House of Representatives
15 September 1939

15th Parliament · 1st Session

  1. House of Representatives
  2. 15th Parliament
  3. 1939

Mr. Speaker (Hon. G. J. Bell) took the chair at. 10.30 a.m., and read prayers.

page 632

QUESTION

CENTRAL WOOL COMMITTEE

Mr FORDE:
CAPRICORNIA, QUEENSLAND

– I ask the Prime Minister -

  1. Who are the members constituting the Central Wool Committee, and what firms or associations do they represent?
  2. Will the Government consider the advisability of adding to the committee a representative of those, small growers who run less than 2,000 sheep?
Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · UAP

-Iam not. able to state offhand the names of the members’ of the committee and the firms or associations that they represent. My recollection is that provision was made for the appointment to the committee of a representative of small growers. I shall have the whole of the information provided on Tuesday afternoon next.

page 632

TARIFF BOARD REPORTS

Mr. JOHN LAWSON laid on the table reports and recommendations of the Tariff Board on the following subjects : -

Cotton Condenser .Yarns, and Coconada Cotton Yarnsfor the manufacture of towels.

Cotton CordageYarns.

Cotton Yarns n.c.i.

Devices for catching or fastening doors of motor vehicles.

Gears for motor vehicles.

Internal combustion engines (other than marine engines and engines for motor vehicles) up toand including 100 horse- power.

Mosquito Spirals or Coils.

Petrol PumpsandPumping Units.

Pneumatic rubber tyres and tubesfor tractors.

Refrigerators andRefrigerator Parts.

Sound films and negative films and lavender prints.

Staple or other synthetic textile fibres; Tops. Yarns and Piece Goods wholly or partly com posed of synthetic, staple fibre.

Towels and towelling n.e.i. and bath mats.

Tractor wheelsand tractor wheel centres for use withpneumatic rubber tyres.

Water bore casings.

Wool Tops; Woollen Yarns.; Woollen Piece Goods;and Blankets.. &c.

Ordered to be printed.

page 632

QUESTION

TREATMENT OF POLISH PRISONERS

Mr PATERSON:
GIPPSLAND, VICTORIA

– Has the Minister for Information confirmation of the reports that are appearing in the press, to the effect that Poles taken prisoner by the Germans are immediately shot?

Sir HENRY GULLETT:
Minister for External Affairs · HENTY, VICTORIA · UAP

– I have no confirmation of such reports, and I suggest to honorable members that, with a recollection of what occurred during the last war, they should view with a good deal of caution statements of this kind.

page 632

QUESTION

SHIPMENT OF PIG IRON

Mr LAZZARINI:
WERRIWA, NEW SOUTH WALES

– Has the Prime Minister made any inquiries to ascertain who was responsible for the recent attempt to ship pig iron to Germany?

Mr MENZIES:
UAP

– If the honorable member is referring to the loading of pig iron ona Dutch ship, I may say that

  1. have this morning received from the manager of the HollandAustralia Shipping Line a letter stating quite plainly that the quantity of pig iron concerned was to be loaded into the vessel in question for shipment to Rotterdam, for use by a well known firm of Dutch smelters, the name of which he ga ve.

Later:

Mr LAZZARINI:

– Can the Prime Minister inform honorablemembers why a” quantity of pig iron which was said to have been loaded on a ship for export to a neutral country, was subsequently ordered to be taken off that ship and prevented from being forwarded to that country ?

Mr MENZIES:
UAP

– I do not know the reason for that action. All I know about that case is that I received a letter concerning it this morning. I shall ascertain the facts and inform the honorable member of them later.

page 633

QUESTION

RIFLE CLUBS

Restriction of Use of Ammunition

Mr NAIRN:
PERTH, WESTERN AUSTRALIA

– Will the Minister for Defence state whether or not it is a fact that restrictions are being imposed on rifle clubs regarding the holding of shooting competitions. If so, for what reason ? Has the honorable gentleman been in consultation with the clubs?

Mr STREET:
Minister for Defence · CORANGAMITE, VICTORIA · UAP

– It is a. fact, that certain restrictions have been placed on rifle clubs, in order that supplies of ammunition may be conserved. I may say that the Western Australian Rifle Association itself suggested such restrictions.

Mr ARCHIE CAMERON:
BARKER, SOUTH AUSTRALIA

– Will the Minister for Supply and Development state whether the output, of small arms ammunition is so meagre that it has been found necessary to restrict the use of it by rifle clubs?

Mr CASEY:
Minister for Supply and Development · CORIO, VICTORIA · UAP

– The output of small arms ammunition is by no means meagre, but the field requirements of the forces in time of war are liable to be very great. I am in entire agreement,’ so far as it is necessary for me to be, with the Minister for Defence, in his efforts to conserve the s up ply of sm all arms ammunition.

page 633

QUESTION

BRITAIN’S PURCHASE OF PRIMARY PRODUCTS

Sir CHARLES MARR:
PARKES, NEW SOUTH WALES

– Can the Prime Minister state whether or not it is a fact thatinstructions have been issued by the censor to the press that no reference whatever is to be made to the sale of Australian wheat to the” British Government?

Mr MENZIES:
UAP

– I was not aware of that, but I shall ascertain the facts from my colleague who attends to the matter of censorship.

Mr JAMES:
HUNTER, NEW SOUTH WALES

– Is it. a fact that during the last war allegations were made that the Imperial Government had bought Australian wheat and sold it at higher prices than were paid, for it in Australia, and that, in some instances, payment was made by means of Rumanian bonds which were practically valueless? What safeguards does the Commonwealth Government propose to establish in order to ensure that, should the Imperial Government dispose of Australia’s wheat crop at higher prices than are paid for it in Australia, the growers of the wheat will share in the increase?

Mr MENZIES:

– The possibility of resales is, of course, well in the mind of the Government when negotiating about these matters with the British Government. I am not in a position to make a statement on the subject at the moment, but the honorable gentleman will find that this matter has not been overlooked.

Sir CHARLES MARR:

– Is it a fact that instructions have been issued that no reference is to be made in the press to the sale of Australian wheat to the British Government?

Mr STREET:
UAP

– I was informed by a representative of the press this morning that instructions to that effect had been issued, at the request of the Department of Commerce. I have not yet had an opportunity to consult with the Minister for Commerce on the subject, but I shall do so. and inform the honorable gentleman as to the correctness or otherwise of the report.

Mr GREGORY:
SWAN, WESTERN AUSTRALIA

– Has the Government come to a determination as to the initial price to be paid to the. wheatgrowers for the wheat that is being taken from last season’s stocks?

Sir FREDERICK STEWART:
Minister for Health · PARRAMATTA, NEW SOUTH WALES · UAP

– The Prime Minister has already indicated thathe is not yet in a position to make a statement on the subject, but hopes to do so shortly.

Mr FORDE:

– Will the Prime Minister consider the advisability of eliminating middlemen and agents in the handling of primary products which are to be sold to Great Britain, especially wheat, wool and meat, and thus ensure a maximum return to the producers?

Mr MENZIES:

– Every step will be taken in order to secure the greatest possible efficiency at the smallest cost in the handling of these products.

page 634

QUESTION

PROTECTIVE BOARD FOR PRIMARY INDUSTRIES

Mr BARNARD:
BASS, TASMANIA

– Early last month the Tasmanian producers’ organization wrote to the Prime Minister a letter suggesting that a board be established on the lines of the Tariff Board for the protection of primary industries. Has the right, honorable gentleman yet been able to give consideration to the terms of the resolution carried by that organization?

Mr MENZIES:
UAP

– I regret to say that, I have not, but . 1! shall make inquiries into the matter and again refer to it when the House meets nest week.

page 634

QUESTION

DIRECTOR OF INFORMATION

Mr JAMES:

– I ask the Minister for Information whether or not the recentlyappointed Director of ‘Information, Major Treloar, possesses any journalistic qualifications? Does the Minister consider that the appointment of a military man to such an important post will result in the public being given the most efficient information service possible? Does the right honorable gentleman intend to appoint journalists to- assist in the distribution of reliable information regarding the progress of the war? If so, in what way will they be selected?

Sir HENRY GULLETT:
UAP

- Mr. Treloar is not a military officer. He was a member of the Australian Imperial Force, and served with it from the landing on Gallipoli onwards. He has admirable qualifications for the position to which he has been appointed. If is my expectation that I shall require the services of at least a few journalists in the development of the new Ministry of Information.

page 634

QUESTION

OFFER BY ENGINEERING FIRMS

Mr ANTHONY:
RICHMOND, NEW SOUTH WALES

– I have received from engineering firms in my electorate who are anxious to place their resources and services at the disposal of the Government a number of offers to do so. Has the Government any intention of utilizing the services of such firms whose plant is situated in locations which would be of strategic value in case of necessity?

Mr CASEY:
UAP

– The Defence Department’s requirements of munitions are now being adequately met by the output, from the munitions establishments themselves, and in prospect by the output from the 23 annexes in course of construction. At the same time, full records are being taken of all engineering workshops and other factories throughout Australia, so that their output may be utilized in time of greater stress than the present.

page 634

CIVIL AIR RESERVE

Mr FAIRBAIRN:
Minister for Civil Aviation · Flinders · UAP

– by leave - The Civil Aviation Reserve was formulated and approved by Cabinet prior to the outbreak of war, and was. not designed to meet the conditions that have since arisen. It will certainly have to he altered in due course to merge in, or even to’ give way to, whatever air training plan is adopted by the Government as part of Australia’s war effort. Nevertheless, carrying on temporarily with this proposal will facilitate the introduction of the training plan finally decided upon, and those who enrol in the reserve will be given early consideration in respect of any substituted body.

Up fill now, the only assistance to civil flying training has been the paymentof bonuses to recognized aero clubs. Bonuses have been paid to clubs for each member to fake out or renew a licence, regardless of the age or the sex of the member. The Civil Air Reserve is to be substituted for the former method of assistance.

At. present, in clubs and other private schools, flying training on aircraft of types approved by the Royal. Australian Air Force for ab-initio training,’ costs the pupil £3 an hour for dual instruction and 30s. an hour solo. It is now proposed, by a payment that is to be made to approved clubs and schools,to provide flying training for those who are selected for the Civil Air Reserve, at 30s. an hour dual and 10s. an hour solo.

Applicants, to be eligible for selection, must be between the ages of18 and 25 years in the ease of those who have had no previous flying experience, and between the ages of 18 and 30 years in the case of those who already hold licences. The intermediate educational ‘standard, and a high physical standard, will be essential. Applicants must undertake- to complete the three years’ course, and to serve, . if required, in the Royal Australian Air Force or the Royal Australian Air Force Reserve. Preference will be given to applicants with flying experience and to those who are able, if necessary, to commence continuous training immediately.

Application forms may be obtained from the Civil Aviation Department, aero clubs, flying schools, and civil aviation officers in charge of air-ports.

The original proposal was to enrol 1,000 in the reserve each year for a period of three years, each year’s entrants continuing their training in the subsequent year.

Applicants whosequalifications meet requirements will be interviewed and reported upon by honorary committees of ex-Australian Flying Corps and ex-Royal Australian Air Force members, which will be set up in all capital cities and several other civil training centres.

It will be of interest to members to learn that up till this morning over 5,000 application forms have been applied for. Of the 260 that have been returned from Victoria alone 99.9 per cent, have expressed their willingness to commence continuous training in the Royal Australian Air Force, if required. This is evidence of the desire to serve which must give cause for sober pride to all of us.

The form of application for joining the reserve, which gives in greater detail the courses and requirements, is asfollows: -

C.A. Form 110

Commonwealth of Australia

Departmentof Civil Aviation

page 635

QUESTION

CIVIL AIR RESERVE

Application for Flying Training Course

I hereby apply for a Flying Training Course for the Civil Air Reserve of Pilots. If my application is successful I hereby agree to enter into an undertaking to join the Civil Air Reserve and complete the Flying Training Course, arid also to join the Royal Australian Air Force or the Royal Australian Air Force Reserve if and when called upon to do so. (See note re pay for R.A.A.F. Reserve.) Such undertaking will be signed by me as soon as I am asked in the event of my application being successful. I append the particulars given below in answer to questions and I certify that the details stated are true in every particular. INFORMATION. Applicants mustcomply with the following conditions : - {: type="i" start="i"} 0. They must be males and, if holding a Private (" A ") Licence, must., be between the ages of18 and 30 years. If not the holder of a licence, must be between the ages of . 18 and 25 years. 1. Mustbe medically fit. Requirements are as set forth onpage 4. hereof. 2. Must be of . British descent., possess fair educational standard and be of good bearing and character. Preference will be, given to those prepared to fly on week-days. Birth Certificate or Extract of Birth Entry will be required for inspection if application is successful. Training facilities maybe available at the undermentioned centres : - Queensland- Brisbane, Dalby. Toowoomba, Maryborough, Bundaberg. Townsville. Ayr.Hughenden, Rockhampton. Cairns and Cunnamulla New South Wales - Sydney, Wagga, Narrandera, Newcastle, Tamworth, Inverell, Moree, Narrabri, Grafton, Kempsey, Coff's Harbour, Casino,Lismore, Tenterfield, Taree, BrokenHill, Camden and Albury. Victoria - Melbourne, Wangaratta and Hamilton South Australia - Adelaide, Whyalla andPort Pirie. Western Australia - Perth, Norseman and Kalgoorlie Tasmania - Hobart, Launceston and Antill Ponds Federal Capital Territory - Canberra Medical Standards. eye examination. {: type="1" start="1"} 0. Vision - {: type="i" start="i"} 0. Candidates must possess at least80 per cent, normal vision for each eye, taken separately, without glasses, or 70 per cent, one eye and 90 per cent, the other eye. 1. Both eyes must have good fields of vision as tested by hand movements. 2. There must be good binocular fusion and balance of the eye muscles. 3. There must be normal colour vision according toIshihara Plates. examination of ears, nose and throat. 1. Hearing - {: type="a" start="i"} 0. The hearing in either ear must be acute, equivalent to hearing a forced whisper at twenty feet, each ear being tested separately with the other car blocked and the face turned away. When it is considered that treatment may bring defective hearing up to standard, the candidate may be temporarily deferred and re-examined at a later date. (ii)Mental defections and obstructions, while not permanently disqualifying a candidate, must be satisfactorily cured or removed before acceptance. {: type="i" start="iii"} 0. Catarrhal or suppurative otitis media. - If the condition is acute or sub-acute the candidate may be deferred for treatment and, subsequently, re-examined. Chronic suppurative otitis media is a cause for rejection, as is also the radical mastoid operation, successful or otherwise. A healed operation for acute mastoid suppuration, with satisfactory hearing and a sound membrana tympani, is not a cause for rejection. 1. A permanent perforation in a membrane without discharge constitutes a disqualification for air work. 1. Cicatrices of the drum of long standing, unless obviously liable to break down under alterations of atmospheric pressure, may be passed, providing the hearing is up to standard. 2. Mouth : Examination of the Teeth - {: type="i" start="i"} 0. Carious teeth must, be successfully treated before acceptance. Artificial teeth do not disqualify, but, care must be taken that the plates fit well. 1. . Extensive pyorrhoeaisa cause for rejection. 3. Pharynx-Tonsils - {: type="i" start="i"} 0. Enlarged tonsils, which . produce obstruction, or become repeatedly inflamed or associated with attacks of quinsy, mustbe enucleated before a candidate is accepted. 1. Septic tonsils, even only small remnants, from which the septic material canbe expressed, or which are the cause of repeated sore throats or chronic enlargement of the glands of the neck, must be enucleated before, a candidate is accepted. 5.Naso-pharynx - 2. Adenoids, however small in amount, if they cause repeated colds, with acute or sub-acute Eustachian obstruction, or catarrhal *or* suppurative inflammation of the middle ear, must be removed. (ii)Both Eustacluan tubes must be patent. 4. Nose - {: type="i" start="i"} 0. Mouth breathing constitutes a serious flying disability ; any condition which obstructs the free passage of air through the naso-pharynx must be remedied before acceptance. 1. Chronic suppuration of the accessory sinuses and atrophic rhinitis constitutes a cause for rejection. surgical examination. 5. The Candidate must not be ruptured, or suffer from a severe degree of haemorrhoids, or varicose veins. Candidates found to be suffering from a complaint which would entail rejection, but is curable by operation, will be marked unfit by the Medical Examiner, but the Examiner may recommend re-examination after operation. The following wounds, injuries, and operations require special mention : - {: type="i" start="i"} 0. Head. - A history of fracture of the skull definitely disqualifies for air work. 1. Neck. - Scars, the result of removal of tuberculous glands, will not be considered a cause for rejection. 2. Chest. - The chest must be well formed and the lungs and bronchi free from disease. 3. Abdominal Operations. - -Evidence that an abdominal operation has been performed will not, in itself, disquality a candidate, provided that no hernial profusion or marked weakness of the abdominal wall has resulted. 4. Height Standard. - For admission to the Air Force there is no minimum height standard, but candidates for flying must possess a minimum length of leg of 39 inches. This measurement is taken in the sitting position with the leg and thigh in a straight line, from the surface of any object against which the buttocks are firmly pressed, to the ball of the foot in the fully extended (i.e., plantar flexed) position. 6. The candidate must be possessed, particularly, of sound lungs, heart and nervous system. Owing to the importance of these systems they will, in addition to the usual clinical examination, be tested by special tests employed by theexaminer. The urinary system must be healthy, and the urine must be free from abnormal constituents. In the circulatory system, valvular or myocardial disease will disqualify a candidate. {: #subdebate-10-0-s0 .speaker-KHL} ##### Mr HOLLOWAY:
MELBOURNE, VICTORIA -- Is it a fact, as I have reason to believe is the case, that under the new regulations controlling civil aviation, the department insists upon applicants for positions as pilots or ground engineers being of British stock? If so, will he have that regulation reviewed, so that Australian-born men and women, some of whose forbears, as, for instance, their grandfathers, were of foreign nationality, may be appointed? {: #subdebate-10-0-s1 .speaker-KEM} ##### Mr FAIRBAIRN:
UAP -- I shall have to refer to the regulation, but to the best of my knowledge, the only requirement is that applicants shall be British citizens. That, of course, includes all Australianborn men and women. {: .speaker-KHL} ##### Mr HOLLOWAY: -- I think that the term "British stock " is used. {: .speaker-KEM} ##### Mr FAIRBAIRN: -- Whatever the precise wording, the regulation has been read as meaning persons born in the British Empire. {: #subdebate-10-0-s2 .speaker-K0K} ##### Mr CONELAN:
GRIFFITH, QUEENSLAND -- What educational standard is required of applicants for admission to the air force? If the standard is high will the Minister explain the reason,' in view of the fact that some of t he best air men of Australia, and of the world, were men without high educational attainments from country districts? Will he state whether the object is to keep the workers out of the air force? {: .speaker-KEM} ##### Mr FAIRBAIRN: -- If the honorable gentleman's question relates to the air force, it is one for the' Minister for Defence ; but if it refers to the civil air reserve, the reply is that applicants must have passed an examination of the intermediate standard. Naturally, a high mathematical standard of education is demanded of men engaged in air navigation. {: .page-start } page 638 {:#debate-11} ### QUESTION {:#subdebate-11-0} #### GALVANIZED STEEL NETTING {: #subdebate-11-0-s0 .speaker-KK7} ##### Mr JENNINGS:
WATSON, NEW SOUTH WALES -- In view of the statement that galvanized steel netting cannot be obtained for the necessary network on the Randwick Municipal Council's safety enclosure on Coogee beach, because, it is stated, the federal authorities control supplies of this commodity, and also because, it is reported, the cost has considerably increased, can the Assistant Minister for Supply and Development say what the position is in regard to supplies and cost? {: #subdebate-11-0-s1 .speaker-009MC} ##### Mr HOLT:
Minister without portfolio, assisting the Minister for Supply and Development · FAWKNER, VICTORIA · UAP -- Since the honorable gentleman mentioned this matter on the adjournment last night I have had some inquiries made, and I find that supplies of wire netting have not been commandeered by the department, as he then suggested. The only order for wire netting that has been given in recent weeks by the department, for defence requirements, was one for 13,000 yards to Rylands Limited, a Newcastle firm.' That is a relatively small proportion of the potential output of that company, which is, I understand, many miles of wire netting each week. I recall that the price which the department was (jailed upon to pay was reasonable in comparison with the price of the corresponding article overseas ; but, should the honorable member consider that the price charged to civil buyers is unduly high, I suggest that he direct the attention of my colleague, the Minister for Trade and Customs, to the matter. {: .page-start } page 639 {:#debate-12} ### QUESTION {:#subdebate-12-0} #### MILITIA {: #subdebate-12-0-s0 .speaker-KF9} ##### Mr GREEN:
KALGOORLIE, WESTERN AUSTRALIA -- I have received a letter from a young man, named Howard John, of Kalgoorlie, who has been a member of the militia force for three years, in which he states that he has been ordered to report for duty at Fremantle. He is out of work at Kalgoorlie, where he tried to obtain employment. As he does not want to be treated as a deserter, he desires to know if there is any method by which the department will enable him to geta pass from Kalgoorlie toFremantle. in order that he may join his company ? {: #subdebate-12-0-s1 .speaker-KVN} ##### Mr STREET:
UAP -- If the honorable gentleman will supply me with particulars, I undertake to see that sympathetic consideration will be given tothe request that he has made. {: #subdebate-12-0-s2 .speaker-JPT} ##### Mr BLAIN:
NORTHERN TERRITORY -- Can the Minister [or Defence say whether the offer of the Queensland Institute of Surveyors to form a militia unit has been accepted? {: .speaker-KVN} ##### Mr STREET: -I am not aware ofthe details of any suchoffer, but I do know that no such special survey corps has been formed. I shall investigate the matte" and let the honorable gentleman have a reply. {: #subdebate-12-0-s3 .speaker-JLZ} ##### Mr ANTHONY: -- I direct the attention of the Minister for Defence to the fact that in many country centres members of the Militia, who have diligently attended parades for thelast twelve months, have never yet had an opportunity to fire their rifles because rifle ranges are cither not in order or non-existent. Will the Minister see that, in response to representations made by myself and other honorable members, and in view of the present emergency facilities are immediately provided forthe proper training of these men? {: .speaker-KVN} ##### Mr STREET: -- No opportunity will be lost to see that every man in the Militia goes through,his musketry course and any other course which maybe necessary. {: #subdebate-12-0-s4 .speaker-KZF} ##### Mr LANE:
BARTON, NEW SOUTH WALES -- Can the Minister for Defence inform the House of the number of men who have been called up for military training in the Militia? How many have actually gone into camp to receive military training and how many are on guard duty at military dumps?Is the Minister aware of the fact that an honorable member, last night, said that a. large number of men employed on guarding bridges were armed with pick handles instead of rifles? {: .speaker-KVN} ##### Mr STREET: -- In reply to the honorable gentleman's last question, any such guards are obviously not members of the Militia if they are so armed. In answer to the first, I cannot tell the honorable member the exact number but it is about 10,000. {: .page-start } page 639 {:#debate-13} ### MERCANTILE MARI NE, {: .page-start } page 639 {:#debate-14} ### QUESTION {:#subdebate-14-0} #### WARCASUALTIES {: #subdebate-14-0-s0 .speaker-KX7} ##### Mr WARD:
EAST SYDNEY, NEW SOUTH WALES -- Can the Prime Minister say whether members of the mercantile marine who may be injured or killed by attacks upon their vessels byenemy forces will be considered on the same basis as members of the armed forces in relation to pensions, &c. ? {: #subdebate-14-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -- The honorable member's suggestion will be taken into consideration. {: .page-start } page 639 {:#debate-15} ### QUESTION {:#subdebate-15-0} #### SHIPPING SPACE {: #subdebate-15-0-s0 .speaker-JXL} ##### Mr FROST:
FRANKLIN, TASMANIA -- I understand that representatives of the producers of meat, wool, wheat, and dried fruits are to consider the shipping of such goods during the war. Will the Minister consider including representatives of the growers and shippers of fresh fruit, in order to ensure an equable distribution of the space that will be allotted to such goods? {: #subdebate-15-0-s1 .speaker-KV7} ##### Sir FREDERICK STEWART:
UAP -I shall bring before the Minister for Commerce the representations contained in the honorable gentleman'? question. {: .page-start } page 639 {:#debate-16} ### QUESTION {:#subdebate-16-0} #### SALE OF AUSTRALIAN METALS {: #subdebate-16-0-s0 .speaker-KZR} ##### Mr WHITE:
BALACLAVA, VICTORIA -- Has any undertaking been obtained from consignees in neutral countries that there will be no resale to enemy countries of metals purchased by them? {: #subdebate-16-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -- I regret that this is not a matter of which I have personal knowledge. I shall bring it before my colleague the Minister for Commerce. {: .page-start } page 640 {:#debate-17} ### QUESTION {:#subdebate-17-0} #### TAXATION OF BONUS SHARES {: #subdebate-17-0-s0 .speaker-KK7} ##### Mr JENNINGS: -- Can the Treasurer say whether bonus shares issued by major companies in Australia are subject to income tax? {: #subdebate-17-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -- No simple answer can be given to the honorable gentleman's question. I ask him to defer his question so that an answer to it may be prepared. {: .page-start } page 640 {:#debate-18} ### QUESTION {:#subdebate-18-0} #### CASEIN {: #subdebate-18-0-s0 .speaker-KXT} ##### Mr PATERSON:
GIPPSLAND, VICTORIA · CP from 1922; ST CP from 1937; LCP from 1940 -- Can the Minister for Trade and Customs say what action, if any, is being taken, or has he any intimation to make to the House with reference to the complaint made by the Victorian Dairymens Association that substantial quantities of casein are being dumped in Australia? {: #subdebate-18-0-s1 .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- The quantity of casein imported into Australia from New Zealand during the first two months of the present financial year totalled only 58 tons. That casein pays a duty of 20 per cent., which is the rate fixed following a recommendation by the Tariff Board last year. The Trade and Customs Department is not in possession of any information that would lead it to believe that dumping is taking place, but if the honorable member, or any one else, can provide it with conclusive evidence that dumping is taking place, he can rest assured that prompt action will be taken by the department. {: .page-start } page 640 {:#debate-19} ### QUESTION {:#subdebate-19-0} #### BROADCAST BY PRIME MINISTER, Government's Militia Proposals {: #subdebate-19-0-s0 .speaker-F4U} ##### Mr FORDE: -- Can the Prime Minister say whether he proposes to make a national broadcast at 7.10 o'clock to-night on the Government's new plans for the Militia? Does he still stand by the statement which he made in reply to a ques tion by me yesterday, that it is his practice to broadcast urgent matters when it is not possible to inform Parliament before so doing? If so, does he consider that by 4 o'clock this afternoon he will not be able to inform the House of a matter concerning which he will be able to make a broadcast statement about three hours later ? {: #subdebate-19-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -- The matters which I propose to broadcast to-night have engaged the attention of Cabinet on every possible opportunity during the whole of this week. The Cabinet will resume its meetings after the House rises this afternoon, and I anticipate that the discussion of this matter will be concluded, so that I may be able to make a broadcast at 7.10 o'clock to-night. At present the matter is incomplete. {: .speaker-JSC} ##### Mr Brennan: -- It must be a " best seller ". {: .speaker-N76} ##### Mr MENZIES: -- It will be; I am sure that the honorable gentleman will be delighted with it. {: .page-start } page 640 {:#debate-20} ### QUESTION {:#subdebate-20-0} #### AUSTRALIAN SURVEY COMMITTEE {: #subdebate-20-0-s0 .speaker-JPT} ##### Mr BLAIN: -- What is the present position in regard to the Australian Survey Committee ? Is it intended to carry on with the making of a complete ordnance survey of Australia? If so, is it intended that the Commonwealth SurveyorGeneral, **Mr. Percival,** shall be given a free hand in regard to staff appointments so that this important work can be carried out immediately? {: #subdebate-20-0-s1 .speaker-KEM} ##### Mr FAIRBAIRN:
UAP -- A departmental committee has been considering this matter for some time. {: .speaker-JPT} ##### Mr Blain: -- Why does it not do something? {: .speaker-KEM} ##### Mr FAIRBAIRN: -- At a recent meeting the committee recommended thatan experimental aerial survey of 60,000 square miles of country be undertaken. The committee has since been authorised to obtain quotations for the work, in order that an estimate of the cost may be obtained. {: .page-start } page 640 {:#debate-21} ### QUESTION {:#subdebate-21-0} #### COMMODITY CONTROL BOARDS {: #subdebate-21-0-s0 .speaker-JOM} ##### Mr BEASLEY:
WEST SYDNEY, NEW SOUTH WALES -- Can the Prime Minister say why the customary practice when Parliament is in session of notifying the House of appointments of members of boards and committees has not been followed during the last two weeks? Does he not think that it is unfair that honorable members have to obtain information on such subjects from the press, thus placing them at a disadvantage when criticizing the personnel of such bodies? {: #subdebate-21-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -I quite agree with the honorable member. I was under the impression that the personnel of these committees had been announced to the House. It was not a matter to which I directed my own attention, but I agree that what the honorable member suggests should be done, and it wild be done. {: #subdebate-21-0-s2 .speaker-L1L} ##### Mr WILSON:
WIMMERA, VICTORIA -- A re we to take the appointments already made to the hoards established to control the marketing of wheat and wool during the war period as complete, or is it still possible to provide greater representation of growers on such bodies? {: .speaker-N76} ##### Mr MENZIES: -Before the House rises to-day I shall make a precise statement dealing with appointments to those bodies. {: .speaker-JOM} ##### Mr BEASLEY: -- Will the Prime Minister place on record officially details relating to all of these bodies which have so far been established? {: .speaker-N76} ##### Mr MENZIES: -- Yes, and if that information can be prepared in timeI shall make it available before the House rises to-day. {: .page-start } page 641 {:#debate-22} ### QUESTION {:#subdebate-22-0} #### INTERNEES RELEASED {: #subdebate-22-0-s0 .speaker-KZR} ##### Mr WHITE: -- Can the Minister for Defence say whether all enemy subjects who were released from internment and then ordered to be interned again were able to be located and re-arrested? {: #subdebate-22-0-s1 .speaker-KVN} ##### Mr STREET:
UAP -- I replied to a similar question a day or so ago. Three persons were interned, subsequently released, and then ordered to be re-interned. To the best of my knowledge, the three of them have been re-interned. {: .page-start } page 641 {:#debate-23} ### QUESTION {:#subdebate-23-0} #### CHRISTMAS UNEMPLOYMENT RELIEF {: #subdebate-23-0-s0 .speaker-KCM} ##### Mr DRAKEFORD:
MARIBYRNONG, VICTORIA -- Will the Prime Minister have consideration given by Cabinet to the making of a substantial grant to provide work or money for the unemployed over the Christmas period ? {: #subdebate-23-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -- The honorable member's suggestion will be taken into consideration. {: .page-start } page 641 {:#debate-24} ### QUESTION {:#subdebate-24-0} #### DEPENDANTS OF INTERNED ALIENS {: #subdebate-24-0-s0 .speaker-KXB} ##### Mr WATKINS:
NEWCASTLE, NEW SOUTH WALES -- The Prime Minister promised last week that a statement would be made concerning steps that would be taken to protect the welfare of the dependants of interned aliens. When will that statement be made? {: #subdebate-24-0-s1 .speaker-KVN} ##### Mr STREET:
UAP -- I regret that I have not yet been able to make a statement on that matter, which presents many difficulties, but I. hope to be able to make one as early as possible. I shall discuss any individual case of hardship with the honorable gentleman. {: .page-start } page 641 {:#debate-25} ### QUESTION {:#subdebate-25-0} #### AUSTRALIAN INSTITUTE OF ENGINEERS {: #subdebate-25-0-s0 .speaker-JPT} ##### Mr BLAIN: -- In view of' the important work that the Australian Institute of Engineers has done in the development of this country, and in view of the fact that the offer of its services was refused and then accepted, will the Prime Minister see that these services arc utilized to the utmost degree possible? {: #subdebate-25-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -- I shall ascertain the position and inform the honorable gentleman on Tuesday. {: .page-start } page 641 {:#debate-26} ### QUESTION {:#subdebate-26-0} #### NATIONAL REGISTER {: #subdebate-26-0-s0 .speaker-KLC} ##### Mr MAHONEY:
DENISON, TASMANIA -- In view of the fact that employment of temporary clerks who have been appointed in connexion with the national register will be limited to six months, will the Prime Minister reconsider the decision not to reimburse their fares from Western Australia, South Australia and Tasmania, to Melbourne? {: #subdebate-26-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -- That matter was not. as far as I know, before Cabinet; no doubt it is a matter of departmental practice. I shall make inquiries about it. {: .page-start } page 641 {:#debate-27} ### CONTROL OF PRICES AND PREVENTION OF PROFITEERING {:#subdebate-27-0} #### Consultants and State Advisory Committees {: #subdebate-27-0-s0 .speaker-KZZ} ##### Mr JOHN LAWSON:
Minister for Trade and Customs · MACQUARIE, NEW SOUTH WALES · UAP . -by *leave* - I have to announce that **Sir** {: type="A" start="R"} 0. *Marcus* Clarke, of Sydney, and **Mr. A.** McK. Hislop, public accountant, of Melbourne, have been appointed as consultants to the Commonwealth Prices Commissioner . Both of these gentlemen have consented to act in an entirely honorary capacity. {: .speaker-JOM} ##### Mr Beasley: -- **Sir Marcus** Clarke is one of the " show ". That is a " racket ". {: #subdebate-27-0-s1 .speaker-F4U} ##### Mr FORDE: -- In view of those appointments, will the Minister for Trade and Customs undertake that the Government will appoint consumers.' representatives on all boards dealing with profiteering? {: .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- Deputy commissioners are being appointed in each State and it is also proposed to appoint an advisory committee in each State on which representatives of the consumers and, I hope, of the trade unions will be included. {: #subdebate-27-0-s2 .speaker-L08} ##### Mr ROSEVEAR:
DALLEY, NEW SOUTH WALES -- Since it is apparently the intention of the Minister for Trade and Customs to appoint representatives of the consumers and the trade unions to the State advisory committees, what is the Minister's objection to similar representatives being placed on the Commonwealth advisory committee? {: .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- The Government considers that the Commonwealth Prices Commissioner must have the assistance of advisers, but it is not desirable to have a large body of advisers as his decisions will be based very largely upon the recommendations that come from the deputy commissioners in the various States. . As the advisory committees in the various States will include representatives of the consumers and, I hope, of the trade unions, it should not be necessary to give effect to the suggestions made by the honorable member. {: #subdebate-27-0-s3 .speaker-KZF} ##### Mr LANE: -- Will the Minister for Trade and Customs make available to honorable members the qualifications of those who have been chosen? Mr.Beasley. - Hear! hear! And their associations too. {: .speaker-KZF} ##### Mr LANE: -- Will the Minister also see that in the selection of gentlemen to act as advisers they are not selected from firms which are suspect, and that the persons selected will give a fair " go " to the consumer and not let the boss have the "show" all the time? {: .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -The honorable member may be assured that the principle underlying the Government's policy for controlling profiteering has been a desire to serve, and ensure fair treatment of, the consumers. {: #subdebate-27-0-s4 .speaker-KX7} ##### Mr WARD: -- In view of the fact that therehave been in the last few days considerable increases in the prices of certain foodstuffs, which are not covered by the proclamations already issued, will the Minister for Trade and Customs issue a general proclamation limiting the price; of all commodities to those ruling on the 31st August? If the Minister is not prepared to do that,will he furnish his reasons to the House? {: .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- The Government is not prepared to issue such a proclamation, because it is not considered practicable to control the prices of all commodities. If the honorable gentleman feels that the prices of certain necessary commodities have been raised unduly and submits to the Government a list of those commodities, the fullest consideration will be given to his representations. {: #subdebate-27-0-s5 .speaker-L07} ##### Mr LAZZARINI: -- Will the Minister for Trade and Customssay what are the insuperable difficulties which prevent the issuing of a proclamation fixing the prices of all Australian produced commodities at the prices ruling on the 31st August last? {: .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- I am unable to state categorically all of the difficulties associated with this matter. This ha? never been regarded as practicable, nor has this, or any other government, considered it wise to attempt to do so. {: .page-start } page 642 {:#debate-28} ### QUESTION {:#subdebate-28-0} #### DISMISSAL OF MILITIAMEN {: #subdebate-28-0-s0 .speaker-KJQ} ##### Mr JAMES: -- If it be a fact that single youths in the coal-fields district of New South Wales were informed, when theypresented themselves at the militia camp at Maitland, after they had been engaged on State emergency relief work in other parts of the State, that they had been dismissed from the service of the Militia because they had missed parades held during their absence, does the Minister for Defence consider that that spirit is calculated to arouse the patriotism of the people in that locality? {: .speaker-KVN} ##### Mr street: -- I feel sure that the honorable gentleman cannot he in possession of the full facts in regard to the case. I do not know of any individual case of the sort complained of by the honorable member, but if he will bring one beneath my notice, I shall have inquiries made. {: .speaker-KJQ} ##### Mr James: -- I wrote a letter to the honorable Minister in which I specified one case. {: .speaker-KVN} ##### Mr street: -- I shall investigate that matter further. northernterritorypolice. {: #subdebate-28-0-s1 .speaker-JPT} ##### Mr BLAIN: -- If there are any difficulties in the way of the Northern Territory police joining the Police Association of Canberra and being merged with the Canberra police for administrative and transfer purposes, will the Minister representing the Minister for the Interior take steps to remove those difficulties? {: .speaker-KXY} ##### Mr perkins: -- There are many difficulties in the way of such action. When **Sir John** Latham was Attorney-General he gave consideration to the matter and was hopeful of bringing about what the honorable gentleman has suggested. I shall refer the matter to the present A ttorney-Gener al . interest rates. {: #subdebate-28-0-s2 .speaker-JVJ} ##### Mr MULCAHY:
LANG, NEW SOUTH WALES -- Is it the intention of the Government to limit the rate of interest on loans and overdrafts from private banks and financial institutions during the progress of the war? Will the Government appoint an advisory committee in respect of interest rates? {: .speaker-N76} ##### Mr menzies: -- The suggestion will be taken into account. The whole question has been under consideration, but at the present time I am not able to make a pronouncement in relation to it. french foreign legion. {: .speaker-JTY} ##### Mr archie cameron: -- I ask the Minister for Defence whether the Government is facilitating or winking at the departure of certain adventurous spirits who desire to enlist in the French Foreign Legion? **Mr. speaker (Hon. G. J. Bell).Order** ! There is an imputation in that question. Question not answered. {: .speaker-JTY} ##### Mr Archie Cameron: -- I shall raise this matter on the adjournment. {: .page-start } page 643 {:#debate-29} ### QUESTION {:#subdebate-29-0} #### MINISTRY OF INFORMATION {: #subdebate-29-0-s0 .speaker-JLZ} ##### Mr ANTHONY: -- In view of the fact that Ministries of Information in other countries are used as instruments of propaganda and for furthering party interests, will the Minister assure the House that his department will perform its work in an unbiased manner? {: #subdebate-29-0-s1 .speaker-KFS} ##### Sir HENRY GULLETT:
UAP -- I remind the honorable gentleman that that assurance has already been given most emphatically by the Prime Minister. However, I now repeat that assurance. {: .page-start } page 643 {:#debate-30} ### QUESTION {:#subdebate-30-0} #### MICROPHONES IN CHAMBER {: #subdebate-30-0-s0 .speaker-KUW} ##### Mr STACEY:
ADELAIDE, SOUTH AUSTRALIA -- Is it absolutely essential, **Mr. Speaker,** that the microphones now installed in the chamber should be retained ? I have been unable this morning to hear the Prime Minister distinctly because of the noises emitted from one of those installed for the use of the right honorable the Attorney-General. {: #subdebate-30-0-s1 .speaker-10000} ##### Mr SPEAKER: -- This matter was fully discussed on previous occasions, and I was assured by the experts that these instruments would not interfere with the hearing of honorable members. I am therefore surprised at the honorable member's statement. However, I shall again investigate the matter. {: .page-start } page 643 {:#debate-31} ### QUESTION {:#subdebate-31-0} #### PUBLIC TELEPHONES IN COUNTRY TOWNS {: #subdebate-31-0-s0 .speaker-K0D} ##### Mr COLLINS:
HUME, NEW SOUTH WALES -- I ask the PostmasterGeneral to provide greater telephonic facilities for the use of the public in country towns. Is he aware that in towns such as Temora and Yass, which have a population from 4,000 to 5,000, only one public telephone is available, and that is situated at the post office? In those towns no public telephone is provided at the railway station, where such facilities are often badly needed. {: #subdebate-31-0-s1 .speaker-KNX} ##### Mr HARRISON:
Minister for Repatriation · WENTWORTH, NEW SOUTH WALES · UAP -- I shall call for a report from the district inspectors in the areas mentioned by the honorable member, and shall give his request every consideration. {: .page-start } page 644 {:#debate-32} ### QUESTION {:#subdebate-32-0} #### COMMONWEALTH OFFICERS ServiceinTerritories. {: #subdebate-32-0-s0 .speaker-JPT} ##### Mr BLAIN: -I ask the Minister representing the Minister for the Interior if consideration will be given to the advisability of inaugurating a system for the interchange of Commonwealth officers between Canberra and the Northern Territory and New Guinea? At present married officers stationed in the Northern Territory and New Guinea are unable, because of climatic conditions, to take their wives with them for any lengthy period. I suggest that officers from Canberra should serve in rotation for, say, three years in either the Northern Territory or New Guinea. {: #subdebate-32-0-s1 .speaker-KXY} ##### Mr PERKINS:
UAP -- Whilst the scheme suggested by the honorable member seems very desirable, many difficulties arise. 1 shall see that his representations are given every consideration. {: .page-start } page 644 {:#debate-33} ### QUESTION {:#subdebate-33-0} #### PRICE OF SUGAR {: #subdebate-33-0-s0 .speaker-KMZ} ##### Mr MARTENS:
HERBERT, QUEENSLAND -- Before the sugar agreement was last renewed by the Lyons Government an arrangement was made with the sugar producers that the price in t he capital cities should be uniform, that price, after a reduction of½d. per lb was made, then being fixed at 4d. per lb. I am advised that the price in Hobart is now 4¼d. Will the Government ensure that the price in Hobart is maintained at the figure prevailing in the other capital cities? {: #subdebate-33-0-s1 .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- No doubt the honorable member is aware that the sugar agreement provides for a uniform wholesale price in the capital cities, and also Launceston, not for it retail price. If the honorable gentleman submits a case for the reduction of the present retail price in any centre throughout the Commonwealth.I shall gladly refer his representation's to the Commonwealth Prices Commissioner. {: .speaker-KMZ} ##### Mr MARTENS: -I am not referring to the price being charged in Launceston, but to the price of 4¼d. in Hobart. Will the. Minister see that consumers in Hobart are enabled to purchase sugar at the price prevailing in the. other capital cities? {: .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -Under an order published in. theGazette last Friday the wholesale and retail prices of sugar were fixed at the levels ruling on the31st August. If itis shown that those prices are being exceeded, or even that the price which prevailed on the 31st August in any centreis excessive, action will be taken in the matter. However, nothing can be done in this connexion unless details are placed before the Commonwealth Prices Commissioner or the Deputy Commissioners in the States. I assure the honorable member that I shall have an investigation made into the price being charged in Tasmania, and shall act, if necessary, upon the result of that inquiry. {: .page-start } page 644 {:#debate-34} ### QUESTION {:#subdebate-34-0} #### FEDERAL MEMBERS' ROOMS AT NEWCASTLE Mr.J AMES. - Is the Prime Minister aware that, the Naval Department has already set up a dictatorship in this country insofar as it has commandeered the rooms used by federal members at the Customs House, Newcastle, and has denied to these members access to correspondence and papers which they have left in those rooms? The Customs House at Newcastle is now under armed guard, and if one attempts to approach the building a revolver is shoved into his face. {: #subdebate-34-0-s0 .speaker-10000} ##### Mr SPEAKER: -- Order! The honorable member must ask a question. M r. J AMES. - This matter has already been referred to the Minister for Defence, the Minister for the Interior, and the Joint House Committee. Following a protest made by the Joint House Committee, the Minister for the Interior has now advised that the mutter will be considered within a few days. I point out that I have important papers deposited in these quarters, and am unable to get access to them. {: .speaker-10000} ##### Mr SPEAKER: -- Order! The honorable member is giving information. He should ask a question. Mr.JAMES. - Despite the representations made to the two Ministers I have mentioned, and the Joint House Committee, the members concerned had no quarters placed at their disposal during recent week-ends. I now ask the Prime Minister if he will take steps to enable us to get access to these rooms this week-end ? {: #subdebate-34-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -- I am not well versed in the ways of dictatorships, but I shall look into the matter and endeavour to give the honorable member an answer during the day. {: .page-start } page 645 {:#debate-35} ### QUESTION {:#subdebate-35-0} #### ADMISSION OF ALIENS {: #subdebate-35-0-s0 .speaker-L1L} ##### Mr WILSON: -- Iaskthe Minister representing the Minister for the Interior whether it. is the intention of the Government to admit any more aliens to Australia during the (period of the war, or whether the Government proposes to amend its policy in this matter? {: #subdebate-35-0-s1 .speaker-KXY} ##### Mr PERKINS:
UAP -- No more refugees other than those who already hold landing permits, willbe admitted during the period of the war. AsI pointed out the other day, the arrivals of other aliens will be restricted owing to the reduced shipping facilities available. In this re- spect preference will be given to A us- rtalians and other persons of British nationality. {: .page-start } page 645 {:#debate-36} ### QUESTION {:#subdebate-36-0} #### NATIONAL HEALTH I NSURANCE {: #subdebate-36-0-s0 .speaker-KX7} ##### Mr WARD: -- Does the Prime Minister intend to accept the advice of Professor Copland, who was recently appointed Economic, Adviser to the Commonwealth Government, that defence expenditure does not present an insurmountable barrier to the implementation of a scheme of national health insurance?If not, is it his intention only to accept advice which conforms to his own opinion? {: #subdebate-36-0-s1 .speaker-N76} ##### Mr MENZIES:
UAP -- I am like most, people in that I seldom accept adviceunlessI am convinced it is right. That is a rule which I. like honorable members themselves, do not hesitate to apply.I made a statement in my budget speech on the matter raised by the honorable member, and I do not intend toadd to that statement: {: .page-start } page 645 {:#debate-37} ### QUESTION {:#subdebate-37-0} #### QUESTIONS WITHOUT NOTICE {: #subdebate-37-0-s0 .speaker-N76} ##### Mr MENZIES:
UAP -- In view of the time already occupied by questions without notice, I should be glad if honorable members would defer any further questions. {: .page-start } page 645 {:#debate-38} ### BUDGET 1939-40 {:#subdebate-38-0} #### In Committee of Supply: Consideration resumed from the 14th September, (vide. page 572), on motion by **Mr. Menzies** - That the first item in the Estimates under Division1 - the Senate, namely, "Salaries and allowances, £8.040 ", be agreed to. {: #subdebate-38-0-s0 .speaker-KRE} ##### Mr SHEEHAN:
Cook -- When the Treasurer **(Mr. Menzies)** delivered his budget speech on the 8 th September, he declared that ho was presenting it in very difficult circumstances. The budget, he said, had three distinguishing features: it was his first budget as Prime Minister and Treasurer, it was the first time in the history of Australia that a budget for £100,000,000 had been presented, and it was only a tentative budget because, very shortly, supplementary estimates would have to be brought down to meet war requirements. Some of the departments, he said, would have to budget for increased expenditure, while others would nor expend as must as had been estimated. I regret very much that the country is involved in war,but I am glad that we are able to debate the budget here calmly and quietly. The people of Australia are involved in a war in the making of which they have had no say. During the last war we were told that we were fightinga warto end war, that it was being fought in defence of all that was noblest in man, that it was in defence of civilization itself; yet to-day, the world isagain in chaos, and it makes one think that we are reverting to barbarism. On the 3rd September, the Prime Minister issued a declaration in which he said that, Great Britain having declared war on Germany, Australia was also at war. He has placeda heavy responsibility on the Australian people.. As sensible, levelheaded people we must face the facts. Wild statements will not help us.. On the contrary, they will only make very much worse that which is already bad. We are an intelligent, community, and somehow we shall contrive to overcome our difficulties. With my leader I deplorethe fact that we have been forced into war in stead of being able to settle international difficulties by negotiation. We believe thatthe resistance of armed aggressionis inevitable if further attacks on free and independent people are to be averted. The Labour party has declared that it stands for the maintenance of Australia as an integral part of the British Commonwealth of Nations. Therefore, this partywill do all that is possible to safeguard Australia, and, at the same time, having regard to its platform, will do its best to preserve the integrity of the British Commonwealth of Nations. The Labour party stands for the adequate defence of Australia, and for a policy of complete national and economic security. It stands for the defence of our people in all States against aggression from whatever source it may come. That is a clear declaration of policy. I regret that some honorable members who support the Government have seen fit to suggest that the Labour party does not propose to take any interest in the war, and will not assist the Government in this fight. The defence of Australia should be placed on a scientific basis. In order to support the burden of the war we must have national planning. The defence of Australia involves three essential items - the fighting forces, the wherewithal to enable them to fight, which includes providing for the civil population, and finance. Australia is not a militaristic nation. Before the last war our people were a carefree, easy-going, sport-loving people, but in 1914 they were plunged into a war which, for the time being, altered their whole character. Now, without our consent, we are engaged in another war, and I hope that, on this occasion, steps will be taken to ensure that those who do the fighting are adequately remunerated for their services. The Government is showing too much consideration for those who occupy the higher positions. There is no justification for paying a salary of £3,500 to Lieutenant-General Squires, Inspector-General of the Australian Military Forces or for paying £4,000 a year to **Mr. Harold** Clapp, chairman of the board controlling the building of aircraft. Those salaries are outrageously in excess of the worth of the recipients, and are being paid at the expense of other persons equally capable and deserving. The members of the fighting forces do not receive the consideration to which they are entitled in the way of pay and pensions to their dependants. We all know of many cases of hardship among returned soldiers' whose health has been ruined as the result of their war service. They have been thrown on the industrial scrap-heap, and are existing on a mere pittance in the form of a war pension. Those injustices should be rectified. Those who take part in this war should be adequately paid, and proper provision should be made for their dependants. This war, unlike those of earlier days, will be all-in - total involvement, total siege. Civilians - men women and children, and the entire productive capacity of the nation - will be drawn upon. An act passed in England after the declaration of war gives the Government complete power to requisition the output of any factory, and where difficulties arise, the Government may requisition storage space also. It can, if it so desires, take over a business, lock, stock and barrel, and use it in the prosecution of the war. The British Government has experienced the difficulty of sufficiently speeding up production, and has now taken power to commandeer all necessary facilities, regardless of ownership. That power has not been taken in Australia. The Government has not taken any steps to control raw materials. We have been informed that practically all of the. raw materials in Australia are under the control of four big concerns. The Government has permitted the private armaments firms to make profits out of the needs of the nation. One of the first steps should be the abolition of the manufacture of arms by private firms. We should abandon the tedious and cumbersome method of tendering for government supplies. The Government should immediately take control of the armaments industry, and nationalize it completely. We all remember that, when the manufacture of shells was first undertaken in Australia, the agreed-upon price was so much above what it should be that the manufacturers were able to return to the Government 7s. on each shell, showing clearly that private armaments manufacturers are necessarily in a position to exploit the Government during war time. 1 have received from, u constituent a piece of cardboard that, has been made to resemble leather, and is being used in the manufacture of women's and children's shoes. If the Government is not careful, this shoddy material will be used in the making of military boots. It is a remarkably good imitation of leather, although it is only pressed paper; but of course, as soon as it comes in contact with water, it is of no use whatever. The wealthy patriots must not be allowed to get a bond rake-off this time. This war must be financed, differently from the last war. Prom the very beginning the Government must make it clear that there are to be no tax-free war loans, and that interest rates arc not to be inflated in order to induce wealthy patriots to part with their money. With little, if any,, prospect of imperial assistance, the Loan Council will be compelled to meet almost immediately to consider measures for the raising of money for war purposes. Never again must the money profiteering of the 1914-18 war period be repeated. The Government has in the Commonwealth Bank to-day a much stronger institution than was at. the disposal of the War Cabinet of the last generation, and we arc no longer bound to the gold standard. Unless the people arc again to be loaded with an intolerable war debt, all internal expenditure must, be financed by the use of the national credit on a cost basis, free of interest. The experience of the years since the depression has demonstrated the degree to which credit expansion can be used for this purpose, and if the present Commonwealth Bank Board stands in the way it must give place to a board prepared to do its part. After obtaining £50,000,000 on loan in Britain at the beginning of the last war, the Australian Government raised in seven separate internal loans* no less than £213,000,000. but so sluggish was the patriotism of those with .money to invest that by the time the last loan was raised the rate of interest, had sky-rocketed to 5 per cent., and the loans were made free of both State and Federal income tax. These huge interest rates remained as a burden for years after the war, and were not reduced until the Labour party, rn 1933, forced the genera.] interest reduction of all government loans, Meanwhile, by a strange transaction under which the Government gave the private banks £3 in notes for each sovereign held in gold, these banks, by special arrangement with the Treasury, made advances up to 90 per cent, to investors, avid teen red themselves for a steady 4 per cent, interest for as long as they held-' the bonds as security. As the result of these transactions the Commonwealth has already paid £3^0,000,000 in interest and sinking fund (in the war debt, yet it still owes approximately £500.000,000, although -the four ye.ars of war were slated to have eos-t only SS0,p00,C00 a year. In addition to these payments the < Government for years lost the whole of the income tax that should have been paid on dividends from war bonds.. Tax-free loans on this occasion must be resisted from thu outset. The maximum interest rate to be paid on loan money that cannot be obtained from the Commonwealth Bank should be fixed by the Federal Parliament, a.nd should not exceed 3 per cent. Workers serving in the army have their rates cut to '6s. a day, and investors in war loans should be prepared to make a similar sacrifice. The private wealth of Australia is officially estimated at nearly £4,000,000,000. anil the (rovern.ni.ent must, call upon this reservoir of financial strength. If the " patriots " are not prepared to do their best, without claiming exemption from income tax and excessive interest rates., the Government has a clear duty. tt;s policy on this aspect of the war must be defined without delay, t well remember an advertisement exhibited throughout Australia., when, an effort was being made to induce the people to unload their private wealth. A poster depicted a. soldier in action, and in large type were the words " Lend the way they fight;" but -the soldiers received no interest. F claim that the Government has definitely sold out on the question of unemployment. This week t drew the attention of the Prime Minister to the position of the wool and basil workers in Sydney, and to the fact that 500 men would finish their employment to-day if action was not taken by the Government, to obtain wool for scouring and carbonizing purposes. I. received a letter to-day from the secretary of the Wool and Basil Workers Federation, who told tin.' that 500 men had received notice of termination of their employment, if, however, the Prime Minister could arrange for a supply of woo! sufficient t<> carry the works over next week, thesis men would be assured, of continuity of employment;, because it is hoped that by the time the forthcoming wool sale is held a sufficient supply will lie available at the scours. The Prime Minister promised to treat the matter as urgent, but I emphasize the fact that these men are finishing work to-night. The Government should act at once to enable the men engaged in wool washing at Botany and in Melbourne to re'tain their employment. Lt is a tragedy that ">(IQ men should lose two or three weeks' work. Some temporary arrangement should be made whereby a quantity of wool could be allowed on commission to the companies concerned for scouring and c.arbonizing purposes. The problem of employment has never been seriously grappled with by the present Government. Since 1930 no other subject has occupied more space in the newspapers, more time and thought, or so much attention as a useful political football by the opponents of the Labour party, as has that of unemployment, lt will be recalled that, at the 1931 federal elections, the United A'ustralia party used unemployment as its main issue. We remember the slogan : " Vote United Australia party and get a job ". At the 1934 elections apparently everybody had not. got a job, despite the slogans, because the story then was that a Minister for Employment would be appointed and all worries would disappear. At the 1937 elections unemployment was not a popular issue with the Labour party's opponents. They had failed to put all of our people back to work under decent conditions and on a living wage. The promised Minister for Employment had not materialized. So Labour's opponents wrapped unemployment up with defence and said there must be a " national effort ". To-day thousands of our people are still unemployed. Many hundreds of them have never been employed. One cannot realize, until one lias personally come in contact with such cases, what the effect of never having worked can have on the human mind. It means a breaking down of morale, a sapping of all the desirable attributes which go towards making a democratic citizen, useful to himself and to the community. But this stark tragedy means nothing to the anti-Labour Government in this Parliament. It hopes that, for the present time, the expanded defence programme will absorb large numbers of the unemployed. But what of th' future? It has no plan to meet the situation. It had no plan in the past, and it goes blindly into the future while thousands of our people are in misery. The Labour party has a comprehensive programme, designed not only to provide employment, but also to make provision for the relief of the unemployable. At the 1936 triennial conference of the Australian Labour party, held in Adelaide, it was resolved that the problem of adequately feeding, clothing and housing the unemployed, in default of the provision of remunerative employment, was primarily the duty of governments. In July last the Sydney *Sun* published a report indicating the serious effects of unemployment in my electorate. It pointed out that, of nearly 350 boys between the ages of six and eleven years, assembled in the yard of the Erskineville public school, a third were without booti, and nearly all of them were without coats. Many of the girls were in threadbare cotton frocks and were without petticoats, whilst not one - neither boy nor girl - wore an overcoat. In Australia, which is claimed to be God's own country, it is appalling that little children should have to attend school under-nourished and under-clothed. entirely unequipped mentally or physically to benefit from their lessons. Although the girls were more completely clothed than the boys, it was stated that many of them were, dressed in secondhand clothing given by sympathisers. Singlets were the exception rather than the rule, and other underclothing was of the cheapest kind, and had been worn for so long that it had lost all its warming qualities. Similar conditions are. to be found in the schools in Alexandria, "Newtown and Botany. We are supposed to be building a glorious nation, but school children are being stunted and starved, and will have no chance in life, because this Government Las decided not to assist the unemployed to the degree that they are entitled to be helped. The Treasurer stated that last year the expenditure on civil aviation was £736,000, and that the Government is budgeting for 1939-40 at £1,435,000, which is almost double the sum expended last year. I hope that there will be improved administration of airports during the ensuing year. It is regrettable that statements appear in newspapers such as that published in the *Sydney Mommy* *Herald* of the 16th August, to the effect that four of the most efficient control officers of the Civil Aviation Department are believed to be seeking positions outside the service because of dissatisfaction with the administration and with the conditions of employment. These nien are receiving low wages, and their services will no doubt be sought after in other countries. No encouragement is given to these men to rise to high positions in the air force, because the Government is adopting a niggardly policy in one of the most important arms of the defence force. On the same day the following paragraph appeared in the *Sydney Mommy Hamid : -* lt is proposed to open and phut the huge 114- ton sliding doors of the new Rose Bay hangar with a hand winch, instead, of an' electric winch, because the latter will cost an additional £200. The doors to the hangar, which will house two flying-boats, have been built in eight sections, each of which is estimated to weigh eight tons. They arc fabricated with steel and covered with other heavy material. It was stated yesterday that a hand winch would cost £8i50, and that an electric winch could bc obtained for £1,060. It is deplorable that the Government should revert to the old days of hand winches in order to save a few paltry pounds. I again draw attention to the plight of the old-age pensioners. It is stated in the budget speech that invalid and old-age pensions are estimated to cost this year £16,700,000, an increase of £70S,000. "The Government claims that it is doing everything possible for the pensioners. When asked yesterday if he had been invited to attend a demonstration in the. Sydney Domain with regard to the conditions of the pensioners, the Prime Minister replied in the negative, and said that the Government had no intention of giving a.n increase to the pensioners. I claim that owing to the increased cost of living the present payment of £1 a week is quite insufficient. When a pensioner goes into a hospital he receives only 6s. a week, and this imposes a grave hardship.' If a male pensioner happens to have a wife, who is probably also in receipt of the pension, it means that she receives only 26s. a' week on which to maintain herself, to supply her husband with the comforts to which he is entitled during periods of illness, and to pay rent, which would bc about 17s. 6d. a week. In presenting the 1938-89 budget, the Government stated definitely that it intended to bring about a reciprocal agreement with the Government of New Zealand for the purpose of regarding residence in New Zealand as equivalent to residence in Australia for pension purpases. I regret that the Government do not intend to fulfil the promise contained in the 193S-39 budget. I wish now to refer to rates of pay in the Navy. The Government promised some time ago that it would look into the representations that had been made, but I find that no provision whatever has been made in the budget for an increase of pay for these men, so apparently the Government has simply been engaging in kite-flying. When the time comes for it to give effect to its undertakings it om ite to do so. This unfair treatment is objectionable not only to the men themselves but also to the general public who naturally expect the Government to give our naval men a fair deal. The whole subject has been a bone of contention with the naval ratings for many years. The mcn have endeavoured to secure the re-appointment of their welfare committees to organize on their behalf, but even that proposal has been disallowed by the Government. The review of service conditions did not provide for the reappointment of the welfare committees. I admit that what: was done was better than nothing, but it was not enough. The men definitely prefer their welfare committees to the arrangements that are now in force. Their major request, however, is that their rate of pay shall be increased, for it is totally inadequate as most of thom, are married. Although they are doing vitally important work, under our present conditions, no voice can be raised mi their behalf during the war. Militiamen receive 8s. a day- while they are in camp, and that is farcin excess of the rate being paid to the naval men. {: .speaker-KVN} ##### Mr Street: -- -01, no, the honorable member is "wrong. {: .speaker-KRE} ##### Mr SHEEHAN: -"-These nien are most definitely loyal subjects. {: .speaker-KVN} ##### Mr Street: -- I agree with that statement. {: .speaker-KRE} ##### Mr SHEEHAN: -- As they have no one among their own number to speak for them, I intend to do so. I urge the Minister to increase their rates of pay. {: .speaker-KVN} ##### Mr Street: -- The honorable member will recollect that. 1 made arrangements under the review of service conditions for the consideration of rates of pay and the methods by which grievances could be reviewed and redressed. {: .speaker-KRE} ##### Mr SHEEHAN: -- *1* do not remember the details, but I hope that the Minister will give earnest and careful consideration to my remarks. As I shall have opportunities, when the detailed Estimates are under consideration, to speak on other matters in which T am interested i shall not delay honorable members longer nt this stage. I" *Quorum formed.']* **Mr. SPURR** (Wilmot) [12.4J .Parliament is meeting under the dark shadow of war. Although I was only young at the time, I well remember the beginning of the war in 1914. I recollect also many s)f the sentiments expressed at that time. The various slogans that were frequently uttered, such as "Eight, for King and country", "Might against right", Help to bring in a new world ", and so on found n ready' response from the people. I agreed with many of them, and 1 am bitterly disappointed to-day to find that we are again at war. Those slogans were designed to develop a war-like spirit among our people and to encourage selfsacrifice throughout the war period. Unhappily, all the sacrifices that were made have proved to bp in vain, and many of the slogans have proved to be entirely unjustified. The peace terms, for which the statesmen and politicians of the time, were responsible, unfortunately had within them the elements which have caused the present war. I therefore express the hope that when peace is again achieved it will be based upon conditions which will make for genuine concord and, if I may say so, have a Christian back. ground. Our statesmen and politicians should pay the closest attention to the requirements of justice and honour so that at the end of this war an enduring peace may be won. As a business man, I am naturally interested in the financial basis of this budget. 1 must confess that in some ways the budget, appals me. We have been told that this is a war budget, but in actual fact very little provision is made in it foi- war purposes. The document consists largely of the usual statement of the financial activities of the Government in the last financial year, and of the estimates of revenue and expenditure for the current year. We have been told that the Estimates do not really cover war operations. In other words, this is a budget of preparation. Notwithstanding these observations by government supporters tile budget forecasts the raising of £19,000.000 by way of loan for, so we are told, defence requirements. In peace time it is, in .my opinion, absolutely wrong to meet, defence expenditure from loan sources. Such provision should be made from revenue. After war actually occurs the situation may well be altered. In those circumstances it; may become necessary to finance war operations from loan or credit, expansion so that normal expenditure may be met from revenue. During the last year or two certain disquieting financial tendencies have become apparent. I refer, in the first place, to our increasing national debt. The national debt in the last, year, for example, has increased by £20,000,000. Throughout the period since the end of the last Avar the public debt for which the Commonwealth Government is responsible, has decreased slightly year by year, but the combined debts of Commonwealth and State governments have increased by approximately £120,000,000. I have no doubt that the Treasurer **(Mr. Menzies)** will tell us that this increase is due to State expenditure; but even if that be admitted, the responsibility is largely thic to Common wealth policy, for the Commonwealth Government has refused to shoulder the responsibility for unemployment in this country, and lias left it for the States to meet. I well remember that during the election campaign before last the late Prime Minister **(Mr. Lyons)** made a statement to the effect that the task of coping with unemployment had gone almost beyond the financial resources of the States and that it would therefore be necessary for the Commonwealth Government to co-operate with the State governments in relieving the position. In my opinion Commonwealth co-operation since that time has been meagre, for the responsibility of financing relief works has been thrown almost entirely upon the State governments. I therefore say that although the public debt for which the Commonwealth Government is responsible has not increased very greatly, it is due to the action of the Commonwealth Government iu shelving its responsibility in respect of unemployment; In 1930-31 we were faced with a very serious adverse trade balance. Our credit in Great Britain had become practically exhausted. It seems to mc that there is a danger of our drifting into the same situation again. The budget states that our exports, including gold, gave us a surplus of only between £8,000,000 and £9,000,000 last year. 1 refer, of course, to operations between Great Britain and Australia. Bearing in mind the amount of interest that we were under obligation to pay in Great Britain our situation was most unsatisfactory. War conditions will probably rectify things this year, and may save the face of the Government by preventing a recurrence of the state of affairs which the Scullin Government had to meet when it assumed office. Another matter which concerns me greatly and will also have. its effect upon the pockets of our people relates to taxation. The policy which the Government is applying seems designed to permit the rich to escape with only relatively light additional imposts, while obliging the poor to submit to * additional heavy taxation. This is due to the very greatly increased volume of indirect, taxation. The budget discloses that only about one-third of the total revenue of the Government is derived from direct taxation. Probably I shall be told in answer to this statement that direct taxation is very much more severe under State legislation than under Commonwealth enactments, and that if combined Commonwealth and State direct and indirect taxation were reviewed it would be found that direct, taxation practically equalled indirect taxation. Personally I think direct taxation should be very much more substantial than indirect taxation. In 1930-31 the Commonwealth revenue from customs duties was £2S,29o,073, but last year the figures jumped to the huge total of £47,632,365. an increase of £19,337,292. That is only one avenue of indirect taxation. Let us consider for a moment the sales tax. Last year the amount of sales tax collected was almost double what it was in 1931-32. It is true that the Scullin Government was responsible for the introduction of the sales tax- I should like to make it, quite, clear at this stage that I am not in favour of sales taxation - but honorable members must bear in mind the state in which the Labour party found the finances of the country when it assumed office. Australia was practically bankrupt: our imports exceeded our exports by millions of pounds a year; our credit from Great Britain had ceased, and it was necessary that drastic steps should be taken to clean up the financial mess left by the previous government. One of those steps was to impose what in some cases was a prohibitive tariff, and in other cases represented a. very large increase over previous duties. That was done to enable certain Australian industries to operateon a paying basis and to correct the adverse tirade balance between Australia and Great Britain. In fact, that tariff schedule was necessary in order to preserve the solvency of this country. One effect of this was to 'bring about a huge falling-off of customs receipts, and the Government had to impose a sales tax in order partly to offset that heavy revenue loss. The tariff has subsequently been restored to its former rates, and once more imported manufactured goods are flooding the Australian market. Last -year we were once again very close to having an adverse overseas trade balance, and. if the amount of interest paid to Great Britain is taken into consideration, we actually did have an adverse 'trade balance. During last year the Government, collected nearly £60,000,000 by means of customs duties and sales, tax, and we have just passed legislation which it is estimated will increase the receipts from sales tax from £9,000.000 to £11,000,000, whilst in bis budget, speech the Treasurer hinted that an even further increase might be necessary. At any rate, a few days ago a statement appeared in the press to the effect that the sales tax was being fully investigated, so it appears that when the supplementary war budget is brought. down *a* further extension of the sales tax to lines at present exempted will be announced. A greatproportion of the burden of the sales tax is placed upon the ordinary citizens of the Commonwealth. Some honorable members will no doubt claim that many items are exempted from the sales tax for the benefit of the workers, but that is only partly true, and that small benefit may be even less if the range of the tax is extended as suggested. One of the biggest items of expenditure, especially among large families, is clothing. I ask honorable members how many lines of ordinary clothing are exempt from sales tax at the present time? There is only one line that I know of, and that is footwear. I challenge any honorable member to name any item of drapery used by the working people that is exempt from sale" tax. The taxation policy of this country should be so adjusted that those who are best able to pay should bc made to pay. An aspect of indirect taxation is that taxpayers pay not only the amount of indirect taxation collected by the Government, but also tax on profits. Let me give an illustration. A business is generally run on a. percentage basis. If a business man imports £100 worth of goods into Australia and after paying customs duty, sales tax, <fcc, he finds that the cost of the goods to him has risen to £150, he seeks to recover approximately half as much again on the goods from the consumer. That means he is collecting profit on the taxes paid to the Government. It is clear, therefore, that this form of taxation is very undesirable and, except insofar as it applies to luxuries and to the protection of local industries, I am opposed to it. lt is also true that direct taxation is passed on, but my experience of business is that direct taxation is not passed on to nearly the same degree as indirect taxation. 1. urge the Government, in reviewing the financial position and devising ways of raising revenue by taxes, to take into consideration the fact that. -thi* form of -indirect taxation imposes a heavy burden upon the workers of the country, well beyond their capacity to pay. l.n my electorate there are married mcn with families working for 25s. a week and double rations, and they have to pay sales tax on almost all of the necessities of life they buy. If the intention is to extend the field of sales tax as was hinted in the Treasurer's budget, speech, then apparently the workers will have to pay sales tax on commodities which are at present exempt. How. can people living on sustenance- afford to carry that burden? Rather than ask the poorer people of the community - those on the lowest rungs of the social ladder - to pay more taxes, the Government should obtain the necessary revenue from people with higher incomes, lt is only right that those who hold the wealth of this country should be prepared to make some sacrifice in order to finance the war. If the workers are taxed any more they will have nothing left to them. One other matter which .strikes me as being very important at the present time is the general question of financial policy. The policy outlined by the Treasurer in the budget speech is in keeping with the general trend of policy applied by this Government and its immediate predecessors. At the present moment sound finance is essential to the welfare of the people of Australia. After all is said and done, *I* am firmly of the opinion that there are. two factors of production which contribute to- the wealth of a country - nature and the workers, *hi the* final analysis it is the workers of a country who pay all taxation. From the last war *we* have a legacy of interest on debt amounting to £7 ,.500.000 a year. Our national debt is increasing year by year, and although I do not believe that an increasing national debt is a bad tiling, so long as there is a compensating increase of national assets, what is the position with which we are faced at the present time? If one can .visualize the cost of 'the last war in wastage of money and man-power, and in the suffering of the people, then one can appreciate what our obligations will, be during the present conflict. The war will not increase the wealth of this country; in. fact, we shall be very lucky if our total wealth does not 'decrease considerably. At the present time, the combined annual interest commitments of the States and the Commonwealth amount to £46.000,000 a year, and in some States the annual interest, commitment exceeds the direct revenue. We wonder, therefore, if the Commonwealth Government is doing its duty to the people of this land. It is its responsibility to introduce some scheme to ensure that after this war is over and we have won the victory which we arc all confident we shall win, the. workers of this country will not find that they have won the war only to live in a state of poverty, amounting almost to serfdom. I repeat that the workers produce the wealth of this country, and knowing how they suffered during and after the last war, owing to the dislocation of industry and increased prices for the necessaries of life, I earnestly appeal to the Government to give careful consideration to the financial position in order to prevent a repetition of conditions that obtained after the last war. It should take action to keep interest rates at a low level and use the credit of the nation to the best advantage, as the Parliament of Canada is reported to be doing at the present t i mo. When we say that the Government should tap the reservoir of social credit, we do not mean that it should print an endless supply of notes, thus causing undue inflation of the currency, with its attendant consequences, because we fully realize that a government cannot inflate the currency beyond certain limits without inflicting hardship on the people. But under existing methods of finance Australia's credit is being used solely for the profit of private finance and banking institutions. All that Labour now asks of the Government is that it give earnest consideration to the utilization of that, great reservoir of credit in the interests of the nation. Unless this is done, the: workers will be" apprehensive lest their laving standards be further 'reduced and greater demands be made upon them for thu upkeep of the nation. If the Government does not face its responsibilities, it will not he long before the workers decide that a Labour government must occupy the treasury -bench. Any dislocation -of the export trade in apples and pears would affect Tas.manian growers more than producers in mainland States, approximately 3,000,000 bushels of apples and pears being exported annually from the island State. Following the outbreak of the war, the growers have been notified that all shipping space for fruit has been cancelled. This announcement has caused great dismay among producers. Representatives of Tasmania in this Parliament will recall that during the last war, owing to the difficulty of obtaining freight space on overseas ships, fruit was allowed to rot on the trees. Growers now fear that that experience will be repeated. Whilst I realize the extraordinary difficulties confronting the Government in. this crisis, I appeal to the Ministry to use all its influence to secure a reasonable amount of shipping space for Tasmanian fruit during the coming season. As all honorable members know, it is essential that such perishable products as fruit should be disposed of quickly, and that the market be stabilized so that approximately half of the Australian crop may be exported. If it be impossible to obtain adequate shipping space, the only alternative is to can the fruit. Certain varieties of apples and pears are suitable for canning and will remain in a state of preservation for four or five years. They could bo used to augment food supplies for British soldiers on active service. Canning facilities are available in Tasmania, but suitable containers must be provided and the growers must be financed so that they may hold the canned product for 2 or 3 years before marketing it. I trust that the Government will give favorable consideration to my representations in this matter so that fruit-growers throughout the Commonwealth will not be penalized as they were during the last war. Honorable members will understand that the work of orchardists must be carried on uninterruptedly in order to prevent deterioration of the orchards. Unless orchards are properly cultivated and trees pruned, future yields will be uncontrolled and the orchards will run wild. Potato-growing is another important primary industry in Tasmania. Lately it has been given a good deal of prominence in the press, owing to the high level of prices reached in mainland markets a few months ago and "the decision of the Government to remove the ban on the importation of potatoes from New Zealand. I appreciate that that was done in the interests of consumers. It should be realized, however, that producers in Tasmania have experienced many poor seasons, and for many years were compelled to dispose of their crops below the cost of production. Therefore, it is only fair, when relatively high prices prevail owing to climatic conditions, that the growers should be allowed to recoup themselves for losses sustained in other years. It was unfair on the part of the Government to lift the embargo on New Zealand potatoes. I concede that the Australian market was not flooded with New Zealand potatoes last season, but that was due to the coincidence of a poor New Zealand, crop. I, and other representatives of the producers, have tried to obtain an assurance from the Prime Minister regarding the Government's proposals for the marketing of potatoes, but so far we have not obtained a definite answer. It is not right, that potato-growers should be kept in suspense. They do not know whether to increase their acreage or not, and so far as I can see, the Government has not taken any action to assure them that their interests will be protected. I hope that the Government will make a clear statement of its policy in this matter. When the Minister for Supply and Development **(Mr. Casey)** visited Tasmania recently, he stated that he favoured 'the decentralization of the sources of defence supplies, and that the work of his department would be spread over all of the States. That must have been an attractive form of speech intended to tickle the ears of the Tasmanian people for propaganda purposes. A return prepared by the Department of Supply and Development proves the inaccuracy of the Minister's statement. It shows that expenditure on defence sup- plies during 1938-39 was allocated as follows:- New South Wales, £250,000; Victoria, £2,0S3,000; Queensland, £2,250; South Australia, £2,200; Western Australia, £2,700; and Tasmania, £300. I wonder that the Government waa able to spare even that amount for poor little Tasmania which always receives scant consideration. I realize that the business of the Supply and Development Department cannot be distributed evenly over all States, but I regard the allocation of £300 to Tasmania as an insult to the enterprise of that State. A much larger proportion of the expenditure could have been allocated to it. I appeal to the Government to distribute as equably as possible the sources of supply of war materials during the coming year. It is regrettable that the budget makes no provision for widows and orphans'" pensions. During my travels in Tasmania, I have come in contact with many poor people and I know of the hardships they are experiencing. In some homes I have seen girls of thirteen or fourteen years of age mothering as many as three or four little children, while their widowed mothers have hired themselves out for scrubbing and washing in order to earn money for the education and maintenance of their children. Honorable members may say that the Social Service Department of Tasmania will care for such people, but the amounts granted by that department are not sufficient for large families. I cast no reflection on the Tasmanian Government in this connexion, because it is hampered by the finance made available to it by the Commonwealth Government. Many unfortunate women have to supplement their allowances from the Social Services Department by doing washing and scrubbing work. I have no intention pf belittling these people; on the contrary I admire their determination to help in the maintenance of their families in decent conditions. It is the duty of the Commonwealth Government, even in wartime, to ensure that mothers are kept in their homes to give the care which they only can give to children at the impressionable period of their development. I do not expect the Government to provide luxuries for these people, but I do ask it to give them sufficient of the necessaries of life- to make the children happy and contented so that in future years they will feel that they belong to a country worth fighting for. *Silting suspended from. IS. J/5 to 2.15 p.m. [Quorum formed.]* {: #subdebate-38-0-s1 .speaker-KUO} ##### Mr SPURR:
WILMOT, TASMANIA · ALP -- I desire to deal briefly w illi the subject of defence, more particularly in relation to Tasmania. At the present time, a number of our political opponents are advocating compulsory universal service, and some of them are going so far as to advocate the sending of an expeditionary force over-, seas. It would be an absolute mistake for the Government to attempt to introduce compulsory universal service. Even no«' it is embarrassed by reason of the number of men volunteering to serve in the forces in the present emergency. Undoubtedly a large section of the community is opposed to compulsory universal service. They would resent its introduction and dissension would be caused throughout Australia. {: .speaker-KZR} ##### Mr White: -- What, about Tasmania? {: #subdebate-38-0-s2 .speaker-KUO} ##### Mr SPURR:
WILMOT, TASMANIA -- The Labour party in Tasmania, and members of the Federal Labour party, stand solidly behind the platform of the party. Our friends opposite emphasize only a small portion of the programme of the Labour party in Tasmania. They should be prepared to accept the whole of the programme, not only that part of it which suits their purposes. I shall read a section of the Tasmanian proposals. I am not advocating them to-day, nor did I vote for them in Tasmania.. The section reads - Such resolution does not mean conscriptio'n for either home or overseas military service, but does mean compulsory military and physical training to provide preparation in the event of invasion; in the event of invasion, the mobilization of the credit of the nation, without interest, and the private wealth which it is sought to protect, the commandeering of such industrial and transport undertakings as can bc mobilized in the interests of defence: but we desire to make it clear beyond all doubt that our support of compulsory national service *is* conditional on the prior legislation for the mobilization of wealth and industry. {: #subdebate-38-0-s3 .speaker-KYI} ##### The CHAIRMAN (Mr Prowse:
FORREST, WESTERN AUSTRALIA The honorable member's time has* expired. . {: #subdebate-38-0-s4 .speaker-KUG} ##### Mr SPENDER:
Assistant Treasurer · Warringah · UAP , - The committee has not, so far as I have heard the debate, challenged the Government, except by innuendo, with "any extravagance in respect of its budget. It is true that, the comment has been made that the increase of the budget is substantially due, not so much to war expenditure, as to the amount for defence which has to be borne by revenue this year, compared with previous years. After ali, expenditure can lie challenged only on the ground of extravagance or "inefficiency in respect of the services rendered, and so far as 1 have been able to gather there has been no challenge on that ground, except, as I say, by suggestion. I am sure that every member of the committee realizes that the country is growing year by year, and that that growth imposes additional demands on the Government, with the result that our budgets progressively increase, just as they do in every other country in which added demands are made from year to year. So to-day we find that we have a record budget. I am confident that the Opposition, does not suggest that there should be a reduction of social services, including pensions and repatriation, and the amounts paid to those who are in the services. There has ,Deen no other suggestion as to how money could be saved. As the Treasurer **(Mr. Menzies)** has indicated, before the budget was brought down every attempt was made to cut out the dead wood and to sec that the minimum of expenditure was incurred, consistent with the obligations which the Government has to discharge. It cannot be said, merely because the budget is enlarged, that that enlargement is due to extravagance or mismanagement. Thus we start with the premise that we have *u* budget, to meet in respect of essential social services and obligations. The main attack appears to have been directed to the method by which we propose to finance, our obligations. In this respect, there has been a good deal of comment to the effect that indirect taxation has been increased but tha ti direct, taxation ha? been left substantially untouched. The charge is, that the Government is lending itself to the taxing of the poor and the protection of the rich. I believe that a moment's reflection will reveal how futile - if I may say so - is that allegation. The Leader of the Opposition **(Mr. Curtin)** drew attention to the amount raised hy way of direct taxation in 1931- 32, and compared it with the estimate in the budget now before the committee. May I say, first, that the honorable gentleman took as his starting point the depression years, for a reason which I suggest is obvious - so that the contrast might be the more distinct. Again, he presented to the committee only one-half of the picture. Every 'member of the committee knows that bit, by bit the States have invaded the field of direct taxation. The States have a limited field in which to tax; they have a very small field of indirect taxation. Further, if one compares the years taken, by thLeader of the Opposition, one finds that in 1931-32 the direct taxes imposed by the States realized £25,95S,000, whilst in 1937-38 the amount so raised was increased by nearly £14,000,000 to £39,540,000. Although these direct taxes are imposed by the States for different services, they fall on the same set of taxpayers. In order to get a true picture one must look to see what amount of direct taxation is imposed throughout the Commonwealth by both the Commonwealth and the State. Parliaments, and one musthave regard to the fact that the States occupy practically three-quarters of the field of direct taxation. But the matter is not finished there. Every honorable member knows how harsh were the conditions in 1931, at the depth of the depression. The Leader of the Opposition, has chosen a year when the purchasing power- of money had increased by reason of the drop of prices in respect of both services, and commodities, and the hurden was easier for those upon whom it was cast. In this year of grace, prices are rising, and I expect ' that during the years that are ahead of us there will probably be a tendency for thom to rise still further. With any increase of prices, there will be a lessened purchasing power of money, and consequently a greater burden, even if only the same amount bo collected as when prices arc low. The matter does not stop there, however. During the last three or four years the Commonwealth has increased direct taxes as compared with indirect taxes. The budget contemplates that this year the sum of £62,850,000 will be collected from indirect taxes compared with £52,020,924 collected in 1935-36. That- is an increase of a little over 20 per cent. Direct taxes are expected to yield £17,160,000 in 1939-40, compared with £11,596,382 in' .1935-36- an increase of 50 per cent. That is to say, for the same period it is expected that' the yield from indirect taxes will increase by 20 per cent., whereas the yield from direct taxes will be about 50 per cent, greater. If we compare last year with the current financial year we find that indirect taxation is being increased by 7 per cent, and direct taxation hy 12 per cent. Therefore it cannot be suggested that this Government is seeking progressively to load the burden on the general wage-earners. Reflection will show that there are only three fields of indirect taxation - first, customs and excise; secondly, the sales tax; and thirdly, the flour tax. Honorable members will not need to be told that the substantial increase of indirect taxes derived from customs and excise is due to the increase of imports. During the years 3 931-32, the period which was chosen by the Leader of the Opposition, imports fell substantially ; but since that time there has been a marked increase of imports, with a correspondingly increased yield from customs and excise. Having regard to the real situation, the allegation that, the Government is seeking to protect the wealthy by keeping direct taxation low cannot he sustained. In order to increase further the yield from direct taxes lbc only substantial field which may be attacked is one which includes the field of middle incomes between, say, £400 and £.800 per annum. {: .speaker-JOM} ##### Mr Beasley: -- The Assistant Minister should keep in mind that some taxes can be passed on. {: .speaker-KUG} ##### Mr SPENDER: -- If we consider the rate of income tax which is imposed upon the highest incomes from personal exertion, we find that in Queensland upon the maximum incomes the total imposition by the Commonwealth and the Statu roaches 15s. in. the £1. {: #subdebate-38-0-s5 .speaker-K0K} ##### Mr CONELAN: -- Why not give the figures for the Commonwealth? {: .speaker-KUG} ##### Mr SPENDER: -- I am endeavouring to show the residue of the field that can be attacked by way of direct taxation. We must have regard to the total amount which is taken by both the Commonwealth and the States. The maximum rate in respect of income from property in Queensland is 16s. 2d. in the £1 . The comparable figures for Tasmania are 13s. 7d. and 14s. 9d. in the £1. In the light of these figures, it is idle to say that much more money can be extracted from person.? with the highest incomes. No doubt it is possible to get a little more; but it is not possible to get the amount which it is suggested could -be raised, and still carry on essential services. {: .speaker-K0K} ##### Mr Conelan: -- Will the Assistant Minister give the figures for New South Wales and Victoria also? {: .speaker-KUG} ##### Mr SPENDER: -- The figures for each State are - lt must bc remembered that in this matter the Commonwealth cannot discriminate between States; any taxes that it imposes must apply throughout, the Com mon wealth. In contemplating further imposts,, the Commonwealth Government must have regard to the effect on incomes in all of the States, and try to avoid causing undue hardship. .1 realize that these figures are unpalatable to honorable members opposite, who urge the Government toincrease direct taxes and who allege that we are. taking taxes from the pockets of the poor. A study of these figures will show that the largest, available field of direct taxation is substantially the middle range of incomes, but no member of the Opposition has been prepared to urge the Government to enter that field. So much for the contention that the Government should concentrate on the man who is already carrying the burden which I have indicated. It is also stated -by honorable members opposite that customs and excise duties bear most heavily on the wage-earners. Again, reflection will show that, although in many instances these duties are passed on, there, are substantial imposts on many luxury items, such as motor cars, petrol, the better classes of textiles, wine and spirits, and machinery which do not touch, or barely touch, the wage-earners. I invite members of the committee, particularly those who have declared that direct taxation can be increased, to show precisely how effect could be given to their contention. It is not sufficient to say that heavier direct taxes should be levied; the onus is on those who make that claim to show that such a field exists. It is certainly not my desire to impose taxes upon those persons in the community who are on the breadline, for I know how difficult life is for them. If the sales tax touches this class, then I say that the present Government learned from a Labour government how to obtain additional revenue by its imposition. When first imposed, the sales tax was at the rate of 6 per cent. During the intervening years, the rate has fluctuated ; it is again 6 per cent. If we have regard to the available field of direct taxation, I think that it will be found that there is little ground for the complaint that the Government is taxing the poor. I should like honorable members opposite to show what effective way is open to increase direct taxation substantially other than by a. method which will increase the burden upon the middle incomes of between, say, £400 and £800 a year. I come to another matter, the method of financing the programme that lies ahead of us this year. It is said that, we are not carrying enough on what is loosely called the credit structure of the country. I admit, quite definitely that money is not for the purpose of determining how people shall live ; I believe that the credit structure should be such as to permit people to live and to live properly. But it is just as idle to say, for example, that war is a reason for inflation as it is to say in time of peace that there is no reason why we should use the credit structure of the country. Credit is available for the purpose of the nation, whether it be at peace or at war. A question that arises, ho" - ever is as to tho limits to which the credit structure can ho used. It is easy to say in general terms that the resources of the country shall bc used within economic limits, but it is another thing to say precisely where the process shall finish. The Leader of the Opposition **(.Mr. Curtin)** says, " Look at Germany. It has used the credit -structure with the result that there is no unemployment there, or substantially no unemployment ". That may be perfectly true, but again the Leader of the Opposition has not given the full picture. I am not prepared, and I doubt if the honorable member is prepared, to go to the lengths which are involved in the full picture. If wc did we should have to peg wages, as they have been pegged in Germany, control exchanges, ration essential supplies, and impose high taxes right down the scale. Finally, we should have to do as Germany did when. **Dr. Schacht** said, " The credit structure will bear no more " ; we should have to take the responsibility of "sacking" the man who said that, because he said it, and appoint some one else in his place. I cannot understand why members of the Opposition, who represent and advocate very strongly and genuinely the interests of the workers, say that our problems may be met by the simple expedient of making more money available, since once the stage of inflation was reached, as it would necessarily be. reached unless a limit were set, the people on the breadline would be taxed because their purchasing power would be reduced. In my view that is the worst possible form of indirect taxation. {: .speaker-L07} ##### Mr Lazzarini: -- The honorable member does not know what wc propose. {: .speaker-KUG} ##### Mr SPENDER: -- I remember that, on another occasion the honorable member said that the credit structure could be used to solve the problems that confronted us. I invited the honorable gentleman to tell me precisely how that could be done. He failed to do so then, and he has not done so yet. {: #subdebate-38-0-s6 .speaker-F4Q} ##### Mr SCULLIN:
YARRA, VICTORIA -- Every proposition that the Opposition has put forward has had in mind the price level. {: .speaker-KUG} ##### Mr SPENDER: -- That may be true, but I have not yet been told, and I should like to hear precisely, to what extent honorable members opposite would use the credit structure, what practical limits they would place on that use, and how they propose to stop increases of prices. This Government does not dispute that the credit structure of the country can be used. It not only intends, but will be obliged, to use the national resources. There is no dispute as to that. The real dispute .appears to be as to the extent to which the credit structure shall be used. {: .speaker-KFE} ##### Mr Gregory: -- The Minister should make it clear that Herr Hitler got his money by long-term loans, which bear interest. {: .speaker-KUG} ##### Mr SPENDER: -- It does not matter how he got it. The process involves the use of the national credit. But, as the honorable gentleman declares, money has been raised in Germany by long-term loans which bear interest. {: .speaker-JOM} ##### Mr Beasley: -- And the Minister believes that the flotation of the loans should be entrusted to private financiers. {: .speaker-KUG} ##### Mr SPENDER: -- I have not said so aud no other Minister has said so. It is very ,easy to make these statements - just as easy as it is to say that any problem can be solved by expanding credit. If the problems which confront us were capable of such easy solution as that, I could not understand any treasury or any bank resisting such a temptation. If prosperity automatically follows the expansion of credit, obviously no bank or government would resist it as the easiest possible method of attacking a problem. What I regard as a shallow approach to this problem is the Opposition's cry, " Look at what the Banking Commission said : ' The Commonwealth Bank can make loans to the Government free of interest ' " ! No one disputes that. Any .member of the committee, if he cared to do so, could jump from the tenth floor of a building to the ground. A quite different question is: Would he do it? It is idle to point to this report and say that the Commonwealth Bank could, if it wanted to, advance money to the Government or any person free of interest. In actual fact, if one analyses again, that is precisely what is not being done in Germany. Germany pays interest on its long-term loans; Italy and Japan do likewise. I should like the members of the committee to consider the argument that unless money is advanced free of interest, the people pay twice in respect of the same work. May i take the example given by the Leader of the Opposition, who said, " If you get X pounds to establish a particular work, you have your work for the X pounds expended upon it, but you also have to pay interest on it ". He did not tell the committee that you have the use of that work while paying the interest. In the establishment of any project, you have on the one hand the capital cost plus interest until the capital is recouped, and on the other the use of the work, less depreciation. It is elementary that sound finance dictates that interest should not exceed the value of that use less depreciation. That, of course, involves a consideration of the economic value of the work. It is of no use for the Leader of the Opposition to put a proposition like that before the committee, because the belief is created - and one has to meet it in fashion - that any financial problem oan be solved in this simple manner; I agree as to the necessity to use the credit resources of the country for national purposes. The Government does not resist that. Obviously, in the years immediately ahead, credit may have to be resorted to very substantially. As the Treasurer **(Mr. Menzies)** showed in his budget speech, it has already been resorted to. To that, honorable members of the Opposition responded by saying : " The banks have become more pliable. At last reason is dawning upon them ". That is not the fact; but if it were, it is hard to understand why the Commonwealth Bank should be criticized for moving with the times. The fact is that, as the Treasurer indicated, the Commonwealth Bank, charged as it has been with the necessity for ensuring that there shall be sufficient liquidity of funds in the community, has been more and more assisting the financial structure of this country. I am not suggesting that it must be credited with having done this to the complete satisfaction of everybody, but what is the alternative ? Either we leave this control to appointed experts; or we substitute our judgment completely as to how the credit structure shall be built up. There is no difference of opinion in this committee on the main proposition. All of us agree that the resources of the country should be used for the purpose of its development in the best and most economical manner, but if you simply increase credit and expend the money in such a way that no new resources are employed the result will be inflation. *mw* Martens. - Who has ever suggested that that should be done? {: .speaker-KUG} ##### Mr SPENDER: -- Precisely what limits does the honorable member propose? It is very easy for honorable members opposite to make a popular appeal by simply saying that if they were the Government they would expand the credit base. I ask them to give some indication of the limitations they would impose. Although one statement of the Royal Commission on Monetary and Banking Systems has been referred to *ad nauseam,* no reference has been made to several other important statements contained in that report. The commission, it is true, states that the Commonwealth Bank can lend to the Government or others in a variety of ways, and it can even make money available to governments or to others free of any charge. No one disputes that. But can honorable members opposite point to any statement in that report in which the commission says that it is advisable to do that? They cannot. If the Commonwealth Bank makes advances to governments and that money is taken out of the past savings of the people, it has to pay interest on such money because it has been borrowed from the people. If, on the other hand, the bank advances credit not based on past savings, we are told that interest should not be paid. What is the result of charging interest? The Commonwealth Bank advances, we will say, on the credit of the country and charges interest, which, goes back into the people's bank, and through the bank to the people. I cannot understand, therefore, what is wrong, with charging interest on advances. There is the further consideration that the bank takes up considerable holdings in public loans and must have negotiable securities; that is one of the best possible methods by which the bank can ensure the liquidity of its assets. I am not one of those who believe that in tlie past the credit of the country has always been used to the fullest extent desirable, but it is not of much use to seek to make a popular appeal by merely saying that the easiest way to solve our financial difficulties is to extend the credit base.- 1 noticed, amongst other matters, that no reference was made by honorable members opposite to paragraph 506 of the commission's report, which reads - >On the other hand, the power of the Commonwealth Bank to increase the cash reserves of the trading banks ig not unlimited. The bank ig bound to pay in legal tender money whenever called upon. So long as its power to issue notes is restricted by law, its power to purchase securities or other property, and to lend or grant money to governments or others, is limited. Apart from the legal limitation, there ig a practical limit to the note issue, in that the bank has to consider howfar it is in the general interests of the community to expand credit. There is no difference at all in principle between increasing the note issue and increasing credit. In either case more money is made available. I have not heard one honorable member opposite say that there should be no reserve in respect of the note issue. If honorable members opposite are not prepared to go that far in respect of the note issue, will they say exactly what limitation should be observed in increasing the credit base? {: .speaker-F4Q} ##### Mr Scullin: -- The only limitation in respect of the note issue is a statutory limitation. {: .speaker-KUG} ##### Mr SPENDER: -- The reason for establishing that reserve was to maintain confidence in the note issue. {: .speaker-F4Q} ##### Mr Scullin: -- But that does not prevent expansion of the note issue. {: .speaker-KUG} ##### Mr SPENDER: -- I have not suggested that. I say to honorable members opposite, "Remove the note issue reserve if you want to, but do you suggest that such a course would bc advisable " ? {: .speaker-F4Q} ##### Mr Scullin: -- There would be no advantage in removing it. {: .speaker-KUG} ##### Mr SPENDER: -- Then honorable members opposite apparently desire a limitation in respect of the note issue, but no limitation in respect of the credit base. {: .speaker-F4Q} ##### Mr Scullin: -- Who suggested that there should he no limitation in respect of the credit base? {: .speaker-KUG} ##### Mr SPENDER: -- 1 should like to hear from any honorable member opposite precisely in what way he proposes th a,t credit should be expanded. {: .speaker-F4Q} ##### Mr Scullin: -- In what way does the Government propose to expand credit? Thu honorable gentleman says that it will use the credit resources of the country within certain limits. {: .speaker-KUG} ##### Mr SPENDER: -- I shall indicate those limits to the right honorable gentleman, and I shall be interested to hear what limitations honorable members opposite propose. {: .speaker-L07} ##### Mr Lazzarini: -- We shall indicate that when wc are charged with the responsibility of government. {: .speaker-KUG} ##### Mr SPENDER: -- Let me take the arguments of honorable members opposite a little further. The royal commission's report states - >The increase in money may be carried to such a stage that, although prices rise, there is little or no increase in the total volume of production . . . The effect on prices of an expansion or contraction of money depends on the particular circumstances and is not easy to predict. In general terms, an increase in the supply money tends to raise prices, and a decrease tends to reduce them. All I have to say in conclusion is that this year the Government's loan expenditure will be increased from £4,000,000 to £23,000,000, and that is not final. Indeed, it may also be said that we are not yet finished with direct taxation for this year. The actual past savings of the community are a limited amount and they will unquestionably be drawn upon, together with future savings, in this time of war. The Government, will not hesitate to . use our credit structure in order to ensure that those savings shall be used for the essential development of the country. At the same time, if will see that the profiteers are kept in their place. I realize that in this respect we have stolen much of the thunder of honorable members opposite. They must now realize that the Government is resolute in its determination to stamp out profiteering. Honorable members opposite contend that this Government is always out to assist the man with money. Consequently, they regard its promise to stamp out profiteering as eye-wash. The cold fact, however, is that on this occasion prices have been substantially stabilized and the people thereby protected from profiteering such as took place at the commencement of the last war, when there was an immediate rise of prices, particularly to the detriment of the working man. 1 again invite any honorable members opposite to state in precise terms, and not in generalizations, how, if they were the Government, they would expand credit, and what particular measures they would take to implement their purpose. 1, for one, would be very pleased to be illuminated on that point. If they are not prepared to do that, it is not exactly courageous of them to shelter behind a solitary statement in the report of the Royal Commission on Monetary and Banking Systems, and to contend that according to that statement the Government is not doing its job. In conclusion, I commend the motives which prompted the Leader of the Opposition to suggest that the Government should make a gift of foodstuffs to the value of £1,000,000 to Great Britain. That suggestion will receive the earnest consideration of the Government. However, lest it, should be suggested that if that course be not pursued by the Government, it is not as desirous as is the Opposition to help Great Britain, I point out that ultimately itis a question of making a gift of money to that amount. Our foodstuffs are going overseas as fast as the available ships can take them. It is not a matter of the supply of foodstuffs, but of freight space. In the ultimate analysis, it is a matter of money. It may be that, after consultation with the Government of Great Britain, a decision will be reached that we can assist Britain better by spending that money in another way. The foodstuffs will go in any case; it is merely a matter of finance. As far as we can see at present, Great Britain is not. in need of finance, but I compliment the Leader of the Opposition on the spirit that prompted the suggestion, and I assure him that it will receive the earnest consideration of the Government. The Government has endeavoured to spread the burden of this budget as equitably as possible. It will not shrink from placing further burdens if practicable on those persons who are alleged to be best able to bear it, but before the war is over it will be found that the burden will be thrown on all of us, and we shall have to bear it. **Mr. SCULLIN** (Yarra) *±0S].-* In justice to the Opposition, I desire to clarify one or two points which the Assistant Treasurer **(Mr. Spender)** rather succeeded in clouding. In the main 1 agree, with the honorable gentleman, who has made a very interesting contribution to this discussion, but, in my opinion, his speech failed, when he1 endeavoured to introduce political propaganda, and by implication and accusation, to misrepresent the. views of the Opposition. He invited us to state our views. I challenge the honorable gentleman to declare where the Opposition has said that credit could bo expanded without limit. He asked us to state in precise language where the limit should be, and I invite him to do the same. He has declared on behalf of the Government which has all the machinery at its disposal for making calculations and surveys of the resources of the country, whilst we have not, that the Government will utilize the credit structure of the country for the carrying on of essential services. I invite him to give a precise definition of what he considers the proper limit. The Labour party has never said that a government should use the national credit, or the credit structure, as the Assistant Minister called it, without, limitation, and I have never presumed to be able to say where the actual limit is; but when I held a. responsible position in this country, and when price levels were falling drastically, when deflation was the order of the day, when people were starving, not because of high prices, but because, due. to the fall of prices, there was no employment, we attempted n small measure of credit expansion, in order to provide employment and assist wheat-growers. Even then, however, we took the precaution of saying that we would watch price levels carefully, and would not let them rise above the price, levels of 1929. "We did not fix that, limit by chance. We fixed it because 1929 was the end of a fairly stable period of five or six years. The depression was brought about by the deflationary policy of those who restored the gold standard so that the moneys they had accumulated during the war, and invested in long-term securities at fixed rates of interest, would yield them a higher return because of a reduction of prices. The primary industries all over the world were almost destroyed because of the greed and selfishness of the *rentier* Class. We declared as a government - and the real test is what one would do as a government - that we would not allow any expansion of the credit structure to raise prices beyond the 1929 level. I admit at once that the power of a government successfully to use the national credit is greatly restricted unless it also has power to fix prices. The present Government is assuming that power under the National Security Act, and I am glad. I am not at all jealous that our thunder has been stolen. I do not want any thunder - I want justice for the people. I emphatically refute, however, the suggestion that the Labour party stands for unlimited expansion of credit and inflation. Moreover, we are emphatically opposed to allowing the private banks to expand credit in order to make profits, hut we do not hear a word about that from honorable members on the other side. {: .speaker-KIX} ##### Mr Hutchinson: -- -How do the private banks do it? {: .speaker-F4Q} ##### Mr SCULLIN: -- If the honorable member had read the report of the royal commission on banking he would know. Every one knows that the private banks expanded credit during the last war, which was financed, to a very large extent, hy inflation of money and prices at the expense of the masses of the people. The interests that benefited most by inflation were the private banking institutions, and they were allowed to do so. We all know that, they practised inflation. The more you give them as a basis of credit the more they will inflate, and they were encouraged to do it during, the last war. We know that any one depositing £10 with a hank was able to buy a Government £100 bond, and pay the rest over a period of years. The whole process was one of inflation, and it was practised in every country, with the result that the war was fought at the expense of the masses of toilers. It was not until 1929 that the basic wage, which had for years been chasing the cost of living, finally caught up with it. Knowing that, our party would not stand for a policy of inflation, which is an indirect and ruthless method of reducing wages and other purchasing power. We say this, however : Where the credit structure can he used within sound limits, which must he ascertained from time to time- {: .speaker-KIX} ##### Mr Hutchinson: -- By whom? {: .speaker-F4Q} ##### Mr SCULLIN: -- By the economic and financial advisers of the Government. Insofar as the credit structure of the country can be safely used, we say that it should be used, but only by the Commonwealth Bank - the people's bank. That is where we stand. When we speak in general terms about utilizing the credit resources of the country through the Commonwealth Bank in order to bring idle man-power and natural resources into production, we mean that we shall do so to the exclusion of the private banks. I desire to make clear an observation on the note issue. I do not believe that a gold reserve is of any value in restricting the expansion of the note issue. The only worth-while restriction - and there should be a restriction, because it would be dangerous not to have one - is a statutory provision limiting the amount of the note issue. Of what use is it to say that the note issue must have a 25 per cent, gold hacking, and to expect that such a provision will prevent inflation, when the bank board, if it so desired, can print, .i million pounds worth of notes, buy a million pounds of gold with them, and on that basis print another £4,000,000 worth of notes, and go on repeating thai process? The note reserve is a fetish, a superstition. Its only value as a note reserve is the psychological effect it has in inducing the people to accept notes as legal tender. I would not abolish the reserve as it has a value as a national reserve. {: .speaker-KUG} ##### Mr Spender: -- What' is the gold reserve for? {: .speaker-F4Q} ##### Mr SCULLIN: -- For the balancing of international accounts when the balance of trade is against us; when we cannot pay for imports with exports. Previously we had a gold reserve in the form of sovereigns and ingots buried in the vaults of the Common wealth Bank in Sydney. It was lying there idle and useless, but now we have no gold reserve. The reserve we have in London to-day is held in sterling, or, in other words, British securities of a liquid nature. That is the only place where the reserve could be of any value. It is of no use whatever in restricting the expansion of our note issue. {: .speaker-KMW} ##### Sir CiTA Ri i3S Marr: -- If we did not have it, we should be compelled to balance our trade. M r. SCULLIN. - If we had no way of balancing our imports with exports, we should be in an insolvent position. Therefore, we need this reserve, and it is a safeguard. It has also a psychological effect upon the minds of those who accept our notes as legal tender, but they would have to accept them in any case. When the Government of which I was leader desired to ship a portion of the idle gold reserve of this country overseas, and have some use made of it, the minority in this chamber was horrified; the hill was passed by the House of Representatives but was rejected in the Senate. Yet my Government had not been out of office three months when Parliament agreed to send the whole of the gold reserve overseas, and I think that the right thing was done.. It is stupid to have gold lying idle, when it can be kept in the only place where it would be of use. When I am challenged to say whether 1 would abolish the reserve of the note issue, I say that I would not. If the nation experienced a crisis in which it could not balance payments Ky an excess pf exports over imports., and could not meet its obligations without borrowing overseas - a wrong method that was adopted for a number of years before my Government took office - it would be compelled to call upon that reserve in order to prevent default. Therefore, the reserve has a real value. I do not complain about having a reserve; but in my opinion it is not large enough. In 1927, when **Mr. Bruce** was Prime Minister, I pleaded with him from the very place where I now stand to stop the flood of imports into Australia, to cease financing the in by means of overseas loans, and, instead, to build up in London a reserve of £30,000,000 or £40,000,000, so that we should have it there when, the value of our exports would not meet our imports and other charges. I little thought that it would fall to my lot to be the responsible Minister to face a crisis such as I then predicted; but many others had given similar advice that went unheeded. I mention this fact to show that the Assistant Treasurer is not justified in giving the impression to the people of this country that members of the Labour party are wild-cat financiers, since it was .a Labour Government that rescued Australia from the reckless financial dealings of the preceding Government. This war should he prosecuted without profiteering in either goods or money. The most shameful thing done in the last war was to say to people who had money to lend on the credit of the nation that they could get practically double the rate of interest that was obtainable in time of peace, although our soldiers who had been earning 15s. or £1 a day went into the trenches for 6s. a day. That was a scandal, and I hope that it will not be repeated. Whatever methods of finance are employed - and I suppose that every method will be employed, including loans, taxation and the utilization of the credit of the nation through the Commonwealth Bank - I hope that the Government will see that those who have money to lend shall receive, at most, the normal rate of interest if they are not. patriotic enough to lond nt a lower rate when other men are called upon to make much greater sacrifices. I rose merely to make the position of the Labour party clear. Progress reported. , {: .page-start } page 663 {:#debate-39} ### SALES TAX ASSESSMENT BILL (No. 5) 1939 {:#subdebate-39-0} #### Second Reading {: #subdebate-39-0-s0 .speaker-KUG} ##### Mr SPENDER:
Assistant Treasurer · Warringah · UAP -- I move - >That the bill be now read a second time. This bill, which was foreshadowed in the budget speech, is designed to increase the taxable sale value upon which sales tax is payable by retailers and other persons upon the importation of goods into Australia. The bill will remove a competitive anomaly which at present exists between retailers and wholesalers, in respect of- sales tax payable upon imported goods. The general scheme of the sales tax law is designed to require the payment of sales tax upon a wholesale selling value of all goods sold in Australia, other than goods in respect of which exemption is authorizedby the law. *A* wholesale merchant who imports goods for sale by wholesale is required by the law to enter the goods at the customs free of sales tax, and is subsequently required to pay tax upon the amount for which he sells the goods to retailers for re-sale. It will be realized that exchange is taken into account by the merchant, together with other costs, in arriving at the price for which the goods are sold, and upon which tax is payable. On the other hand, however, a retail merchant who imports goods for sale by retail is required under the existing law to pay sales tax in respect of those goods at the time of entry for home consumption, upon values which arc not, in fact, expressed in terms of Australian currency. In these cases the law requires tax to be paid upon a " sale value " representing an amount which exceeds by twenty per centum the sum of- {: type="i" start="i"} 0. the value for duty of those goods; and 1. the duty of customs payable in respect of the goods. With few exceptions, such as goods imported from New Zealand, the value for duty of imported goods, for the purposes of customs duty, is expressed in terms of sterling, and not in terms of Australian currency. Thus the taxable sale values for sales tax purposes, which are based on these values for duty,are not related to Australian currency. This point was of little importance in 1930, when the sales tax law was introduced, as the rate of exchange, Australia on London, was then in the vicinity of £106. It is now £125 buying, and £125 10s. selling. This substantial increase has caused the exchange factor to assume considerable importance. It means that a wholesale merchant who pays tax on his Australian currency sale prices of imported goods is at a considerable disadvantage from a sales tax point of view, in competition with a retailer who imports comparable goods and pays sales tax on values which are based on sterling. It may be explained that the provision in the existing law for the addition of 20 per cent. to the sum of the value for duty and the duty to ascertain the taxable sale value for sales tax purposes was not designed to cover the exchange factor. It was designed to arrive at a figure which would include other importing costs, together with a reasonable measure of profit to the importer, and which would, in general, represent the fair wholesale value of the goods if sold in Australia. It must be admitted that in respect of some classes of goods, the addition of 20 per cent. may be too low to reach a fair wholesale value, whilst in some few cases it may be a little high for that purpose. In the vast majority of cases, however, and taking the taxable field of goods as a whole, it is considered that the 20 per cent. originally decided upon does no more than cover the costs, charges and profits, exclusive of the exchange involved, which would normally form part of a fair wholesale sale price. It would, of course, be impracticable to attempt to prescribe varying percentages for all the different classes of goods affected. It is considered, from a practical point of view, that 20 per cent. is fair for general application to all cases, provided that action is now taken to require exchange to be reckoned as proposed in this hill. It will be noted that the bill provides that the rate of exchange to be used in converting values for duty into Australian currency shall be the telegraphic transfer selling rate, as fixed by the Common wealth Bank, at the date of export of the goods from the country of export. The present telegraphic transfer selling rate, Australia on London, is £125 10s. This rate has remained constant, owing to regulation by the Commonwealth Bank Board, since the 3rd December, 1931. It is proposed that the conversion of values for duty into Australian currency shall come into operation in respect of importations on and from the 1st October, 1939. The fixing of a definite date in this manner is necessary in order to avoid confusion amongst importers and their agents. The scheme will not necessarily be applicable to all entries of goods on and from that date, as it will definitely not apply to entries of goods which were. in fact, imported into Australia prior to ihe 1st October, 1939. it may be explained that the High Court of Australia has held in the case *Wilson* v. *Chambers & Co. Pty. Ltd.* i .192G), reported in 38 C.L.R. 131, that goods are imported into the Commonwealth whenever they are brought into their port of destination for the purpose of being finally discharged in Australia at that port, and that the discharge of the goods from the importing vessel is not required to complete the importation. The port of final discharge of such goods may Ih3 a coastal port at which the importing vessel does not call, and, therefore, the goods must be landed for transport by land or sea to the coastal port for final discharge. In such a case the date of the arrival of the goods at the coastal port is the date of their importation into Australia. I commend the bill to honorable members as a measure which will result in the removal of a definite anomaly by placing retail importers on more even terms with wholesale, importers from the point of view of their liability for sales tax. It is estimated that during the current financial year, the bill will produce additional revenue amounting to £120,000. Debate (on motion by **Mr. Forde)** adjourned. {: .page-start } page 665 {:#debate-40} ### STATES GRANTS BILL 1939 Message recommending appropriation reported. *In committer.* (Consideration of Governor-General's message) : Motion (by **Mr. Spender)** agreed to - >That it is expedient that an appropriation of revenue be made for the purposes of a hill for an act to grant and apply out of the Consolidated Revenue Fund sums for the purposes of financial assistance to the States of Smith Australia, Western Australia and Tasmania. Resolution reported. Standing Orders suspended; resolution adopted. *Ordered -* >That **Mr. Spender** and **Mr. Holt** do prepare and bring in a bill to carry out the foregoing resolution. Rill brought up by **Mr. Spender,** and read a first time. {:#subdebate-40-0} #### Second Reading **Mr. SPENDER** (Warringah- Assistant Treasurer) [3.23]. - I move - >That the bill be now read a second time. The grants for which approval is sought in this bill are those recommended by the Commonwealth Grants Commission to be paid to the States of South Australia, Western Australia and Tasmania during the financial year 1939-40. The recommendations of the commission are contained in its sixth report, which was tabled in Parliament on the 8th September last. The proposed grants, compared with those paid last year, are as follows: - Before proceeding to an explanation of the methods adopted by the commission in arriving at its recommendations, I submit for the information of honorable members a statement showing the trend of these grants during the last eleven years. The grants paid for the year 1934-35 and following years are those based on the recommendations of the commission : - Whilst the total amount of the grants now recommended, viz., £2,020,000, is the same as the total of the grants paid last year, this is not a true comparison because of the fact that both last year and this year reductions are made from the normal grant to Western Australia in order to repay advances made in previous years. As will be seen from the following comparison, the total normal grants for 1938-39 were £2,064,000, whilst the total normal grants for this year are £2,156,000, an increase for this year of £92,000:- The general principles upon which the recommendations of the commission are based have been explained to the House at some length in previous years, and I do not propose, therefore, to enter at this stage of the bill into a full and lengthy discussion of the principles involved in arriving at the amount now proposed. These principles are explained ' very fully in the commission's sixth report, which was recently tabled and copies of which are available to honorable members. It is necessary, however, to explain that the plan which the commission has evolved and followed in each of its' six reports is to base the grants recommended for the threeStates concerned on financial needs, as indicated by a comparison of their budgets with those of the non-claimant States. The grants recommended are calculated to bring the finances of the claimantStates up to what the commission considers to be a fair Australian standard. In. short, the commission is of the opinion that the grants should be sufficient to enable a State which is in difficulties to function at a standard not appreciably below that of other States. The States concerned, however, are required to make some effort themselves to remedy their inferior financial position. I think, perhaps, that it *is* necessary to mention that the basis adopted by the commission has evoked some criticism, to which reference has been made when submitting legislation for approval in previous years. It has been claimed by certain of the States concerned that the grants which are made to them should be based on compensation for disabilities arising from federation or the effects of federal policy. The Grants Commission has given very careful consideration to this aspect and in earlier reports has expressed the opinion that the necessity for grants to these States is in no case due to any appreciable extent to the operation of federal policy. The commission states in its present report that it is convinced of the impracticability of assessing special grants on the basis of disabilities arising from federation and the operation of federal policy. In the view of the commission - and this view is said to have been supported by many expert witnesses who appeared before the commission - the reactions of the protective tariff and other aspects of federal policy are so interwoven with the financial and economic structure of Australia asa whole that it is impossible to express in monetary terms their full effect on the finances of the individual States. Moreover, even if it were practicable correctly to assess the financial effect of federation and federal policy on the finances of the claimant States, it would at the same time be necessary to make proper allowance for the advantages which accrue to those States from federation. This factor has been given a great deal of consideration by the commission as is evident from its various reports. Any financial disability which a State suffer* by reason of federation will be reflected in the State's budgetary results, and is automatically provided for by the commission's method of assessing grants according to " financial needs ". The commission is satisfied that the only safe and practicable basis upon which these grants can be assessed is the careful analysis of the relative financial position of the States as expressed in their annual budgets. This fundamental principle was expressed by the commission in one of its earlier reports as follows: - >Special grants are justified when a State through financial stress from any cause is unable efficiently to discharge its functions as a member of the federation, and should be determined by the amount of help found necessary to make it possible for that State by reasonable effort to function at a standard not appreciably below that of other States. The adoption of the principle just stated has involved a careful comparison by the commission of the budgetary results of the claimant States -with those of the non-claimant .States. The accounts of all States are not compiled on a uniform basis, and it is accordingly necessary for the commission to make certain adjustments of the figures in order to place tha budgetary results on a comparable basis. Having arrived at the amount that is required to raise the claimant States to the budgetary standards of the nonclaimant States, the commission then proceeds to make certain adjustments which it considers necessary after a comparison of the relative severity of taxation in the several States, differences in the cost of social services, costs of administration, and other relevant factors. Last year, the commission introduced a new feature into its work. In its report for that year the commission expressed the view that, in times of prosperity, a claimant State should take action to improve its financial position which it cannot take in less prosperous years, and that it should not incur expenditure which is unjustified or uneconomic. The commission examined the finances of the claimant States from that angle and imposed certain nominal penalties with a view to drawing the attention of the claimant States to their duty in that respect. The items particularly examined were: In the case of South Australia, the failure to recover debts due to the Crown; in the case of Western Australia, the expenditure of loan moneys on unproductive projects; and in the case of Tasmania, the failure to take action to secure an improvement of the railway finances in that State. In its present report the commission expresses the belief that its criticism of last year has not been adequately met, though in certain accounts improvement is noted. In particular, the commission has mentioned the heavy loan fund expenditure on unproductive road works, notwithstanding the greatly increased Federal Aid Roads grants from the Commonwealth, the dan gerous trend in railway losses, and losses on land settlement in Tasmania. After considering all these factors concerned the commission decided to make general deductions from the grants of the three States, viz. ;. - I think honorable members will agree that so long as the Commonwealth continues to make subventions to the States based on their budgetary accounts, a duty devolves upon the commission, and finally upon this Parliament, to ensure that the interests of all federal taxpayers shall be protected to the extent that the claimant States shall be required to maintain their finances on a sound basis. For this reason the . Government endorses the procedure adopted by the commission to achieve" this objective. The calculations by the commission for the purpose of assessing the grants for the present year are based on the financial results for the year 1937-38, which is the latest year for which complete statistics are available. It has been complained that the calculations made by the commission are based on figures which are, in effect, two years old. The term commonly used in this regard is the " timelag ". As an- example, the grants proposed for the year which commenced on the 1st July, 1939, are based on the financial position of the States for the year ended on the 30th June, 1938. There are disadvantages attaching to this procedure as the conditions two years ago may not truly reflect the circumstances of the present time, but any inequality which might result from the use of figures of a previous year is not cumulative, as differences will balance out. over a term of years. It has been sometimes urged that a formula should be evolved so that the amounts of the grants could be automatically fixed for a term of years. In the view of the commission, a fixed formula could not take full account of the relative effects of changes in prices, wages, fluctuations of trade, unemployment, the effects of droughts, floods and bush-fires, and movements of population, as well as the effects of external influences on the economy of the nation. Another factor to be borne in mind is the changing position caused by the uneven growth of Federal and State responsibilities in relation to their financial resources. The commission considers that, in view of fluctuating financial and economic conditions, financial adjustments in the form of special grants cannot be fairly assessed without a searching annual review of the finances and economic conditions of all the States. T shall now refer briefly to the variations of the grants now proposed from those recommended and paid last year. The reduction of £45,000 in South Australia's grant is due in the main to improved economic conditions in 1937-38, the year upon which the present grants are based. The total revenue and the taxation revenue of the State constituted records and a surplus was achieved for the fourth successive year. Whilst the grant recommended for Western Australia is £25,000 Lu excess of that, recommended last year, actually the normal grant now recommended is £117,000 greater than the normal grant of last year. The normal grant for last year was £614,000, but a deduction of £44,000 was made to adjust an advance made in 3 936-37, the grant actually paid being £570,000. The normal grant recommended for this year is £731,000, from which is deducted a special advance of £136,000 made in 1937-38 on account of drought. The increase of the normal grant is therefore £117,000. This increase is due to the effects of drought, which had serious repercussions on the income year 1936-37, on which the taxation assessments for 1937-38 were based. The grant recommended for Tasmania *i±* £20,000 greater than that of last year. This is caused mainly by changes in the relative financial positions of the States. There is ample evidence that the commission, which has been set up as an independent body to investigate the claims of the States for financial assistance, has discharged its duty with thoroughness and in a wholly impartial manner. The Government therefore considers that it must accept the amounts recommended by the commission as special grants as bona fide recommendations to adjust the financial needs of the claimant States. The Government lias accepted the recommendations of the Grants Commission in all past years, and it has decided to accept the commission's recommendations in this instance. I commend the bill to honorable members. Debate (on motion by **Mr. Forde)** adjourned. {: .page-start } page 668 {:#debate-41} ### QUESTION {:#subdebate-41-0} #### ADD.LT 1 ON AL T A XATION PROPOSALS **Mr.** SPEND EE (Warringah- Assistant Treasurer). - *by leave* - The Treasurer **(Mr.** Menzies) in his budget speech on the Sth September, indicated that, because of the large increase of expenditure to carry out the Government's defence programme, the tax proposals then submitted could not be regarded a* static, and that it would be necessary later to submit additional proposals for increased taxation in the present financial year. During the last three or four days Cabinet has given consideration to the matter, and it is thought desirable that an announcement should be made as early as possible as to further imposts which have been decided upon as immediately necessary. fu the time that has been available to us since the budget was introduced, we have not had an opportunity completely to review the whole of the tax field, but certain important factors affecting the budget have made necessary an immediatesurvey at this early stage. Increased expenditure involved by measures taken just prior to or since the outbreak of the war is about £6,000,000, and there can be no doubt that, in the year that lies immediately ahead of us, further expenditure will be inevitable. It is also anticipated that, as a direct result of the war there will be substantial reductions of customs revenue. It is yet too early to say what will be the amount, but no one can doubt that it may be substantial. Tt is not unreasonable to expect a loss of £5,000,000 or more. As has. already been announced, the Government is preparing its plans on the assumption that war conditions may last for three years or more. lt is impossible to estimate, with any degree of accuracy, the effect, on the budget of a prolonged conflict, but it is certain that the proposals brought down h few days ago will be totally inadequate to meet obligations which wo may be called upon to bear. The Government has reviewed certain tax fields for the purpose of ascertaining what it can do immediately. It is advisable, as I have indicated, that any additional tax proposals should be made known as early as possible after they have been decided upon, in order that the taxpayers will have some knowledge of their precise liabilities. Honorable members will remember that the budget contains proposals to increase income tax collections by £2,360,000, sales tax by £1,420.000, and customs and excise duties by' £2,1.30,000, making the total of additional tax collections £5,910,000. After careful consideration, the Government has decided to submit a proposal further to increase the companies tax, which the budget increased from I3.8d. in the £1 to 1.9.«d. This was estimated to produce an additional £1,360,000. A further levy of 4. 2d. is now proposed, making the total tax 2s. in the £1. It is estimated that this further increase will yield an additional £1,000,000. Another new tax proposal relates to certain profits of gold-mining which, honorable members, I am sure, will appreciate when I. have placed the facts before them, are due solely to circumstances and conditions arising out of the war. Because the price of gold has increased solely because of the outbreak of Avar, the Government believes that the increase of the price of gold represents in substance on unearned increment and should be taxable for war purposes. It was suggested that it might he possible to fix 20s. a fine ounce as the approximate amount of the increase. I think that honorable members will, however, regard as a fairer basis, a tax of 75 per cent, of the amount by which gold exceeds £9 Australian currency an ounce of fine. gold. At present profits of gold-mining are exempt from Commonwealth income tax, both as to profits in the bands of gold-mining companies and dividends in the hands of sha reholders. These profits are also exempt from most State taxation except iu Western Australia and Tasmania. High prices for gold have benefited the industry for several years. The. war has caused the dollar sterling exchange to depreciate, with the result that the price of gold has risen considerably in the last ten days. For instance, in 193S-39, the average price of gold, was £9 ls. 2d. an oz.; in July, 1939, it rose to £9 £3. lid. ; in August, the price was £9 8s. 7d. The price to-day is £10 10s., an increase of nearly 30s. an oz. over the average for 1938-39. Similar legislation is contemplated in the Union of South Africa and Rhodesia, but the Government does not know whether that legislation has yet been implemented. Announcements have appeared in the newspapers that both of these govern ments intend to appropriate the proceeds of gold over £7 10s. sterling a fine oz. The Union of South Africa in .1933 taxed gold profits heavily when the. South African currency was depreciated to the level of sterling in that year. The recent exchange premium is by way of a windfall due to war, and presents a strong case for a contribution to the Commonwealth revenue upon lines somewhat similar to those which, ii; is understood, have been adopted in the Union of South Africa and Rhodesia. The Government, therefore, proposes to place a tax on all gold delivered to the Commonwealth Bank or its agents on and after to-day, the 15th September. The tax will be 75 per cent, of the amount by which the price of fine gold, as fixed by the Commonwealth Bank from time to time, exceeds £9 Australian currency. As all gold must now he delivered to the Commonwealth Bank or its agents, arrangements will be made for the tax to be collected by the Commonwealth Bank. **Mr. McHugh.** - The price of gold will vary from time to time. {: #subdebate-41-0-s0 .speaker-KUG} ##### Mr SPENDER:
UAP -- Yes. there may be fluctuations, hut the *tax* will vary in direct proportion to the increase of price over rind above £!) a fine ounce. {: .speaker-JTY} ##### Mr Archie Cameron: -- Could not the same result be achieved by acquiring all the gold: that process would be much cheaper. {: .speaker-KUG} ##### Mr SPENDER: -- The procedure is simple. All the gold must bo delivered to the Commonwealth Bank or to the bank's agents. When the actual quantity of fine gold is determined, the tax will be collected by the Commonwealth Rank. The tax will be imposed on gold produced in Papua and New Guinea, as well as on gold produced in the Commonwealth. The present production of gold is about 1,800,000 fine ounces a year. The amount of tax collected will depend upon the price of gold. If the price averages £10 10s. a fine ounce, the Government will receive about £1,500,000 for the balance of this year. The remaining 25 per cent. of the excess price over the £9 will remain with the companies and shareholders to provide an offset against a rise of mining costs, and will probably provide some additional benefit. It is estimated that the total additional revenue from company tax will be £1,000,000, and from excess gold profits; £1,500,000, or a total of £2,500,000. The Government regrets that it is necessary to impose additional taxes, but in the circumstances it is unavoidable. It is with great reluctance that further burdens are imposed on companies, particularly in New South "Wales, where they are already bearing a heavy burden. SALES TAX BILLS (Nos. 1 to 9) 1939. Assent reported. {: .page-start } page 670 {:#debate-42} ### GOLD TAX *I n Committee of Ways and Means:* Motion (by **Mr. Spender)** proposed- Progress reported. {: .page-start } page 670 {:#debate-43} ### ADJOURNMENT {:#subdebate-43-0} #### Cotton Industry - French Foreign Legion : Australian Enlistments - Release of Internees - Repatriation: Claim of R. E. Cragg - Canberra: Residential Accommodation Motion (by **Mr. Menzies)** proposed - >That the House do now adjourn. {: #subdebate-43-0-s0 .speaker-F4U} ##### Mr FORDE:
Capricornia .-I should like the Minister for Trade and Customs **(Mr. John Lawson)** to make a definite pronouncement as to the Government's proposals in connexion with the Australian cotton-growing industry. In the act passed in 1934 which expires in November, provision is made for the payment of a bounty. The cotton-growers are anxious to know whether it is proposed to re-enact that legislation or whether the industry is to be assisted in some other way. For some Weeks I have questioned the Minister oh this matter. I raised it in the closing days of the last period of the session, and was given the assurance by the Minister that there was no cause for anxiety, and that the cottongrowers could rest assured that he would not let them down. I was impelled to raise it, by telegrams which I had received from cotton-growers in my own electorate. I have been waiting for a long time for a definite pronouncement by the Minister. The subject was referred to the Tariff Board on the 13th September, 1938, and the board submitted its report on the 3rd April, 1939. The Minister on the 12th of this month replied to a question by me in the following terms: - >Important aspects of the raw cotton industry are still the subject of discussion between the Commonwealth and Queensland Governments. It is hoped that the Government's decision will be available at an early date. I consider that I have reason to feel anxious, particularly as the period is approaching when thecotton-growers must plant their crops. Australian factories use 35,000 bales of raw cotton a year. Last year the local production was approximately 12,000 bales. There are some 3,000 growers and 2,000 seasonal workers in the industry, which was worth £400,000 to Queensland last year. It is a small man's industry, the average acreage being approximately 15 acres. I submit to the Minister that it is advisable to, make an early decision which will induce cotton-growers to increase their acreage. The Government of Queensland has decided upon a developmental scheme of irrigation,, with the object, of substantially increasing the production of cotton. That Government realizes the. considerable importance of this industry, and the necessity to produce at least the whole of Australia's requirements. It now rests with the Minister to fulfil the very definite promise he made to. me in this House, that I could rest assured that he would not let the cotton-growers of Queensland down.. Surely sufficient time has elapsed since April last for the Government to have come to a decision as to whether the existing legislation shall be re-enacted or amending legislation introduced. If the Minister is not at present in a position .to make a definite statement, I ask ham to give to me the assurance that he will do so next week. **Mr JOHN** LAWSON (MacquarieMinister for Trade and Customs) [3.57). - It, will1 be possible to make a pronouncement next week regarding the proposals of the Government with respect to the cotton industry. {: #subdebate-43-0-s1 .speaker-JTY} ##### Mr ARCHIE CAMERON:
BarkerLeader of the Country party -- I bring under, the notice of the Minister for Defence **(Mr. Street)** a position that may arise by reason of the fact that quite a number of our fellow citizens are offering themselves at the French Consulate-General for active service with the French Foreign Legion. 1 should like to know whether the Government has taken any steps to prevent such use of our man-power, seeing that we may need to have recourse to it ourselves before the termination of the present conflict. I take this stand, because. I remember that, during the Spanish civil war, quite a number of persons left Australia to participate in it.' I understand that the Foreign Enlistments Prohibition Act is still in operation. I should like to know, so soon as the Minister is able to tell me, what the attitude of the Government 18 On Tuesday last the Prime Minister **(Mr. Menzies)** informed the honorable member for Riverina **(Mr. Nock)** that no persons had been released from intern ment a3 the result of political pressure. Yesterday, in reply to, a question, by the Leader of the Opposition (M'.r. Curtin), the right honorable gentleman said that he had. intervened in a certain case with the Minister for Defence **(Mr. Street).** La. this matter, we have to be very careful to see that only the necessities of the situation govern internment. The internal security of Australia is a rather important matter. In. view of the peculiar circumstances, I ask the. Prime Minister whether the papers relating to the case referred to by the Leader of the Opposition may be made available. 1 should also like him to state whether or not the release of the person concerned was made under instructions conveyed in a telegram to the proper authorities? If such instructions were given either by telegram or by letter, would it be possible for them to be made available to the House some time next; week? I have no desire whatever that any person who might be acting detrimentally to. the welfare of this country should continue his present avocation, but I do think that n very serious precedent would be established, and one that would certainly redound to the very great danger and detriment of this country in. time of war, if any Minister of the Grown, either the Prime Minister or any other Minister, were to give instructions for the release of any person from internment before the evidence in the possession of the police and the military authorities, on which that . person had been, interned, was thoroughly examined by a competent authority ; and in that competent, authority I naturally include the Government, which, after all, over-rides all military law in this country. I further invite the Prime Minister to make next week a statement which will show how many persons have been released from internment under conditions similar to those that operated in the case to which I have referred, and, if the information may be disclosed by the competent authorities, how many of those whom it was thought advisable to re-intern have eluded reinternment since instructions to that effect were given. {: #subdebate-43-0-s2 .speaker-KZR} ##### Mr WHITE:
Balaclava .- I asked the Minister for Defence **(Mr. Street)** to-day to state whether any of those persons who had been released and whose re-internment had been ordered could not be found, and his reply was that, so far as he knew, three of those who had been released had been reinterned. Either he or some other Minister replied to a similar question by the honorable member for Riverina **(Mr. Nock)** in different terms. This reply was that a number had been released on parole, and while they behaved themselves they would not be re-interned. The honorable gentleman has not yet answered the question as to whether some of those who were released cannot now be located. J. should be glad if he would explain the matter more fully. {: #subdebate-43-0-s3 .speaker-KLL} ##### Mr MAKIN:
Hindmarsh .- Some weeks ago, I drew attention to anomalous situations that were arising in respect of certain provisions of the repatriation administration, particularly by reason of the rigidity of the act. The Minister **(Mr. Harrison)** will remember that I said that certain medical decisions were very conflicting and were rather inexplicable at times. I informed him that cases had been brought to my notice of nien who had returned from active service medically unfit, had been adjudged as having a disability either due to, or aggravated by, war service, and had been granted pensions which had subsequently been withdrawn although they were still suffering from the same disability. The Minister asked me to cite a specific case which would give a clear idea of the nature of my complaint and substantiate my contention that injustice was being done. I have had brought to my notice a case which I think comes within this category. The man in question approached the repatriation authorities for the acceptance of his disability. It was accepted upon his return to Australia, from active service, and he was given a half-rate pension as well as medical treatment. Later, the doctors decided that his disability was not to be regarded as due to war. There is nothing more that this man can do; unless he can bring fresh evidence in support of his claim, he has no possible hope of obtaining redress. The department already has in its possession all the evidence that he can supply. It would appear that there have been some remark.able misunderstandings regarding certain aspects of the case. I shall not dis close any confidences by giving details of this case, for I have not seen the file. All of the information that I now present to the House was obtained from the man himself, **Mr. R.** E. Cragg. He enlisted in August, 1914, at Gawler, where he was examined and passed by the doctor at the recruiting station. He was drafted to Morphettville, but when he presented himself for a second medical examination, he was rejected because his teeth needed attention. Evidently he did not persevere with his enlistment at that time. Instead he went to Port Augusta, where he worked for the Commonwealth Government as a fireman. While there, he was taken ill, while still in the employ of the Commonwealth Government, and was operated on for appendicitis. After his discharge from hospital, he worked with the Broken Hill Associated Smelters at Port Pirie. There seems to be some confusion as to the cause of his first rejection. **Dr. Griffiths,** the department's doctor, said that this man's rejection for active service was due to his condition arising from appendicitis, whereas it was due to his dental condition. **Mr. Cragg** enlisted again in January, 1917, and embarked for overseas in May of that year. During the voyage he had the misfortune to be injured in one eye as the result of a hammock stick falling down a wind chute. The accident necessitated several stitches in the wound. Even in regard to that injury, the records appear to he confused, because I understand that they assert that appendicitis developed immediately upon embarkation. The operation for appendicitis was performed in 1915, before his second enlistment. To-day **Mr. Cragg** suffers from certain abdominal injuries, which have been the cause of much discomfort since his return to Australia in 1919. Almost immediately on his return he was treated in hospital. Later he was discharged as medically unfit and was sent to the Torrens Park hospital by the Medical Board, which certified that his disability was aggravated by his active service. The report states - >Noticed trouble as above in right abdomen in France. Still has similar attacks, but otherwise feels well. Discharged, but to return for further treatment if he has any further trouble. Incapacity half. Although that was the report of the Medical Board, this man has been denied the treatment that he should have received in accordance with the board's direction. Two years later **Dr. Griffiths,** who was the Divisional Medical Officer in Adelaide, stated - >It is difficult to connect up present disability with war service. **Mr. Cragg** had had some heated words with **Dr. Griffiths,** and it is evident that the doctor had not forgotten the incident. Although **Dr. Griffiths** said that itwas difficult to connect **Mr. Cragg's** disability with his war service, he recommended that he be supplied with a surgical belt. The case was referred to **Dr. Corbin,** of Adelaide, for an opinion as to the advisability of an operation. **Dr. Corbin** reported that the man suffered from an old appendicitis trouble, which was not due to war service, and drew attention to the fact that **Mr. Cragg** weighed 15 stone. At no time was he of slight build ; when he enlisted, at the age of 32 years, his weight was 13 st. 5 lb. On the 13th May, 1921, **Dr. Griffiths** certified that his disability was not due to war service, and cancelled the order which he had previously given for a surgical belt. His reportstated - >Disability not sufficient to make him eligible for training and he is fit to work at pre-war occupation. **Mr. Cragg** then endeavoured to do as the doctor suggested; he returned to work, but after two or three months he had to discontinue his employment. He went back to Gawler, where he was examined by **Dr. Lewis,** who reported, that he was suffering from shooting pains in the right side, which had developed in France, and that the pain occurred first with heavy lifting, and had since been getting more frequent and severe. He said that the man was normal except for a large appendicitis scar which had thickened and was tender. Mr.Cragg's case was then reported on by a specialist, who gave an adverse decision, and suggested that an increase of 4 stone in weight was the cause of his disability. Here, again, there seems to be some confusion, because when **Dr. Corbin** examined, **Mr. Cragg** in 1921, his weight was 1 st. 9 lb. above his weight at enlistment. Within twelve months it was assumed that his weight had increased by 4 stone. **Dr. Lewis** then returned to the case and reported - >The above condition is the result of the strain of war service upon operation scar. Condition not due to his default. **Dr. Griffiths** again made a recommendation to the department in which he strongly advised rejection of the appeal. This man has now exhausted all possibility of his securing justice unless the Minister takes a personal interest in the case. {: #subdebate-43-0-s4 .speaker-KNX} ##### Mr HARRISON:
WentworthMinister for Repatriation · UAP -- I am glad that the honorable member for Hindmarsh **(Mr. Makin)** has brought this matter before me in detail, but, as the honorable member remarked, he has not seen the departmental file. I think that he will agree that, notwithstanding the amount of detail he has put before me, it will be necessary for me to acquaint myself with the facts on the file. I shall make this case a personal matter and see what can be done. {: #subdebate-43-0-s5 .speaker-JNX} ##### Mr BARNARD:
Bass -- I rise to urge upon the Prime Minister **(Mr. Menzies)** the necessity for the application in Canberra of the appeal made by him that business should be carried on as usual. I appeal against any slackening of the works programme in this city. My inspiration for speaking on this matter to-day lies in two reports published in the *Canberra Times* this morning. The first report is - {: .page-start } page 673 {:#debate-44} ### OVERCROWDING *Fourteen in Four-roomed House.* Evidence of unsatisfactory housing condi tions in Canberra was given by the Director of the Canberra Tourist Bureau **(Mr. W. J. H. Dunbar)** before the Public Works Committee yesterday. The committee is investigating a proposal to construct a new hostel in Canberra ata cost of ?42,500. **Mr. Dunbar** said that one four roomed house in Canberrawas occupied by fourteen boarders, some of whom slept in the garage and others in tents in theback yard. " Canberra is urgently in need of accommodation," he added, "It is the national capital and yet tourist services have often to advise visitors tostay away as it would be impossible to secure accommodation anywhere." {: #debate-44-s0 .speaker-JNX} ##### Mr BARNARD: -- The honorable member for Hume **(Mr. Collins),** a member of the Public Works Committee, says that the witness admitted that that case was isolated. Nevertheless, it is a fact that the people of Canberra have difficulty in obtaining residential accommodation, either houses or lodgings, and within *my* lifetime 1 hope to see the disparity between the supply and the demand made up. The position has become worse every year since I first came to Canberra as a member of Parliament five years ago. I remember that when parliamentarians first came here they all had to hoard at the one hotel; we were allowed to go to no other. Married persons, whose jobs demand that they live in Canberra cannot get houses. Single men and women have difficulty in obtaining board. Certain people who have to be in Canberra when Parliament is in session can obtain accommodation only at high rates and, even then, it is intimated to them that they will not be welcome as boarders for long periods because the hotels find the casual visitors more profitable. The position will he aggravated if the following report, the second of those I mentioned at the beginning of my speech, be true : - >PRICE FIXING. > >New Staff koh Canberra. A stair of about 100 officers will be appointed to the office of the Federal Prices Control Commissioner (Professor Copland). > >Because existing departments .are cramped for space, office accommodation for this new war-time department has been reserved over a block of shops in a business section of Canberra. > >A small army of inspectors will be appointed to police price fixing regulations made by the Government. I have no complaint to make about that, proposal; on the contrary I welcome it, because all the Commonwealth departments should be at Canberra, and I hope to live to see the day when that will he so. It is ridiculous that administrative staffs should be situated in other cities, requiring departmental heads to come to Canberra when Parliament is in session or Ministers to go from Canberra to them. In the last twelve months there has been a fair amount of activity in the provision of more houses. and 1 hope that in the years- to come that activity will not be diminished - that no- other issue will he allowed to intrude and prevent Canberra from receiving fair treatment. I close with a further appeal to the Prime Minister to heed his own slogan: "Business as usual ". {: #debate-44-s1 .speaker-KVN} ##### Mr STREET:
Minister for Defence · Corangamite · UAP -- The honorable member for Barker **(Mr. Archie Cameron)** asked whether the Government proposed to take any action to prevent individuals from offering their services to the French Consul for enlistment in the French Foreign Legion,, and suggested that legislation existed prohibiting such enlistments. I have not been able to find any act containing such a provision, and I doubt very much whether there is any such, prohibition. If any individuals have offered their services in this direction, I imagine that they are few. At this juncture, the Government, I think, would take no action to prevent such enlistments. In reply to the honorable member for Balaclava **(Mr. White),** I point out that in answer to a question, I said that 1 thought there were three cases of aliens who had been interned, released and reinterned. That is correct. A. number of aliens were interned and released and further examined, but in these cases, it was decided on the dossiers to continue their release under conditions laid down by the defence authorities. These latter cases, perhaps, a.re responsible for the misunderstanding which apparently has arisen in the honorable member's mind. To the best of my knowledge, there is no instance of an enemy alien who was released, and whose re-internment was ordered, not having been, found and reinterned. air. MENZIES (Kooyong- Prime Minister) [4.27]. - *in reply* - My only connexion with the case to which the honorable member for Barker **(Mr. Archie Cameron)** has referred was that the case was brought under my notice and, knowing something about the business in question, I indicated that a prompt investigation should be made. Apparently an investigation was .made, and I gather from my colleague that the man was released and later re-interned. As to the tabling of papers with respect to any case of internment of an alien, it would seem to me, and I imagine to honorable members generally, that it would be contrary to the public interest to have individual cases made the subject of publicity, involving disclosure of 'the sources of information upon which action was taken. {: .speaker-KLL} ##### Mr Makin: -- It is the action of the Prime Minister that is in question. Mi-. MENZIES.- I have explained my only connexion with this matter. {: .speaker-KLL} ##### Mr Makin: -- It was said that the right honorable gentleman sent a telegram. {: #debate-44-s2 .speaker-N76} ##### Mr MENZIES:
UAP -- I did not send a telegram. I spoke to my colleague On the train when travelling up from Melbourne and indicated that this was a case in which on the face of it a mistake might have been made, as mistakes can be made in bringing in people in the first few days of a war. I indicated to my colleague that from what I knew of the people with whom this man was connected an investigation was warranted. That was my sole connexion with the case. {: .speaker-JTY} ##### Mr Archie Cameron: -- 'Will the right honorable gentleman allow me to -study the papers? {: .speaker-N76} ##### Mr MENZIES: -- I have hot seen the papers myself. {: .speaker-JTY} ##### Mr Archie CAMERON: -- That is not an answer to my question. Question resolved in the affirmative. {: .page-start } page 675 {:#debate-45} ### PAPERS The following papers were pre* sen ted : - Commonwealth Public Service Act - -Appointments - Department - Commerce - R. A. Potts. Treasury - K. m. Fraser. Land Tax Assessment Act - Applications for relief from "taxation dealt with during the year 1938-39. Post ane1- Telegraph Act - Regulations amended- Statutory Rules 1030, No. 84. Science and Industry Research Act - Regulations amended - Statutory Rules 1939, No. 83. Arbitration (Public Service) Act - Determinations by the Arbitrator, *&c.* - 1939 - No. 23 - Professional Officers' Association, Commonwealth Public Service. No. 24- ^-Amalgamated Postal Workers' Union of Australia. House adjourned at 4.30 p.m. {: .page-start } page 675 {:#debate-46} ### ANSWERS TO QUESTIONS *The following answers to questions were circulated: -* {:#subdebate-46-0} #### Port Wakefield Shell Testing Range {: #subdebate-46-0-s0 .speaker-KRH} ##### Mr McHugh:
WAKEFIELD, SOUTH AUSTRALIA h asked the Minister for Defence, *upon notice -* >Will he explain why shells are not being manufactured at the Port Wakefield shell testing range? {: #subdebate-46-0-s1 .speaker-KVN} ##### Mr Street:
UAP -- There are no factories or plant at the proof range, Port Wakefield, for the manufacture of shells. The purpose of the range is only for testing and proving munitions. {:#subdebate-46-1} #### Australian Commonwealth Line or Steamers {: #subdebate-46-1-s0 .speaker-JNX} ##### Mr Barnard: d asked the Treasurer, *upon notice -* {: type="1" start="1"} 0. What is the amount still owing to the Commonwealth by the shipping company which purchased the ships of the Australian Commonwealth Line? 1. How much of the purchase price has been paid during the past five years? 2. How much interest has been paid each year for that period? {: #subdebate-46-1-s1 .speaker-N76} ##### Mr Menzies:
UAP -- The answers to the honorable member's questions are as follows > - {: type="1" start="1"} 0. The amount unpaid by the White Star Line Limited, now in liquidation, is £427,211. 1. Amounts totalling £339,000 have been received 'from the liquidator since the company went into liquidation. 2. No interest has accrued in respect of this debt since the company went into liquidation. The amounts received from the liquidator are in partial settlement of amounts due for principal and interest. GOVERNOR-GENERAL'S Canberra Residence. {: #subdebate-46-1-s2 .speaker-KUW} ##### Mr Stacey: y asked the Minister representing the Minister for the Interior, *upon notice -* >What were the coats of the alterations and additions to Government House, Canberra, showing (a) structural costs, and (6) costs of interior decorations? {: #subdebate-46-1-s3 .speaker-KXY} ##### Mr Perkins:
UAP -- The costs cannot be given at present as the work is not completed. broadcasting of WAR NeWS. {: #subdebate-46-1-s4 .speaker-L08} ##### Mr Rosevear: r asked the Postmaster.General *upon notice -* {: type="1" start="1"} 0. Is the announcement that is always made after the rebroadcast by Australian stations of the British Broadcasting Corporation's news t<j the effect that such news is broadcast by courtesy of the Associated Press to be taken a* an indication that the press has a proprietary right over such news? 1. ls this courtesy paid fur by the Australian Broadcasting Commission? :i. If so, what ure the terms of payment! {: #subdebate-46-1-s5 .speaker-KNX} ##### Mr Harrison:
UAP -. - The answers to the honorable member's questions are as follows: - {: type="A" start="I"} 0. Yes. The Australian Associated Press owns the copyright of the Reuter news service, including that transmitted from the British Broadcasting Corporation. {: type="1" start="2"} 0. No. For the time being the Associated Press has voluntarily allowed the service, to he made use of throughout Australia for broaden sting purposes. 1. See answer to question No. 2. Internment of Enemy Aliens. {: #subdebate-46-1-s6 .speaker-KVN} ##### Mr Street:
UAP t. - On the 1 2th September the honorable member for Riverina **(Mr. Nock)** asked the following question, *without notice: -* >Can the Minister for Defence inform the House as to whether or not the rumour is correct that New South Wales police interned certain aliens, who were released under institutions from the federal authorities, and were later re-interned? I am now in a position to inform the honorable member that re-internment has taken place in three cases to date. A certain number of enemy aliens have been released under control. "Whether they are re-interned or not will depend on their conduct whilst at liberty. In matters concerning aliens, the State police act as agents of the federal authorities. Sales Tax. Mir. Menzies. - On the 12th September the honorable member for Boothby **("Mr. Price)** asked the following question. *without notice: -* >Tn view of the proposed raising of the Hales tax from 5 per cent, to 8 per cent., and the considerable cost involved in the collection of such ;i ta,x, will the Treasurer ascertain thi. amount, that could be collected if a 1 per cent, turnover tax were imposed instead of >i 6 per pent, sales tuy? The reply to the honorable member's question is as follows : - >It is impossible to estimate with any degree of accuracy what revenue at a rate of 1 per cent, would be collected if a multiple turnover tax were instituted. It should, however, . be not less than £15,000.000 per annum. > >The honorable member ls informed in connexion with the matter that, at various times since the inception of the present sales tax legislation, the effect of changing over to a multiple turnover tax has been considered. The evidence adduced has shown the principle of multiple turnover taxes to have many objectionable features. Some of them are - > >the costs and difficulties of administering such a tax would greatly exceed the costs and difficulties o' the present form of sales tax. > >the snowballing and pyramiding effect is such as to cause the incidence to become unequal in relation to the same goods, unduly burdensome, and much more objectionable than the present single tax. (el the burden would fall much more heavily on those in the lower-paid classes because of the taxing of all commodities and the raw materials used therein. {:#subdebate-46-2} #### Construction of Torpedo Boats {: #subdebate-46-2-s0 .speaker-KHL} ##### Mr Holloway: y asked the Minister for Defence, *upon* *notice, -* {: type="1" start="1"} 0. Were Victorian shipbuilders given an opportunity to tender for the construction of the torpedo boats which are to be built for thu Defence .Department? 1. If so, was the opportunity availed of, how many tendered, and who were the tenderers ? {: #subdebate-46-2-s1 .speaker-KVN} ##### Mr Street:
UAP -- The building of motor torpedo boats, which are of a highly specialized type, is confined, in England, to a few firms whose designs are proprietary, and no firm in Australia could build these craft except by arrangement with an English firm to use its design. The only firm in Australia which at present has the necessary association with a British firm to enable construction to be immediately undertaken is the Cockatoo Docks and Engineering Company Proprietary Limited, which ha= submitted a tender for the construction of six boats; that tender is now under, consideration. In view of the necessity for construction to be completed at the earliest possible date, and having regard to the foregoing conditions, public tenders were not invited.

Cite as: Australia, House of Representatives, Debates, 15 September 1939, viewed 22 October 2017, <http://historichansard.net/hofreps/1939/19390915_reps_15_161/>.

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