most cases the amendments contain no departure from the prin ciples laid down in the bill, additional words merely being inserted to make the statute more explicit. The passing of this bill will hardly affect the revenue; while increasing the revenue in some cases, it will decrease it in others. It is designed not to reduce nor to increase the tax, but to simplify its collection. The further amendments distributed really make the act less harsh in its application to the taxpayer. For example, it is now proposed that profits distributed in respect of income earned before the Income Tax Act was first passed, shall not be taxable, although there is a time limit imposed during which a tax-free distribution of such profits may be made. Obviously, such a concession should not be allowed to go on for ever. There is a big principle involved in one of the amendments now before the committee - bonus shares or a distribution from profits whether by way of bonus shares or a distribution of paid-up shares.- are to be treated as a dividend, which undoubtedly they are, and as such are liable to the tax.”
– I support the Leader of the Country party (Dr. Earle Page) in his suggestion that these amendments should be allowed to stand over. It is true, as the Assistant Treasurer (Mr. Casey) has said, that the report of the Royal Commission on Taxation had been available for some time, but the members of the commercial community were not aware of the amendments which the honorable gentleman has just circulated. On the Minister’s own confession the provisions of the bill itself created a great deal of confusion in business circles when they became known. Many telegrams were sent to honorable members asking that the bill be withdrawn. The Assistant Treasurer, of course, was satisfied witu the advice he had received from his officials, and declined to grant this request. Representatives of the commercial and business community were immediately despatched to Canberra to confer with the Minister, in an effort to remove anomalies, and clear up misunderstandings. With regard to the justice of income taxation I am in agreement with the Leader of the Opposition (Mr. Scullin), but I am not in agreement with him that justice will be done by these amendments. A great deal of trouble may arise out of them, and it may be desirable that the bill should be completely remodelled and simplified. A second plea advanced is that these piecemeal amendments should be held over until such time as the whole of this legislation can be remodelled. I should like to ask the Minister if the interests who have made the representations which he has mentioned are fully aware of the nature of the amendments just circulated. If they are, my argument is naturally destroyed, but the fact that there was sufficient in the bill itself to influence them to send representatives to Canberra to discuss matters with the Government, should indicate that they should be made fully acquainted with the nature of the amendments.
– Who are these people ?
– They are the people in the commercial world, who find nine-tenths of the taxation upon which the well-being of this Government and the honorable member rests. If the Minister can give me the assurance I have asked for, I shall be prepared to withdraw my objection.
– In the bulk, the amendments now being put forward are drafting amendments; only two may be considered to be important. The necessity for them has been demonstrated by the many representations which have been made to the Government within the last two or three weeks. The principal representations have been made upon the more important clauses 7 and 13. The Government has courteously and effectively considered any view put forward on behalf of the public on these points, and has given them mature consideration.
– What is the position with respect to Starr Bowkett societies ?
– They are covered by proposed legislation affecting the Commonwealth and the States and are not affected by this measure. If we were to withhold these amendments in order to design an omnibus measure to embrace the whole of taxation matters, Federal and State, I think it would unnecessarily delay reforms which the taxpayers of this country are most anxiously awaiting.
– But it might prevent further anomalies.
– That factor has not been overlooked. Taxation is divided into matters which affect the Commonwealth alone, and matters which affect the Commonwealth and States conjointly. Consideration of matters falling in the latter division it is proposed to postpone until next year to allow of their being considered at a conference between the Commonwealth and State taxation authorities. Within the next month or two a conference of State premiers will be called and at that conference income tax matters which affect the Commonwealth and the States equally will be discussed with a view to arriving at uniformity. In the meantime this bill deals with subjects which are the Commonwealth Government’s own concern, and thus the question of attaining uniformity between this and State legislation does not arise.
– I again ask honorable members to confine their remarks specifically to the amendments. There can be no need for further discussion as to the desirability of proceeding with the measure.
.- On behalf of the Taxpayers Association of South Australia I express appreciation of the frank manner in which the Assistant Treasurer (Mr. Casey) has met all the representations made on behalf of this association, and on the frankness with which he discussed the points they raised, and to which he gave every consideration. In many cases their wishes were not granted, but no complaint whatever has reached me that any attempt has been made to hide anything or to hurry through any matter on which they desired to make representations. I feel quite sure that the big body of taxpayers which these amendments will affect, desires the bill to be put into operation so that they may benefit by its provisions when this year’s assessments are being made. My saying thisdoes not mean that I endorse every aspect of the measure. As to the definition of dividends, I am not sure whether I can discuss this matter in connexion with this amendment, or whether I should wait until clause 7 is under consideration, when we will discuss the whole question of taxation upon savings made by companies or individuals which are devoted to the erection of new plant or to extensions. These savings have been partly exempted from taxation where they have been funded by companies, and, instead of being distributed as profits in the form of cash, have been devoted to extension of plant and later on distributed in the form of bonus shares representing the value of those new assets. The shareholders in such cases receive no additional spending power. To some extent these assets are more liquid and marketable when they become represented by bonus shares, but such a transaction really amounts to a saving made for the extension of a plant or a business. There is a definite distinction between a profit that is put back into a business in this way, and a profit which is held in cash for the purpose of avoiding taxation. I recognize that a private individual would have to pay tax upon all such profit; and to that extent a company is in a more advantageous position. On the other hand a private business man pays tax on a lower rate. When that applies to the smaller businesses, this lower rate is a social measure of undoubted justice to the earner of income by personal exertion, - as wages, professional fees, or the management of an enterprise or business. But as the size of a business increases the social argument becomes less potent. The justification in such cases for the concession in the form of ‘ lower rates to a man earning income from personal exertion, is based upon the fact that such a taxpayer does not enjoy the advantage of being able to retain a certain portion of profits. He therefore pays tax at a relatively lighter rate of taxation than that which applies to companies which are permitted to do so without having to pay tax upon profits set aside and not distributed. At the present time, when it is tremendously urgent to encourage people to extend their resources as faT as possible with the object of creating more employment, we should aim at encouraging people to put back profits they may earn into the, productive side of their business. If there is any anomaly between the treatment of the private taxpayer as compared with the company taxpayer in this matter, we should try to give to the private person the same encouragement to spend his money in extending his operations to provide more employment, as is given to companies. I admit that there would be great difficulties in the way, but suggest that the differentiation of the rates, as I have just pointed out, is, in a rough and ready way, an offset to the private business in place of the concession to companies. I am certainly not putting up any case for a public company which holds back profits in a liquid form, in order, ultimately, to get them through to its shareholders in the form of bonus shares, purely to avoid taxation. The practice does not bring any particular benefit to industry ; it does not create extra employment; it means that other taxpayers have to pay more tax in proportion. I am making a plea for encouragement of the practice of giving taxation concessions where the profits are put straight back into the business, and in that way tend to make for more employment and progress in the community. I am not suggesting that the Minister can hold up the bill at this stage to make amendments of the sort I propose, but I regret that in section 16a of the principal act, provision of this nature was not made to apply to the limited number of assessments on bonus shares which it would affect. I do not know how any further attempt could have been made to include among taxable dividends those distributed in the form of bonus shares or capitalized as profits held in reserve.
– I think honorable members should be given more time to consider these amendments, and would suggest that after the Minister has explained the mature of the different amendments, a further discussion of the measure be deferred until early next week.
– I have been advised that the royal commission recommends that action should be taken in regard to taxpayers with incomes derived from abroad, for whom no provision was made in the original act, and I am informed that no amendments have yet been framed to deal with these people.
As the law stands at present, provided any income tax, however small, is paid on this income in the country where it is earned, no further tax is payable in Australia. This gives an unfair advantage to those people who prefer to invest their money in foreign countries rather than in their own country. They should be compelled at least to pay the same rate of tax as their more patriotic fellow citizen, whose money is used in the development of their own country.
– The honorable member will have a later opportunity to deal with that point. It does not arise underthis amendment.
Amendments agreed to.
Clause, as amended, agreed to.
Clauses 4 and 5 agreed to.
Clause 6 verbally amended, and, as amended, agreed to.
Clause 7 -
After section sixteen of the principal act the following sections are inserted: - “16aa.- “ (2.) The assessable income of a shareholder shall not include dividends -
paid after the commencement of this section wholly and exclusively out of -
profits arising from the sale, compulsory resumption for public purposes or revaluation of assets not acquired for the purpose of re-sale at a profit or from the issue of shares at a premium; or
Provided that this sub-section shall not apply to dividends paid out of profits arising from the revaluation of assets, or from the issue of shares at a premium, except dividends in the form of shares.
Section proposed to be repealed - 16b. Where in the course of the winding-up of a company a distribution is made by the liquidator to the members or shareholders, the amount distributed shall, to the extent to which it represents income derived by the company (whether prior to or during liquidation) which would have been assessable in the hands of the members or shareholders if distributed to them by a company not in liquidation, be deemed to be assessable income of the members or shareholders derived in the year in which the distribution is made:
Provided that profits which have, in the opinion of the Commissioner, been properly applied to replace a loss of paid-up capital shall not be included in theincome of a company for the purposes of this section-
Mi. CASEY (Corio- Assistant Trea surer) [3.2]. - I move -
That the words “ After section sixteen of the principal act the following sections are inserted “ be omitted, with a view to insert in lieu thereof the words “ Section. 16b of the principal act is repealed and the following sections inserted in its stead “.
This is one of the important clauses of the bill. It sets out to substitute for the present scheme of the law a new scheme based on the recommendations of the Taxation Commission with respect to assessments of shareholders in relation to distribution of profits. In future, in order to be exempt a dividend must be paid wholly and exclusively out of the specified exempt profits, which are popularly described as, first, ex-Australian profits taxed abroad; secondly, capital profits; and, thirdly, what may be described as pre-war profits that were accumulated prior to a certain date in July, 1914. Since the introduction of the bill, the Government has decided that, as the provisions of the law in regard to bonus shares are to be considerably altered to bring their treatment, for all practical purposes, into line with the treatment of cash dividends, it is proper and only reasonable to allow to companies a limited time within which they may distribute profits by way of shares, and, for the purpose of ascertaining the liability of shareholders, have those shares treated in accordance with the existing law. Sub-section 2 has, therefore, been altered to include a new paragraph, d, providing for the continuance of the present law in respect of bonus shares, in the case of those distributed by a company up to the 31st December, 1934. In effect, this means that, instead of the law coming into operation against bonus share distributions immediately the new provision is enacted, companies will have until the end of this calendar year to make such distributions. This is one of the principal representations made to the Government within the last fortnight Up to the present time, companies have had certain limited privileges in regard to bonus share distributions, but they will have had no opportunity in the period between the introduction of the bill, and its passage into law, in which to make any distribution of past profits under the present conditions. It is not the aim of the Government in this instance to increase the revenue. It desires merely to achieve simplification, and as that will not be endangered by the continuance of the existing privileges for a further four or five months, it proposes by this amendment to make the 31st December next the date on which the law will operate in respect of bonus shares.
– Sub-section 2 says that the assessable income of a shareholder shall not include dividends. Will the effect of that be to give him the benefit of any exemptions provided for under the sub-section?
– He will get those exemptions. Paragraphs a, b, and c, as amended, describe the types of dividends which arc not to be assessable.
.- The proposed new sub-section 2 provides that the assessable income of a shareholder shall not include dividends paid wholly and exclusively out of profits arising from the sale, compulsory resumption for public purposes, or revaluation of assets. Does that apply to the sale of property by a company?
.- This amendment is undoubtedly a concession of value, as it affects pastcapitalization by a company; but it holds out no encouragement for the future expansion of businesses and productive enterprises out of profits. I suggest that, if the resultant complications would not be very great, the time allowed for the distribution of past profits in the form of bonus shares might well be put forward another year, so that the whole matter might be finalized at the time when it is probable that further amending legislation will be brought down to bring the Federal and State taxation laws more into harmony with each other. Past expenditure on extensions of plant is not of such great moment as the inducement to continue expenditure in such a way when many thousands of men are out of work, and when it is of the utmost importance to give every possible stimulus to those who have organized going concerns to push forward with them to the greatest extent. I draw a distinction, which was not drawn in the old law, but which I hope it will be possible to draw in the drafting of the law of the future, between profits which are absorbed in fixed assets that have an employing and earning capacity, and profits which may be held back in the form of cash or investments. My desire is to encourage the spending of money in buildings, plant, machinery, &c., in order to create more employment. I am afraid that will not be furthered by this particular provision. If the period for the distribution of past profits is extended to the end of 1935, it might be possible to evolve some new definition which would enable the department to make the distinction to which I have referred. If it is not possible to make that distinction between now and the end of 1935, the law, as proposed, would automatically come into operation.
.- The honorable member for Wakefield (Mr. Hawker) has returned to the point which he dealt with on clause 3. The committee has passed that clause which pro- vides that the issue of bonus shares shall be treated as dividends and taxed by inserting in the definition of “ dividend “ the amendment proposed by the Assistant Treasurer (Mr. Casey), which will have the effect of bringing bonus shares into the taxable area. The amendment now before the committee seeks to extend the time for the distribution of the reserved profits of a company by providing that action to this end will not be taken until the 31st December. The honorable member for Wakefield has asked that the term be extended for another year. I see no good reason for the further delay, or for even the amendment proposed by the Assistant Treasurer, but because one does not like to do anything too suddenly, I am prepared to accept it. The honorable member for Wakefield suggests that if the time is extended, it may be possible to get a new definition which will make a distinction between profits reserved to increase the assets of a company, and profits retained in the form of cash for future distribution. If we attempt to draw a distinction between the two forms of profit, we shall undo most of the work of simplification in taxation measures for which the royal commission was appointed some time ago. There is no justice in exempting from taxation profits which may be reserved to add to machinery or plant. A private individual earning a profit in his business and desiring to invest some portion of it in the erection of additional plant to provide further employment, has to pay taxation on the whole of his taxable income before he has the right to invest his surplus profits. “Were it otherwise, he would be escaping his share of the taxation.
– There is no essential difference between an individual investing his money in that way and having it invested for him by a company.
– Not the least. If a company issued all its profits as dividends and then called for a new issue to increase its plant the subscribers to the new issue would first have had to pay a tax on the dividends which they had received. The distinction in our taxation laws ‘between a company and a private individual is recognized in all taxation measures in respect of incomes over a certain amount. Why should that distinction be removed by a subterfuge, which would allow a company to do something which a private individual is not permitted to do? There may be two businesses of the same nature in operation on opposite street corners. One may be controlled by John Brown, who is not allowed to set aside onethird of his profits to a reserve fund. The other may be conducted by John Brown and Company, and because it is a company business it is allowed to set aside one-third of its profits to reserve, pay the company rate of taxation of ls. in the £1 on that amount of the profits, and later distribute its reserve profit to shareholders in the form of bonus shares, which they can sell on the open market. There is no justification whatever for extending the term. [Quorum formed.]
– I assure the honorable member for Wakefield (Mr. Hawker) that this amendment makes no alteration of the law such as he has in mind. A private individual now or in future will get no privilege in respect of any portion of the profits which he makes. He will pay tax on income at the “personal exertion rate. A proprietary company has the right now and will still have the right in the future to sot aside one-third of its distributed profits upon which it will pay company rate of ls. in the £1. The remaining two-thirds of the profits will be taxed at the rate provided for individual shareholders. A public company can set aside portion of its profits to a reserve for the extension of its business, or, as the honorable member has suggested, to provide further employment. I think there is some confusion in the mind of the honorable member as to the right of a company to set aside portion of its profit for this purpose or to increase the assets of the company. I cannot see that there is any connexion. When bonus shares are issued to capitalize profits, the activities of the company are not in any way forwarded. The distribution is merely made for the convenience of the shareholders. Bonus shares are taxable now except those paid out of specified profits, such as capital profits, casual profits, which are somewhat difficult to define, pre-1922 profits, and also profits to the extent of onethird of the distributable income that has not been distributed in past years. In future, bonus shares are to be placed, from the point of view of the Taxation Department, on the same footing, generally speaking, as cash dividends; they will be exempt from taxation only to the extent to which they are based on a fund which comprises exclusively ex-Australian profits that have been taxed pre-war profits, or capital profits. Bonus shares distributed out of profits arising from a revaluation of assets that have been acquired by a company, not for resale, are to he exempt but if the distribution is in cash it is taxable. I think the honorable member for Wakefield has confused the issue of bonus shares with the setting aside of profits for the extension of a business. There may be some connexion between the two, but I have not been able to see it. There are certain limitations on the capitalization and issue of bonus shares which represent the accumulated past profits, but I suggest that the additional employment visualized by the honorable member for Wakefield will not be
affected in any way. In future a shareholder receiving shares will pay the individual rate of tax on them instead of getting them relatively free from taxation, as in the past.
– I should like to discuss a very dangerous practice that has grown up in this country as a result of the Commonwealth Parliament exempting from income tax, sales tax and other such charges a company that is registered as a religious organization, but which is carrying on in keen competition with legitimate trading concerns dealing in similar products.
– That matter does not come within the scope of this bill.
.- I ask the Minister to consider introducing an amendment to proposed new section 16 ab of the act with a view to extending the period for rebate until the 30th June, 1935, so that companies might have a chance to distribute profits on which they have already paid tax at the rate of 2s. 8d. in the £.
– The system of rebates has become impossibly complicated, necessitating an infinity of work by officials to apportion incomes into their various classifications. One of the objects of the bill is to simplify administration in this respect. It has been calculated that more than 80 per cent. of taxpayers get the rebate at their own rate, and not at the company rate, so that only a small percentage would be affected by the honorable member’s proposal.
Amendment agreed to.
Amendments (by Mr. Casey) agreed to-
That sub-paragraph (ii), paragraph (b) section 2 proposed new section 16aa be omitted, with a view to insert in lieu thereof the following sub-paragraphs: -
profits arising from the sale or compulsory resumption for public purposes of assets not acquired for the purpose of resale at a profit.
profits arising from the re-valuation of assets not acquired for the purpose of re-sale at a profit or from the issue of shares at a premium, if the dividends are paid in the form of shares; or
That the proviso to section 2 be omitted with a view to inserting in lieu thereof the following paragraph: - “ or (d) paid before the thirty-first day of December, one thousand nine hundred and thirty-four, in the form of shares, except to the extent that the paid-up value of those shares would have been included in the assessable income of the shareholder if the assessment of his income had been made under the law in force immediately prior to the commencement of this section.
That after proposed new section16ab the following new section be inserted: - “ 16b. - (1.) Amounts distributed to shareholders of a company by a liquidator in the course of winding up the company, to the extent to which they represent income derived by the company (whether before or during liquidation) other than income which has been properly applied to replace a loss of paid-up capital, shall, for the purposes of this Act, be deemed to be dividends paid to the shareholders by the company. “ (2.) Any amount deemed, under the last preceding sub-section, to be a dividend, shall, to the extent to which it represents any income or profits specified in paragraph (b) of sub-section (2.) of section sixteen aa of this Act be deemed, for the purposes of that subsection to be a dividend paid wholly and exclusively out of that income or those profits “.
Clause also verbally amended and, as amended, agreed to.
Clauses 8 to 11 agreed to.
Section twenty-four of the principal act is repealed and the following section inserted in its stead: - “24. - (1.) The following amount (in this act called “ the statutory exemption “ ) shall be a deduction allowable under this act to any person other than a company or an absentee: -
the sum of Two hundred and fifty pounds, less One pound for every Two pounds by which the income exceeds Two hundred and fifty pounds ; or
where the income does not exceed Two hundred and fifty pounds, the amount of the income.
In this sub-section “ income “ means the residue after deducting from the assessable income all other deductions allowable under this act. “ (2.) The deduction of the statutory exemption shall be made successively from the income from property other than dividends, from the income from dividends and from the income from personal exertion.”.
Section proposed to be repealed -
– (1.) In the case of a person (other than a company or anabsentee) whose income is derived solely from property, there shall be deducted . . .
the sum of two hundred poundsless one pound for every two pounds by which the income exceeds two hundred pounds. (3.)For the purposes of this section “income “ means the residue of the assessable income of a tax payer after allowing the deductions, allowed by any other section of this act.
. -I move -
That the following sub-section be added to proposed new section 24: - “ (3.) Where special property tax is imposed upon the taxable income derived from any sources by any person (other than a company or absentee) the preceding provisions of this section shall not be applied in calculating the amount of the taxable income subject to that tax but, for the purpose of making that calculation, there shall be deducted, from that part of the assessable income derived from those sources which remains after all other deductions allowable under this act have been made, the amount of that part or the sum of Two hundred and fifty pounds whichever is the less.”.
This provision was omitted from the bill by pure inadvertence. It has been a part of the law in various forms ever since 1932. It was originally enacted for one year in 1932, and was brought into the Income Tax Assessment Act in 1933. When certain parts of the act were being excised during the course of the drafting of this bill, this sub-section was inadvertently left out. The amendment entails no alteration of the existing law.
Amendment agreed to.
Clause, as amended, agreed to.
After Part III. of the principal act the following division and sections are inserted: -
Division 2 - Private Companies. 31b. - (1.) Where a private company has not within nine months after the close of the year of income made a sufficient distribution of its income of the year, the Commissioner may assess the tax and additional tax which would have been payable by its shareholders if the company had on the last day of the year of income paid the undistributed amount as a dividend to the shareholders who would have been entitled to receive it, and the company shall he liable to pay the tax and additional tax so assessed.
.- This clause, which occupies three pages of the bill, deals with highly technical matters, and needs very careful consideration. Surely it need not be passed at this stage! I should prefer that it be held over until honorable members have had an opportunity to study it more carefully.
– I move -
That the word “ within “, sub-section 1, proposed new section 31b, be omitted with a view to insert in lieu thereof the words “ before the expiration of “.
Clause 13 is one of the important clauses of the bill, and in it the Government is seeking to carry out the recommendations of the royal commission regarding the taxation of private companies, with particular reference to the insufficient distribution of profits. The clause may appear to be a complicated one, but it really comprises a series of definitions of companies, this method of description having been copied, partly from the British act, and partly from the act in force in New South Wales. I have moved to strike out the word “ within “ with a view to insert in lieu thereof “ before the expiration of “. It is purely a drafting amendment.
– Has the Assistant Treasurer received any representation from organizations or interested parties with respect to this clause?
– Yes; they have been fairly general, and are to the effect that section 21 of the principal act should be allowed to remain. The Government is not prepared to do that, as it wishes to adopt the recommendation of the royal commision. The bill has been in the hands of honorable members for three weeks, and as there are no amendments in this clause of any consequence, they should be acquainted with the proposed new sections.
– This clause provides that after Part III. of the principal act certain new sections shall be inserted. These new sections have caused a good deal of comment, and numerous representations have been made to the Government concerning them. Those interested, contend that the proposed new sections constitute a radical departure from the intentions of section 21 of the principal act, and that they are more obnoxious than that section. They also contend that it is questionable whether the proposed alterations will result in any simplification of our taxation legislation. It has been said that without mature consideration, it is difficult to understand the extent to which this provision will operate, and that time should be given to allow it to be further studied.
Mr. JENNINGS (South Sydney; [3.34]. - The proposed new sections may cause concern amongst those controlling private companies. Under this clause it is provided that twothirds of the profits of a private company shall be distributed. A company with a capital of £10,000 may earn a profit of only £100, and it would be inadvisable to expect such a company to pay a dividend on such a small profit. I suggest that a minimum should be fixed so that a company may pay a dividend of, say, 2$ per cent, on its profits.
– -Under this provision there is no compulsion for a company to distribute its profits, and in respect of the point raised by the honorable member for South Sydney (Mr. Jennings), the law has not been altered. In the matter of private companies there is to be a notional distribution, and a company shall be deemed to have distributed twothirds or its distributable profits, and is taxed on those profits at the rate applicable to each shareholder. It is proposed to amend the existing law in two ways. In the future, as in the past, a company must distribute two-thirds of its distributable profits. At present certain discretionary power rests with the Commissioner; but that discretionary power, which has been the cause of a good deal of complication and worry has not been of any great consequence to the shareholders, because only in relatively rare instances has the Commissioner thought fit to exercise it. After careful consideration, the Government decided to recommend to Parliament that such discretionary power should be withdrawn, and that in future the distribution, actual or notional, of two-thirds of the profits of a private company should be applicable to all circumstances.
– Is not the Assistant Treasurer in favour of fixing a minimum?
– I do not see that any advantage would be derived from that. If the profits of a company were only £100, only £66 would be deemed to have been distributed, and would be taxed at the individual rate and not at the company rate.
.- I join with other honorable members in asking the Assistant Treasurer (Mr. Casey) not to endeavour to pass to-day this long and complicated amendment of the existing law. Clause 1, and not this clause, may be the means of avoiding complications. It seems incredible that the Assistant Treasurer should suggest that this clause merely provides that it shall be mandatory upon the Commissioner to tax two-thirds of the profits of a private company instead of him having the right to exercise discretionary power. The clause covers several pages of the bill.
– In my second-reading speech I referred in detail to the effect of these proposed new sections.
– The proposed new sections are now to be further amended, and it is impossible, in the limited time at our disposal, to determine the effect of the Government’s latest proposals. Moreover, as we are unable to obtain expert advice upon them, I earnestly appeal to the Assistant Treasurer not to ask the committee to pass them this afternoon. If necessary, the clause could be withdrawn and considered at a later date. There are other points with respect to private companies which need careful consideration, including the subject of holding companies. As pointed out by the royal commission, and emphasized by the Leader of the Opposition (Mr. Scullin), there has been a good deal of subterfuge, and the anomalies which exist should be corrected. Such correction is a highly complicated and technical matter, and cannot be done in a few minutes. Some of the proposed alterations of the law which have taken twelve months to evolve have been amended at the last moment, and may make the law even more confusing than it is to-day.
– In the past, section 21 of the act has applied generally to all companies, but, as I mentioned in my second -reading speech, on the recommendation of the royal commission, its application is to be limited to private companies and public companies are being eliminated. The limitation of this section to private companies brings with it the obligation to define a private company, and that accounts for at least one page of the bill. Apart from that, the principal alteration made by the proposed new sections is the removal of the Commissioner’s discretion, which affected only a small proportion of companies.. In addition, there is an alleviation of the law to the extent that the two-thirds distribution is now to be averaged over the previous four years, which is a distinct advantage to private companies, in that if in those years they made distributions greater than twothirds of their profits, this will be taken into account together with the current year’s distribution in determining the amount on which tax is to be assessed. The “ assumed distribution “ is to be deemed to have been made on the last day of the year of income. At present it is impossible to assess private companies and their shareholders for about two years after the year in which their profits had been made. This entails tremendous complications, a carry-over and great administrative difficulties. This amendment will not hurt the shareholders but will enable ,the assumed distribution to be deemed to have been made on the last day of the year of income.
There are provisions dealing with holding, property and investment companies which I think I have adequately described in my second-reading speech, hut there I intend to propose an amendment which might be appropriately touched upon at this stage. This provides for an addition of certain words at the end of the proposed new section 31o. under which we have sought to. provide against a private company, in lieu of declaring a dividend, making a loan to its shareholders. A private company is one in which there is a small number of shareholders. A subterfuge resorted to in the past has been a distribution of cash to the shareholders in the form of a loan. Power is to be taken under the bill to treat such a loan as if it were a dividend ; but, if the company should subsequently pay a dividend to the extent of that loan or some part of it, it would be liable under the bill as it stands to pay double taxation. Therefore, an amendment will be proposed to provide that if the company has made a loan to the shareholders and has subsequently paid a dividend to cover part of the loan, the dividend shall be to that extent not taxable. “With that explanation, and my replies to any further queries which honorable members may address to mc, they should be satisfied, I think, to accept clause 13. We have received a great number of representations upon it, and we have yielded properly, I consider, to this one; but we have not acceded to a fairly widespread request from a number of interested quarters that we should drop this portion of the bill altogether. We intend to clean up the position with regard to private companies, and we believe we are doing so in a fair manner.
.- There is a popular misconception, which has been referred to by the honorable member for South Sydney (Mr. Jennings), that section 21 compels a company to distribute two-thirds of its profits; but that is not the position. It is merely deemed that two-thirds of the profits have been distributed. Under the old provision, discretionary power was given to the Commissioner to alter that proportion. Last year, discussion took place in this chamber as to whether this discretionary power should be given to one man, and. a strong protest was made against the Commissioner having such a power. The taxpayers’ associations and others have been arguing against the discretionary power of the Commissioner, particularly in regard to this section. This matter was investigated by the royal commission, which recommended that that power should be removed, so that it would be mandatory on the Commissioner to deem that two-thirds of the profits had been distributed and the proposed alteration is the very first thing of which complaint is made ! In my opinion, this discretionary power should never have ‘been granted. When the power existed it was exercised, and certain remissions had to be given. I believe that, in some cases, even capital losses had to be allowed as income losses ; but capital profits are never regarded as income, and deductions from income should not be made on account of capital losses. Apart from that, the law is being considerably liberalized. The averaging process mentioned should give a great deal of relief. If a company distributed 80per cent, of its profits in one year, and 20 per cent, in another year, it should be deemed to have distributed 50 per cent, in each of the two years, and provision has been made for this.
The position in regard to holding companies has been tightened up. The Assistant Treasurer thinks that he has now closed the door; but in that regard he is probably over-optimistic. In this Parliament we have been trying to close it for ten years or more, yet clever persons always succeed in finding a means to escape taxation. At any rate, I hope that the present attempt will be successful. We learn by experience. It is true that the provision is a lengthy one; but we have had it before us for three weeks, and- expert opinion has been available with regard to it, in addition to the speech of the Assistant Treasurer. No good reason has been advanced why action should be postponed. I am satisfied that the amendments to the law now proposed will bring about an improvement; but I do not consider that the bill deals with every aspect -that should be covered. Although I hold strong opinions on the subject of rebates of company tax, I shall not obtrude them at this stage. I may submit them on another occasion, when a general review is being made of the income tax law.
– The discretionary power to which the right honorable gentleman has referred is still being exercised.
-Yes. in other sections, and if the honorable member can suggest means by which the granting of such power to the Commissioner could be made unnecessary, he will have done something which nobody else has been. able to accomplish.
Mr.NAIRN (Perth)[3.49].- Section 21 has long been a source of trouble. Under the act the Commissioner has a discretionary power, and naturally complaints have been made as to the manner in which he has exercised it. The compulsory distribution of two-thirds of the profits will be less acceptable to most private companies than the old provision under which discretionary power was given to the Commissioner. In changing times, it is often undesirable for a company to make a complete distribution of its profits. For instance, a company might be in a position in which losses were impending shortly after the year pf accounting. It is not safe to distribute two-thirds of the profits each year; but, if that is not done, full taxation must be paid. The enforcement of these provisions by the Commissioners has caused hardship during the depression. Business . discretion dictates that directors of companies shall build up their reserves in order to meet periods of depression. Bather than have an arbitrary figure of two-thirds, it would be better to vest a discretion in the Commissioner. The main effect of this clause is, however, to create a new taxing machine.
– It is not designed for that purpose.
– Its object is to compel the payment of more taxes.
– It is designed to stop the avoidance of taxation which should he paid.
– The effect will be to bring in greater revenue.
– That result will be only incidental.
– It is a ‘ taxing provision. The statement that public companies are exempted is meaningless, because, in practice, these companies do not withhold their profits; their shareholders insist on a distribution of any profits available. It would appear that some honorable members are prepared to pass these provisions without attempting to understand them. Unfortunately, there has grown the habit of rushing legislation through towards the end of a session, without honorable members understanding its meaning. Very few honorable members understand this lengthy clause which we are asked to pass to-day.
– No bona fide company will suffer by this legislation ; but those persons who have formed private companies for the purpose of avoiding taxation will suffer. I expect that the passing of this lpgislation will lead to a number of companies being dissolved, because there will no longer be any reason for their existence. The persons who have formed these companies will probably conclude that it will be better to have their property assets return income to them directly than by the circuitous route of passing through a number of private companies. The present exemptions enable unscrupulous persons to avoid taxation which they should rightly Pay-
Amendment agreed to.
Amendments (by Mr. Casey) agreed to-
That the following sub-section be added to proposed new suction 31g: - “ (2.) Where the amount of any advance, loan or payment is deemed, under the last preceding sub-section, to be a dividend paid by a company to its shareholders, and in any year subsequent to that in which the dividend is so deemed to be paid, the company sets off any dividend, distributed by it in that subsequent year, in satisfaction in whole or. in part of the amount of that advance, loan or payment, that dividend shall, to the extent to which it is so set off, be deemed not to be a dividend for any purpose of this act.”.
That after the word “ recipient “, proposed new section 31h the words “ and received by him as a shareholder of the company “ be inserted.
Clause, as amended, agreed to.
Clauses 14 and 15 agreed to.
Clause 16 verbally amended, and, as amended, agreed to.
– I move -
That the following new clause be inserted : - 13a. Section 32 of the principal act is amended by omitting paragraph (a) of subsection (1) and inserting in its stead the following paragraph : -
In the case of a resident (not being a company) the total assessable income is not less than £250.
This is a machinery clause which provides that non-residents of Australia will not be liable to submit returns unless their gross income is £250; the exemption is now £200.
– Does gross income include the total receipts, without any deduction for expenses?
– The meaning of the term “ gross income “ has not been altered by this bill.
New clause agreed to.
Title agreed to.
Bill reported with amendments.
Motion (by Mr. Casey) proposed -
That the report be adopted.
.- I trust that in the future when income tax assessment bills are introduced the Government of the day will revert to the practice that obtained a few years ago of making available to honorable members, with the bill, a memorandum explaining the effects of the proposed amendments in their relation to the existing law. These bills deal with very technical subjects. I have ordinary intelligence, but I, and I am sure, other honorable members, find it extremely difficult to follow a bill of this kind without the help of an explanatory memorandum.
.. - I circulated an advance copy of the bill to the leaders of the different parties, and if I had been asked to do so, I should also have circulated copies of the principal act, so that the provisions of the bill and those of the act could be compared.
– The Assistant Treasurer has misunderstood me. I expressed the hope that in the future a memorandum will be circulated showing the sections proposed to be amended, and in special types, the proposed amendments. I sincerely trust that that will be done. It would greatly help our discussion.
Question resolved in the affirmative.
Bill - by leave - read a third time.
Assent was reported to the following bills : - .
Distillation Bill 1934.
Electoral Bill 1934.
The following bills were returned from the Senate without amendment: -
War Service Homes (Suoth Australia Agreement) Bill 1934.
Flour Tax Assessment Bill 1934.
Land Tax Assessment Bill 1934.
Colonial Light Dues Collection Bill 1934.
Bill returned from the Senate with amendments.
Bill brought up by Mr. Stewart and read a first time.
Assassination of Dr. Dollfuss - Aus.TRALIAS Export TRADE : Restrictions by Italy - Sanitarium Health Food Company - -PRICE of Petrol - Mining in Northern Territory - Invalid and Old-age Pensions.
– I move -
That the House do now adjourn.
I take this opportunity to express the deep regret of the Government at the assassination of Dr. Dollfuss, the Chancellor of Austria. The Commonwealth Government deeply sympathizes with the Government and people of Austria in the loss that this . deplorable happening has entailed. The circumstances surrounding the assassination are not yet entirely clear. The official information furnished to the Government is to the same effect as that which has appeared in the press. Martial law has been declared in Vienna; the army remains loyal to the government, and the situation in the capital and the provinces remains quiet. The Commonwealth Government has taken steps to forward to the Government and people of Austria a message expressing its sympathy.
.- The news of the assassination of Dr. Dollfuss is disturbing because, among other reasons, we are all too frequently hearing of appeals, by the people of other countries, to force and violence. It is disturbing also because of the possible repercussions of a deed of this description. When such events occur we feel glad that we live in a community that thrashes out its differences in a better way. We hold our general election and discuss in Parliament, on the public platform, aud in the press, the various problems that confront us; and we seek to express our views and conduct our affairs in an orderly and a constitutional way. We appeal to the democracy, and not to force, in order to reach decisions. I hope that that will always be the case with us and the other countries with which we are so closely allied. Whenever democracy has been , replaced by a dictatorship appeals to force and violence have followed and one grave wrong has been succeeded by another. I am sure this Parliament will deeply deplore the bloodshed that has taken place. The assassination of Dr. Dollfuss is distressing in every respect; but it is to be hoped that at* least it will serve as a lesson to other countries to seek to settle their differences by constitutional methods rather than by those which have been employed in certain parts of Europe lately. It is sometimes said that democracy has failed; but democracy has not failed. It is infinitely to be preferred to autocracy or dictatorship, no matter from what stratum of society the dictator may come. I conclude by observing that it is to be hoped that the parliaments that may be involved in the trouble that may arise from this happening will not allow it to lead to such a disaster as that which followed a somewhat similar happening just twenty years ago, when a world-wide conflagration commenced that cost millions of human lives. I hope passions will not be stirred up. This is not an occasion for passion; it is an occasion for prayer.
– In view of misunderstandings and some criticism in certain quarters in Parliament and the press regarding negotiations for a trade treaty with Italy, I wish to make a statement setting out the position.
In considering our trade relations with Italy and the’ threatened restrictions of Italian imports of Australian wool, I should like to make it clear that from the Australian point of view it is totally incorrect to say that there has been any discrimination on the part of the Commonwealth against Italy. Italian products are and always have been subject to the same tariff treatment as the products of every country outside the British Commonwealth of Nations. The Commonwealth is under obligations through the terms of the Anglo-Italian Treaty of 1883, to accord Italy mostfavourednation treatment in tariff matters, and these obligations have been faithfully observed. The intention of the Italian Government to restrict the importations of Australian wool into Italy is evidently an enforcement of an Italian law passed in April. This law subjects imports of oil seeds, scrap and ingot copper, coffee and wool to a system of licensing, and provides that in the issue of licences to individual Italian importers regard is to be paid to the trade turnover with the countries whence the goods came. This practice of controlling imports is now extensively practised in almost all European countries. It provides a tariff bargaining weapon and is being widely used as a means to extract tariff concessions from countries with which the balance of trade is unfavorable. Although for some years there has been much pressure from Italy for tariff concessions, it was not until April, 1933, that definite requests were received from the Italian Consul. At that time the whole tariff schedule was before Parliament. It was quite impossible to consider the Italian proposals, or in fact, proposals from any nation, until the new tariff had been adopted by Parliament, and consequently the negotiations had to be deferred until December last. That was a general arrangement with all those who were seeking treaties. This position was made .quite clear to the Italian authorities.
Definite negotiations were opened in December last, when the Consul-General was informed in detail concerning the different items covered by his request. At the same time he was asked to supply information showing the conditions under which the principal exportable products of the Commonwealth are admitted into Italy. The Government has not as yet been favoured with this information. The course of the negotiations has. been very difficult, because many of the Italian requests are of such a nature that the Commonwealth Government is not free to grant them without infringing its treaty obligations to the United Kingdom under the Ottawa agreement. For instance, Italy ha3 demanded the free admission of artificial silk yarn - that is, at the same rate as applies “to the United Kingdom.
The, Commonwealth, however, is bound by the terms of the Ottawa agreement to accord United Kingdom producers a preference of 15 per cent, ad valorem. How could the Ottawa agreement have been implemented in any other way in relation to that item, which is only one of many? It will, therefore, be clear that, regardless of the disposition of the Commonwealth Government towards the Italian request, it cannot be met unless the United Kingdom Government is prepared to waive some of its rights under the Ottawa agreement, and to that extent to lose some of its trade to Italy. Many of the Italian requests are in the same category, but I quote this example to make the position quite clear. Consultations with the United Kingdom have taken place, and are continuing, but as these must be conducted by cable, and in turn involve further consultations with trade interests, the speedy conclusion of treaties is not practicable. For instance the modified requests of the Italian Government were transmitted to the United Kingdom on the 17 th May, for the purpose of ascertaining how far the United Kingdom Government would be willing to waive certain of its rights under the Ottawa agreement. Considering the nature and number of the requests, the United Kingdom dealt with the question without loss of time and replied in detail on the 9th July. These negotiations with the United Kingdom have not been completed, but everything reasonable is being done to have them speeded up. Pending the outcome of the negotiations with the United Kingdom, the Commonwealth is not in a position to meet the major Italian requests without deliberately defying its contractual treaty obligations to the United Kingdom.
It is not clear whether the Italian Government proposes to. apply the restrictions to Australian wool only, but, as announced previously, it is understood that the restrictions will apply also to South Africa. If, however, it is the intention of the Italian Government to apply the restriction only to Australian wool, then such action can only be interpreted as discrimination against the commerce of the Commonwealth, and a breach of the terms of the Anglo-Italian Treaty of 1883. The position is being carefully watched, and the Italian Consul-General is being asked for further information. If the proposed restrictions are to be operated in such a manner as to amount to discrimination against Australian goods, the Commonwealth will have to consider the tariff position with regard to Italy. Meanwhile, a reply is now being awaited from the High Commissioner in response to a further cable communication, and we hope that that reply will be favorable.
– I have been requested by the employers and employees in a very important industry to draw attention to unfair competition resulting from action taken by Commonwealth Governments. The company, which is .the subject of the complaint made to me, is known as the Sanitarium Health Pood Company registered in New South Wales. I arn told that it is undermining bona fide establishments carrying cm the same class of business, and producing and selling the same commodities. The reason why it can do this, and why I have been asked to raise the matter in the House, is that the Commonwealth frees it from the necessity to pay income tax, land tax, sales tax, and primage. Through the advantages which it has over other companies in not having to pay taxation, it can undersell legitimate trading companies who are engaged in the industry. The reason why governments gave, and still give, it this advantage is that it is also registered as a religious organization.
– Did not the Assistant Treasurer (Mr. Casey) say that he was investigating that matter, and that there was no preference?
– No. He said that I could not deal with the subject on the Income Tax Assessment Bill, as I wished to do, but that next year I could debate the matter on another bill.
– But he answered a question on the subject yesterday.
– I am referring to what took place to-day. A question was certainly answered yesterday, but I wantaction taken at once. The companies dealing with marmite and other vegetable products employ a great deal of labour, but cannot carry on, and are now putting off labour in Victoria; and, I dare say, in other States because of this unfair competition. The matter is very important, particularly to Victoria, because legitimate companies are being undersold by this unfair competition made possible by the action of the Commonwealth Government in freeing this company from taxation on the ground that it is a religious organization. If it were like other religious organizations which are freed from taxation, and do not enter into competition with legitimate traders, no one would raise any objection to it. The religious organization which carries on this business is known as the Seventh Day Adventists, a wealthy sect, comprising a worthy type of people who conduct some of the finest sanitariums in Victoria and probably elsewhere - certainly it does so in America. Its work, however, is not carried out on a charitable basis like that of other missions. People pay high fees to go into its sanitariums, - there is no complaint about this - but the organization manufactures and sells its products on the open market, in competition with others who have to pay taxes. Furthermore, with every packet it sells, it gives one away, so that there is no possibility of legitimate trading companies competing, and at the same time paying arbitration court award rates to their employees, and giving them the labour conditions laid down by the law. That is why they have asked that the position be reviewed. This religious organization, which is purely a trading company, was never meant to take advantage of its freedom from federal taxation in such a way as to enter into competition with other companies in their ordinary business operations. I am sure that the Government never intended to produce that effect. The Commonwealth first gave, and still gives, freedom from taxation to religious organizations, because they are religious organizations, and use their property for religious and charitable purposes only. The Government never intended that they should be free from taxation, and at the same time enter into ordinary business competition with people who pay taxes. That is the first advantage which this company gains. The second, although I am not sure that it is an advantage, is that it employs only members of its own sect. That, I presume, is not wrong, but we do not know whether it pays the same wages as others do. i can say, however, that the conditions arc just as healthy and clean as in similar industries outside. Their religious principles will not permit the employees of this company to belong to organizations, and we have no means of ascertaining whether award rates are being paid to them or not. It is necessary to prove that employees and employers shall be members of an association for Arbitration Court purposes. That gives to the company another advantage, but in any case its immunity from taxation is a distinct handicap to its competitors. It gives to every customer two jars of Marmite for the price of one. It enters into serious competition with such companies as The Rosko Products Proprietary Limited, Fitzroy; Fred. Walker and Company, South Melbourne; and Cereal Distributors, Brunswick; and others. This competition is not only unfair but is harmful in its effect upon the community generally. It breaks down the standards of living of the workers, and results in loss of trade to other concerns, with the result that men are being thrown out of employment. I ask the Government to inquire into the matter, and ascertain if the company is abusing the privileges accorded to it as a religious organization. The only justification for the granting of immunity from taxation is that as a religious body it expends some of the profits made in Australia on missionary work in the South Sea Islands. I suggest that it is quite wrong that Australian laws should be set aside, enabling one company to undercut its competitors, through, not having to pay taxation when its classification as a religious body is due to the fact that it carries on missionary work outside of Australia. I ask the Government to investigate this charge which is supported by both the employers and the employees engaged in producing the same lines as the Sanitarium Health Food Company. If the company traded merely by legitimate competition no objection would be raised because people would be obtaining cheaper food, but if advantage continues to be given to this company under the existing conditions, the members of this business company reap all the benefits. All business activities should be placed on a basis of fair competition, and all employers should be. compelled to pay award rates, otherwise no standards can be maintained. I ask the Government to investigate the matter. If the charge is well founded and the company continues to manufacture and sell articles in competition with other concerns which do not enjoy similar advantages, it should be compelled to pay all taxation levied by the Federal Government.
.- I endorse the remarks made by the honorable member for Melbourne Ports (Mr. Holloway). I would be the last to urge that religious bodies should be called upon to pay any unjust impost. But if they enter into commercial com- ‘ petition with other concerns, they should be compelled to abide by the law which applies to their competitors. If the matter cannot be adjusted by regulation, let us do justice -by legislation even in the dying hours of this Parliament.
I have received a letter from the Grand United Order of Oddfellows conveying a resolution passed by that body in the following terms: -
That this lodge, of the Grand United Order of Oddfellows, protests against the practice of the Commonwealth Government, deducting the equivalent to the amount of sick pay received by friendly society ex-soldier members, from the amount of sustenance available, whilst inmates of military hospitals.
– That matter has already been adjusted by legislation.
– I thank the Minister for that assurance.
A subject that is agitating the minds of a large number of people in Australia is the price that is being charged for petrol. In this connexion I have received the following telegram : -
Please hurry the price fixation of petrol before House rises. Price war on. No profits no taxes.
A fair price would be one based upon’ the selling price in the country of origin, plus the cost of freight, exchange, primage duty and distribution. The great President of the United States of America (Mr. Roosevelt) has compelled 1,500,000 firms to sell their goods at a fixed price; consequently, on behalf of the oil and petrol users of Australia, I have no compunction in asking the Commonwealth Government to take action by regulation to fix a fair price for petrol in Australia so that users will not be subject to the present heavy imposts.
– I think the Minister will agree that the development of the Northern Territory is a matter of great importance, and that the recent activity in the mining industry right throughout that area is sufficiently encouraging to warrant expectation of further development in the north. The miners themselves are doing their part in working the diggings, some hundreds of them being employed there. This entails an obligation on the Government to supply the necessary assaying service, expert advice, and geological examinations that are essential on the various properties that arc discovered. Mr. Bell, the Director of Mines at Darwin, is also the assayer and a magistrate and it is a physical impossibility for one man to cope with all the work that now is offering. I know this officer is most competent and has the confidence of the miners in the Northern Territory. Such is the volume of work he has to do, however, that very often he works on Sundays, for which extra duties he receives no recompense. His office is badly under-staffed, and I suggest that the Minister should immediately send an assayer to assist Mr. Bell, and give him a staff sufficient to make his services more widely available as an assayer and geologist. Under the present conditions he is not capable of advising miners as fully as they would like. I urge the Minister, in view of the important part that mining will play in the development of the Northern Territory, to give attention to this request without delay.
.- I desire to supplement the remarks made by the honorable members for Melbourne Ports (Mr. Holloway) and Melbourne (Dr. Maloney) concerning what appear to be unfair conditions in connection with the sale of certain goods, because of the exemption from taxation of religious or semi-religious bodies engaged in commercial manufacture and distribution. I suggest that the circumstances mentioned to-day by the honorable member for Melbourne Ports clearly reveal that injustice is being done to firms engaged in similar business which do not enjoy these remissions of taxation, but which have to go into the open market and compete with these religious bodies in the sale of these goods. I suggest that everything should be done to see that no section of the community shall suffer this injustice.
– The matter to which the honorable member for the Northern Territory (Mr. Nelson) ha3 referred has been investigated by the department. We realize that there has been great development in the mineral fields of the Northern Territory. There is a far greater number of prospectors employed there now than there were a year or so ago, and consequently increased work has fallen upon the shoulders of the territory geologist, Mr. Bell. We have appointed Mr. Clark, an assayer from Tasmania, to proceed to Darwin, and he will leave Sydney on the 6th August. It is also possible that other assistance will be necessary, and the Government is taking the necessary steps to ensure that all new fields are scientifically investigated, so that mineral development in the Northern Territory will be facilitated.
– The complaint made by honorable members regarding the trading operations of the Sanitarium Health Food Company has already been brought under the notice of the Government. It is true that this company is not liable for income tax, but it does pay sales tax. This concession to religious bodies has been the law since the beginning of Commonwealth income taxation and similar concessions are given under State laws. I agree with honorable members that this matter should be investigated. There are a number of federal taxation matters, other than those dealt with in the amending bill this afternoon, which need investigation. As honorable members are aware, an attempt is being made to reach a high degree of uniformity in Commonwealth and State taxation laws, and the representations of honorable members regarding the immunity of religious organs zations engaged in trading will be brought before the next conference of Premiers. The subject, however, is not quite as simple as it looks on the surface, because there is quite a number of religious bodies which are engaged in trading and businesses of various kinds. For instance, the Salvation Army conducts People’s Palaces, which give good and cheap lodging to a large number of people. I give to honorable members the assurance that the matter will be thoroughly investigated.
. -Section 51 of the Pensions Act provides for the forfeiture of pensions where pensioners are found to have committed certain offences. I understand that the department has in the past administered this provision sympathetically, and has usually given the pensioner, after one conviction for a minor offence, such as drunkenness, notice that he will lose his pension if convicted a second time. The Auditor-General in his report drew attention to the fact that a certain number of people were illegally receiving pensions. Thereupon a number of investigators appointed by the department made a list of pensioners who had been convicted. I understand that previously there was an arrangement that police officials and clerks of courts should notify the department of pensioners convicted of offences. This, however, was more frequently broken than observed, with the result that when these officials were appointed to inquire into the matter it was found that a large number of pensioners had been convicted of offences’ of which the department had not been informed. The department consequently cancelled many pensions. When in Brisbane within the last few weeks several pensioners complained to me that because they had been convicted a number of times, in most cases for drunkenness, they had lost their pensions without having been notified that they were running that risk. One man had been convicted 53 times for drunkenness, but only . once in the last five years and that occurred twelve months ago. He lost his pension and will not be eligible to have it restored until a period of at least six months has elapsed. I am asking the department to follow the practice previously observed, of giving the pensioner at least one warning that, if a second conviction occurs he will be liable to lose his pension. Where a man has incurred a number of convictions over- a long period, but it is clear from his recent history that he is mending his ways, I certainly think he is entitled to sympathetic treatment.
Question resolved in the affirmative.
House adjourned at 4.40 p.m.
y asked the Treasurer, upon notice -
Will he supply for the information of honorable members a table showing the rates of Public Service salaries (a) on 1st July, 1930; (b) on 1st October. 1932; and (c) under the provisions of the Financial Relief Bill 1934 for all grades, and the deductions in every case for cost of living?
– The desired information is not at present available in respect of every Public Service salary; but the following gives the information in respect of typical salary rates: -
Reductions under the Financial Emergency Act, operating on and from the 9th July, 1931, are in two parts, firstly, under section 10, an amount representing fall in cost of living, and secondly, under section 11, a percentage scale reduction on the remaining salary. The amount of deduction under the Financial Relief Bill 1934, representing cost of living, is £48, applicable to all salaries; but where, by reason of cost-of-living fall, i.e., in the salaries of lower-paid officers, an actual reduction would have been involved, an allowance has been granted to prevent -such reduction.
en asked the Minister for the Interior, upon notice -
With regard to the question asked on the 5th December last by the honorable member for Kalgoorlie, as to whether a report had been received regarding the parasiticwasps liberated, in certain parts of the Northern Territory and the Kimberley district of Western Australia, to control the ravages of the buffalo-fly - to which the honorable member received a reply later by letter, that some considerable time must elapse before any definite indication could be obtained as to the efficacy of the parasites which have been liberated - is the Minister yet in a position to furnish a statement as to the efficacy of the remedy indicated?
– The parasites were liberated only last year, and, as a period of approximately two years will be occupied in producing sufficient numbers to determine their efficacy, it will be at least another year ‘before any definite pronouncement can be made.
b asked the Treasurer, upon notice -
What is the total cost of the recent inquiry by the Commonwealth Grants Commission?
– The total cost to date of the Commonwealth Grants Commission is £4,124 2s. 3d.
Unemployed in Territories.
s. - The information is being obtained, and a reply will be furnished as soon as possible, to the questions asked by the honorable member for Kennedy (Mr. Riordan) relating to the number of unemployed in the Territories.
y asked the Prime Minister, upon notice -
Does the Government intend to enforce the Waterside Workers Regulations in any additional ports in Australia; if so, will the Government, before drafting and enforcing any such regulations, take into consideration the ruling given by His Honour Judge Beeby, in the Arbitration Court, as to which and how many men now working on the waterfront are entitled to be classed as volunteers and receive preference in accordance with the promise made by the Government and/or shipowners ?
– It is not the practice to announce, in answers to questions, the Government’s intentions as to matters of policy.
Interest Charges by Money Lenders.
y asked the Treasurer, upon notice -
Will he ascertain and inform the House as to what are the rates of interest charged by pawnbrokers and money lenders (not induding banks, trustee companies, insurance companies, &c. ) ?
– I regret that I am not in a position to obtain this information.
Invalid and Old-age Pensions.
s asked the Treasurer, upon notice -
If the Government does not intend to proceed further with the Invalid -and Old-age Pensions Bill validating the order exempting relatives of -pensioners from making contributions towards the upkeep of such pensioners, will he issue a regulation to exempt another’ class of relative referred to in paragraph (fb) of section 17 of the net, who are compelled to maintain invalidrelatives regardless of the fact that many of such relatives are over sixteen years of age, and the fact that the persons who have to maintain such relatives have children dependent upon them?
– Paragraph fb of section 17 of the Invalid and Old-age Pensions Act does not compel relatives of invalids to maintain those invalids. It provides that if an applicant for an old-age pension is adequately maintained by husband, wife, father, mother, or children of the applicant, he shall not be entitled to a pension. Similar provision is made in respect of applicants for invalid pensions by section 22 h of the act.
Tariff Board Reports.
e asked the Minister for
Trade and Customs, upon notice -
– The answers to the honorable member’s questions are as follows: -
e asked the Minister for Trade and Customs, upon notice -
– The answers to the honorable member’s questions are as follows: -
en asked the Minister for Health, upon notice -
With reference to the answer to a question on the 28th November last by the honorable member for Kalgoorlie, in which the Minister stated that his attention had been drawn to a cablegram from London appearingin the Australian press of the 23rd November, that Dr. F. G. Banting, the discoverer of insulin, was shortly announcing a schemeto prevent silicosis, and that action had been taken to secure information as to its application to the gold-mining industry in Australia - in view of the fact that eight months have elapsed lines the inquiry was made, will hestate whether any reply has been received to the request made for information?
– There has been some difficulty in obtaining exact information: it would appear that, while laboratory results were encouraging, their practical application on a large scale has not yet been satisfactorily worked out.
Cite as: Australia, House of Representatives, Debates, 27 July 1934, viewed 22 October 2017, <http://historichansard.net/hofreps/1934/19340727_reps_13_144/>.