House of Representatives
30 November 1939

15th Parliament · 1st Session



Mr. Speaker (Hon. G. J. Bell) took the chair at 2.30 p.m., and read prayers.

page 1836

QUESTION

EMPIRE AIR SCHEME

Mr HUTCHINSON:
DEAKIN, VICTORIA

– Is the Prime

Minister in a position to confirm, or. comment on, the statement in to-day’s press that Australia’s contribution to the Empire Air Scheme will be 26,000 pilots and observers and 50,000 ground staff?

Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · UAP

– I have not yet seen the statement referred to, although it has been mentioned to me. Any statement set out in the press at the present time is completely unauthorized and speculative.

page 1836

SALES TAX EXEMPTIONS

Mr JAMES:
HUNTER, NEW SOUTH WALES · ALP; LANG LAB from 1931; ALP from 1936

– Following representations which I made to the Acting Treasurer in regard, to the desire of the Parents and Citizens Association at Cessnock to equip school children with certain first-aid appliances, in the event of air raids, I have received from the Acting Treasurer a letter from which I propose to read one paragraph-

Mr SPEAKER:

– If the reading of the paragraph is necessary in order to make the question clear to the Acting Treasurer, I shall allow it

Mr JAMES:
HUNTER, NEW SOUTH WALES

– It is necessary, Mr. Speaker.. After setting out that certain articles were exempt from the tax, the letter proceeded -

Goodswhich are not specifically exempt may be obtained free of sales tax under Item 74 of the Schedule to the Sales Tax Exemptions Act 1935-1938 if they are for use in schools conducted by theNew South Wales Department of Public Instruction and are not for resale. So far as the equipment forthe threeRoman Catholic schools is concerned, I am informed by the Commissioner of Taxation that the amount of tax payable is very small indeed. As there is no exemption for goods to be used in the schools not conducted by the New South Wales Department of. Public Instruction, the tax is, therefore, properly payable.

Will the Minister say whether children attending Roman Catholic schools are to be less provided for in the event of a national emergency than other children ?

Mr SPENDER:
WARRINGAH, NEW SOUTH WALES

– This morning I received a letter on the same subject from probably the same person as that mentioned by the honorable member. I shall give attention to it, and let the honorable member have a reply later.

page 1836

QUESTION

MILITIA CAMPS

Mr FRANCIS:
MORETON, QUEENSLAND

– Will the Minister for the Army relieve the anxiety and uncertainty of members of the Militia and their employers by announcing when the Militia will go into camp, and what units are affected? Will he say when the second batch of the Militia is. to go into camp for three months, which units will go into camp, and the camps that they will attend? It is now about two months since the Government announced that Militia units were to go into camp.

Mr SPEAKER:

– Order!

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

– I shall make a statement on the subject as early as possible.

page 1836

QUESTION

REQUISITIONING OF S.S. BINGERA

Mr BERNARD CORSER:
WIDE BAY, QUEENSLAND · CP

– I have received from a large saw-milling company in Maryborough the following telegram : -

  1. U.S.N. advise Admiralty requisitioning steamerBingera which will seriously interfere our timber shipments. Suggest you strenuously endeavour . have vessel released as if position remains unaltered grave possibility of both plants having to pay off number of employees running into hundreds. Position very desperate. Please do your utmost.

In view of the statement contained in that telegram, and the serious unemployment which would result if the vessel be requisitioned, as well as the disabilities which would be caused by the non-arrival of’ timber at northern towns, will the Minister for the Army treat the matter seriously and endeavour to have the decision favorably reviewed with the object of alleviating the distress which the action of the Admiralty would cause?

Mr STREET:
UAP

– I am not familiar with the case which the honorable member has mentioned, but I shall investigate it and let him know the result.

page 1837

QUESTION

BOOT CONTRACTS

Mr NOCK:
RIVERINA, NEW SOUTH WALES

– Will the Acting Minister for Supply inform the House of the date on which the contracts for hoots to which he referred yesterday were signed and, further, will he say whether the boots obtained as a result of such contracts have been in use by the soldiers sufficiently long to receive the condemnation of the boot manufacturers?

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

– Not one pair ofthe boots that have been referred to so much lately in this House has yet gone into service. It is true, however, that during the last 12 months the Government has purchased 99,000 pairs of standard Militia boots, 471/2per cent. of which, or about 48,000 pairs, were purchased from men whose names were included in the listof ten men named by me in this chamber a few days ago.

page 1837

COMMONWEALTH RAILWAYS

Mr PERKINS:
Minister without portfolio administering External Territories · EDEN-MONARO, NEW SOUTH WALES · UAP

– I lay on the table the following paper: -

Commonwealth Railways - Report on Commonwealth Railways operations for year 1938-30.

Mr CURTIN:
Leader of the Opposition · Fremantle

– Acting under Standing Order318, I move -

That the paper be printed.

I am taking this course inordertodirect attention to the fact that the report of the Commonwealth Railways Commissioner, insofar as it summarizes the operations of the Commonwealth Railways Department for the year ended the 30th June, 1939, in its statistical abstract, is, no doubt, thorough and complete; but insofar as it relates to the administration of the railways by the Commissioner, it leaves out. I venture to say, the most cardinal aspect which calls for the attention of honorable members. During the year covered by the report an inquiry was ordered by the Government into the administration of the Commonwealth Railways Commissioner. No particulars have been vouchsafed to the House regarding that inquiry. I have reason to believe, though I do not say that I have been completely informed, that certain persons who tendered evidence at the inquiry have since suffered to some degree in respect to their rights in the Service, either because of. the views they expressed, or because of views they may havebeen believed to hold, concerning this matter. Men should not he penalized by their superiors in office in respect of any such matter. The Minister concerned has declined to table the report of the inquiry.

Mr Beasley:

-Why ?

Mr CURTIN:

– I do not know; nor do I know what evidence was adduced, or what finding was reached at the inquiry. I acknowledge that it was a departmental inquiry. A departmental inquiry into charges made against a subordinate officer may, perhaps, quite properly be left in the hands of the Commissioner, but an inquiry held at the behest of the Minister into the administration of the Commissioner of Railways is a vastly different matter.

SirCharlesMarr-Whenwasthe inquiry held?

Mr CURTIN:

– I have not exact information. I believe it took some weeks. It may even have been months. Perhaps the Minister can tell me.

Mr Perkins:

– That is so.

Mr CURTIN:

– That acknowledgment by the Minister makes it all the more necessary that we should know what actually occurred. I think that the Prime Minister (Mr. Menzies) will agree that an inquiry into the administration of the Commissioner of Railways is an entirely different thing from an inquiry into the actions of a subordinate officer because, while the responsible Minister is under obligation to Parliament in connexion with the railways, the conduct of the administration is reposed by statute, and very properly so, in the Commissioner. Cabinet directs the policy and the Minister is responsible for seeing that it is carried out, but, by and large, the administration is entrusted to the Commissioner by statute.. The statute authorizes the Commissioner to do many things on his own volition. In some of the States the Cabinet, or the Minister, cannot- vary the administration of the Commissioner, because his duties are so clearly specified by statute. This surely indicates clearly that an inquiry held by ministerial order into the administration of the Railways Commissioner is of very great importance. In my opinion it is utterly wrong that the result should be withheld from Parliament. In the hurried survey that I have made of the report just tabled I find no reference whatsoever to this inquiry. There are references to what I shall describe as fiddling details of administration which are in themselves unimportant; but there is no reference to the ministerial inquiry. I have moved this motion in order to draw attention to this fact. I make no accusation against the Commissioner. I do not know the nature of the evidence submitted at the inquiry, but I feel that we are entitled to information on the subject. I desire that the evidence adduced at, and also the result of, the inquiry, shall be laid on the table of the House.

Mr SPEAKER (Hon G J Bell:
DARWIN, TASMANIA

In connexion with this motion I draw attention to Standing Order No. 68, which reads -

The House shall proceed each day with its ordinary business in tlie following routine: - (I) Presentation of petitions; (2) Giving notices; (3) Questions on notice; and (4) Motions and orders of the day or vice versa, as set down on tlie notice-paper.

It would appear to me that in view of that standing order the debate on this motion should be adjourned, but it will be seen that nothing very definite is laid down regarding the moving of such a motion and the duration of debates upon it. The Prime Minister may reply to the remarks of the Leader of the Opposition if he so desires, but I feel. that I should not allow the debate to continue beyond that stage at present.

Mr Menzies:

– I was about to suggest that in order that I may have the opportunity to confer with my colleague on the subject, the debate should be adjourned.

Debate (on motion by Mr. Menzies) adjourned.

page 1838

QUESTION

WHEAT INDUSTRY

Mr McHUGH:
WAKEFIELD, SOUTH AUSTRALIA

– In view of the alarming statement made last night by the Prime Minister concerning the position of the most important industry in Australia - the wheat industry - I ask the right, honorable gentleman to say plainly whether the 2s. 6d. a bushel advance for bagged wheat and, I understand, 2s. 4d. a bushel for bulk wheat, will probably be the full price which the farmers will receive for their wheat this year?

Mr MENZIES:
UAP

– I made a full, and, I had hoped, a clear statement on this subject last night, to which I have nothing to add to-day. I fully explained the position in which we find ourselves. I sincerely hope, as I am sure every other honorable member does, that we shall be able to effect such sales of wheat during the season as will enable further payments to be made to the farmers, but whether that will be so or not neither I nor anybody else knows.

Mr GREEN:
KALGOORLIE, WESTERN AUSTRALIA

– Will the Prime Minister inform me whether I am correct in surmising that the Leader of the Country party (Mr. Archie Cameron) agreed with his proposal outlined last night for the payment of 2s. 6d. a bushel for bagged wheat and 2s. 4d. for bulk wheat at sidings’?

Mr MENZIES:

– I always like to speak for myself, and I should prefer the Leader of the Country party to speak for himself.

Mr WILSON:
WIMMERA, VICTORIA

– A few days ago I asked a question concerning the quantity of wheat which was entering Great Britain. I regard the reply I received as unsatisfactory as, in my opinion, honorable member* ar& legitimately entitled to such information in order to enable them to analyse the position of the wheat industry. I therefore ask the Minister representing the Minister for Commerce whether he will take steps to secure a more adequate reply to my question?

SirFREDERICK STEWART. - I shall refer the honorable gentleman’s request to the Minister for Commerce.

page 1839

QUESTION

THE A.B.C. WEEKLY

Mr JENNINGS:
WATSON, NEW SOUTH WALES

– I ask the PostmasterGeneral whether The A.B.C. Weekly, published by the Australian Broadcasting Commission, is published simultaneously in each capital city? If so, does the journal go to press about two weeks before being issued?

Mr HARRISON:
Minister for Repatriation · WENTWORTH, NEW SOUTH WALES · UAP

– The journal is published simultaneously. A maximum period of ten days is allowed between the time of going to press and the time of publication in order to ensure that the Weekly shall be published on the same day in different States.

Mr PRICE:
BOOTHBY, SOUTH AUSTRALIA

– Will the PostmasterGeneral inform me whether it is a function of the Australian Broadcasting Commission, in connexion with its new weekly, to provide cartoons . which, as stated in this week’s issue of the journal, are to he “ badder, sadder and madder “ ?

Mr HARRISON:

– The commission is entitled to publish any cartoons that it considers appropriate. The honorable member may be interested to know that from advice which has reached me concerning the sales of the new journal, the commission is likely to be “ gladder “. 2nd AUSTRALIAN IMPERIAL FORCE.

Concession Fares.

Mr SPURR:
WILMOT, TASMANIA

– Is the Minister for the Army able to say whether some Tasmanian members of the 2nd Australian Imperial Force have been unable to go home on final leave because of the fact that they would have to pay their fare home, plus one-third of the return fare to camp ? If that is so, will the Minister take immediate steps to ensure that all members of the 2nd Australian Imperial Force are given free passes when going home on final leave?

Mr STREET:
UAP

– Steps have already been taken to see that all members of the 2nd Australian Imperial Force when going on final leave prior to moving to their concentration areas are to be issued with free railway warrants. Men who have already proceeded on such leave and paid their own fares will have the cost refunded to them.

Sir EARLE PAGE:
COWPER, NEW SOUTH WALES

– I have received the following telegram from Melbourne -

Respectfully protesting on behalf of 39 men of the 2nd Australian Imperial Force being discharged at twelve hours’ notice as temporarily unfit on enlistment. Disposed of civilian clothes, &c. Can you help, aswe still want to serve in any capacity?

In view of the fact that during the last war it was found necessary to vary the standard of medical examination as the war proceeded to permit certain men to enlist who had previously been declared unfit, I ask the Minister for the Army whether some military work can be found for such men as are referred to in the telegram, who, although medically fit on enlistment, are later found to be temporarily unfit?

Mr STREET:

– Without knowing the disabilities from which those men were suffering, I cannot give a definite reply to the honorable member’s question. However, consideration is given, whereever possible, to those persons who have passed the first medical examination, but who had failed to pass the second, with a view to finding for them employment in some form of army activity.

Mr FRANCIS:

– In view of the fact that the men of the 2nd Australian Imperial Force are expected to leave Australia on active service early in the new year, I ask the Minister for the Army to consider the advisability of giving them special Christmas leave, seeing that this will probably be the last Christmas they will spend in Australia for some years?

Mr STREET:

– That question is at present receiving very favorable consideration.

Mr CONELAN:
GRIFFITH, QUEENSLAND

– Will the Minister also arrange that men who are given special Christmas leave will be provided with a warrant to permit them to travel to their home State for the period of their leave?Some of the men in the 2nd Australian Imperial Force have had to leave their own States for final training.

Mr STREET:

– I am unable to give the honorable member an assurance on that point. It would probably take some of the men from Western Australia a fortnight or three weeks to go to their homes and return. However, the most generous leave possible will be granted. I have already dealt with the point as to warrants,

Mr HUTCHINSON:

– Does the Minister for Information consider it advisable that news such as the moving of the amendment by the Leader of the Opposition yesterday concerning the 2nd Australian Imperial Force should be sent overseas, as it can only be heartening to the enemy and depressing to the Allies?

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

– I do not believe in the suppression ofnews of that kind.

page 1840

CONTROL OF IMPORTS

Ministerial Statement

Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP

- by leave - I think that honorable members areaware that measures to control imports have been in process of formulation for some time. I am now in a position to inform honorable members that regulations licensing the importations of goods will be promulgated early to-morrowmorning. They will be known as the Customs Import Licensing Regulations, and will have effect immediately on their promulgation.

In substance, the regulations will prohibit the importation of any goods except under a licence issued pursuant to the regulations, unless the importations consist of goods which are excepted from the application of the regulations. Some very important exceptions will be made. I shall refer to them later.

The chief immediate aim of the licensing measure is to conserve resources in non-sterling exchange, and, in particular, to prevent the absorption of those resources in the purchase of unessential imports to the detriment of the more vital national needs. The administrative arrangements have, however, been developed to combine a system of import licences carrying several degrees of priority in the matter of shipping space and supply, and to serve a number of complementary purposes, the chief of which are -

  1. The collection of informationconcerning the relative importance of particular imports to enable any future restrictions to be soundly based should conditions develop to necessitate a greater degree of selectivity in imports.
  2. Ascertaining the urgency and relative claims of particular imports, and the demands those imports make on both shipping space and non-sterling exchange.
  3. Providing industries relying on imports with opportunities to have their claims examined in advance of the time whena greater degree of import restriction may become unavoidable for any reason.
  4. To enable the possibility of obtaining requirements from alternative sources to be explored, and to facilitate the laying down of plans for the provision of suitable substitutes for good? which may no longer be. obtainable.

Under the National Security (Monetary Control) Regulations and the Customs (Overseas Exchange) Regulations, action has already been taken to ensure that all supplies of overseas exchange will be placed at the disposal of the Commonwealth Government during the present war emergency. The Import Licensing Regulations carry the process a step further by giving the Government the necessary power to ensure that exchange resources will be used to the best advantage to meet our war needs.

The large-scale purchases by the British Government of our principal export products will provide supplies of sterling exchange adequate to our current needs. Sterling exchange can be used to purchase imports originating in all countries of the British Empire with the exception of Canada, Newfoundland and Hong Kong. Sterling may also be used to purchase imports from British mandated territories as well as from Egypt and Sudan. It is, therefore, proposed to exempt all goods originating in countries of the sterling area from the application of the licensing control. Goods may be imported from such sources under the same conditions as apply at present. In future, however, no goods may be imported from countries constituting the non-sterling area, including Canada, Newfoundland and Hong Kong, unless a licence to import the goods has been granted.

In addition, as from to-morrow, exchange for the purchase of imports from countries outside the sterling area will not be provided except on production of an import licence authorizing the importation of those goods.

The restrictions will not apply to goods now in transit to Australia, and it is proposed to admit under licence, goods on order under drafts drawn under letters of credit already established in Australia.

In order to facilitate the administrative arrangements and to serve as a guide to all interested parties, all goods entering into trade have been classified into four categories according to the degree of importance attached to the imports. Essential or very important imports are given an “A” classification; important goods a “B” classification; less important goods a “C” classification, and unimportant goods a “D” classification.

The grading of the whole range of imports into categories obviously presents many problems. I, therefore, do not hesitate to say that the classifications are not regarded as perfect or final. As they standat present they provide a basis for immediate application. It is realized that variations may be necessary in the light of either additional information or new conditions affecting particular commodities. Where sufficient evidence in support of alterations in classification is adduced they will be made.

The general scheme of administration contemplates that licences will not be issued for “the importation from nonsterling countries of goods classified in Category “D”. The goods included in Category “D “ for which licences will not be granted are shown in theschedule which has been circulated for the informationof honorable members.

Calculated on the basis of the imports from non-sterling countries during the year 1938-39, these goods were valued at £3,250,000 sterling. Total imports from non-sterling countries in the same year were valued at £46,500,000 sterling.

With regard to goods in the remaining categories, that is, all goods except those shown in the list circulated to honorable members, it is proposed, in general, to base the measures of regulation on the value of imports during the year 1938-39. That should not be taken to mean that licences will be immediately obtainable for amounts equivalent to the importations in that year.

During the first licensing period which will cover a period of two months ending on the 31st January, 1940, licences will be granted to individual importers to the extent of one-sixth of the value of their respective importations of the same goods during the twelve months ended the 30th June, 1939. This is a general principle that will apply and will place licensing officers at the various ports throughout the Commonwealth in a position to deal promptly and uniformly with a large proportion of the more or less regular imports. The normal period of validity of a licence has been fixed at eight months in the case of imports from European countries’, and six months in the case of those from other countries.

Departures from the general principle will be unavoidable in the case of certain classes of imports as for instance -

  1. Imports of a seasonal character.
  2. Irregular or non-recurring import transactions as for example- imports of special machinery, new plant or equipment.
  3. Essential commodities, the demand for which may have substantially increased under the emergency of war conditions.
  4. Essential commodities subject to material price increases since 1938-39, the demand for which in terms of value exceeds the 1938-39 levels.

In the interests of sound administration it will be necessary progressively to adjust the bases on which licences are granted to meet these cases. Such adjustments as may be necessary may only be determined in the light of the factors affecting the particular commodity or transaction.

The measures, therefore, do not involve any immediate reduction of the value of imports except insofar as the goods named in the schedule in the hands of honorable members are concerned. The limitation of the immediate issue of licences for other goods to one-sixth of the importationsin193839willenabletheGo vernmenttokeepaclosewatchonthe situation should the position in relation to non-sterling exchange become more difficult at any time.

When it is realized that Australia does not directly acquire sufficient foreign exchange to finance essential imports from non-sterling countries, the urgent need for husbanding our resources becomes doubly apparent. We will, in fact, be obliged to draw on the reserve of nonsterling exchange held by Great Britain, and we can hardly approach the British Government for aid in this direction unless we are exercising the strictest economy in our use of foreign exchange. The British Government has itself imposed major restrictions on imports from countries outside the sterling area and the purposes for which foreign exchange is made available.

The total Empire demand for foreign exchange necessary to finance urgent war requirements will be extremely heavy and will necessitate the wisest use of such supplies aswe can command. I would be misleading honorable members if I failed to say that there is little doubt that further restrictions will be unavoidable. We are engaged in a life and death struggle, and as the pressure of war needs increases we may have to face the question, not so much from the point of view of what we can do without, as from the point of view of what we must do without.

The administration of the import control measures, which represent the biggest step in trade control adopted in Australia, iscertaintopresentmanynewproblems. Everything possible will be done to deal with those problem cases fairly, impartially and expeditiously. In a world where difficulties associated with supply and shipping space are sometimes acute, and where prices may be subject to sudden increases, the importance of prompt decisions will be fullyrecognized.

It will be an important aim in administration to guard against conferring anything in the shape of monopoly rights on individual importers, and to preserve the free play of competition as far as practicable. The Government appreciates fully the implications of the policy of restriction and control which it has been obliged to adopt in the national interest, and realizes that measures of import restriction and control must inevitably bring about a disturbance and dislocation of many businesses. We shall do our utmost to reduce those conditions to a minimum, and to that end shall be glad to consult with interested parties.

The measures arise from necessity. Therefore the Government feels that where it is a question of choice between essential commodities and thoseimports that we can do without, or obtain with less embarrassment from other sources, the people of Australia and the business community will accord the Government, measures their full support.

page 1842

QUESTION

PRICE OF CORNSACKS

Ministerial Statement

Mr SCHOLFIELD:
WANNON, VICTORIA

– In view of the further reports appearing in the daily newspapersregarding the shortage of corn sacks, does the Minister representing the Minister for Commerce still maintain that ample supplies are available?

Sir FREDERICK STEWART:
UAP

by leave - In response to a question asked by the honorable member for Gwydir (Mr. Scully) the day before yesterday, I undertook to make a complete statement to the House in regard to the cornsacks position. In view of the publicity that has been given to the cornsacks position in respect of the 1939-40 wheat harvest, I think it desirable that I should set out the facts insofar as the Commonwealth and State Governments are concerned. In the first place it should be pointed out that the responsibility for ensuring an adequate supply of sacks attaches primarily to the wheat-grower or his agents, and in ordinary times little or no difficulty is experienced in meeting requirements, as it is possible even at the last moment to supplement quickly supplies from oversea?.

The incidence of the war, with its extraordinary demand on the world’s jute supplies for war purposes - the British Government in one order is reputed to have called for 500,000,000 sandbagschanged the conditions entirely, with the consequence that those farmers who had failed to make early provision found themselves in difficulties. In these circumstances the Commonwealth Government interested itself and instituted action in several important directions -

  1. Cornsacks were included in the list of items brought under price control ;
  2. Action was taken to stimulate the ordering of sacks up to the esti mated requirements, and to ensure fulfilment of orders already made in Calcutta.

Added to the difficulties attendant on the huge demand for European war supplies, was that of ensuring appropriate shipping space, and in this latter connexion our Commerce Department was able to render valuable aid.

In connexion with price regulation, prompt action was taken when, immediately after the outbreak of war, representations were made to the effect that profiteering was taking place in woolpacks andcornsacks. Preliminary investigations indicated that there was some danger . of profiteering. Accordingly, when the Minister for Trade and Customs issued his first proclamation six days after the outbreak of war, bringing a number of goods under price control all jute goods, including cornsacks, were included in the list of controlled commodities.

The price of cornsacks- in Calcutta on the 31st August, 1939, was 8s.21/2d.a dozen c.i.f. Australian currency. Between the 3rd September and the 9th September prices in -Calcutta had advanced to 9s.31/4d. and indications were that the market would continue to rise.

Althoughtrading was taking place. there was some slackening off of orders because of the general nervousness, and on the 18th October, the Commonwealth Government decided to take steps to ensure an additional 6,000,000 bags . being ordered over and above those ordered through the usual channels. But for this action, in respect of which the Commonwealth Government assumed a measure of financial liability, there would have been a most serious shortage. In regard to 4,260,000 of these sacks the average landed cost in Australia will be 12s. l1/4d. a dozen, in which is included additional war risk insurance of approximately 11/2d.adozenandincreasedfreightof approximately23/4d.Thiscompareswith 8s.21/2d.justbeforetheoutbreakofwar, 9s.31/4d.onthe9thofSeptember,and 15s.31/4d.quotedonthe11thNovember for January delivery. All prices quoted are in Australian currency. Thus, the action taken by the department has secured these additional 4.250,000 sacks at 3s. a dozen, Australian currency, less than the current prices, and will result in a saving to growers ofat least £50,000, as well as ensuring a substantial increase of supplies above what would have been available but for this action.

The Government was also faced with pressing requests from Queensland and New South Wales for cornsacks for districts where the wheat matures early. Although approximately 60 per cent. of the. season’s requirements for the whole of Australia had been purchased and distributed at pre-war prices, the outbreak of war caused a heavy demand, especially from early districts, because of the fear of a restriction of supply.

As an indication of the problem which was put to’ the Commonwealth Government, it is only necessary to say that on the 18th October the authorities of Queensland said that they needed 105,000 sacks immediately; eight days later, on the 26th October, they said that the quantity required was 180,000 sacks; on the following day they said that it was 315,000 sacks; and on the 31st October, after referring to their previous requests, they said that the total requirements should have been set down at 600,000 sacks. These have been obtained. Since the 31st October the Queensland WheatBoard has asked for a further 135,000 sacks. Most of these have also been obtained and forwarded to Queensland. In each case theCommonwealth was asked to get these sacks immediately and at any price. At the same time the authorities of New South Wales were pressing the Commonwealth to obtain sacks. At first, during tuc third week in October, they said that they needed 3,350,000 sacks immediately. Later this demand was reduced to 1,050,000 sacks, 300,000 immediately and the balance out of the next three steamers to arrive from Calcutta.

Upon receipt by the Commonwealth of the first requests for sacks the authorities in Queensland and New South “Wales were urged to explore all possible avenues, of supply within their respective States. They claimed to have explored all of these avenues without result. The Department of Supply and Development concentrated first of all on the immediate inquiry for 300,000 sacks for New South Wales and .105,000 sacks for Queensland. Unfortunately, the inquiries were interrupted from time to time because the Queensland -figure was constantly increased until finally, as stated, it reached a total of 600,000 sacks on the 31st October. This increase made the total immediate, requirements 900,000 sacks from a market on which, at the commencement of the inquiry, there was not one bale of cornsacks readily available on spot. Allegations of hoarding had been examined in New South Wales and Victoria, but no evidence of cornering could be found. As the result of the efforts of the Department of Supply and Development, Queensland now has been supplied with nearly 750,000 sacks and New South Wales has 60,000 sacks out of the 1,050,000 requested. The balance, 450,000 for New South Wales, will be supplied next week. The quantities required have been obtained without the Commonwealth Government having to commandeer one sack. They have been freely lent as a contribution towards the national well-being, and they will be replaced by the borrowers out of the shipment of 6,000,000 sacks to which I referred previously.

Despite previous assurances that requirements for New South Wales had been covered, as I have already explained, I was informed, at 11 o’clock on Monday morning that some shortage of sacks was :s’till likely in that State. The Minister for Agriculture of New South Wales, in asking for Commonwealth assistance, based his request on an estimated crop of 60,000,000 bushels in his State. The sacks necessary to cope with such a crop have been fully arranged for, but the estimated crop has now been increased to 66,000,000 bushels, necessitating an increased quantity of 1,800,000 cornsacks. At this stage it is impossible to obtain these sacks in time for the harvesting, and the Minister for Agriculture is endeavouring to make other arrangements for handling the excess wheat. I point this out in amplification of my earlier statements regarding cornsack supplies for New South Wales. As I have previously indicated, the Department of Supply and Development has arranged for the supply of all of the sacks which had been asked for by the authorities in New South Wales prior to Monday last.

I wish to pay a tribute to the assistance rendered by members of the trade in the inquiries and by fertilizer and other companies in making sacks available on an undertaking of replacement.

Having dealt with the immediate problem of cornsacks for the crop now being harvested, the Department of Supply and Development is now devoting its attention to the task of ensuring adequate supplies of jute goods in the future. The position is extremely difficult owing to the increasing prices in Calcutta, which may or. may not continue and which are responsible for the present high costs of jute goods to farmers and others in Australia. I know that honorable members, particularly those representing rural districts, are deeply interested in this matter, and I can assure the House that the Government is doing all it can in the face of the existing difficulties to assist producers to secure their supplies at the best possible prices.

Mr Scully:

– The chairman of the State Wheat Board told me that that board had on order 3,000 bales of cornsacks. The Minister’s statement was to the effect that at the end of next week 1,400 bales would be distributed. Does that mean that no more cornsacks will be available?

Sir FREDERICK STEWART:

– I am afraid that the position is even worse, than that described by the honorable, member. The situation has been brought about by au unexpected increase of the estimated wheat harvest of New South Wales by 6,000,000 bushels. Steps are being .taken to handle that wheat in various ways. I had a personal consultation this morning with the Minister for Agriculture in New South Wales. We are hoping to find some way out of the difficulty.

page 1845

QUESTION

COTTON BOUNTY

Mr FORDE:
CAPRICORNIA, QUEENSLAND

– With regard to the representations by the Queensland Cotton Board for the re-enactment of the cotton bounty legislation for a further five years, the same as is proposed for the wine industry, is the Minister for Trade and Customs yet in a position to indicate whether the Government is prepared to accede to the request, or whether the Government intends to limit the continuation of the bounty to a period of one year, which will end on the 30th November, 1940?

Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP

– The Government’s intention is to re-enact the Cotton Bounty Act for a period of one year.

page 1845

QUESTION

STRENGTH OF MILITIA

Mr WHITE:
BALACLAVA, VICTORIA

– To approximately what numerical strength has the Militia been reduced as the result of enlistment of members in the 2nd Australian Imperial Force, transfers to the Militia Reserve, or discharges as the result of the specification of reserved occupations, unfitness, or hardship?

Mr STREET:
UAP

– Between 55,000 and 65,000 at a guess.

page 1845

QUESTION

PROHIBITED IMPORTS

Mr GREGORY:
SWAN, WESTERN AUSTRALIA

– What is the objective of the list of prohibited imports which includes Canadian products? Is it to drive another nail into the coffin of the producers?

Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP

– The principal object of the Government in introducing the list of prohibited imports is to make a proper contribution to the winning of the war.

page 1845

QUESTION

CENSORSHIP

Resignation or PROFESSOR Nicholson.

Mr WARD:
EAST SYDNEY, NEW SOUTH WALES

– If it be true, as reported in the press to-day, that Professor Nicholson has retired from the censorship staff, can the Minister for the Army indicate the reason for his resignation?

Mr STREET:
UAP

– I understand that Professor Nicholson has resigned his position as Deputy Censor. The circumstances of his resignation are not yet known to me, but when they are I shall inform the honorable gentleman.

page 1845

QUESTION

PEARCE AERODROME

Mr NAIRN:
PERTH, WESTERN AUSTRALIA

– If it be true that because permanent buildings at Pearce aerodrome have not been erected, recruits to the Royal Australian Air Force in Western Australia, who have been examined and passed, have been told to stand by for some weeks, probably until Christmas, will the Acting .Minister for the Air consider taking advantage of the fact that it is now summer time in the west and put the men under canvas until the permanent buildings have been erected ?

Mr HOLT:
Minister without portfolio, assisting the Minister for Supply and Development · FAWKNER, VICTORIA · UAP

– Steps are being taken to overcome the difficulties to which the honorable member has directed attention. .1 shall let him know what has been done.

page 1845

QUESTION

NATIONAL REGISTER

Mr CONELAN:

– Can the Attorney-‘ General tell me how many prosecutions have been launched against people for failure to fill in national register cards, and whether any prosecutions have been launched in respect of failure to fill in, or to supply correct information in, the wealth register cards?

Mr HUGHES:
Attorney-General · NORTH SYDNEY, NEW SOUTH WALES · UAP

– Offhand, I am not able to give that information, but I shall make inquiries and let the honorable gentleman know the result.

Mr CLARK:
DARLING, NEW SOUTH WALES

– Can the Minister for the Army make available the information extracted from the National Register cards showing the amount of unemployment in Australia?

Mr STREET:
UAP

– In due course, when the figures have been compiled, they will be made available to the House.

page 1846

QUESTION

EXCESS PROFITS TAX

Mr LANE:
BARTON, NEW SOUTH WALES

– In order to supplement the good work being done by the fixation of prices, will the Prime Minister undertake to introduce legislation to impose taxation on excess profits?

Mr MENZIES:
UAP

– The honorable gentleman’s suggestion will receive full consideration.

page 1846

QUESTION

CANBERRA

Mail Closing Time

Mr PATERSON:
GIPPSLAND, VICTORIA

– Has the attention of thePostmaster-General been directed to the fact that the time for the departure of the train from. Canberra for Melbourneand Sydney has been altered to 8.55 p.m., and, if so, has he given consideration to the possibility of extending the closing hour of mails leaving Canberra until 7.30 or even 8 p.m.?

Mr HARRISON:
UAP

– Some time ago I took steps to have the closing time extended to 7 o’clock, in respect of mails for Queensland, and I shall give added consideration to extending the closing time generally.

page 1846

QUESTION

CHIEF ARBITRATION JUDGE

Mr BEASLEY:

– Will the Prime Minister examine the statement made by Chief Judge Beeby in the recent metal trades case, and after such examination make a public statement indicating the functions of the court and the principles which this jurisdiction is expected to follow in determining wages and conditions in industry? Will he in such statement indicate particularly that cases are not to be pre-judged before the evidence is submitted?

Mr MENZIES:
UAP

– I shall be glad to have a look at the report mentioned by the honorable member, but I am afraid that I should be undertaking a somewhat stupendous task if 1 endeavoured to set out what the principles of arbitration are. That point I shall refer to the Minister for Industry.

page 1846

PRIVILEGE

Queensland Directorof Department op Information: Comments on Parliamentary Utterances.

Mr.McCALL. - Has the attention of the Minister for Information been drawn to an article in the Tweed Daily with reference to a debate in this House in relation to a statement by Mr. Han man of his department?

Sir HENRY GULLETT:
UAP

– Yes. A statement was made in the Tweed Daily with respect to alleged remarks made by this officer of the department in Brisbane, and upon that statement a debate took place in this House. A week later the Tweed Daily, a copy of which publication I have in my hand-

Honorable Members. - A Dorothy Dix?

Sir HENRY GULLETT:
UAP

– I was aware of the intention of the honorable member for Martin to ask this question.

Mr SPEAKER:

– There is nothing wrong in a member informing a Minister beforehand that he intends to ask a certain question. That rule is observed in many parliaments.

Mr Menzies:

– It is a very sensible procedure.

Sir HENRY GULLETT:

– In justice to this officer, who is a member of the Australian Journalists Association, I point out that the Tweed Daily, in the later issue to which I have referred, after referring to its previous statement that Mr. Hanman had criticized a statement made by the Leader of the Federal Country party (Mr. Archie Cameron), said -

Mr. Hanman did not mention Mr. Cameron and his statements had no relationship to the Leader of the Federal Country party. His criticism was of those who belittled Australia’s war efforts. We regret the error and tender our apologies to Mr. Hanman.

Mr ANTHONY:
RICHMOND, NEW SOUTH WALES

– Has the Minister any knowledge that the statement referring to Mr. Hanman was supplied to the Country Press Association of Queensland by representatives of the CourierMail, and does he not consider the

Courier-Mail to be a reputable journal, whose reports can generally be relied upon ?

Sir HENRY GULLETT:

– All that I know is that the statement did not appear in the Courier-Mail.

Mr ARCHIE CAMERON:
BarkerLeader of the Country party

– % leave - The Minister for Information (Sir Henry Gullett) informed me yesterday that he had a copy of the Tweed Daily and intended to make a statement in this House that afternoon. After the correspondence and the telephone conversations that I have had from both Murwillumbah and Brisbane, it is remarkable that we should now have such a statement as the Minister has just made.

Sir Henry Gullett:

– I read an apology by the newspaper concerned for having printed the statement.

Mr ARCHIE CAMERON:

– The Minister has not cleared up the position. The statement appeared, not only in the Tweed Daily, but subsequent to the debate in this House, it was discovered in practically every country paper in northern New South Wales and in Queensland. The telegrams which the’ Minister was good enough to show to me before I made a statement in this chamber ought to ‘ be produced. If I remember rightly, one of them said that I was not mentioned by name at the meeting. I also believe that another telegram stated that the officer concerned considered that it was part of his job to defend the Prime Minister.

Mr Menzies:

– That was very decent of him. It is most unusual for any one to feel called upon to defend the Prime Minister.

Mr ARCHIE CAMERON:

– The Prime Minister must expect to be a target. This statement did not get into all of these newspapers by chance.

Sir Henry Gullett:

– It came from one news agency, which has written to me saying that it was not present at the meeting, and regretted distributing the statement. I also have a statement signed by nine gentlemen who were there saying that the statement which was printed was not correct.

Mr ARCHIE CAMERON:

– It is a most interesting position, and calls for some further inquiry by the Minister as to how this new department is to function in matters of this kind.

page 1847

QUESTION

SIR GEORGE PEARCE

Mr POLLARD:
BALLAARAT, VICTORIA

– Will Sir George Pearce, in addition to the £500 allowance made to him as a member of the Defence Business Administration Panel, also draw his allowance as a member of the Commonwealth Grants Commission, and will the Prime Minister ascertain if there are any other positions to which Sir George Pearce could be appointed, so that he could obtain additional modest pickings ?

Mr MENZIES:
UAP

- Sir George Pearce will draw such fees as he is entitled to draw as a member of the Commonweal ti i Grants Commission. I am bound to say that I know of very few positions in Australia to which Sir George Pearce could not be appointed with great advantage to the Commonwealth.

page 1847

QUESTION

DOCKING FACILITIES

Mr PRICE:

– What steps have been taken by the Government -to provide additional docking facilities for Australia, by the provision of either graving or floating docks, and can the Minister say whether any sum is provided in the Estimates for this purpose?

Mr STREET:
UAP

– No special steps have been, or are at present being, taken to provide additional docking facilities.” The Government is awaiting the report on the subject about which the honorable gentleman has frequently asked questions.

page 1847

QUESTION

ADVISORY COMMITTEES

Mr ROSEVEAR:
DALLEY, NEW SOUTH WALES

– Is the Prime Minister in a position to say when I can expect a reply to a question which I asked on the 16th November, requesting information as to the salaries and/or expenses of members of voluntary advisory committees, and also the rates of expenses allowed to them? Is it because these expensesare so high as to constitute a problem of compilation that there has been delay in furnishing the information? A fortnight haselapsedsincethequestionwasasked.

Mr MENZIES:
UAP

-Iapologizetothe honorable member for the delay, and shall ascertain the reason for it. On the face of it, the time taken to furnish a. reply does seem to be excessive.

page 1848

QUESTION

DARWIN

Arbitration Methods

Mr BLAIN:
NORTHERN TERRITORY

-Inviewofthefactthat at Darwin a tribunal purporting to have powers of local arbitration has been set up, although actually it has no powers of conciliation, will the Minister representing the Minister for the Interior make representations for an alteration of the law to enable that tribunal to conciliate?

Mr PERKINS:
UAP

– I shall bring the honorable member’s question to the notice of the Minister for the Interior.

page 1848

QUESTION

AUSTRALIAN REPRESENTATION AT WASHINGTON AND TOKYO

Mr FORDE:

– In view of the further publicity given to the proposed appointment of Ministers or Ambassadors to Washington and Tokyo, is the Prime Minister in a position to make a statement to the House as to the Government’s intention in this connexion?

Mr MENZIES:
UAP

– I am not in a position to do so at the moment; but I shall make a statement as soon as circumstances permit.

page 1848

QUESTION

YOUTH EMPLOYMENT

Mr MAHONEY:
DENISON, TASMANIA

– Some months ago, the Acting Minister for Aviation stated that a plan for the employment of youths was being formulated. Can he say whether any action has yet been taken, and whether the advertisement in the press calling for young men to work as toolmakers and mechanics is part of the Go vernment’s scheme? If so, will he say why all of the States are not allowed to participate in it.

Mr HOLT:
UAP

– The research programme into the question of youth employment to which the honorable member refers is at present under consideration. On Monday of next week a meeting of research officers from all of the States will take place, when attention will be given to the subject. The other scheme to which the honorable member referred is not directly connected with that programme, although it is in some degree associated with it. That scheme is part of the Government’s defence programme, and involves the provision of the necessary technicians to carry it out. In Sydney towards the end of next week the advisory committee appointed for the purpose will give consideration to the principles to be applied to the scheme for the training of technicians under the Government’s programme.

Mr Mahoney:

– Will Tasmania be represented ?

Mr HOLT:

– Tasmania will be represented at the conference to be held on Monday, but will not be directly represented at the meeting of the advisory committee.

page 1848

QUESTION

GERMAN PERIODICAL

Mr McCALL:
MARTIN, NEW SOUTH WALES

– I ask you, Mr.

Speaker, in your capacity of chairman of the Library Committee, whether you will investigate the position in relation to a certain publication published wholly in German which appears on the Library table? I understand that the subscription for this publication is about due, and is to be renewed, and that Australia House has arranged to receive the publication through a neutral power. Will you ascertain, sir, the amount of money involved? Seeing that Great Britain has decided quite recently to confiscate all German goods, do you consider it proper that this publication should be purchased, and that thereby a German firm should obtain revenue from Australia?

Mr SPEAKER:

-SofarasIknow, only one periodical in German is received by the Library. Australia House, without request from the Library Committee,. instituted inquiries in England through the Board of Trade .to see whether, in view of the war, this publication would continue to be available. The Library is informed that the Board of Trade approves of the importation of the magazine being continued. As the journal referred to appears, from comments 1 have heard, to be interesting to honorable members, it will continue, for the time being, to be placed on the table of the Library. I shall make inquiries as to the cost involved.

page 1849

QUESTION

COMPULSORY ACQUISITION OP LAND AT ALLANDALE

Mr JAMES:

– I ask the Minister for De’fence Co-ordination whether he is aware that in consequence of the compulsory acquisition of certain land for defence purposes, great hardship has been inflicted on some land-owners? I refer specially to Mr. A. E. Brown, from whom 270 acres of dairying land was taken for the purpose of the Allandale camp. Mr. Brown has been left with 170 head of milch cows without land on which, to graze them. Seeing that the Government lias power to acquire land in this way, does not the Minister think that it should also acquire land to assist persons whose properties are taken and who find themselves with livestock on their hands ?

Mr MENZIES:
UAP

– I appreciate the fact that cases of hardship occur. I shall look into the special case mentioned by the honorable member and communicate with him later in regard to it.

page 1849

QUESTION

NATURALIZATION

Mr ANTHONY:

– Will the Minister for the Army inform me whether something can be done to expedite the handling of applications for naturalization ? Many papers,’ some involving the interests of friendly’ neutrals resident in Australia, have been held up by the Department of Defence. ‘ The papers have on occasion to 1)0 transferred by the Department of the Interior to other departments and the delay in certain instances is causing considerable hardship.

Mr STREET:
UAP

– Certain applications for naturalization have to be forwarded by the Department of the Interior to Military Intelligence for report before naturalization can be granted. I do not know how many cases are at present in process of investigation, but I shall look into the matter.

page 1849

QUESTION

FLOUR MILLING

Mr McHUGH:

– I ask the Minister representing the Minister for Commerce whether, if the Government is successful in obtaining another order for flour, similar to the last order of 50,000 tons, from the British Government or elsewhere, it will insist that the Balaclava flour mill in South Australia shall be put into operation? Is the Minister aware that the machinery in this mill, which cost approximately £57,000, is most up to date and capable of producing two tons of flour an hour? Does the Minister consider it is wrong in the extreme for a monopolistic concern to hold this mill out of use against the best interests of the district concerned and of the State as a whole? Will the Minister, if need be, use his power under regulation to have this mill re-opened?

Sir FREDERICK STEWART:
UAP

– I shall convey the honorable member’s question, with the relative information, to the Minister for Commerce.

page 1849

QUESTION

PORT AUGUSTA TO BROKEN HILL RAILWAY

Mr LANE:

– In view of the need that may arise to transfer troops expeditiously from west to east of the continent, will the Minister for Defence Co-ordination take into consideration the desirableness of constructing a. railway of standard gauge from Port Augusta to Broken Hill ?

Mr MENZIES:
UAP

– I shall take the honorable .member’s suggestion into consideration.

page 1849

QUESTION

AUSTRALIAN HIDE AND LEATHER INDUSTRIES BOARD

Mr POLLARD:

– Will the Minister representing the Min.is.ter for Commerce inform me whether the Edwin John Bowater, of W. Angliss and Company (Australia) Proprietary Limited, Sydney, who has been appointed to represent the master tanners and leather manufacturers on the Australian Hide and Leather Industries Board, is the same gentleman who is ‘a member of the- Australian Meat Board ? Will he also ascertain what other positions this gentleman may possiblybe appointed to fill?

Sir FREDERICK STEWART:
UAP

– I shall convey the honorable member’s question to the Minister for Commerce.

page 1850

QUESTION

LIFE ASSURANCE OF AIR FORCE RECRUITS

Mr GREGORY:

– Some time ago I asked the Prime Minister whether he would make representations to certain life assurance companies concerning a clause in their policies dealing with the position of persons who enlist in the Air Force. Has he any report to makeon this matter?

Mr MENZIES:
UAP

-Ihopetobeable toanswerthatquestionto-morrowornext week.

page 1850

QUESTION

DARWIN INDUSTRIAL DISPUTE

Mr BLAIN:

– I direct the attention of the Minister representing the Minister for the Interior to the fact that one of the membersofatribunal established in Darwin to deal with industrial disputes, the secretary of a certain trade union, had to travel to Sydney a fortnight ago to attend a sitting of the Arbitration Court in connexion with an industrial dispute at Darwin. Will the Minister ascertain the result of that visit? Will he also say whether it is the policy of the Government to adopt uniform wages and conditions for Darwin?

Mr PERKINS:
UAP

– I shall have inquiries made into the subject and inform the honorable member later.

page 1850

QUESTION

PRICES OF COMMODITIES

Mr CLARK:

– Will the Prime Minister inform me what action the Government proposes to take to deal with increases of the price of goods covered, by prohibitionsofimports?

Mr MENZIES:
UAP

– The control of prices will continue to be exercised through the organization of the Prices Commissioner. I shall discuss with the Minister for Trade andCustoms whether any additional precautions are necessary.

page 1850

QUESTION

QUESTIONS

Mr MENZIES:
UAP

– I ask honorable members to defer any further questions until to-morrow.

page 1850

ESTIMATES (No. 2) 1939-40

Messagesreported transmitting revised Estimates of Revenue and Expenditure, and revised Estimates of Expenditure for Additions, New Works, Buildings, &c, for the year ending the 30th June, 1940, and recommending appropriations accordingly.

Ordered to be printed and referred to Committee of Supply forthwith.

page 1850

FINANCIAL STATEMENT

In Committee of Supply:

Mr SPENDER:
Acting Treasurer · Warringah

– When the Prime Minister (Mr. Menzies) brought down his budget on the 8th September, he stated that, although the budget was not delivered until after the outbreak of war, the estimates upon which it was based had been prepared in a time of peace.

It was true that the budget had been prepared to meet greatly increased defence expenditure and had provided for substantial increases of taxation. The altered position due to the war, however, necessitated revision, and a plain indication was given by the Prime Minister that the Estimates of expenditure would have to be revised, some upwards and some downwards. The Prime Minister also stated that the Estimates of revenue would have to be reviewed. As the Estimates of expenditure had to be returned to the departments, it was not possible for their revision to be completed before Parlia ment was adjourned. In order to avoid delay, however, certain supplementary war taxation measures were brought down which were estimated to produce an additional revenue of over £2,000,000 this year, and over £2,500,000 for a full year.

In the meantime, the detailed Estimates have been reviewed by the Government, and revised Estimates of revenue and expenditure have now been presented. These revised Estimates will supersede those which were presented with the budget.

Before dealing with the Estimates in detailitisfittingthatIshoulddiscuss briefly some of the outstanding features of our financial problem and also give some indication of the policy of the Government in regard thereto.

The Financial Problem

At the outset I would emphasize thai the Government has given much consideration to the financial problem. Obviously all of the difficulties which we shall have to face are not yet unfolded to us. We can, however, make plans for the future as far as it is practicable to do so. The Government has, therefore, looked ahead with the object of formulating a financial policy which will fit into a co-ordinated plan, and will be capable of being adapted to changing circumstances.

Just as the United Kingdom is planning for the war lasting at least three years, so must our plans visualize a similar possibility. This requires a much more intensified defence and economic effort than this country was called upon to exert in the last war.

It will be necessary for us to direct a very large proportion of our resources, physical and financial, to war purposes. Various phases of our activity will require to be co-ordinated closely if wasted effort is to be avoided. Briefly, we are faced with an economic problem of enormous magnitude.

It is necessary for us to consider this problem in terms of the resources which wil] be required both for the war effort and for the civil needs of the people. Only the resources now available can be used for these purposes. To see the problem as one of making the best use of resources makes it clear that the real’ burden of our war effort must be borne now ; that it cannot by ingenious financial devices be shifted to the future. Once we recognize this fact we can concentrate our attention on securing the necessary diversion of resources from peace to Avar purposes with a minimum of interference with the standards of consumption we have enjoyed in the past, and on avoiding disturbance to the balance of our economy which would make the subsequent transition from war to peace more difficult.

General Financial Policy

Briefly stated, the financial policy op the Government is to finance the. war effort by a balanced programme of taxation, borrowing from the public and borrowing from the banking system. This summary, however, does little to illuminate how that policy will be applied at any time. The balance between these three methods of finance must change from time to time’ and the determining factors will be mainly economic. A review of the condition and trends of the economic system must precede a judgment on the exact financial policy required.

Present Economic Situation

In the period before the war we had experienced a prolonged fall of export prices. In the last few months of thi. pre-war period, the adverse effects of falling export, prices were intensified by a decline of private investment. As a consequence there was some recession in economic activity in Australia, which may be illustrated by the increase of unemployment. Between the June quarter o 1938 and the June quarter of 1939 the percentage of unemployed in trade unions rose from 8.6 to 9.7 per cent.

Another aspect of this recession was the declining liquidity of (he trading banks. The low level of export prices had caused a decline in london funds in each of the last two years. Despite considerable activity by the Commonwealth Bank to offset the effects of this decline, there was a net deterioration of the liquid position of the trading banks which necessarily intensified the difficulties of the period.

We had not recovered from this slight recession when war was declared. There was inevitably some dislocation of normal economic activity, which showed itself in a greater hesitation in private investment, in a check to the flow of imports, in, an increase of the numbers of unemployed and in some delay in the receipt of ,the proceeds of export production.

There is no reason to believe that this dislocation will be more than temporary. A number of factors are working for improvement. First, ‘‘the proceeds of the recent sales of export products to the United Kingdom are already coming to hand. Altogether they will amount to more than £100,000,000. Payment will probably be received sooner and will affect the banking system more quickly than normal peacetime sales. There has been, indeed, a general improvement in respect of the balance of payments. Whereas in the last two years our reserves of London funds have been substantially drawn upon, in the current year we may reasonably expect some net increase of those funds, perhaps as much as £15,000,000. This is, however, an optimistic estimate, and may be reduced if difficulties are experienced in shipping exports or if there is a very great reduction of the flow of capital into Australia. A second factor working for improvement is that Commonwealth Bank operations are confinning to give support to the banking system and to maintain economic activity. Thirdly, defence expenditure is having an increasingly stimulating effect on the economy generally. While these factors have not yet been fully reflected in the employment of our resources, their effects will continue to become more evident in the coming months.

Immediate Financial Policy

Paced with the temporary dislocation in the economic system the Government considered that for the time being it must avoid action likely to discourage private activity until our resources are more fully employed and our national income has been raised. Consequently the Government has decided that, in distributing the cost of its war programme between taxation, public borrowing and borrowing from the banking system, it will for the time being weight the balance towards borrowing with the assistance of the hanking system rather than towards taxation.

In accordance with this decision two private loans have been arranged from the banking system; the first for- £.10,000,000 for Commonwealth and State works and the second for £2,000,000 for special defence works low in the order of defence priority, especially chosen to ease the” unemployment position until the effects of defence expenditure become fully apparent.

In view of the increases of taxation imposed , in . September, aggregating- £3,000,000, . the uncertainty resulting from the outbreak of war and the recent decline of employment, the Government is of the opinion that to increase taxation at the present time would merely delay the recovery of our economy, retard the” full utilization of employable labour, reduce the potential of our national income, and consequently interfere with the full prosecution of our war programme. Ithas been decided, therefore, not to in- crease further the burden of taxation for defence purposes in this financial year.

Long Term Policy

While the Government is convinced that the policy I have just outlined is the most appropriate for the present situation, it does not imagine that that situation will remain static, and it has consequently made plans to modify its financial policy to meet the changing character of the economic problem facing it. . We expect the economic situation to be profoundly influenced by the financial policy we arc putting into effect.

In the absence of increased taxation and with the stimulating influence of increasing export income and rising defence expenditure, it is anticipated that the employment position will improve substantially, and the national income will be increased correspondingly. When these changes have occurred, the demands of the war on our physical resources will commence to encroach on what may be described as the ordinary civil demands. The Government will then review the economic position to decide the exact form in which its policy needs to be applied. The problem will be to determine the most appropriate balance between the various methods of finance upon which the Government has planned to rely. Some consideration of the general principles to be taken into account may be appropriate at this stage.

Credit Expansion

Credit expansion is a valuable instrument of financial policy for bringing into the economic system resources which might otherwise remain unused. The Government has shown by its financial policy at the present time that it is prepared to avail itself of this instrument for its appropriate purpose. It must, however, be used with discretion: We learned’ some lessons from the last, war when credit expansion was carried to excess by most belligerent countries and even by Australia. This excess was reflected in the spiral of rising prices and costs, profiteering, industrial unrest and in the burden on fixed incomes and also on salaries and wages which lagged behind prices. Moreover, to undue monetary expansion in the last war must be attributed much of the economic instability of the post-war period. It is the intention of the Government to avoid these evils in Australia as far as lies in its power.

The simple fact is that defence must be paid for nowwith men and materials. No manipulation can alter the burden. All that can be done is to change its incidence. Credit expansion overdone is one of the easiest ways of doing this, but its results are very different from what its advocates believe. While wage and salary earners suffer and savings are whittled away, those engaged in trade inevitably profit from the war, and the large investor protects and increases his wealth by holding equities, the value of which will rise us the purchasing power of money declines. Not only is it unjust in its incidence, but it also brings repercussions which are harmful to the whole economic life of the community. For every undue expansionwe shall ultimately pay the price.

Borrowing from the Public.

It is the policy of the Government to draw for war purposes upon the savings of the whole community. These savings are devoted to the capital development of our country. They are embodied in factories, machinery, railways, roads, homes, motor-cars and other capital goods. If we are to devote our greatest efforts to the war, it will, unfortunately, be necessary for us to content ourselves with a slower rate of civil development than we have had in the past. The expansion of capital equipment and of public amenities must proceed more slowly. At the same time, the Government considers it of firstclass importance that progress and development should proceed to the utmost extent which available resources permit.

Furthermore, we must exercise care to see that the savings of the people are not dissipated in ventures inappropriate in time of war. Regulations under the National Security Act have recently been promulgated to provide for the regulation of private investment so as to conserve the resources required for our war effort. Action has also been taken under the various monetary control regulations to ensure that no capital finds its way out of Australia. By this supervision and control, it is hoped to direct the savings of the people, first, into Government, loans for war activity and, secondly, into the development of enterprises indirectly necessary for war activity.

It is, I am sure, unnecessary for me to emphasize that this control will not be employed arbitrarily to restrict commercial activity. Limitations on private investment will be imposed only to ensure priority to the Government’s needs.

An important part of our borrowing plan is the issuing of savings certificates to afford people of small means the opportunity to play their part. The certificates will be available at an early date. Similar certificates are being issued in the United Kingdom.

Little- has been said so far about the rate of interest. The Government is of the opinion that in the financing of the large war effort a low rate of interest is essential. Thus, to reduce interest, rateis a definite objective of the Governmentfinancial policy. This objective willbe reached, however, as a consequence of our whole financial policy, rather than as the result of action directed solely at interest rates. The Government is confident that its general financial policy willenable it to reduce rates from the level now current. Already we have arranged a loan at a substantially lower rate than any floated for some years. As part of its policy directed to this end, the Government recently incorporated in its securities regulations a proviso that banks could not charge rates of interest on loans in excess of the rate current for similar loans on the 31st August, withoutthe approval of the Commonwealth Treasurer. The yield on Government securities in the market is already declining, and it is expected that the Government’s policy will ultimately result in interest rates reaching and being maintained at a satisfactory and acceptable level.

Taxation

As 1 have pointed out, the Government has decided not to impose new taxation at the present time apart from the increases aggregating about. £8.000,000 which ware embodied in the budget and supplementary taxation measures which have already been placed before this House. This does not indicate an unwillingness on the part of the. Government to use taxation for financing the war effort. Of all forms .of war finance wellplanned taxation spreads the burden most equitably and has the least harmful repercussions. The vital questions are when and to what extent taxation should be relied upon at any given time.

I have drawn attention to the limits of finance by credit expansion and by public loans. When our resources are as fully employed as is practicable and our “ real “ national income at its peak, borrowing should not exceed the sayings of the people available at any time. Any additional requirements should be drawn from taxation. There may, of course, be unexpected changes in our economic system which temporarily may render advisable the use of credit expansion again, but that does not affect the validity of this conclusion.

It is inevitable that, if the necessary effort is to be achieved, we shall have to do without some of the luxuries and semiluxuries which, in more appropriate timet-, we would be able tq enjoy. A well-planned scheme of taxation will cut into only those forms of expenditure which can best be done without and will be capable of adjustment so that the burden does not exceed what is necessary at any particular time. Do not let us imagine that the burden can be reduced if taxation is avoided. The measure of the burden is the reduction of the supply of goods available for consumption made inevitable by our Estimates. The outstanding feature While the burden cannot be reduced, it can fall with varying hardship on different groups of people. Whereas credit expansion used to excess causes the burden to be distributed unfairly, and in a disguised way, taxation enables us scientifically to place the burden where it can best lie borne and where it will interfere least with the basic needs of the people. Taxation once paid is riot lost to the community. It is available to the Government to be spent on purposes which are in the interests of the community as a whole.

Summary

It will be evident from the considerations which I have laid before honorable members that, as the economic recovery which has already begun gets under way, the Government will necessarily transfer the emphasis in its financial policy from borrowing1 from the banking system first to borrowing from the public and secondly, and more particularly, to taxation. These financial measures will be supplemented by the other forms of supervision I have outlined to prevent the waste of resources, and to eliminate profiteering.

Plans for 1940-41

It is probable that- the need for this change in emphasis will come before the end of this financial year. Our attitude towards the plans for next year’s budget, the details of which are already being considered, is therefore substantially different from our attitude to the present problem. In 1940-41, while retaining the same three sources of finance - taxation, public borrowing and borrowing from the banking system - the Government intends to impose a comprehensive scheme of war taxation details of which will be brought down early in 1940. Only if this is done and if the other controls of exchange, prices and capital investment are maintained will it be possible for Australia to avoid the evils of excessive credit expansion.

Revised Estimates, 1939-40

Defence and War Expenditure

I turn now to review the changes in our Estimates. The outstanding feature is the greatly increased estimate of Defence and War Expenditure. In the budget, defence expenditure was estimated at £33,137,000, to be met as follows : -

In the revised Estimates the amount required for defence and war services has been increased to £62,014,000, to he provided as follows: -

The amount to be found from revenue includes £9,066,000 for expenditure which was included in our pre-war plans,- and £4,714,000 for war expenditure, the greater part of which is for pay and allowances of the army. The charge to revenue on account of defence and war expenditure is now1 £1,768,000 greater than in the previous budget proposals.

From Loan Fund we propose to provide £10,215,000 for general war services, such as pay, maintenance of troops, ammunition, &c. ; £15,583,000 for what may be termed “ capital “ war expenditure, such as naval construction, reserves of munitions, aeroplanes, buildings and other works ; and £20,383,000 to carry od the original programme of pre-war plans for capital defence works.

The amount of £2,053,000 is available in Trust Fund for defence purposes as was the case when the original budget was tabled. Honorable members will find the proposed defence expenditure set out in considerable detail .in the Estimates which will shortly be circulated.

Expenditure other than Defence and War.

In view of the greatly increased burden of defence, other departments have been asked to exercise economy and to forgo, for the present, expenditure which, in happier times, would probably be approved. It must be emphasized, however, that the field within which economies can be effected is narrow. Little reduction can be expected in statutory and fixed expenditure, salaries and wages fixed by law and other irrevocable commitments. The balance, on which economies can be made is approximately £12,000,000 out of a total expenditure of about £302,000,000. Nevertheless reductions have been effected of the votes of departments amounting to £1,617,000.

Against this must be set certain increased charges largely due directly or indirectly to the war.

Revenue

The war situation has affected the estimates of revenue also. Outstanding is the anticipated decline of customs revenue following the check to the flow of imports. This check is due partly to the uncertainty of importers as to the future but partly also to increased freight, exchange and insurance charges, and to some difficulty in arranging for supply and shipment. Apart from new duties of customs to yield £150,000 to be introduced shortly, this reduction would have been £2.920,000. It must, however, be emphasized that an estimate of customs revenue made in wartime is highly speculative. Changes in the military and naval situation abroad and changes in- economic activity, particularly in the United Kingdom, may falsify the most well-founded estimates.

Our estimates have been adjusted to include the yield from the supplementary income tax and the gold excise duty imposed in September. Income tax receipts are estimated now at £1,140,000 more than in the budget, while the gold excise is expected to yield £900,000 in the current year. Certain other adjustments have been made, including allowances for increased yields from estate duty and sales tax and an increase of revenue from the profits of the Note Issue Department. The estimated total receipts for the year are £101,490,000.

Estimated Surplus

When these adjustments have been made, it is expected that a balance of receipts over expenditure of £38,000 will result.

To summarize and compare the estimated total transactions and the results of the Consolidated Revenue Fund as anticipated under the budget and under the revised Estimates I give the following figures : -

New Taxation

The new taxation this year embodied in the budget amounted to £5,910,000. Supplementary taxation measures affecting income tax and gold excise, which were brought down later, will produce a further sum of over £2,000,000, or a total of new taxation of approximately £5,000,000. In addition, further customs duties will be proposed, estimated to yield £.1.50,000 in this year. Details will be available to honorable members when the Minister for Customs tables the appropriate resolution. For reasons already given no further taxation is proposed this year, but I have made it clear that the Government is preparing a comprehensive and balanced plan of taxation for 1940-41.

For the information of honorable mem-‘ bersIdistributealsoastatementshowing in some detail the actual receipts and expenditure of 1938-39, and a comparison under heads of the estimated transactions of the original and revised budgets for 1939-40.

Loanexpenditure 1939-40

In the budget speech it was indicated that the total estimated loan expenditure for 1939-40 was £23,072,000, made up of £19,072,000 for the defence programme, £2,000,000 for the Postmaster-General’s Department, and £2,000,000 for Farmers’ Debt Adjustment.

The revised Estimates of loan expenditure amount to £48,931,000. Of this amount, £46,181,000 is for defence and war services.

The war services to be charged to loan cover pay, maintenance and general upkeep charges amounting to £.10,215,000 and works charges amounting to £15,583,000. The works expenditure is for additional naval construction, reserves of stores, arms, aeroplanes, equipment, &c. Further particulars will be available when the Loan Bill is brought before the committee.

The estimated Postal expenditure from loans remains as in the budget at £2,000,000, but the amount which will be paid to the States for adjustment of farmers’ debts has been reduced from £2.000.000 to £750.000.

Conclusion

I have sought to place before honorable members in general outline the financial plans which the Government has in mind to meet the problems of war. Necessarily they must be sufficiently elastic to adjust themselves to such conditions in which we may find ourselves. The burden which has been imposed upon the country by our present commitments will increase, not decrease. The duty of the Government is to so distribute it that it will cause the least disturbance to our economy. It would be foolish, as I have been at pains to point out, to delude ourselves into the belief that there is any easy way of. bearing this burden, It would be equally foolish to believe that this war will not entail substantial sacrifices for every section of the community. The financial task which confronts the Government is one which, if discharged in accordance with the plans which I have outlined, will, it is believed, ensure that the nation may, when this conflict is over, confidently face with a sound economy and financial system the possibly greater tasks which peace itself will present.

We must build now and for the future. The path ahead is arduous and beset with difficulties. No one can predict the course the war will take, or the toll it will finally exact. We are in this war against our will;we are determined to see it through to the finish. No matter what the sacrifices that may be entailed, so long as we preserve - as we will - the liberty of this country, they will be insignificant indeed comparedwith the disasterwhich will resultif victory is not ours.

I am confident that the people of Australia,whohaveneveryetfailedtoface their difficultieswith courage,will be prepared without demur to give their earnest support to the Government in the tremendous taskwhich lies ahead. I move -

That the first item, in the Estimates under Division 1 - the Senate - namely “ Salaries and Allowances, £8,040 be agreed to.

Progress reported.

page 1858

TARIFF PROPOSALS 1939

Customs Tariff Amendment (No. 14) ; Excise Tariff Amendment (No. 7)

In Committee of Ways and Means:

Mr JOHN LAWSON:
Minister for Trade and Customs · MACQUARIE, NEW SOUTH WALES · UAP

.- I move - [Customstariff Amendment No. 14.]

That the Schedule to the Customs Tariff 1933-1939, as proposed to be amended by Customs Tariff Proposals, be further amended as hereinafter set out, and that, on and after the first day of December, One thousand ninehundred andthirty-nine, at nine o'clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Customs be collected in pursuance of the Customs Tariff 1933-1939 as so amended. That in this Resolution . "Customs Tariff Proposals" mean the Customs Tariff Proposals introduced into the House of Representatives on the following dates namely : - 8th September, 1939 ; 21st September, 1939; and 22nd September, 1939. [Excise Tariff Amendment No. 7.] That the Schedule to the Excise Tariff 1921-1939 as proposed to be amended by Excise Tariff Proposals be further amended as hereinafter set out, and that on and after thefirst day ofDecember, One thousand nine hundred and thirty-nine, at nine o'clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Excise be collected in pursuance of the Excise Tariff 1921 -1939 as so amended. That in this Resolution " Excise Tariff Proposals " mean the Excise Tariff Proposals introduced into the House of Representatives on the following dates : - 8th September, 1939; and 21st September, 1939. The tariff proposals I have just introduced provide for increases of customs and excise duties for budget purposes. Increases of customs duties are - 1d. per lineal foot on unexposed sensitized kinematograph films which were previously free of duty except for primage; 1d. per lineal foot on positive films ready for exhibition, making the rates1d. British, and 5d. foreign; 1d. per lineal foot on home kinematograph films, the duties on which will now be1d. British, and11/2d. foreign. Unexposed film is used largely in the copying in Australia of positive films from imported negatives or lavender prints. The existing duty margin in favour of the local film printers will he preserved by the imposition of the corresponding increase of the duty on imported positives. Opportunity has been taken to overcome the practice adopted by some importers of films, particularly home kinematograph films, of arranging for two subjects to be printed on the one film and subsequently slitting the film into two separate films after importation, thus avoiding duty which is payable according to running length. Duty will now be charged on such films as if they were separate films. An excise duty of1d. a gallon is imposed on petrol produced by the National Oil Proprietary Limited up to 10,000,000 gallons per annum. In accordance with the National Oil Proprietary Limited Agreement Act of 1937, the Government was committed to grant exemption from excise of petrol produced by the company up to 10,000,000 gallons per annum whilst the customs duty on imported petrol and excise duty on petrol produced from imported crude oil remained at 7d. and51/2d. agallon, respectively. As these duties were increased by1d. a gallon in September, the Government is now exercising its right under the agreement to impose1d. a gallon on the company's production up to 10,000,000 gallons per annum. Production in excess of 10,000,000 gallons per annum will be subject to the ordinary petrol excise of61/2dagallon. The estimated additional revenue from these sources during the current financial year is £150,000, comprising £130,000 from film duties and £20,000 from the excise on petrol from shale. Progress reported. {: .page-start } page 1860 {:#debate-39} ### WARTIME ACTIVITIES OF FIGHTING SERVICES {:#subdebate-39-0} #### Ministerial Statement Debate resumed from the 16th November *(vide* page 1174) on motion by **Mr. Street)** - >That the paper be printed. {: #subdebate-39-0-s0 .speaker-L08} ##### Mr ROSEVEAR:
Dalley .- During the last fortnight, the House has been regaled with a series of ministerial statements outlining, with all the disorderly design of a patchwork quilt, the war activities of the Government. One would have thought that the legal training of the Prime Minister **(Mr. Menzies)** would have dictated to him the advantages of having all his witnesses of governmental activity tell a story of governmental planning that would, at least, hang together. One might even expect now that the right honorable gentleman has created himself the General "Poo Bah" of the Government, under the impressive title of Minister for Defence Co-ordination, that it would have been a distinct advantage to the House and to the country had he made the whole procedure a solo effort instead of using the services of all of the Cabinet " inner group " to present a picture of their lack of direction and muddling incapacity. The Standing Orders do not permit of a close analysis *en bloc* of all of the ministerial statements, but those that have been so far discussed, and the one now under consideration, have shown, and will show, the grave dissatisfaction that exists, not only in this House, but also throughout the country, at the efforts so far made by the Government in the matters of defence, the trading of primary products, and the lack of protection afforded to the great bulk of the people, producers and consumers alike, against wartime exploitation. Recently the Prime Minister assured the House that he did not desire a muzzled Opposition, but the fact is that, in making most of its fundamental decisions, the Government has effectively muzzled the whole Parliament. In defence, as in all other governmental activities, the Government has set up hoards and advisory committees whose recommendations are virtually translated into government decisions, the most important of which are made while. Parliament is in recess. Thus, not only are irresponsible bodies practically governing the country, but also the Government is studiously avoiding parliamentary discussion on matters of vital importance, feeling secure in the power to make regulations .under the National Security Act. What has been the spectacle of the past fortnight? A minority Government, usurping the powers of Parliament, has presented ministerial statements of what it has accomplished, or has sought to accomplish, with a flamboyant air of " take it or leave it". It has strained theloyalty of its' own supporters, trusted to the vacillation of the Country party, and challenged the Labour party to controvert what has been done, believing, as recent events have given it reason to believe, that there is a more or less pliant majority in the House that will assist it in evading a vote on a vital issue. So we pass to the statement by the Minister for the Army **(Mr. Street)** on the wartime activities of the fighting services, wherein he outlined past performances and the present policy of the Government - at least, one should say, the policy as it was at 3.30 p.m. on the 17th November, 1939. What it is to-day no man knows and few, apparently, care. In these days of kaleidoscopic changes of policy and reshuffles of portfolios and Cabinet personnel, he would be a bold prophet who could venture a stable opinion. . Whether these changes bespeak disclosed incompetence, or whether the situation at home and abroad has created a Tower of Babel in the Cabinet-room, only the Prime Minister can say, and he, to say the least, is not communicative. The Minister for the Army has given an extensive review of the defence forces and the proposals to extend the various arms of the Service, but has been strangely silent on the many changes of -policy in recent months. The decision of the Government to raise a 6th Division, to be known as the 2nd Australian Imperial Force, for service at home or abroad, caused considerable speculation as to what was the ultimate objective of the Government. The Government has pondered long, but, apparently, not very deeply, on t)he wisdom of sending the 2nd Australian Imperial Force abroad. Various Ministers have, from time to time, indicated that the expressed desire of the British Government was that Ave in Australia should concentrate on the defence of Australia. That view is completely shared by the -Labour party. The continued uncer tainty of the international situation, the doubt as to whether the RomeBerlinTokyo axis is still an active factor in world politics or is defunct, and the isolated position of Australia from any conceivable assistance in the event of invasion, have all been continued sources of speculation among thinking people when considering the wisdom of sending Mien abroad. Now the die has been cast. The Prime Minister has announced the Government's decision to despatch a division, abroad. The House has debated the proposal at length, and I do not propose to deal Avith the matter, other than to express my pleasure that the Labour party has set out clearly its objection to the course to be taken. I contrast the Labour party's attitude with that of the Government, which has said, in effect, ih rough its leader, that the only reason for the despatch of this force is a desire to offset German propaganda. The 20,000 men to be despatched will certainly not be the last to go. History will repeat itself. Tens of thousands will lie marched to the slaughter in Europe and the safety of Australia will be jeopardized as a counterblast to German propaganda - at the will of this vacillating and inept Government,, which has, itself, warned the people against " falling for " the very same propaganda. It is the fervent hope of the Opposition that its worst fears will not be realized. The Minister, in his statement, dealt extensively with army organization, camp works and supply of materials and equipment. Questions about supplies, equipment and the general comfort of the men have been directed from all sides of the House to the Minister, but have usually produced the reply that all is well. No doubt, his reports have been based on reports of departmental officers. But the fact is that the picture of efficiency that he has, from time to time, presented has been a trifle overdone. The clothing of the troops in at least one camp was of poor material, shabby and ill-fitting, and the eating utensils were a standing disgrace. There Avas a rifle to every fourmen. {: .speaker-KVN} ##### Mr Street: -- .Can the honorable member substitute that statement - that four men have to share one rifle? {: .speaker-L08} ##### Mr ROSEVEAR: -- Honorable members who have visited the camp can do so, and I can assure the Minister that it is true. An interesting picture of theefficiency and equipment of the defenceforces is presented in an editorial in the *Sydney Morning Herald* to-day. It is stated - >The final training of the 6th Division could not be provided in Australia for some time; certain armament for the modern division is not yet locally available, and with the adoption of the *new* training manual, it was clearly important to have the benefit of a training base where the necessary weapons could be provided without delay. In .plain language, instruction of an Australian division for modern warfare could not have been completed in this country at present. If this is a statement of fact, then it is obvious that the Australian, forces are not only deficient in equipment, but also deficient in training for modern warfare It would appear that, despite the muchvaunted efficiency of the Defence Department, Australia is maintaining a force that can only secure the requisite know.ledge and equipment outside Australia. At the same time, it constitutes an effective reply to those who claim that Ave must have conscription in order to teach our men how to defend Australia in Australia. The *Sydney Morning Herald* could have gone further and said that not only is our equipment defective, but also the supply of it has not kept pace with enlistments for the Militia Forces and the other units of our Defence Forces. E direct attention to the following statement in the *Sydney Morning Herald* of the 18th October, 1939 :- >When the Governor-General (Lord Gowrie) visited the Militia camp at Warwick Farm yesterday, hu made careful inquiries into reports that men were inadequately supplied with blankets and were shivering with cold at night. On his return to the city. Lord Gowrie informed the Lord Mayor (Alderman Nock) that lie wished to .become patron of an immediate appeal for 500 pairs of blankets for men in camps. Is it not a tragic commentary on a department that this year is spending £59,500,000, that the Lord Mayor of Sydney has to " send the hat around " ingloriously cadging for blankets to keep in a reasonable degree of comfort the men who have volunteered for service? The same article states - >Further reports from camps at Warwick Farm, Rutherford mid other place indicating that sickness is increasing because of an insufficiency of warm clothing and blankets led the Lord Mayor to take further action. During the day, lie sent a telegram to the Minister for Defence **(Mr. Street)** asking if the military authorities proposed to increase the issue of personal equipment to the Militia. The telegram followed an urgent request from the Maitland committee asking from the Lord Mayor's patriotic fund an issue of 200 sets of shirts, socks, singlets, underpants and other articles for mcn in the Rutherford camp who were suffering intensely from the cold. To use the vernacular, the Defence Department has put the Army on the " bum ". Sickness and disease in the Army are such as to warrant the greatest consideration. According to official records of the last war, 5,379 out of a total of 60,000 Australian deaths were due to sickness and disease. Of the 698,706 deaths in the British and Dominion expeditionary forces, no fewer than 113,173, one in every six, were duo to disease and injury other than war injury. Those figures disclose the importance of careful supervision of camp hygiene, proper food and clothing. To-day, we are given the belated information in the press that the issue of complete uniforms to the 2nd Australian Imperial Force is to be made, and I quote a report published in to-day's issue of the *Daily News,* which says - >Officials at Victoria Barracks said yesterday that the issue of complete uniforms to members of the 2nd Australian Imperial Force at Ingleburn .camp would be completed within a short time. Uniforms were issued yesterday to many of the 6.000 soldiers in the camp but a number were still without sufficient clothing. They are unable to provide themselves with extra apparel because of meagre pay. One thousand .pairs of socks have been sent to the camp by the Lord Mayor's appeal fund and more will follow shortly. It has been revealed that some time ago officers refused to accept uniforms for the men which consisted of tunics and breeches of a different shade of khaki. Before concluding my remarks on this point, I desire to stress, in the interests of the men, the importance of instituting more effective drainage and sanitary systems. It is beside the point for the Minister to dismiss the subject with the cursory statement that these matters are up to the usual standard. The figures that' I have already quoted indicate the importance of vastly improving the camp conditions that operated in the last war. The camps are in close proximity to settled areas and the danger of epidemic is always present, menacing the health not only of the troops, but also of the civil population. The next point of outstanding importance in the Minister's statement is the announcement regarding the reintroduction of compulsory military training. This change of policy, like all vital changes by this Government, was effected while Parliament was in recess and no opportunity was available for discussion. The Labour party makes clear its opposition to the compulsory training system and, if I did not know politics as well as I do, I should expect considerable support from the -Government benches. During the last election campaign, Government supporters frantically denied the charge levelled at them that the Government would introduce conscription. From their leader down, they pledged themselves to oppose conscription. There can be no doubt of that. That they are selling out on the people, as many of their predecessors have done, there can be still less doubt, if that be possible. I have no doubt that many of them will shelter behind the plausible excuse that universal military training is not conscription. It is the difference between " tweedledum " and " tweedledee " and the distinction matters as much to the young men concerned as it matters to a chicken whether it is to be boiled or baked. Boiled or baked, the chicken loses its head in the process. Subjected to universal military training or conscription, the person concerned loses that sacred right that was so dear to the Prime Minister himself in the last war - the right to determine whether his duty or obligation to serve was greater than his personal or family duties and obligations. Tlie right and the privilege that the Prime Minister reserved for himself are now denied by him to others. How >a man holding such views can lead a conscriptionist government passes all human understanding. Repugnant as is the principle of conscription in a democratic community, it becomes even more so when we know that the Government intends to bring about a form of discriminatory conscription made possible by the use of information contained in the National Register. This decision confirms the fears expressed by the Labour party when, in speaking to the National Registration Bill, the present Minister for the Army said - >The National Register, however, will provide means by which the allocation of appropriate classified personnel can be made to meet the requirements of defence forces and of the community in general. A list of reserved occupations is being compiled and will be published for information. Men trained in these particular occupations are limited in number and there would naturally be great demand for them in time of war. Individuals whose names and occupations appear on this list would be precluded from serving with the forces in an emergency. The result of the application of these principles will be the setting up of a privileged class from which service will not be demanded, whereas the forgotten legion of youth, the unemployed young men to whom society denies the right to work and lead a decent life, will have the obligation to serve thrust upon them. On the 7th June, 1939, the Minister for the Army said - >Many honorable members opposite have urged that this bill is the forerunner of the introduction of compulsory training and some have gone so far as to assert that it is the prelude to conscription for military service overseas ... In regard to compulsory training for home service, it is a well-known fact that the Government is providing for the peace organization of the Army that is necessary for Australia's defence. In fact, the strength of the Militia Forces, as a result of the recent recruiting campaign, already exceeds the figure that has been recommended. The Minister then went on to boast about the success of the campaign and the fact that the Defence Department was able to turn away potential recruits. In his speech last week, he indicated that the Government's aim was to maintain the Militia at a war-strength of 75,000. In other words, the wartime strength was to be exactly the same as the peacetime strength. {: .speaker-KVN} ##### Mr Street: -- I said "not less than 75,000". {: .speaker-L08} ##### Mr ROSEVEAR: -- There is not a great deal of difference between " 75,000 " and " not less than 75,000 ". That indicated to me that the Minister's aim was to have a war establishment of the Militia Forces of the same strength as the peace establishment. On his own showing, the recruits offering up to June last exceeded the 75,000 required. "What has happened, in the meantime, to justify the belief that those numbers cannot be maintained without compulsion? {: .speaker-KVN} ##### Mr Street: -- Most of the members write asking for exemption from service. {: .speaker-L08} ##### Mr ROSEVEAR: -- I am not concerned with what most of the members do. I am concerned about the disparity between the Minister's first statement and his second statement. I am endeavouring to find some justification for the Govern,ment's change of policy from voluntary enlistment to compulsion. Is enthusiasm for enlistment lagging as the result of the miserable treatment proposed to be meted out to militiamen after the 1st January? *Or does the* Government, by compulsory measures designed to call up single men, seek to cheapen the cost? The decision of the Government to reduce the Militia pay from 8s. a day to 5s. a day has been described by the honorable member for Moreton **(Mr. Francis)** as a breach of contract. It could be called something far worse than that without adequately stating the case. The Minister's defence that the Government's action is technically correct begs the question'. Is it to be assumed that the average raw recruit in future must take with him a legal adviser to peruse thoroughly the regulations and master the technicalities before signing up? The Prime Minister claims that his Government has a mandate for the Government's action. What mandatory right have the voters of the Commonwealth to authorize the conscription of the non-voters who will be affected? The Labour party is opposed to this action by the Government and it challenges this interpretation of the Government's mandate. We believe that Australians will not be lacking in their desire to defend Australia, and we insist that military service is a question to be determined by the individual conscience of the manhood of Australia. The people of this country are awaiting a stable determination on the part of the Government regarding air defence. In no other branch of the services has the Government's policy been so vacillating. First, Australia was to establish an adequate air defence for Australia - a belated recognition of the correctness of the Labour party's views of the situation expressed at the 1937 elections. Then we were to have sent abroad an air expeditionary force, which would have disastrously depleted the service, leaving it totally inadequate. But this scheme has been abandoned now in favour of an Empire scheme, the exact details of which are still in the clouds. The Labour party believes that the Air Force would be the main line of defence in the event of invasion, from the point of view not only of the developments of modern warfare, but also of the vast area of the continent to be defended and the extent of our financial resources. In addition to our opposition to military expeditions abroad, we say that the sending overseas of the flower of our aerial defenders would be a national calamity of the greatest magnitude. Reference i3 made, in the Minister's statement to the defence works being carried out in the Commonwealth. The Labour party welcomes the statement that 87 per cent, of defence requirements of the Government will be produced in Australia; but we are by no means satisfied that the interests of the taxpayers and the workers in war industries are being adequately safeguarded. No other department of the Commonwealth is so notorious for profligate and wasteful expenditure as is the Defence Department, even in time of peace. Without proper and watchful restraint, the pressure of war provides a set of conditions in which wastefulness knows no bounds. The fact that war calls for colossal expenditure does not mean that waste can be tolerated, for such toleration would superimpose on the usual ghastly wastage of war the additional penalties arising from official incompetence and blundering incapacity. We must be convinced that every pound spent will be represented by one pound's worth of 'defence equipment. Despite the Government's eulogies of the services of the various advisory committees, we are not satisfied that the Parliament is being allowed to exercise sufficient control, of the expenditure that is to be incurred. The glaring instances of, and opportunities for, exploitation that have been disclosed to date by the rebate of certain conscience money by the Broken Hill Proprietary Company Limited in connexion with certain armaments contracts, and the outspoken statements of the Acting Minister for Supply **(Sir Frederick Stewart)** regarding boot contracts, provide food for thought by members of this Parliament, and provoke the suggestion that a parliamentary committee should be appointed to restrain the almost inevitable desire of contractors to exploit wartime conditions for their own material profit. The continued failure of the Government to provide adequate safeguards against sub-contractors committing breaches of industrial awards is causing grave concern in trade union circles. If the Government genuinely desires the cooperation of trade unions in carrying out its defence programme, the best evidence of its sincerity will be immediate action to place the same restraint on subcontractors as is already provided in respect of contractors. Provided that the interests of the public and the workers are adequately safeguarded the carrying out of defence work to the degree estimated by the Government cannot fail to have a beneficial influence on Australian industries, both during, and after, the present conflict. The possibilities of new Australian industries being developed as the result of our defence activity is a factor that cannot be overlooked. Commodities thai have previously been obtained from overseas and have swollen the cost of Australia's imports to an undesirable degree will, because of the inevitable restraint that war conditions exercise on the normal shipping facilities of the world, provide an opportunity for local production, of which advantage must be taken. This constitutes the only oasis is an otherwise arid desert. The Prime Minister, in his statement, spoke of the post-war possibilities of Australian industry. What has the Government done to date, and what does it propose to do in the future, in order to meet post-war conditions? It is clear that it has discerned the possibilities of the future, for it has talked about it. But talk will not get the Government far; action is needed. The only things of which the Government seems capable are inaction and reaction. According to the statement issued on the 1st November by the Prime Minister, " up to the present the estimate of Australia's war expenditure totals £59,500,000. This represents an increase of £26,250,000 on the pre-war estimate of the cost of the defence programme for the current financial year ". I direct attention to the fact that, despite this enormous expenditure on defence works, unemployment is increasing in every State. This is undoubtedly due to the tremendous drain on capital available for investment, caused by the Government'3 decision to finance the whole of the defence requirements by loan and taxation in what has been so often described as " sane, orthodox methods of finance ". It is a maxim of unchallengeable accuracy that more cannot be taken from a pint pot than is put into it. From the economic results achieved to date, it is also abundantly clear that orthodox methods of finance have failed, and that from the employment aspect, what Australia has gained on the roundabouts it has lost on the swing-boats. It is an accepted fact that in taxation matters, particularly in the taxation of wealth that is active 'in production and industry as against capital that is idle and yet is gathering unearned increment, there is a point of absorption beyond which it. is disastrous to proceed. There is a point at which it begins to stifle investment and destroy employment. It is equally true that a policy of borrowing extensively at high rates of interest, whilst it has its hectic and seductive inducements during the pleasant process of spending, inevit ably brings in its trail the day of reckoning. The easy course of leaving the debt that results from the folly of this generation for posterity to pay has lost much of the effectiveness that it had in generations past. The close cooperation and the co-ordinated efforts of the institutions of privately-owned and controlled finance to-day determine, at their sweet will, when and how " the piper must be paid ". In quite recent years we have had abundant evidence of that fact. The question is whether this Government has learned the lessons of the immediate past, or intends to follow the natural tory instinct of the Bourbons of France. We find no evidence in the statement of the Minister for the Army that he has changed the views which he expressed during the debate on the National Registration Bill, that he was entirely in favour of financing this war as the last war was financed, by the good old orthodox methods. I remind him that this war is not an orthodox war. To date, the experts agree that its conduct has been entirely unorthodox, and that the estimated expenditure will be such that the cost of the last war will pale into insignificance. This Government has at its disposal a national bank. The wealthproducing capacity of the Commonwealth is unlimited. It is claimed that the very life of the community is at stake. Why, then, continue the futility of the community borrowing from private and privileged financial institutions, pawning the present and future welfare of this and future generations to institutions whose only genuine backing is the wealthproducing capacity of the community? If the community is to struggle for its life, why should that life be prolonged only for an existence shackled in the chains of Mammon? The evidence before us is that, to date, the Government's policy of war finance is destroying the very fountain from which employment springs. Economically, Australia is tobogganing to disaster. It has a bank; it has a country rich in natural resources. Let it use the bank and the credit resources of the nation in the interests of the nation. Labour does not view with pleasure this enormous expenditure on defence, but as an outward manifestation of the stupidity of present-day civilization. Labour has a deep-seated urge of peace and goodwill to all men, but Labour realizes that these world conflicts happen despite our efforts, not because of them. We realize that while we live in a world that, is an armed camp, we ourselves must go armed. *[Leave to continue given.']* For that reason our policy dictates, and our pledges to the people of Australia demand, that we support all proper efforts to defend Australia adequately against aggression. We believe that that is our paramount obligation in the world circumstances that face us. We believe that our obligations, in conformity with our declared policy to help to maintain the integrity of the British Commonwealth of Nations, can best be fulfilled by providing for the defence of a self-reliant Australia, by defending Australia within Australia. "We, therefore, express our complete opposition to the despatch of Australia's man-power overseas ; we believe that those who serve iii the defence forces of the Commonwealth should be paid an adequate remuneration and we oppose the conscription of Australia's manhood for service. {: #subdebate-39-0-s1 .speaker-C7E} ##### Sir EARLE PAGE:
Cowper .- The condition of military preparedness of Australia and the lack of enthusiasm that has been shown in regard to the expeditionary force, as is evidenced by the failure to get the 20,000 men desired to make up that force in the time originally set, is in sharp contrast with the forward stage of the economic preparations, and especially the industrial progress in connexion with the manufacture pf munitions. The lack of military preparedness can, I think, be shown to be due to the fact that there has been a reversal of the decision of previous governments and, in addition, several reversals of its own decisions by the present Government. Insofar as our economic preparation is concerned, it can be said that we have been getting ready ever since the Imperial Conference of 1937. In 1938, I discussed this matter with **.Sir Henry** French, the ControllerGeneral for Food in Great Britain, personally. In February of this year, I appointed the various committees to deal with certain commodities, and sent **Mr. Lynch** to London as the representative of the Australian Government to make the necessary arrangements for the final purchase of our commodities should war break out. All of the wheels of this organization were not merely placed in position; they were also oiled. All that was necessary in the event of war was to fix the price of the goods that were sold. On the industrial side, extraordinary progress was made before the declaration' of war by the previous government. Industrial panels were arranged for, and provision was made for the building of defence annexes, whilst the aircraft industry had been established and was producing aircraft before the Govern ment of which I was a member went out of office. Moreover, partnership arrangements in respect of aircraft construction had been made with Great Britain; in fact, a Controller-General had been appointed for this undertaking while arrangements made for Australia to become the arsenal of the southern hemisphere for practically all British requirements. Insofar as the economic side and industrial side of things is concerned, this Government has carried on operations from the position that had been reached by the previous Government. Without question, extraordinary progress has been made by reason of the uninterrupted march of that programme. But, insofar as the military side of things is concerned, that is, the getting ready of the man-power of this country to defend Australia, there has, unfortunately, been a change of policy which has been largely responsible for the chaos that has occurred. I acquit the present Minister for the Army **(Mr. Street)** of responsibility in this connexion. I am quite satisfied 1hat he has tried very strenuously to secure continuity of policy in this regard. I am fortified in that belief by my knowledge that the honorable gentlemandid his best while he was Minister for Defence in. the Lyons Government, to give effect to the recommendations made by Lieutenant-General Squires, who was brought to Australia last year as Inspector-General of our Military Forces to endeavour to bring our methods of preparation for war into lino with those that have been successfully adopted in Great Britain. The Minister, while still a member of the Lyons Government, made a statement on- this subject on the 14th March last, in the course of which he said - >The Inspector-General recommended the formation of field units, other than those now permitted under the Defence Act, as part of the Permanent Military Forces. Such units would be immediately available at all times, and would provide a means of securing the protection of localities whose defence was of the first importance from the commencement of hostilities, thus affording greater security against minor aggression. Later they could, as the situation demanded, be employed either as reserves of highly-trained troops available for the reinforcement of any areas in which reinforcement was needed: or be distributed, as a " stiffening " element, among Militia formations. > >Apart from the value of such units in war, they would have a very definite value' in peace, in that they would assist the training of the Militia, during both continuous and home training, by lending instructors, providing demonstrations, and by setting a standard, and would thus help to raise the all-round efficiency of the Commonwealth Forces. They would also furnish a new and much-needed source of supply of permanent instructors for the Militia, and afford the officers of the Staff Corps more opportunities for gaining experience in the command of troops than they can have at present. > >The Inspector-General recommended that the raising of field units as part of the Permanent Forces be accepted as part of the Government's policy for placing the Australian Military Forces on a sound basis, and rendering them more capable of dealing with any emergency, and that the first units be formed within the next two years. As the result of the honorable gentleman's advocacy, the Lyons Government agreed to the policy that he outlined, and went ahead with the proposal to prepare two battalions. That decision wa3 made on the day after the present Prime Minister ' resigned from , the Lyons Government. Unfortunately, after the right honorable gentleman became Prime Minister, the policy was reversed. This occurred in late May or early June of this year. The reversal was brought about, not because it was felt that there was any lack of wisdom . in the recommendations of Lieutenant-General Squires, but entirely because of the outlook of the Prime Minister, who really gambled on there being no war. I am strengthened in that opinion by reason of a speech which he delivered on the 18th August at Hurstville, New South Wales, which was dealt with in a leading article in the *Sydney Morning Herald* of-the 19th August under the heading " The European Crisis and Australia ". The writer dealt with the history of negotiations between various countries and also with the speech made by Lord Halifax, who was quoted as follows : - >Indeed, it may well be that the next few weeks or months may prove critical. The article went on to say - >In contrast to the Foreign Secretary's measured words, **Mr. Menzies** struck an incongruous note in his speech at Hurstville on Thursday. " Let us he said, " give up talking about the inevitability of war. Let us be optimistic and talk about peace and happiness ". Commenting on those sentiments of the Prime Minister, the article said - >The Prime Minister surely does a disservice to this country when he indulges in loose " sunshine " talk at such a time as this. Nobody in Australia knows better than he how critical is tlie situation in Europe. As the result of that initial mistake which was due, not to ineffective military advice tendered to the Government, but entirely to the bad judgment and unfortunate outlook of the Prime Minister, there has been extreme difficulty in getting Australia's war effort properly moving. Innumerable false starts have been made. Jobs have been put in hand which have been discontinued, or only partly completed. I need to refer, by way of illustration to only one instance. When the Prime Minister, on the 16th or 17th September, suggested the possibility of an Australian "expeditionary force in a broadcast address, he said. that if such were provided the pay of the troops would be on much the same basis as that of the previous Australian Imperial Force. He also added that conditions in regard to dependants would be similar. The arrangements in this regard in respect of the 1st Australian Imperial Force were 2s. for wives and 4½d. for each child. Since the Prima Minister made his broadcast statement a series of alterations has occurred. The child allowance has been increased, by successive steps, to 6d., 9d. and ls., at which figure it now stands. I am hopeful that, before this debate coneludes, the Minister for the Army will be able to announce that the allowance will be ls. 6d. for each child. I shall state good reasons for providing this additional amount. The allowance for wives was increased from 2s. to 2s. 6d. and later it was lifted to 3s., at which it now stands. {: .speaker-KVN} ##### Mr Street: -- The original figures were 2s. 6d. for wives and 9d. for children. {: .speaker-C7E} ##### Sir EARLE PAGE: -- If the Minister challenges the accuracy of my statement, I shall, during the course of the debate, produce newspaper extracts to show that four different statements have been made in regard to child allowance. {: #subdebate-39-0-s2 .speaker-KVN} ##### Mr STREET:
UAP -- The figures originally were 9d. for each child and 2s. 6d. for wives. {: .speaker-C7E} ##### Sir EARLE PAGE: -- I shall, if necessary, produce the newspaper extracts to which I have referred and ask that they be incorporated in *Hansard.* The attitude which the Prime Minister has adopted has undoubtedly caused a reduction of enthusiasm in recruiting. Within the first week of the declaration of war the feeling of the people of Australia was such as to have ensured, in my opinion, the enlistment of 250,000 men, who would have been prepared to fight so long as they were told definitely and clearly what they were to fight for, and how they would fight. {: .speaker-KHL} ##### Mr Holloway: -- No one can tell them that yet. {: .speaker-C7E} ##### Sir EARLE PAGE: -- It is regrettable that three months after the declaration of war we are facing the tragic spectacle of the dominion which, in 1914, led the rest of the Empire in its preparations for war, coming on this occasion a bad last. I cannot understand the attitude of the Opposition in regard to the proposed expeditionary force. We have to face the fact that many weeks ago it was stated clearly and definitely that the Governments of Canada and New Zealand each intended to send an expeditionary force overseas to serve in the western theatre of the war, while it was only yesterday that Australia made its decision known in this respect. It is rather interesting to read the., comments of the press in regard to our war preparations over the period of the last two or three months. I direct attention first to the following statement that was published on the 14th September in the Melbourne *Herald* in regard to camps and training : - >The immediate anxiety is that the Government is lagging behind the people in determination of the part that Australia should immediately prepare itself to play. There is growing a great restlessness because of delay in the mobilization of Australia's manpower. On the 15th November the same newspaper discussed in a leading article " Why the new Australian Imperial Force is short of men". It stated - >The Government made confused statements which left every one in doubt as to the relative purpose and importance of the Militia and of the special force. The man who was prepared to make every sacrifice to fight for Australia was at a loss to know where his duty lay. > >In the absence of any statement of the future of the special force it was no wonder if men have hesitated to give all their time to soldiering if no more was to be required of them than they could give by militia service. At one time a plan was suggested by which the Militia could be made the training ground of the special force, but it was rejected by the Government, which appeared to take the view that the training of the special force was something apart from Australia's measures for its own defence, and must therefore be made secondary to militia preparations. The result of that attitude is clearly seen in the fact that, whereas at one time it was confidently anticipated that 60 per cent, of militiamen would volunteer' for the new Australian Imperial Force, it is in the militia quota that enlistments have fallen short. So it is clear that not only in the period immediately preceding the declaration of war, but also in the months that have since elapsed, a definite lack of enthusiasm has been noticeable in a country which at heart is absolutely and solidly with the Empire. This lack of enthusiasm, and of failure to stir the hearts of the people, is due to ineffective leadership on the part of the Prime Minister. I shall take a second illustration to demonstrate my point. Every one remembers how eagerly the people received the announcement of the Government many weeks ago that an air expeditionary force would be equipped and despatched overseas. I think that almost every honorable member of this House approved of that decision. It was intended, we were told, to enlist 5,000 men. But what do we find? The enthusiasm evaporated when it was found that the men were not to be prepared for immediate service, and that it might be a long time before any of them would be sent abroad to participate in the titanic struggle that is proceeding. The original 5,000 has dwindled to a mere 166 men. The remainder of those who enlisted are to remain in Australia indefinitely. In all of these circumstances I sincerely trust that there will be no false step on the part of the Government in respect of the proposal to send 20,000 men abroad in the 2nd Australian Imperial Force. Even since the announcement was made last night that this would be done, the enthusiasm of the people has increased. I trust that the Government will not allow this eagerness to be again dissipated. A comparison of the position of Australia three months after war was declared in 1914 with its position to-day, will show how ineffective the Government's activities have been. In 1914 we were not expecting war, but I suppose that every honorable member of the House has felt for the last four or five years, that he has been living under the constant threat and shadow of war. The fact that 70,000 militiamen were enlisted was due entirely to the previous government and not to this Government. The 1914 war broke out on the 4th August. On the 7 th August our men were beginning to go into camp. On the 17th August our first expeditionary force had started for Rabaul In October we had a contingent actually on the. sea. On this occasion, in about the same length of time, our men are just beginning to go into camp. The whole trouble at present is that our men do not know where they stand. No one knows what the position is, I have a boy in the Militia who doe3 not know what to do because he cannot get any definite information from the Government. The time has surely come for the Government to gather up the scattered threads of its preparatory work and give a definite lead to the Australian people. It is high time that we were emulating the deeds of 1914. Not only should there be proper coordination, but we should also ensure that, when the men go into camp, they are treated properly. "When we gather 5,000, 10,000 or 20,000 men into a camp, it is important that measures be taken to ensure that a high standard of health is maintained. Money must be spent on preliminary preparations. It is useless to wait until an epidemic breaks out. It is then too late to recover lost lives. Nothing disorganizes a force so much as sickness, as was demonstrated during 1914, 1915 and 1916, when meningitis broke out amongst the troops in the military camps. The danger of such epidemics can be minimized by the installation of proper systems of hygiene, at least as good as exist in towns with the same populations. For years past, the Government has been voting money to enable towns with populations of 2,000 and upwards to install sewerage systems. The first essential for Che preservation of the health of the troops is the sewering of the camps. When I went to Ingleburn camp, and advocated the installation of a sewerage system, I was told that I was talking out of my turn. Now, I am glad to hear the Minister say that this work is to be undertaken. It will be found that the expense of installing a sewerage system, either by linking up with a near-by drainage system or by septic tanks, will be more than repaid by saving the cost of disposing of the night-soil in other ways, and by a reduced incidence of sickness caused by the contamination of food. I understand that the preparation of the camp is to cost £192,000. Even if it were to cost another £10,000 - and I do not think it would, because there would be countervailing economies - we should not hesitate to spend the money so as to bring the hygienic facilities up to those of towns of similar size. The cost should not be so very great, because there would be a clean slate to work on, and it should be cheaper to sewer a military camp, where the huts are close together, f/han a town, where the dwellings are more widely separated. {: .speaker-KVN} ##### Mr Street: -- It will0 be done. {: .speaker-C7E} ##### Sir EARLE PAGE: -- It should be done at the earliest possible moment, not only at Ingleburn, but at all of the camps. {: .speaker-KVN} ##### Mr Street: -- It will be done in all of the camps as soon as possible. {: .speaker-C7E} ##### Sir EARLE PAGE: -- Where there is a good sewerage system in the nearest town, the camp should be connected with it at a cost of a few hundred pounds. It is important that due consideration be given to the matter of soldiers' pay, and particularly to allowances for wives and children. I do not believe that it is good economy to try to run this war as cheaply as possible as far as our soldiers are concerned. At any rate, our savings should not be at the expense of our defenders or their dependants. The Government has no compunction about paying the full price for the materials of war, and neither should it have any compunction about paying the full price for the human element that must take part in the war. Surely it is just as proper that we should pay the full price for the warm human flesh that has to participate in a war as for cold, inhuman steel. Whether the men have enlisted for home service or service abroad makes no difference - they are entitled to fair and reasonable pay. Consideration should be given to the sacrifices which they have made to join the forces, and also to the effect which the rates of pay are likely to have upon economic conditions generally. Allowances should be made sufficiently generous to encourage the marriage of men going into camp. These men are allowed to enlist only because they are the physical pick of Australia. To-day, reference was made in this House to the fact that hundreds of trainees who had passed the first medical examination, had been rejected at the second. The men who have enlisted for overseas service are also the spiritual pick of Australia, because they have offered their lives for the defence of their country. We cannot afford a cheap defence scheme at their expense. The country can afford to pay them properly, and we should see that it is done. Other countries have recognized that conditions now are very different from those of 1914. The rate of pay for soldiers in New Zealand during the last war was 4s. a day; now it is 7s. The rates, with deferred pay added, were 5s. a day in 1914, and are 8s. a day now. Although the rate of pay for soldiers in Great Britain is very low compared with here, the fact remains that, even in England, the rate has been increased by 50 per cent, as compared with the last war. When we realize that in Australia the basic wage has increased from £2 14s. a week in 1914 to over £4 a week now, we realize that the men who will fight for us are entitled to a higher rate of pay than was given in 1914. I do not approve of the action of the Government in reducing the pay of mili tiamen from 8s. to 5s. a day. They were encouraged by the Government to enlist on the promise, which was endorsed by several Ministers, that they would receive 8s. a day. Now, they find that they are committed, for the duration of the war, to serve for 5s. a day. That seems to me very like a breach of contract, no matter what the technical or legal position may be. Those of us who took part in the recruiting meetings never believed for a moment that militiamen who offered themselves for training in peace time, while others were free to amuse themselves, would have their pay reduced from 8s. a day to 5s. This is especially unfair in view of the fact that the men are required to go into camp, not for twelve or sixteen days as originally proposed, but for as long as three months- at a time. Men from, the land thought at first that they would be able to get their neighbours to look after their places for a fortnight or so, but now, when they have to go into camp for three months, they find that they have to employ substitutes. Many of them will be going into camp in the autumn, just when the great bulk of the farm work must be done. If it is not done then, the reward of the whole year's work will be lost. As I have said, it is important to encourage the marriage of trainees by making proper allowance for wives and children. As the result of constant pressure, the allowance has been raised from 2s. a day, to 2s. 6d. and lately to 3s. for wives, while the allowance for children has been raised from 6d. to 9d., and then to ls. We should not be satisfied until we make the allowances at least as generous as those in New Zealand, where wives receive 3s. a day, or one guinea a week, and 10s. 6d. a week is paid for each child, which represents ls. 6d. a day. In New Zealand, a man with a wife and two children will receive £2 2s. a week, in addition to his ordinary pay. That is not unreasonable. In Great Britain, the family allowance is 17s. for a wife, and 22s. for a wife and child. That, however, is in sterling, which represents 21s. 3d. in Australian money for a wife, and 27s. 6d. for a wife and one child, which is almost as much as is given here. {: .speaker-JOM} ##### Mr Beasley: -- The original proposals were along those lines. {: .speaker-C7E} ##### Sir EARLE PAGE: -- The original proposal was that if men were prepared to go into camp to receive at one. time the military training which would ordinarily be spread over three years, they were to receive a special bonus. The country would gain rather than lose by making the family allowances more generous. If there is one thing we need in Australia it is increased population, and the best population we can have are the children of soldiers. What better memorial could there be to a soldier who serves his country than the child he leaves here behind him? It is a far better memorial than the expensive monuments of brick or stone which have been erected all over the country. It is desirable to deal frankly with these matters. Whereever there are large bodies of young men gathered together, well fed, and in good physical condition, something will go wrong if they have not some natural outlet. Therefore, we should encourage these men to marry in Australia, and we should make that possible by providing adequate allowances. In that way wo would reduce the incidence of venereal disease which has always wrought such tremendous havoc in every army. One is staggered by the statistics which show the terrible toll levied by venereal disease in camp conditions among soldiers. These men are of an age which is recognized throughout every country in the world as one at which young men are most susceptible to that condition. {: .speaker-KHL} ##### Mr Holloway: -- I remember the right honorable gentleman fighting increases of widows' pensions under the Repatriation Act on many occasions. {: .speaker-C7E} ##### Sir EARLE PAGE: -- I am the man who increased old-age pensions from 15s. to £1. I have never done any cutting down of pensions. I venture to say that, during the last twenty years in which I have been a member of Parliament, I have been associated with practically every liberalization of soldiers' pension conditions, especially the last, which granted pensions to burnt-out soldiers. These have always 'been brought in by governments with which I was associated. Irrespective of what has happened before, it is necessary that what happens now should be right, and the right time to deal with this matter is the present. Consequently, I raise this "matter now. I suggest that the allowance for a child should be 10s. 6d. a week, which is only 6d. a week more than the endowment paid to widows by the Child Welfare Department in New South Wales. . Surely that is not asking too much. If I had any doubt with regard to this matter, it would have been completely removed to-day by the financial statement made by the Acting Treasurer **(Mr. Spender).** *[Leave to continue given!]* To-day, the honorable gentleman announced that a large part of the expenditure' incurred in connexion with Australia's war effort would have to be met out of loan moneys. That means that when the soldiers come back they, and ultimately their children, will have to bear their full share of the repayment of those loans. Surely, then, it is reasonable that the Government should exercise some generosity in connexion with this matter. Another point to which I should like to refer in regard to this matter is that the inadequacy of the soldiers' pay has been recognized by the Government; because it has stated that, in respect of its own servants, it will make up the difference between their Militia pay and their Public Service pay for the first sixteen days. After that period, they will revert to their Militia pay. The very fact that there is this difference shows that the Government recognizes, to some degree at any rate, the inadequacy of the Militia pay. It was suggested, I think by the Attorney-General **(Mr. Hughes),** that private business men should do likewise, and some business undertakings have even already agreed to make up the difference between the expeditionary force pay and the civil pay of their employees who have enlisted. A moment's thought will show that that cannot possibly be done generally. From 60 per cent, to 80 per cent, of the employees of one firm may enlist in the 2nd Australian Imperial Force and not a single employee of another firm may join the army. In this way discrimination would arise. The responsibility in connexion with this matter should be borne, not by individual employers, but by the general taxpayer. Unless that is done, all sorts of anomalies and difficulties will arise. This is a national question, arid because of that it seems to me that the military pay should have some reasonable relation to the earnings of an average man in1 civil life. I recognize, of course, that in serving their country some men make great sacrifices and that no provision can be made adequately to recompense them. Theirs is a special class of case; but at the same time I believe that the military pay should be fixed at a rate comparable to what is earned by the average man in civil life. There is another phase of this matter which will have its effect on recruiting. Many men who are anxious to fight for their country are faced with the possibility of leaving their dependants in penury, unless more adequate provision is madeforthem.Fromallthese viewpoints, I urge that the Government should recognize the justice of the claims of those who are prepared to serve their country, and at the right time, I am prepared to do something in connexion with it. Mr.WHITE (Balaclava) [5.41].- The statement of the Minister for the Army **(Mr. Street)** has much in it with which we agree, but to claim that the Commonwealth war measures have functioned in a way that entirely justifies the care and forethought put into the preparation is something which to say the least, is rather overstating what has happened. It is unfortunately true - and I do not intend to labour this - that the Government has not adopted a forthright policy; on the contrary, there has been a great deal of change and delay. In the first place, we had a very definite statement that there would be no compulsory military training; then we had a pronouncement regarding the rates of pay to be paid to the force enlisted for overseas service; then there was a change in regard to that followed by delay in offering a division for overseas service; then we had a tardy decision about its really departing from Australia; all of these are matters which I brought up on many occasions and in. respect of which I incurred a good deal of unpopularity because one is frequently looked upon as a critic if one offers suggestions. There is no doubt as to the unfortunate position of the Militia. I say very clearly to honorable members that the Government is in a difficulty about the Militia. It must be aware that what the Militia is expected to do now is vastly different from the original proposal of a camp of from six to twelve days' duration with pay at the rate of 8s. a day. Now, the Militia is to undergo a month's training in camp, to be followed by a further three months' camp, the pay for the latter period being at the rate of 5s. a day. I know that, since the first decision was made, war has broken out, and with the outbreak of war matters are entirely different; but the men to be called up for training are definitely covered in Part 4 of the Defence Act. Although under Sections 59 and 60 of that Act, the Government may call up men between the age of 18 and 60 years for service in Australia, it has very tardily given notice of the calling up of one quota in January to make up certain deficiencies. To-day I asked the Minister for the Army - >To approximately what numerical strength has the Militia been reduced as the result of enlistment of members in the 2nd Australian Imperial Force, transfers to the Militia Reserve, or discharges as the result of the specification of reserved occupations, unfitness or hardship ? The reply was - >Between 55,000 and 65,000 at a guess. **Mr.** Street.I said it was a mere guess. {: #subdebate-39-0-s3 .speaker-KZR} ##### Mr WHITE: -Idonotwishto misrepresent the Minister. I think thatitwasaliberalestimate.Dealing with transfers to regimental reserves, the Minister says in the statement he has issued that, as the result of the process of transferring to the reserves, discharge of those unfit, and of those married men who elect to be so transferred, 25,000 members of the Militia will not be available for the period of the three months' camp training. That leaves a very inadequate army for Australia. In 1914, with a population of 2,000,000 less than we have now, we had some 40,000 militiamen, who had at least undergone one camp, and some 80,000 cadets who had day and night training but no camp experience. I suggest that a Militia force reduced to these dimensions is quite inadequate for Australia's defence. {: .speaker-KVN} ##### Mr Street: -- The gaps are being filled. {: .speaker-KZR} ##### Mr WHITE: -- When are they being filled? {: .speaker-KVN} ##### Mr Street: -- In January. {: .speaker-KZR} ##### Mr WHITE: -- The Minister stated that Militia trainees will be called up in January. I suggest a more equitable proposal than that. During the recruiting campaign last year, a number of men rushed in to volunteer for the Militia. Some of them who were over age but who held high key positions were rather more inadequately fitted to take on soldiering than the younger men. Whilst they were quite prepared to do what was in prospect at the time, it is very difficult for many of those whose employers offered to make up the difference between their civil and military pay to have to ask their employers now to make up the difference for three months instead of the original month. Honorable members may have read in the *Argus* that the legal officers of the Defence Department are making inquiries to see if there is any victimization so that employers may be dealt with who do not re-employ men after they return from camp. The employers may say that trade has wilted because of the outbreak of war, and that if a man is victimized, they should not be punished. Some honorable members opposite have said that there has been a breach of contract in the change of militia training and pay; at any rate conditions are entirely different to-day from what they were when those undertakings were given. It is reasonable that men should be re-enlisted in these circumstances. The majority of the members of the Militia will go to camp gladly; few will seek to get out of their responsibility under the hardship clause because they are the pick of our manhood. Still, the Government must face up to the fact that the position today is entirely different from what it was, and because of that it should offer the men of the Militia an opportunity to reenlist on the new terms. If sufficient men do not offer their services, it should fill the gap by calling up further quotas included in the six categories mentioned in section 60 of the Defence Act, of which the first one is single men between 18 and 35 years of age. They could be subdivided into any classification which the Government may choose. That, in my opinion, would be the fair thing to do in the present circumstances to meet the difficulty associated with the Militia. The members of the 2nd Australian Imperial Force are in a different category. The Government has to finance the expenditure associated with this war, and whilst it is prepared to pay what is demanded in other directions, it should not overlook the claims of the men who take the risks of war. It should realize that the men who serve for home defence do not take the same risks as those who go overseas. If honorable members compare the rates of pay in the two forces, they will find that a specialist in the Militia, for instance a sapper in the engineers, is paid about 8s. a day, whereas a man in the 2nd Australian Imperial Force gets only 5s. a day, and, when he goes overseas, 6s. a day. It is unfair and odious to make comparisons between the pay of Australian troops who go overseas and that of the armies of other countries. It has been said that during the last war the British " Tommy " received only1s. a day; but, as the right honorable member for Cowper **(Sir Earle Page)** has pointed out, the pay of the British " Tommy " in this war has been increased by at least 50 per cent., and, furthermore, it must be remembered that he is paid in sterling. During the last war, Australian currency was atpar with sterling. The men of the 2nd Australian Imperial Force, who will be paid6s. a day in Australian currency when overseas, will receive only the equivalent of 4s. 6d. sterling. {: .speaker-KVN} ##### Mr Street: -- While they are abroad, they will be paid in sterling. {: .speaker-KZR} ##### Mr WHITE: -- Will they be paid the equivalent of 6s. in sterling? {: .speaker-KVN} ##### Mr Street: -- No ; they will 'be paid in sterling the amount of their daily pay less the allotment which they make in Australia. The allotment will, of course, be paid in Australian currency. {: .speaker-KZR} ##### Mr WHITE: -- Exactly; but while the men are in camp in Australia they receive 5s. a day and when they go overseas they will get1s. a day more. However, they are still to be paid in Australian currency. {: .speaker-KA9} ##### Mr Jolly: -- They will lose the exchange. {: .speaker-KZR} ##### Mr WHITE: -- Yes. {: .speaker-KVN} ##### Mr Street: -- A man who goes over seas will draw 6s. sterling if he has not made an allotment. {: .speaker-KZR} ##### Mr WHITE: -- I am glad if that is so, but no statement has hitherto been made that that is so. {: .speaker-KVN} ##### Mr Street: -- We are following the practice that was established in 1914. {: .speaker-KZR} ##### Mr WHITE: -- But in 1914 the Australian pound was on par with sterling. The men were paid in gold or notes, or silver, whichever they elected. My fellows in India were' paid in silver. Every man was paid the equivalent of sterling. The minimum pay in the last war for air mechanics in my unit was Ss. a day. Buglers, batmen and the like, received less, but that was the rate for the rank and file. Yet, all that we propose for the rank and file of the Australian expeditionary forces in this war is 5s. a day in Australia and 6s. a day abroad. {: .speaker-KRH} ##### Mr McHugh: -- That cannot compare with the 19.14 pay. {: .speaker-KZR} ##### Mr WHITE: -- No. It is of no use comparing the Australian Army with other armies. My unit in the last war was attached to the.Indian army in which the Sepoys drew perhaps a few annas a day, hut their standards were different. Comparisons with other armies cannot be made. Our industrial rates of pay are different from the rates that operate in England. What of it? But the rates for troops in the war of 1914-18 provided us with a good model to- work on. {: .speaker-KVN} ##### Mr Street: -- In the last war the allotments started at ls. 4jd. and 4d. a day. {: .speaker-KZR} ##### Mr WHITE: -- Yes, but the rate for the men was higher. {: .speaker-KVN} ##### Mr Street: -- We have not yet paid it ; Great Britain paid for that. {: .speaker-KZR} ##### Mr WHITE: -- The honorable Minister, should not try to shift ground. When shall we he able to pay for this war? We must work hard to do so. That is not the question at present, however. The bigger consideration is not the financial consideration; it is the winning of the war. Those who do not go away must see that the rights of those who do are preserved. Many youths went away to the last war when they were just entering their apprenticeships, came back untrained, and found that men who had not gone to the front had in many instances risen to affluence while they had so little. All of the repatriation and the vocational training schemes did not make up the leeway in a great number of instances. I exhort the Government, therefore, to study carefully the pay of men who go away. Their rate of pay should be greater than that 'of the men who remain for home defence, except if there be fighting in Australia. If there be no fighting in Australia. - and I trust that there will not be - it will be the force that is overseas that will fight Australia's and the Empire's and civilization's fight and win it. Men will be here guarding vital points, many of them returned soldiers, and I appreciate the work that they will do, but from the danger aspect their positions will not be comparable to those of the men who are "in the front line. I am" glad that the Government has insisted that an Australian air unit shall go overseas from Australia as I understand that the Empire air training scheme will make provision for flying personnel to be trained in Australia before going away. That -decision is to be applauded. The Australian Flying Association has sent letters urging that the original proposal to send an Air Force contingent from Australia should be revived. At this stage, I hope I may be excused if I say something that I should have said last night had I had the opportunity. Yesterday, after I had concluded my speech, the honorable member for Reid **(Mr. Gander)** asked me whether I was going to the war. I said that I was. But I should add that I- do not know the present plans of the Government in detail, but I do expect to go away. I was on the unattached list of the army, hut transferred to the unit in which I served in the war, the Air Force. I was to have gone with the proposed Air Expeditionary Force of six squadrons which would have left later this year. I am reminded by an interjector that I am too old for the 2nd Australian Imperial Force.. I am grateful for the reminder, because the decision to impose age limits is utterly ridiculous. To suggest that a captain over 30, a major over 40 and a lieutenant-colonel over 45 cannot go away with a unit is to shut one's eyes to the fact that the experience of such men would be of inestimable value. ' The decision to impose age limits at the very outset of the war was extremely unwise. The Minister qualified the decision later by saying that in exceptional circumstances, exceptions -would be made; but that was too late for me. I submitted my name on the night of war for enlistment overseas, but was, apparently, too old. I then went to the Air Force. {: .speaker-KVN} ##### Mr Street: -The age limits are based on the experience gained in the last war. {: .speaker-KZR} ##### Mr WHITE: -- Experience gained in the last war ! The Minister should figure it out for himself. In 1918, the average age of the captains was about 30 years. Those men would now be about 50 years of age, and if they have stayed in the Army they will have advanced a step or so since then. {: .speaker-KVN} ##### Mr Street: -- The age limits were based on the reaction of war on people of similar ages in 1914-18. {: .speaker-KZR} ##### Mr WHITE: -- What reaction? I have faced the doctor and passed him at my age. Surely experience counts more than a dogmatic age limit decided by some one in an office. Before this war is over, men of all ages will be wanted. Even if experienced men lasted only a year or two in this conflict, they would be able to tell the younger men something totheiradvantagewhatevertheirrank. Their services would be useful in camp or overseas. Reverting to the matter of pay, I lay stress on the fact that the men who go overseas should be paid at a higher rate than those who remain for home defence; The renowned economist Keynes, in suggesting a means of avoiding a post-war slump, advocated - and was met with a good deal of criticism - a system of part-payment in industry by certificates tobe cashed after the termination of the war. He said that the cashing and spending of those certificates would help to maintain the impetus of trade. As an alternative to an actual cash increase of the pay to the soldiers who go overseas, theGovernment should look into that proposal. {: .speaker-KHL} ##### Mr Holloway: -- I agreed with the honorable member when he advocated a higher rate of pay for the soldiers, but I do not agree with him now. {: .speaker-KZR} ##### Mr WHITE: -- What I am suggesting is an alternative means of supplementing the soldiers' pay. {: .speaker-KHL} ##### Mr HOLLOWAY:
MELBOURNE, VICTORIA · FLP; ALP from 1936 -- They could not spend certificates. {: .speaker-KZR} ##### Mr WHITE: -- No, but the certificates could be. saved for redemption after the war. At any rate, I put that forward merely as an alternative, if the Government feels 'that it could not now afford to meet the additional expenditure which would be involved in an increase of the rates of pay for soldiers. There is no need for the Minister for the Army alone to take the responsibility of looking into these matters I have raised. There are now four Ministers, including the Prime Minister himself, who is Minister for Co-ordination of Defence, connected with the armed forces. Between them, surely they could undertake the task. It is a reasonable proposal that the soldiers should get more money, in spite of the fact that there is a division of opinion in this country on the subject. The pay of the 2nd Australian Imperial Force would not amount to much in a programme of more than £60,000,000 worth of defence expenditure this year. I ask the Minister for the Army now what proportion of that expenditure will be involved in soldiers' wages? {: .speaker-KVN} ##### Mr Street: -- About £10,000,000. {: .speaker-KZR} ##### Mr WHITE: -And how much of that will be for the overseas forces? I think it would be fair to say that it would be between £2,000,000 and £3,000,000 for the whole of the expeditionary forces, which is only about one-thirtieth of the whole of the defence expenditure. It is cheeseparing to cut down where the human element is concerned, while big prices will be paid for weapons of death. {: .speaker-KLC} ##### Mr Mahoney: -- The soldiers are being paid the basic wage in New Zealand. {: .speaker-KZR} ##### Mr WHITE: -- Yes, and I commend the Labour government of New Zealand, not only for that, but also for the fact that it has decided to send an expeditionary force from New Zealand. To summarize, I suggest that the Government should give the militiamen an opportunity to re-enlist on the present terms, that existing and future gaps in the Militia should be filled by calling up further age groups for universal training, and that the Government should revise the rates of pay in the Australian Imperial Force in order to ensure that those whose patriotism is practical in offering their lives for their country if necessary in order to defend it, will be paid some rate which is commensurate with their services. {: #subdebate-39-0-s4 .speaker-JNX} ##### Mr BARNARD:
Bass .- The Minister for the Army **(Mr. Street)** has done good work in many ways since he has been in the Cabinet. He has always been prepared to listen to any complaints, and has always endeavoured . to rectify them wherever possible. There has been criticism of the Defence Department in this debate, but in any department whose ramifications have been extended so greatly as have those of the Defence Department there must be room for criticism. I was impressed with some of the critical remarks of the right honorable member for Cowper **(Sir Earle Page),** particularly those in which he drew comparisons between the conditions that prevail now and those that prevailed several years ago. The present attitude of the right honorable gentleman, however, does not appear to be consistent with the attitude that he adopted when he was a member of the Government. It is true that honorable members do not know what took place in the Cabinet room, where the right honorable gentleman may have expressed opinions similar to those that he expressed this afternoon, but the fact remains that, while he was a member of the Ministry, very little was done to rectify the position of which he complained to-day, despite his statement that even in those days he foresaw the difficulties lying ahead of the Government. Although I agree to a great degree with what the honorable member for Dalley **(Mr. Rosevear)** said this afternoon in the very fine speech with which he opened this debate on behalf of the Labour party, I also agree in many respects with what the right honorable member for Cowper said. Fortunately, I have not committed the political sin of being a member of a Government which is largely responsible for the lack of defence preparedness in Australia. Thi, Government, and others of the same political complexion, have occupied the treasury bench for more than seven years now. During the last three or four years, the ominous clouds of war have been looming on the horizon and, despite the fact that the Labour party has offered constructive criticism of the Govern ment's defence policy and has made many valuable suggestions regarding preparations that should have been made for any conflict in which Australia, as a member of the British Commonwealth of Nations, might be involved, the Government ignored and, at times, ridiculed its proposals. Within the last few weeks, however, the Minister for Air **(Mr. Fairbairn)** has made statements based on the very principles that Labour advocated at least two or three years ago. Those facts, which may be verified in the records of the debates of this Parliament, speak for themselves. They show that this party enunciated years ago a sound policy for the defence of this country. I support much of the criticism that has been voiced this afternoon of the rates of pay provided for members of the defence forces, and I am also strongly opposed to any form of conscription. Conscription of man-power is neither necessary nor desirable at this juncture. The voluntary system has never had a fair trial; I do not believe that the Government has ever tackled very seriously the problem of obtaining recruits for the Militia Forces. Of course, as soon as the international situation overseas became precarious, there was a speeding-up of defence preparations in Australia. The fact that the Government has repudiated its agreement with the men who enrolled for a period of three years in the Militia has had a curbing effect on further enlistments; the alteration of conditions and the extension of the period that the men have to spend in training have had a tremendous effect. The New Zealand Government has had no difficulty in obtaining the number of men that it considers to be necessary for the adequate defence of that dominion by voluntary enlistment. One of the main reasons for this is that since a Labour government has been in power, it has done many things to bring about social and economic development; it has introduced a shorter working week, increased rates of pay in industry, improved housing conditions, and generally created a better set of social conditions. That has given the people of New Zealand a greater degree of confidence in themselves and has created an attraction for many men residing in Australia, because conditions in New Zealand provide greater scope for the ability and skill of the working man. Men are rushing to the colours in New Zealand to take their part in the war effort of the British Commonwealth of Nations because reasonable rates of pay are provided for them. A married man with a wife and two children, who enlists as a private in the New Zealand militia forces, receives a weekly wage of £2 9s. for his own services and allowances of £11s. in respect of his wife and £11s. in respect of his children, making a total of £4 l1s. a week. I agree with the right honorable member for Cowper that if Australians are given sufficient inducement to enlist, we shall have no difficulty in obtaining as large a force as we need. Before I returned to Canberra to attend the present sitting of this Parliament I received numerous complaints regarding rates of pay in the Militia. Men joined the Militia for a term of three years in the expectation of spending some time in camp and attending a number of drill parades, which cut into their private lives, because it was considered necessary in the interests of Australia's safety to have a greater supply of trained men; but when the speeding-up process took place and the Government decided to introduce a longer period of continuous training, hardship was imposed on many of them who had fixed financial commitments. One of the many men who interviewed me told me that he was earning £5a week and had to support a wife and four children. He was purchasing a home and had to pay insurance premiums and other regular expenses, which exhausted almost the whole of his income. He was sent into camp on a wage of £3 a week and had to remain there for one month. For the whole of that period, therefore, he suffered financially to the amount of £2 a week. To make matters worse for him the Government has now decided that the Militia must spend a further three months in camp early next year. *Sittingsuspendedfrom6.15to8p.m.* {: #subdebate-39-0-s5 .speaker-JNX} ##### Mr BARNARD:
BASS, TASMANIA · ALP -- One cannot help comparing the treatment of the men who will be called upon to bear arms with the treatment of those financiers who invest their money in war loans. In this connexion we find that while interest rates have been pegged at the level at which they stood on or about the 31st August, many men who have gone into camp are losing as much as £2 a week. Their wages were not pegged for even a fortnight. It requires a good deal of patriotism for a man with a family to maintain to volunteer for service when he knows that it will mean a loss of £2 a week to him. It is true that provision is made for exemptions in cases of hardship, but these men want to do the job, and are entitled to know that adequate provision will be made for their families. The right honorable member for Cowper also drew attention to the provision made at the military camps for the men. The Minister's statement contained the following paragraph: - >The estimated expenditure on camps for the 2nd Australian Imperial Force amounts to £1,250,000. Structures for outlying districts and commands have been erected, but the main works are for the brigade camps at Ingleburn and Allandale (New South Wales) and Puckapunyal (Victoria). The men in the ranks have a right to expect reasonable treatment when in camp. There should not be so much differentiation between the men and the officers. In this connexion I refer not only to the canteens but also to other matters. The rate of pay has been fixed at the 1914 level, whereas the cost of living has risen about 50 per cent. since 1914. While we, as members of the British Empire, desire to help the Mother Country, we must not ignore the pertinent statements made during the last two or three years by the Prime Minister of Great Britain and other leading British statesmen. **Mr. Chamberlain** has said quite plainly that, in the event of Britain being unable to protect the dominions, they would have to look after themselves. That leads me to remind the House that this continent is rich in natural resources but is thinly populated. We must also bear in mind that since 1914 the whole position has altered immeasurably in that, whilst distances remain the same, the period required to get from one place to another is much less than it was then. Australia would be wise to pay close attention to some of its near neighbours. A leading article in to-day's Melbourne *Age* substantially supports what the Leader of the Opposition **(Mr. Curtin)** said in thisHouseyesterdayanddraws attention to the alignment of the nations, particularly in the Pacific. We do not know how the nations will align themselves in this conflict, and we must not be blind to the possibility of Australia being itself in the danger zone. Strategically our position' may change dramatically, and the consequences, indeed, be serious. For that reason, Australia must consider, first, its own defence, and take steps to safeguard this portion of the British Empire. That is our job. In last month's issue of *Current Problems* the following paragraph appeared : - >We quote a high Japanese diplomatic authority : " Japan is in no state to enter upon another war." The European war does give Japan an opportunity, if she can end' the Chinese incident without loss of face, to rebuild her economic strength, whilst two of her strongest competitors, Britain and Germany, are fighting. Australia's policy should be to do possible to re-knit the bonds which formerly united the two countries, and the Australian Government, when Japan makes a gesture of goodwill, should welcome it, which it is not doing at .present. > >There is much of merit in that statement. I invite the Government's attention to this important aspect of our own defence. > >It has been said that our aim in the present war is victory, but much depends on what We mean by victory. In my opinion, there are no victors in any war. The Allies were supposed to have won the war of 1914-1918, but whilst they may have won the' conflict in arms and imposed certain conditions on a supposedly defeated foe, the fact remains that economically, neither side won the war. Audited figures which were recently published show that the cost of the war to the nations that participated in it was «s follows: - ifr. *Barnard.* Should the present struggle continue for any considerable time, both sides will be exhausted financially. I want to see the Allies win in this conflict, but I want also to see, at its conclusion, a peace founded upon justice in the social and economic lives of all the peoples engaged in it, including ourselves. In criticizing the Government's defence proposals I hope that I have said something of a constructive character. I desire to be helpful. Although I am not satisfied with many of the activities of the Government, and have been somewhat critical in my remarks, I appreciate the tremendous problem confronting the Government. I am not satisfied with what is being done for those who will play the most important part in the conflict, namely the soldiers sand their dependants. That is an aspect of the war to which the Government should give more consideration, so that when the war is over, all sections of the community, soldiers, dependants of soldiers, and citizens generally, will be able to live in a better world. {: #subdebate-39-0-s6 .speaker-F4U} ##### Mr FORDE:
Capricornia .- My colleague, the honorable member for Dalley **(Mr. Rosevear),** dealt so ably this afternoon with the statement now under "consideration that it is not my intention to speak at any length on the general subject. I shall devote my attention to one aspect of it which concerns the welfare of the members of the 2nd Australian Imperial Force and. of the Militia Forces. In order to make clear the attitude of the Federal Labour party, I move - That all the .words after " That " be omitted, with n. view to insert in lieu thereof the following words : - " in the opinion of this House, the rate of pay to a private in the 2nd Australian Imperial Force should be not less than 7s. per day. with an allowance of 3s. per day for a wife, and Is.Od: per day for each child under the age of sixteen years, deferred pay to be at the rate of ls. per day on embarkation; and for the Militia Forces, the rate of pay, shall he not less than 8s. per day for a private, with 3s. per day allowance for a wife, and ls. 6d. per day for each dependent child - Commissioned ranks to be graduated on this basic scale. In the opinion of the Opposition an increase of the rates of pay of both the 2nd Australian Imperial Force and the Militia is absolutely necessary. We owe a duty to these young men who are making great sacrifices. I was impressed by the remarks of the right honorable member for Cowper **(Sir Earle Page)** this afternoon concerning the spirit that prompted our young mem to enlist in the 2nd. Australian Imperial Force and the Militia. Speaking as a medical practitioner, he said that he knew that many of these men were of the finest type, physically, in Australia, and were actuated 'by the adventurous spirit of their forefathers who had been so successful in1 organizing and developing many of the great industries of this country. These young men, he said, were true to type. I agree with him. This country cannot afford to run this war " on the cheap ", by inadequately paying those who are prepared to enlist, sacrifice jobs and prospects, and risk their lives. As the representatives of the electors, we have a great responsibility to give our close attention to the matter with which I am now dealing. It is already engaging the attention of a very wide circle of people in the general community. The pay and conditions offered to these young men have been discussed at meetings of various kinds and. also in numerous articles in the press. The existing rates have caused great dissatisfaction, noi only in the ranks of the 2nd Australian Imperial Force and the Militia, but also in the community at large. "We feel that we should be lacking in our duty as an Opposition if we permitted Parliament to go into recess next week without giving honorable members a specific opportunity to express their opinion on this subject on the floor of the House. It is a long way to hark back to 1915. At that time our soldiers were being paid 5s. a clay and ls. a day deferred pay on embarkation. It is surprising, therefore, to find that to-day the rate should still be only 5s. a day with ls. a day deferred pay on embarkation. In 1915, the allowance for wives was ls. a day and for dependent children 4£d. a day each. Corresponding rates for 1939 are 3s. a day and ls, a day. The total amount provided for the soldier and his wife and. one child in 1915 was 6s. 9£d. a clay plus ls. a day deferred pay. In 1939, the corresponding amount is 9s. a day plus ls. a day deferred pay. This small increase is not at all in keeping with the increase in the cost of living, as honorable members must be very well aware. Moreover, a substantial increase of the basic wage has occurred during the period under review. In 1914, according to the statistician's figures, the Federal basic wage was £2 14s. 6d. In 1915, it was £3 ls. 6d. The figure for the 1st December, 1939, is £3 19s. The basic wage has increased by 22 per cent, since 1915, and by a much greater percentage since the end of 1914. Under existing conditions, the remuneration for a man and his wife and one child will be £3 10s. a week inclusive of deferred pay, and £3 3s. a week minus deferred pay. The soldier will retain 14s. a week. Thus, a married woman with one child will receive £2 9s. a week. Is it fair to ask her to pay rent and maintain herself and child on that meagre pittance with all the attendant worry, anxiety and sorrow? The right honorable member for Cowper pointed out this afternoon that the sister dominion of New Zealand is treating its soldiers and dependants in a much more liberal manner than Australia is doing. He added that the rate provided for New Zealand would satisfy him. The New Zealand rates are as follows: - Private, 7s. a day or £2 9s. a week; wife, 3s. a day or £1 ls. a week; child, ls. 6d. a day or 10s. 6d. a week, making a total of £4 0s. '6d. a week. The comparative rate for Australia at present is, private, £1 15s. a week; wife, £1 ls. a week; child, 7s. a week, making a total payment of £3 3s., not taking into consideration the deferred pay. Not only has a substantial increase occurred in the basic wage since 1915, but I emphasize that the cost of living has also increased greatly. The figure for September, 1939, according to the Commonwealth Statistician, is 33.3 per cent, above that for November, 1914. The figure for to-day is 35 per cent, in excess of that for November, 1914. All of these factors should be taken into consideration. "We must also bear in mind that to-day we are offering the single man who enlists only the same rate as was offered to single men in 1915, namely 5s. a day, plus ls. a day upon embarkation. I do not see how any one can stand for that policy. Single men who have enlisted have, in many instances, left positions of great promise. I realize, of course, that some of them were unemployed, but that is no reason why the Government should underpay them in the hazardous undertaking on which they have entered. Those who have enlisted in Queensland include many young men who were receiving a basic wage considerably higher than the federal basic wage. Our young men made substantial sacrifices when they left their permanent positions and went to the nearest recruiting depot to enlist. Moreover, it happened that some of them had to wait from two to five weeks before they were called into camp. I met many young men in my own electorate quite recently who had given up permanent jobs to enlist and who were kept hanging about for weeks, at their own expense, before they were called into camp. Numbers of these young men had widowed mothers or aged fathers or other members of their families dependent upon them. I ask whether it is right' for us to expect them to make such great sacrifices ? The young men who are enlisting are being asked to make sacrifices out of all proportion to the sacrifices capitalistic interests are being asked to make. In my opinion the Government should, if necessary, tax the wealthy classes of our community to provide additional money for the remuneration of these men. The people who own large properties, retail shops, or big manufacturing establishments, and enjoy huge' . incomes, stand to lose most if Australia should be invaded, or if the British Empire should be overwhelmed. I submit, therefore, that they should be taxed in order to assist the nation to provide for those who are prepared to fight for their country. The capitalist class of Australia should not expect to escape with a minimum of taxation. It is not fair that they should be able to call upon the Government to " run the war on the cheap " at the expense of the boys who are risking everything. Nor is it proper that they should expect the brave young spirits of this country, the very flower of our manhood, to enlist with the possibility of making the supreme sacrifice without being willing, themselves, to do the fair thing. Many of the men who have enlisted in the 2nd Australian Imperial Force or who are at present in militia camps, have wives and young children as well as other dependants. Our soldiers who go abroad to this war will have an even worse time than the soldiers who served in the last war. Many of them will sacrifice their permanent employment, and even those who return at the end of two, three or four years, if the war should, unhappily, last so long, will be handicapped when they attempt to resume their civil employment. These factors should be considered now, not after the men have left our shores. "We should do what we can for them now, while they are in camp, and before they leave on active service. What I am saying applies also to the men in the Militia. An additional reason for support for ray amendment is to be found in the statement of the right honorable member for Cowper this afternoon that when he took an active part in the recruiting campaign some months ago, he assured the men who enlisted that they would be paid 8s. a day. The right honorable member for North Sydney **(Mr. Hughes),** who was in charge of the recruiting campaign, and in course of it toured Australia from one end to the other delivering many soulstirring speeches, also assured the men who enlisted that they would get 8s. a day. I can understand the dismay of the right honorable member for Cowper and many other honorable members, as wall as the disappointment in the hearts of the militiamen, when they found, after the outbreak of war, that the pay of men who enlisted was to be reduced from 8s. to 5s. a day. The men who go into the longer militia camps will also be recouped at only that lower rate instead of the 8s. that was promised to them. It is true that the Government has increased the allowance for a wife to 2s. 6d. a day and for each dependent child to 9d. a day, but we are of the opinion that privates and militiamen in camp should receive 8s. a day, wives Ss. a day, and each dependent child ls. 6d. a day. The increase which the Government has conceded in respect of wives and ChIldren is paltry. In my opinion, it is too parsimonious altogether. Now, when the budget is under consideration, is the time to take action to put this matter right. It is not too late even at this stage to recast the budget, if necessary, so as to make proper provision :for these young men who have joined the. Militia and the 2nd Australian Imperial Force. Many of them are wage-earners, of course, but some have left their farms or small businesses to go into camp, and they will have to employ others in their places. They enlisted believing that they would be required to serve in camp for only about a fortnight a year. The period was increased first to a month, and then to three months, so that they will have to make arrangements for the working of their farms or businesses in their absence. It is not fair that, in addition to risking their lives in defence of their country, they should be compelled also to make heavy financial sacrifices. While the Government pays full price to manufacturers for arms, munitions and supplies, at the same time it wants to get human flesh, muscle and brain at an unreasonably low rate of allowance. No member of this House could keep a wife and child on the niggardly pay which the Government is offering to trainees, and the trainees should not be asked to do so either. I therefore call upon honorable members to show by their votes that they will not desert the just claims of the young men who have enlisted to become the defenders of Australia and of the British Empire. Motion (by **Mr. Thompson)** put - >That the debate be adjourned. The House divided. (Mr. Speaker - Hon. G. J. Bell.) AYES: 30 NOES: 27 Majority . . . . 3 AYES NOES Question so resolvedintheaffirmative. Debate adjourned. {: .page-start } page 1881 {:#debate-40} ### WINE EXPORT BOUNTY BILL 1939 {:#subdebate-40-0} #### Second Reading Debate resumed from 28th November (vide page 1636) on motion by **Mr. John** Lawson - >That the bill be now read a second time. {: #subdebate-40-0-s0 .speaker-KRH} ##### Mr McHUGH:
Wakefield .- I. thank the Leader of the Opposition **(Mr. Curtin),** who has been good enough to entrust to me the duty of leading the debate from this side of the House on the Wine Export Bounty Bill. This bill, which I commend to the House, is somewhat belated. The. industry has been asking for it for some time. The existing legislation providing for the payment of a bounty on wine, expires at the end of February, and this is the last opportunity we shall have to renew it. The wine industry is situated mainly in South Australia, and in that State is, indeed, confined almost exclusively to the district of Wakefield. Hence my position as opener of this debate. The wine export bounty has been in operation for many years. In a sense, it is not a bounty at all, because the money is raised, in the first place, by an excise duty on fortifying spirit, is paid into a trust fund, and from that fund is paid to the growers. At the present time, there is nearly £40,000 in the fund. The bounty was first paid in 1924, when it was fixed at 2s. 9d. a gallon. Since then, it has been gradually reduced until it now stands at ls. a gallon, which is the rate proposed in this bill. The wine industry, which began in South Australia a century ago, has nOw spread practically all over Australia, and wine grapes are grown in considerable quantities in Victoria, "Western Australia, and New South "Wales. After the last war, the Governments of New South Wales, Victoria and South Australia expended big sums of money in the settlement of large numbers pf returned soldiers in grape-growing districts along the River Murray. In 1924 the quantity of wine exported from. Australia was 142,000 gallons ; in' 1934 it increased to 2,600,000 gallons; and in 1939 it reached the large figure of 18,500,000 gallons. The difficulties which beset the industry have been brought about by its dependence on overseas markets for the disposal of surplus production. To place it on a satisfactory footing we must either improve the export market, increase local consumption, or decrease the acreage planted with wine grapes. All of these avenues are being explored by the wine growers and makers who, from time to time, submit proposals for the betterment of the industry to the Governments of the Commonwealth and of the States. To assist it the Commonwealth Government has seen fit to bring down this bill to continue the payment of a bounty of ls. a gallon on the export of wine. It was estimated that payments from the trust fund this year would be approximately £150,000; but in common with other primary industries, the wine industry is likely to suffer severely as the result of the curtailment of exports, due to the war, and it does not seem likely that the estimated bounty payments will have to be met. I have travelled right through the wine-grape growing districts in order to get firsthand information regarding the industry from the point of view not only of the growers but also of the makers. The former honorable member for Wakefield, the late **Mr. Charles** Hawker, and earlier representatives of that constituency have stressed the importance to Australia of this industry. When the late **Mr. Hawker** met a sudden and tragic death in the *Kyeema* disaster he was flying from Adelaide to Melbourne with the members of the Viticultural Council with the object of endeavouring to unravel the problems that beset the industry at that time. Shortly after the death of **Mr. Hawker,** nature took a hand and the wine-growing districts experienced a severe drought as the result of which the position was somewhat eased. The difficulty which then faced the industry, however, was negligible compared with its outlook at the present time.- It is estimated that the capital invested in this industry amounts to approximately £20,000,000. The three most important industries in South Australia are the .wool, wheat and the wine industries. Here is an opportunity for this Parliament to deal open-handedly with one of the smaller States. I appeal to honorable members to give this bill a speedy passage because of the almost chaotic condition of the industry in South Australia. Many of the returned soldiers settled in the wine-grape growing districts in South Australia find themselves, after twenty years' toil, no better off than they were when they returned from the war. Large quantities of wine-grapes are grown in the Barossa Valley, to which John Fife Angus brought out the first German settlers about a hundred years ago. As the result of their industry the Barossa Valley has been transformed from its native state into one of the most beautiful and picturesque spots in Australia. {: #subdebate-40-0-s1 .speaker-KHL} ##### Mr HOLLOWAY: -- Many of the sons of the original German settlers are returned soldiers.- {: .speaker-KRH} ##### Mr McHUGH: -- That is so. In the valley of Clare, near the home town of my predecessor, the late **Mr. Hawker,** grapes are grown in abundance. Another great grape-growing district to the south of Adelaide is in the electorate represented by" the honorable member for Barker **(Mr. Archie Cameron).** The only new feature in this bill is contained in clause 11 which makes provision for an initial payment of £2 on the 21st of the mont-h following the delivery of the grapes. If a grower delivers grapes during the month of May the payment of £2 will be made on the 21st -june. This arrangement has received, the endorsement of both makers and growers. The bill also provides for the payment of four other amounts to be spread over the year. The Labour Government led by the right honorable member for Yarra **(Mr. Scullin)** was responsible for the introduction of the first legislation providing for a bounty on the export of wine, and the - growers, being the weaker section in the industry, have since then been protected by successive governments. This industry has always received, the sympathetic consideration of the members of the party to which I belong. The only stipulation they make is that those engaged in the industry shall be paid in accordance with the recognized standard of living in this country. I am glad to bo able to assure them that ..the pickers employed in the industry are members of the Australian Workers Union and are paid in accordance with an award of the Commonwealth Arbitration Court. {: .speaker-KZF} ##### Mr Lane: -- This industry has always had to 'be assisted to remain on its feet. {: .speaker-KRH} ##### Mr McHUGH: -- If the honorable member had listened carefully to my earlier remarks he would know that there is no justification for his interjection. For the information of the honorable member I repeat that bounty payments are made from a trust fund established by contributions from the excise duty levied on wine. {: .speaker-L1L} ##### Mr Wilson: -- In effect, the trust fund is really an equalization fund. {: .speaker-KRH} ##### Mr McHUGH: -- That is so. {: .speaker-KZF} ##### Mr Lane: -- Why not turn .the grapes into raisins instead of into wine? {: .speaker-KRH} ##### Mr McHUGH: -- In this debate I shall not go into the question of temperance. The wine-making industry is closely related to the dried-fruits industry, especially in connexion with the provision of fortifying spirit. The banks of the River Murray are bordered by cooperative concerns operating in both industries. The pretty town of Berri, South Australia, is a splendid example of co-operation. I have not seen its equal in any part of the world that I have visited. In Renmark, the co-operative system has been so advanced that the grape-growers own not only the grapes, but also the distillery, packing sheds, and the hotels. Last year the profit from the co-operative hotels was £9,000, every penny of which went into the. beautification of the town and district, and into the provision of educational facilities. The .co-operative system employed at Renmark has been commended all over Australia. Having been in close contact with both aspects of the wine-making industry - growing and distilling - I commend this bill to honorable members, because- the industry is vital to South Australia and important to the other States. I realize that the cities of Sydney and Melbourne are largely responsible for the consumption of the product of the industry. Another aspect that enters my mind is the fact that Great Britain, which takes the bulk of our exports - we export a little wine to Canada and New Zealand - has imposed duties on Australian wine, with a detrimental result to the industry, and I appeal to the Government that it take all steps' possible, through the High Commissioner in London, to have preference given to our wine. It must be impressed on Great Britain that, if Australia is prepared to sell to it wool and other primary products at less than world parity, in order to assist it in this war, it should reciprocate. France is one of the largest wineproducing and wine-drinking countries of the world. To give the House an idea of the difference between France and Australia insofar as wine is concerned, I understand that France produces 1,200,000 gallons a year and that the *per capita* consumption is about six gallons, whereas the *per capita* consumption in this country is only six pints. That leads me to the belief that there is room for a big expansion of wine sales in Australia, provided that the alcohol content is reduced in order to make the wine comparable to the light wines of France. {: .speaker-KYC} ##### Mr Pollard: -- There would he no drunks then. {: .speaker-KRH} ##### Mr McHUGH: -- That is. true. The honorable member for Ballarat **(Mr. Pollard)** and I know from our experiences in France .that the consumption of wine in that country is considerable, but that the alcohol content is so slight as to render the drink innocuous. In all the time I was there, I never saw a wine-drunk Frenchman. The Australian wine industry could benefit by following more closely the principles of wine-making in the older countries of the world, where wine has been produced for thousands of years. One of the difficulties about expanding the wine trade in this country is the fact that the hotels are almost exclusively in the hands of the breweries. It may be that negotiations between the two industries would lead to better co-operation between them, with a consequent increased consumption of Australian wine. I make that suggestion in the faint hope that it will mean an increase instead of a diminution of the consumption of wine. {: #subdebate-40-0-s2 .speaker-KZF} ##### Mr LANE:
Barton .- I regret exceedingly that honorable members seem to be almost united in an intention to grant a bounty to the wine industry. About sixteen years ago, I visited Renmark and the other wine-making districts along the Murray River and saw then that the growers, owing to the refusal of the wineries to give them a payable price for their grapes, threatened to turn their efforts from wine to raisins. Ever since the wine grape industry has been in existence, like most primary industries, it has been coming cap in hand to this Government for. a bounty in order to make the industry pay and in order to enable it to foist on to the Australian community something which it does not want. {: .speaker-KX7} ##### Mr Ward: -- " Plonk " ! {: .speaker-KZF} ##### Mr LANE: -- Yes. The honorable member knows "Woolloomooloo, and may know the wine bars in his electorate. He should know the dreadful effect that wine has had on sections of the community in Sydney. {: .speaker-K9A} ##### Mr Gander: -- How does the honorable member know? {: .speaker-KZF} ##### Mr LANE: -- I have been to those wine bars. When I was a member of the Parliament of New South Wales, I inspected most of the wine bars and counted the number of men and women in them. My investigations led me to make certain charges on the floor of the Legislative Assembly as. the result -of which the Chief Secretary ordered an inquiry by the police. The police report proved that what I had said in the House was true. It was shown that the wine bars were frequented by the worst kind of prostitutes in Sydney. Honorable Members. - Oh, oh! {: .speaker-KZF} ##### Mr LANE: -- Yes. I made that charge on the floor of the State Parliament. The wine bars are cesspools of immorality and vice, yet the honorable member for Wakefield **(Mr. McHugh)** urged bringing the wine-making and brewing interests together in order to increase the sale of wine in Australia. I charged the Labour Government, of which the present Leader of the Opposition in the Legislative Assembly of New South Wales, **Mr. McKell,** was then Minister for Justice in the Labour Government, with being tied to the wine distilleries. I told him that I had in my hand the card of the president of one of the wholesale wine distributors on which he, **Mr. McKell,** had promised to amend the Licensing Act in order to permit the sale of wine by the glass instead of only by the bottle in groceries, and thus create wine bars all over Sydney. He replied, "But we turned that down ". I said, " Before you speak out of your turn tell me if you got £7,000 from the Liquor Defence Association not to do it, and then pulled it both ways ". {: .speaker-KRH} ##### Mr McHugh: -- What has that to do with the bill? {: .speaker-KZF} ##### Mr LANE: -- The people of Australia have proved that they are not a winedrinking community, yet every lie that can be told in advertisements has been published throughout. Australia in an endeavour to persuade young men and women of all ages to frequent wine cellars and imbibe that liquor which destroys the best that " there is in humanity. The honorable member for Wakefield **(Mr. McHugh)** said that he and the honorable member for Ballarat **(Mr. Pollard)** had learned something of the value of wine when in France. I should like the honorable member to tell me all that happened to him when he was in France. {: .speaker-KHL} ##### Mr Holloway: -- The honorable member would not tell the House what happened when he visited Woolloomooloo. {: .speaker-KRH} ##### Mr McHugh: -- The honorable member {: #subdebate-40-0-s3 .speaker-JOS} ##### Mr SPEAKER (Hon G J Bell: Order! The honorable member for Wakefield **(Mr. McHugh)** must not interject. He has already spoken to this bill. {: .speaker-KZF} ##### Mr LANE: -- Wine drinking cannot be put upon a high plane although men who wish to make money out of the degradation of their fellows are trying to elevate it. The French nation has become what it is to-day largely because it has allowed wine-drinking to sapits moral fibre, resulting in its own destruction through failure to reproduce the species in sufficient numbers. If wine were what some honorable members say it is, it would be a very fine thing to give to every body in order that they might benefit from its medicinal properties. But my experience is to the contrary. I went to Mildura and interviewed many men who told me that " pinky " was sold in Mildura and all along the River Murray in such quantities that honest, good and straight men were destroyed morally, mentally and physically by it. Mr.Wilson. - That is an absolute slander. {: .speaker-KZF} ##### Mr LANE: -- That is only the truth. The honorable member may deny it, but I have proof of it. One night I went to two wine bars in Oxford-street, Sydney, to see how the police were regulating the sale of liquor there. At one of them I counted 46 men and women of all kinds. Mr.Ward. - Some one rifled the till that night. {: .speaker-KZF} ##### Mr LANE: -- Only blackguards like the honorable member for East Sydney **(Mr. Ward)** would do a thing like that. {: #subdebate-40-0-s4 .speaker-10000} ##### Mr SPEAKER: -- Order ! The honorable member for Barton **(Mr. Lane)** must withdraw that remark. {: .speaker-KZF} ##### Mr LANE: -- I withdraw my remark, **Mr. Speaker,** but I ask you to ask the honorable member for East Sydney to withdraw the remark that he made. {: .speaker-10000} ##### Mr SPEAKER: -- I did not hear the honorable member for East Sydney say something which I regarded as unparliamentary. What was the remark that he made? {: .speaker-KZF} ##### Mr LANE: -- The honorable member said that on the night to which I was referring, certain tills were rifled. {: .speaker-10000} ##### Mr SPEAKER: -- I ask the honorable member for Barton not to raise frivolous points of order, and I ask honorable members generally not to interject. These exchanges lead to disorder. I have reminded honorable members of that more than once. The honorable member for Barton must be allowed to speak without interruption. {: .speaker-KZF} ##### Mr LANE: -- I know that the remark made by the honorable member for East Sydney is not true- {: .speaker-10000} ##### Mr SPEAKER: -- Order! If the honorable member does not speak to the bill and refrain from making such statements, I shall not allow him to continue. {: .speaker-KZF} ##### Mr LANE: -- In this bill we are asked to subsidize an industry that has its ramifications in every city and country town of Australia. It creates immorality and vice. I may turn to the scriptures in support of my remarks, for the Bible states "Look not upon the wine when it is red, when it giveth its colour, for it biteth like a serpent and stingeth like an adder ". Had the honorable member for Wakefield asked for a subsidy for dried raisins instead of a subsidy for wine, I should not have hesitated to give him my support. I believe that the dried fruits industry can be developed in the interests of the moral, social and physical welfare of the community. During the eight years in which I have been a member of this Parliament, I have heard many honorable members champion the cause of the wine industry. Obviously, it cannot maintain itself without the help of money taken from the pockets of the people of this country. I defy any man to prove anything to the contrary. It is all very well for honorable gentlemen to say that they will pay a bounty upon exports. That has been done, and still the industry has failed to show a profit. A bounty is granted in order to spread propaganda throughout Great Britain to persuade the people of that country to give preference to Australian wines over much less expensive wines produced in Portugal, Spain and elsewhere on the Continent. An. analysis of the condition of the wine industry in Australia will show that it is like many other primary industries, and the Government must call a halt some day soon and restrict the production of every industry according to the wants of the people, so that it will no longer be necessary to pay bounties. *[Quorum formed.]* The time has arrived when the Commonwealth Government or the State Governments should force a reduction of the area devoted to the production of wine grapes. That is the reasonable thing to do, because the growers do not receive a fair return for their efforts. The wine grape industry of Australia depends upon the sale of wine under such conditions that, if we had not lost a great deal of our moral courage and instincts, we would not tolerate for one moment the existence of wine bars that are only traps of immorality and vice. The honorable member for Wakefield knows why wine bars are established in centres where working men congregate. Wine may be used very extensively by certain well-to-do people in their private homes, but wine bars are established in the great cities in order that the poorest people may be lured into the habit of drinking wine. Fortunately, the owners of those bars have never been able to create a popular taste for their wares. The honorable member for Wakefield advocated the making of an agreement with brewery firms so that wine would be boosted over hotel counters in order to make the industry successful. When I spent a week in the Murray Valley, inspecting grape farms, I saw many returned soldiers who cultivated grapes, not for wine merchants, but for raisins. I was introduced to a one-armed soldier who had made £700 a year from the production of dried fruits. Those returned soldiers were not allowed to grow anything upon their twenty-acre blocks apart from grapes, because it Was said that the growing of grapes was a full-time job for one man. I saw many places where men had gone in for the production of dried fruits, and, after reaping the first full crop of grapes, had sold out for as much as- £4,000 and £5,000. The dried fruits industry was regarded in that locality as a very fine one. ' Farmers at Renmark, in South Australia, had at that time just informed the wineries that if they did not receive a higher price for their grapes, they would divert their energies to the production of raisins. Ever since I entered parliamentary life in 1922, 1 have heard the same old story told by men who wish to foist wine drinking upon a growing nation. We raise our families to lead good, healthy lives, and then, through false advertising, this damnable- traffic, which is being carried on under our very noses, seeks to lure people into the wine-drinking habit. In spite of all that, honorable members say that the industry can be put up on a high plane. {: .speaker-KJQ} ##### Mr James: -- Did not the lowly Nazarene give the people wine? {: .speaker-KZF} ##### Mr LANE: -- I do not think so. Two classes of wine are referred to in the Bible. The original Scriptures contain two different words which have been interpreted as " wine ", but one of them refers to fermented wine and the other to' unfermented wine. Where the Scriptures say, " Come, buy wine and milk without money and without price", the word " wine " ' refers to the unfermented juice of the grape, not the fermented stuff to which other ingredients are added that is handed across wine bars. But where the Scriptures say, " Wine is a mocker, strong drink is raging, and whosoever is deceived thereby is not wise " they refer to fermented wine-- {: .speaker-JTY} ##### Mr Archie Cameron: **Mr. Archie** *Cameron interjecting,* {: .speaker-KZF} ##### Mr LANE: -- The only reason that members from South Australian electorates are driven to interject is that the wine-growers of their State say, " If you do not do certain things we will get some one else to represent us ". They are made to do what the producer of wine says, not what their consciences say they should do for the benefit of mankind. Most persons who have been received into any of the churches by baptism have been baptized, not with wine, but with what I regard as the best of all liquids - purewater. I make no apology for being a total abstainer, or for advocating theremoval of things which destroy human life at its best. The only reason why I am in public life is to try to lay hold of the things that destroy the flower "of our youth and manhood. The reason why so many in our midst are physically unfit is that in our parliaments there are so many men who, like the honorable member for Hunter **(Mr. James)** a few minutes ago, use the name of the lowly Nazarene to bolster up the drink traffic. If the wine used in the great religious, festivals referred to in the Bible was fermented wine, as the wine-growers claim, those festivals would havebeen drunken orgies, not religious feasts. When I was responsible forthe training of boys and girls and youngmen and women, I studied these issues in order that I might place before them right ideals of life. It is deplorable that when men advocate the need for moral and spiritual reformation, others in the community only snigger and laugh at the name of Him -who gave to the world the greatest example of true manhood. I have never been afraid to stand in the public street, on the public platform, or in Parliament, as I stand here to-night, even though I have, perhaps, been only " as a voice crying in the wilderness ", in opposition to the drink traffic. "We are told that the people of France, .who are winedrinkers, are not drunkards, and that the English people, who indulge in another kind of beverage, are also good examples of decent citizens. I say that, so long as these intoxicating beverages are placed before our young people, we shall not develop the highest type of manhood, either morally or physically, nor will the day come when wars shall be no more, and right, instead of might, govern the world. Should this Parliament accede to the demand to assist the wine industry, it will not act in the best interests of Australia. The wine industry has never been any credit to Australia. In the Parliament of New South Wales men who represent wine-growing districts have said repeatedly that the Australian people will not drink wine. When I was a member of that Parliament, representing a large industrial centre, representatives of the wine industry asked for bounties. Sixteen years ago they acknowledged that the industry could not live unless assisted by money provided by the people. {: .speaker-KJQ} ##### Mr James: -- Why does not the honorable gentleman oppose the hop-growers? Is it because he thinks beer is better than wine ? {: .speaker-KZF} ##### Mr LANE: -- I have never had any interest in the liquor trade. I object to wine bars being placed as a temptation to every young man who walks the streets. Especially I object to wine bars being situated near big establishments where working men spend their wages, and frequently go home to their wives and families with no money in their pockets. On one occasion I had the pleasure of discussing this subject at a meeting in a wine-growing district which was attended by representatives of some of the big wine-making firms, such as Penfolds Limited. I told the audience of the evil effects of the drink traffic on its victims in order that a few persons in the community could become wealthy, and then I invited the representatives of the liquor trade to mount the platform and speak a word in favour of the industry. Not one of them accepted the invitation. On another occasion I visited Gun Alley, where previously a man had been shot. Before I went, people said to me that I was not game to go. I went there on a Saturday afternoon and found young nien and women, as well as old men, saturated with wine, until practically deprived of their senses. I asked those who were trying to rear families to look at this thing from the point of view of their children. Any parent knows that when his boy of eighteen or nineteen years of age goes out into the world, he must face conditions, permitted by law, which provide that men may learn to drink. I want men who love their children to know that their lives can be destroyed within 48 hours if, in that time, they acquire a taste for the things which destroy human life. I hope that while God gives me breath I shall be found opposing the vested interests which have used both honest and dishonest means to develop this industry. Many men who represent Labour constituencies are not game to say a word against the liquor trade or the wine industry, because they know that if they do those who control those industries will select other candidates to oppose them. I have said publicly that the liquor trade has the State parliaments in its hands. It can have appointed as magistrates whom it likes by demanding from the Ministry that these men be placed in such positions. {: .speaker-KRH} ##### Mr McHugh: -- As far as I am concerned, that is a lie. {: .speaker-10000} ##### Mr SPEAKER: -- I ask the honorable member to withdraw that statement. {: .speaker-KRH} ##### Mr McHugh: -- In deference to you, **Mr. Speaker,** I withdraw it. {: .speaker-10000} ##### Mr SPEAKER: -- It is not a matter of deference to the Chair. The honorable member made an unparliamentary remark. {: .speaker-KZF} ##### Mr LANE: -- When I was in the Parliament of New South Wales and **Mr. McKell** was Minister for Justice in a Labour government, the president of the Wholesale Wine Association assured me, and gave me the right to mention his name, that he couldbring witnesses to prove that scores of people associated with the liquor trade had put money into the party funds. {: .speaker-10000} ##### Mr SPEAKER: -- Order ! I cannot allow the honorable member to criticize members of a State parliament. Moreover, his remarks are irrelevant to the bill under discussion. {: .speaker-KQB} ##### Mr Scully: -- I rise to a point of order. The honorable member has reflected on the Parliament of New South Wales, of which I was a member at the time. {: .speaker-10000} ##### Mr SPEAKER: -- I have already called the honorable member to order. {: .speaker-KQB} ##### Mr Scully: -- I desire a withdrawal of the statement, which is a reflection on a parliament of which I was a member. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member is not entitled to ask for a withdrawal unless he is personally reflected upon. {: .speaker-KQB} ##### Mr Scully: -- I was a member of that Parliament. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member for Barton must refrain from further remarks of that nature. {: .speaker-KZF} ##### Mr LANE: -- I did not know that this bill would be discussed to-night and I have not yet closely examined it, but from my practical experience as a member of this Parliament, and from my visits to the capital cities of the various States, and to numerous suburbs, including industrial areas, I know how enticing hotel bars are, and how they lure people to destruction. Winedrinking is a pernicious and dangerous habit. {: .speaker-10000} ##### Mr SPEAKER: -- The honorable member has exhausted his time. {: #subdebate-40-0-s5 .speaker-JTY} ##### Mr ARCHIE CAMERON:
BarkerLeader of the Country party -- I am confident that honorable members generally will approach the consideration of this bill from a point of view different from that of the honorable member for Barton **(Mr. Lane).** I regret the manner of his attack on the wine industry. This is not the place for speeches of the kind he has just delivered. This bill deals with the provision of a bounty on fortified wine of a certain strength which will be exported. It has nothing whatever to do with the sale of wine within Australia. The Commonwealth Parliament has no power to determine the conditions that shall govern the sale of wine in Australia. The honorable member for Wakefield **(Mr. McHugh),** who represents the biggest wine area in Australia, referred, 1 believe, to the necessity for some review of licensing conditions in Australia. Whenever the question of the manufacture and sale of liquor comes up for discussion some people " see red ". Like the honorable member for Barton I am a rigid teetotaller and a lifelong Rechabite, but I shall approach this subject in a way very different from that of the honorable member for Barton. {: .speaker-KRH} ##### Mr McHugh: -The Leader of the Country party knows my attitude on the liquor question! {: .speaker-JTY} ##### Mr ARCHIE CAMERON: -- Quite so. I was a fellow member of the South Australian Parliament with the honorable gentleman at a time when, I think, he did not represent a single grapegrower. There is a tendency in the community for certain people to tell other people how they should live. I feel that the best thing that any sincere man can do in such a matter is to show by his own example that his way of living is so much superior to that of other people with whom he may disagree, that they will be persuaded to his ideas. That method is far better than criticism. The honorable member for Barton does not seem to realize that the big wineproducing areas are not in the irrigation districts but in non-irrigated areas, such as those in South Australia that the honorable member for Wakefield represents, and which I, too, in a lesser degree also represent. Just as fine people are engaged in the growing of grapes and in the making and exporting of wine as are to be found in any other occupation in Australia. We ought, in considering this bill, to ask ourselves what sort of an industry this is. I remind honorable members that the wine industry provides a very close type of settlement in the country at a distance from the metropolitan areas. It also gives permanent employment for the persons engaged in the wineries. Making wine is not merely a matter of growing grapes and putting them through the crusher; it involves the distillation of spirit. That and the production of brandy are very highly skilled occupations. Only men who have been constantly engaged in wine and brandy making, and who have served a long apprenticeship, are able to do this work to perfection. The people for whom the wine industry caters are very particular, as a rule. Fashions change in wines and brandies, and those engaged in the wine industry have to study the requirements of their customers, just as, I suppose, the honorable member for Barton had to study the requirements of his customers when he was a suburban storekeeper selling groceries or the like. Unless the wine-makers study their customers they will undoubtedly lose their trade. The wine industry of Australia is facing a good many problems. Some of these arise from the fact that Australia produces more wine than our people consume. We are not regarded as a big wine-drinking country. One of the reasons, perhaps, is that too much highly fortified sweet wine is produced here and not enough of the light, dry types which are more of a beverage wine. There are climatic reasons why Australian wines contain a greater alcoholic content than the dry wines produced - iri less favoured countries. For the benefit of the honorable member for Barton I may say that in our fermentation the whole of the sugar content of the grape juice is retained. The greater the amount of sunshine in a country, the greater is the quantity of sugar contained in the grapes grown there, and, consequently, the greater is the alcoholic content of the dry wines produced. The reason why our wines contain such a high alcoholic content is that we enjoy so much sunshine. The problems of wine production in Australia are likely to become even more serious in the States in which governments have encouraged settlement, sometimes to their cost and possibly to their regret, in grapegrowing areas. Returned soldiers were not settled exclusively in irrigation areas. Many of the vineyards which the honorable member for Barton appears to have visited in 1922 were planted by men inexperienced in the industry, but it should be remembered that the doradillo grapes originally planted have been replaced by more satisfactory types. The wine industry is one of our oldestablished activities. Wine-making has been in vogue in South Australia for nearly 100 years. About 90 per cent, of the wine and brandy produced in Australia is made in that State. Consequently, the bulk of this export bounty, probably well over 90 per cent, of it, will go there. But the honorable member for Barton, who has shown himself to be so bitterly opposed to this bill, must not imagine that the levy, which honorable members are being asked to reaffirm, all goes for the benefit of the grape-growers. There are two kinds of excise by which contributions are made to the revenues of the Commonwealth. The first is the excise of £1 6s. a gallon on brandy produced in Australia. In the last fifteen or sixteen years revenues totalling almost £6,000,000 have been received from this source. The other form of excise is that on fortified spirit, which is distilled from dry wine and is used to fortify wines for export. It is that type of duty which is now under consideration. The revenue produced from that source during the last fourteen years has totalled 'more than £4,200,000. The honorable member for Barton should realize that the wine industry, after having provided its own export bounty, has contributed very large sums to the revenues of the Commonwealth. {: .speaker-KZF} ##### Mr Lane: -- The organization to which the honorable member and I belong would never endorse a policy of producing liquor in order to derive revenue from it. {: .speaker-JTY} ##### Mr ARCHIE CAMERON: -- I am not suggesting any such thing. I am referring to a fact of which the honorable member has not seen fit to take cognizance. After hearing the honorable gentleman's speech, 1 say quite confidently that he has not read the bill and does not understand the purpose of it. The wine industry is very strongly established in South Australia. We have in that State what is called " the three W's " - wheat, wool and wine, in that order, which constitute our three great primary producing industries. If the Commonwealth Parliament were to adopt the attitude suggested by the honorable member for Barton and veto this proposal, it would bring' stark ruination to hundreds of grape-growers, dozens of wine-makers, and very many people who depend upon this industry for their livelihood. The great bulk of wine produced in South Australia is exported, but in order to obtain the bounty certain conditions must be observed. For example, the wine-makers must pay a stipulated price for the grapes they purchase. That price is fixed at_a conference of various interests, over which the Minister for Trade and Customs 'presides, each year. It is in connexion with the fixing of the price of grapes that one or two innovations have been introduced in this bill. Previously, the rule has been for both the co-operative and proprietary winemaking organizations to pay pretty well what it suited them, and when it suited them, for the grapes delivered to them each year. The result has been that grapegrowers, like the people engaged in other primary producing industries, have been forced, out of considerations of economic necessity, to form themselves into a rigid organization, which speaks, with very few exceptions, for all grape-growers of South Australia. It has been one of their grievances for a long while that the wine-makers have paid for their grapes only in instalments and at considerable intervals after delivery. The grape-growers have been greatly inconvenienced by this arrangement, for they, of course, have to pay for the ploughing of their land, the pruning of their vines, and, in many instances, the carrying of their grapes to the wineries. This bill provides a method by which payment for the grapes shall be made on a more equitable basis. The buyers of the grapes will be obliged to pay £2 a ton for the grapes within one month of delivery. It is obvious that there is a slight flaw in this bill in that connexion, which the Minister intends to amend. If the hill is passed, both the grape-growers and the wine-makers will be convenienced. The second payment, which will fall due about the 30th June, may possibly cause considerable hardship this year. If I understand the situation, the wine industry will face one of the major crises of its history when the harvest comes around next year. The difficulties have been somewhat diminished by heavy frosts which occurred some months ago in the "Wakefield district. {: .speaker-KRH} ##### Mr McHugh: -- About 40 per cent, of the crop was lost in some localities. {: .speaker-JTY} ##### Mr ARCHIE CAMERON: -- That, is so; but the crop will be so heavy that, about next autumn, the Minister for Trade and Customs will he experiencing headaches of a kind that he is not accustomed to. If it is found that the conditions are too stringent and that, because of war conditions, the grape-growers will not be able to sell their product, there will be an unanswerable case for the Government to finance the purchase of the wine grapes if private buyers do not feel disposed to do so. One of the hardest blows that the Australian sweet wine industry has received for a long time was delivered by the British Government this year when it increased the duty on Australian wine from 4s. to 8s. a gallon, as against the so-called British wines, which are our greatest competitors. "We can deal successfully with South African competition, but the other is more difficult. South Africa, by the way, has a very much be'tter method of blending wine and maintaining types, and a better system of marketing in the United Kingdom, than we have. There is -too much of the old pira'tical catch-as-catch-can method practised by those selling Australian wines in Britain, and this makes necessary the regulations which some people find irksome. I hope the Government will succeed in inducing the Government of Great Britain to reduce the import duty on Australian wines. This bill deserves sympathetic treatment by the House, and I am sure that no other honorable member, will endorse the views expressed concerning the industry by the honorable member for Barton **(Mr. Lane).** In the interests of the Australian wine industry, it is imperative that the growers should know how they stand, not only in respect to the next export season, but also in respect of the next five seasons. Any assistance which I can give in that direction will be readily forthcoming. {: #subdebate-40-0-s6 .speaker-KZR} ##### Mr WHITE:
(Balaclava -- I support the bill. This may seem to be a small matter to be engaging the attention of the House in view of the gigantic difficulties with which we are now confronted, but it is" an important matter none the less. While I admire the zeal of the honorable member for Barton **(Mr. Lane),** and agree that the excesses to which he drew attention should he investigated, I believe that we should be temperate in our criticism and not cite the worst examples. The wine industry is one of the most important in South Australia. The bill now before the House is a replica of the one which I brought down in 1934. The wine bounty was originally introduced in 1924, when **Mr. S.** M. Bruce was Prime Minister, and was primarily intended to help grape-growers. The wine industry has suffered many vicissitudes. The growers were, in some instances, settled on the land by the State Government, and were advised to grow doradillo grapes, as well as various varieties of wine grapes. Difficulty was experienced in marketing the wine, and in 1933, in company with the then honorable member for Wakefield **(Mr. Hawker)** and the honorable member for Barker **(Mr. Archie Cameron),** then a State member, together with representatives of the industry and officers of the Customs Department, I visited the wine-growing districts of South Australia. I may interpose here that, in the same aeroplane in which **Mr. Hawker** met his death, there were travelling three representatives of the wine industry, who certainly did not merit the criticism of the honorable member for Barton, but were good and eminent citizens and leaders in their industry. At the time of our visit the wine industry was near disaster. Sales had fallen off, and both the co-operative wineries, which were run by returned soldier growers, and the proprietary wineries were in difficulties. The wine bounty is not paid from general revenue, but from a fund created from the proceeds of an excise duty on fortifying spirit used in the manufacture of sweet wines. It is paid only upon wines exported. No bounty is paid on dry wines, which are the kind that ought to be more generally manufactured in Australia. The export of wine from Australia has been encouraged by the payment of a bounty out of this fund. Since 1934, exports of wines to Great Britain from Australia have steadily risen, until they exceeded those of all other countries, except Portugal. Unless the bounty is renewed the industry will slump. This year, there was a surplus of grapes, and but for a frost, which reduced production, the industry would have been in difficulties. It was also proposed that production of doradillo grapes should be limited, and plans were made in conjunction with the South Australian Government for allowing a large area to go out of production. It must be remembered that grapes are grown for the manufacture of dried fruits, as well as for the manufacture of wine; and the industries, are, to some degree, interlocked. Almost constant difficulty has been experienced in connexion with the wine industry - in Australia, which is now stable. As the bounty is not paid on wines sold within Australia, wine-makers, co-operative and proprietary, were able to buy grapes at any prices they thought fit. It was then provided that wine-makers, who did not pay the fixed price, should keep export wine grapes apart from those used for the manufacture of wine for the home market. A fair price is fixed for grapes used for the manufacture of export wine3, and the growers are assured of a reasonable income. There is a tendency for production to outstrip sales, and in the district of Berri, where there is a co-operative winery, something like a million gallons of spirit accumulated at one time, so that special arrangements had to be made for its disposal. All these are difficulties that had to be grappled with at the time of my examination, and they may again recur. The industry is now on a more or less stable basis, but it should not be allowed to slump again. Although we have a hig export trade in wines with the United Kingdom, more can be done. Our wines, in some instances, are not sold under Australian labels. When I visited the Australian pavilion at the Scottish exhibition in Glasgow last year, I saw that South African Dutch labels had been put on Australian wine bottles. That sort of thing should not be allowed to happen. It is very difficult to get Australian wines in restaurants, hotels or trains overseas ; they just do not seem to' be available. The sale of Australian wines in Great Britain should be encouraged, and when I speak of expanding the market for our wines, I do not mean that we should try to force alcoholic drinks on the people. The evils .to which the honorable member for Barton referred do exist in large measure, but that is due to the selling of bad and adulterated wines and to insufficient supervision. We are not a wine-drinking people. If more wines were drunk here instead of beer and spirits, it would probablybebetterforthecommunity.The honorable member was astray in condemning the French, who are a winedrinking people. They, as a matter of fact, are bearing the brunt of this war, and by that I imply no criticism of the part played by the British. It so happens that, because of their situation, the French must bear the brunt of it.. They have all along been the realists who understood the Germans for what they are. We might with advantage learn a lesson from them in the use of wine. I believe that the wine industry in Australia should be encouraged and developed, and I say that as one who is probably as temperate as is the honorable member for Barton. I support this bill for the reasons I have put forward, and hope that it will be passed. Question resolved in the affirmative. Bill read a second time. *In committee:* Clauses 1 to 10 agreed to. Clause 11 - {: type="1" start="1"} 0. No bounty shall be payable unless the Minister is satisfied that- {: type="a" start="a"} 0. the price paid or to be paid to the grower for any grapes used in the production of the wine or fortifying spirit contained in the fortified wine in respect of which bounty is claimed is not less than the minimum price, and the grower has received, in cash, a payment of two pounds per ton within one month of the delivery of the grapes to the manufacturer of the wine, or of the fortifying spirit contained in the fortified wine, and has received, or will receive, in cash, payment of the balance in full not later thanthe prescribed date, or payment of the balance by four equal quarterly instalments the first of which is payable on or before the thirtieth day of June next following the date of delivery of the grapes. {: #subdebate-40-0-s7 .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP .- I move- >That the words, " within one month of the delivery of the grapes " par *a* sub-clause ( 1 ) be omitted with a view to insert in lieu thereof the words, " not later than the twenty-first of the month next following the month of delivery of the grapes." The words proposed to' be omitted are rather indefinite, and, by a strict interpretation, would permit the growers to claim payment upon any day of the month. The wine-makers and the growers have requested that a specific day be inserted, so that both parties will know that payments are to be made on that particular day. {: #subdebate-40-0-s8 .speaker-KZR} ##### Mr WHITE:
Balaclava .- Will the Minister say whether payments are to be made in cash? When I visited the wine-growing districts, I found that in places there was in existence what could be called a cart note currency. When the growers took the grapes to the winery, they were paid with a chit from the winemakers, and with this they paid their accounts, or borrowed money from the bank. {: .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- The wine-makers are required to pay in cash. Amendment agreed to. Clause, as amended, agreed to. Clauses 12 to 20 agreed to. {: #subdebate-40-0-s9 .speaker-KZZ} ##### Mr JOHN LAWSON:
Minister for Trade and Customs · MACQUARIE, NEW SOUTH WALES · UAP .- I move- >That the following new clause be inserted: - 17a. - (1.) Where in the locality where - > >fortified wine, in respect of which bounty is claimed, is manufactured ; (b)ine contained in fortified wine, in respect of whichbounty is claimed, is manufactured; . > >fortifying spirit contained in fortified wine, in respect of which bounty is claimed, is manufactured; or > >grapes are produced from which wine or fortifying spirit contained in fortified wine, in respect of which bounty is claimed, is made, any standard rates of wages or conditions of employment to he paid in respect of any persons employed in any such manufacture or production have been - > >prescribed by any award, order or determination of the Commonwealth Court of Conciliation and Arbitration or of any other industrial authority of the Commonwealth or of a State or Territory or in any industrial agreement registered under any law of the Commonwealth or of a State or Territory; or (/) declared to be fair and reasonable in pursuance of sub-section (2.) of this section, any person making a claim for bounty under this Act shall furnish to the Minister such evidence as the Minister requires as to the rates of wages and conditions of employment observed in respect of the persons employed in the manufacture of the fortified wine, in the manufacture of the wine and of the fortifying spirit contained in the fortified wine and. in the production of the grapes from which the wine and fortifying spirit contained in the fortified wine were made. (2.) If, in any locality referred to in subsection (1.) of this section the rates of wages and conditions of employment to be paid and observed in respect of any persons employed in any class of manufacture or production specified in that sub-section have not been so prescribed, the Minister may make application to the Chief Judge or a Judge of the Commonwealth Court of Conciliation and Arbitration, for a declaration as to what rates of wages and conditions of employment are fair and reasonable for persons employed in any such class of manufactureor production. (3.) If the Minister finds that the rates of wages paid to, or the conditions of employment, or any of them, observed in respect of, persons employed in the manufacture of the fortified wine upon which bounty is claimed, or in the manufacture of the wine or of the fortifying spirit contained in that fortified wine, or in the production of grapes from which that wine or fortifying spirit were made, were less favorable to those persons than the rates and conditions prescribed or declared as specified in paragraph (e) or paragraph (f), as the case may be, of sub-section (1.) of this section, he may direct that the whole or any part of any bounty shall not be payable and that whole or part, as the case may be, shall thereupon not be payable." Honorable members will recall that, until last year, it was usual to include in all bounty bills a provision designed to enable payment of the bounty to be withheld from claimants if award rates and conditions were not observed by them. Last year this provision was omitted from several bounty bills in order that its constitutional validity could be examined. An examination has been made, and as the Government is satisfied that the provision is quite legal, it proposes to include a similar provision in all bounty bills. . Proposed new clause agreed to. Preamble and title agreed to. Bill reported with amendments; report adopted. Bill read a third time. {: .page-start } page 1893 {:#debate-41} ### SHIP BOUNTY BILL 1939 Secondreading. Debate resumed from the 22nd September *(vide* page 1121), on motion by **Mr. John** Lawson - >That the bill be now read a second time. {: #debate-41-s0 .speaker-JOM} ##### Mr BEASLEY:
West Sydney -- The importance of this subject of shipbuilding in Australia has been brought more prominently before the people on account of the present world situation than at any other period since the agitation for the building of ships in Australia was first commenced. The need for modern ships to transport our products overseas is greater now than in normal times. The uninterrupted flow of goods to the British people during these times is vitally necessary. The activities of enemy ships and submarines and unrestricted mine warfare have again demonstrated the havoc that can be created. During this war of destruction, the tonnage destroyed has to be replaced. Skilled workers are needed for this work but, unfortunately, Australia has lagged behind and, by some means or other, we have to make up the leeway that we have lost. Unfortunately, the country is not prepared to the degree that is necessary, but we shall have to make the best of the position that now confronts us. It is regrettable that this bill falls far short of what is needed, and is typical of our failure to think well and act wisely in our own national interest. We are slow to make up our minds, and equally slow to recognize that we have the future to provide for and, as it now happens, a tremendous responsibility to carry. This bill is the outcome of a long agitation on the subject of shipbuilding in Australia, and the closing chapters of the history of this matter prior to the introduction of the bill were provided by the shipbuilding unions in refusing to effect repairs to ships built outside Australia which could reasonably have been built in this country. The basis upon which the scheme has been submitted to the Parliament appears to rest on a Tariff Board report submitted to the Government on the 7th May, 1936. Subsequent to that date, an independent inquiry was conducted by certain officers of the Customs Department. Their views have not been made known to the Parliament and, therefore, are not available for endorsement or otherwise. Against the Tariff Board finding on this question, which finally resulted in this proposal, two outstanding criticisms will he advanced, namely, that the tonnage to be assisted by means of the bounty is far too low, and that it is wrong to admit free of duty boilers, machinery and auxiliaries for use in ships in respect of which bounty will be paid. What the Government proposes to give on the one hand by the payment of the bounty it is taking away with the other by admitting these components free of duty. It is upon that basis that we criticize the bill in the hope that we shall be able to convince a sufficient number of honorable members to compel the Government to see the need for extending the bounty to cover ships of 5,000 tons and for maintaining the duty on boilers, machinery and other auxiliaries so as to encourage the construction of complete vessels in this country. The Minister for Trade and Customs **(Mr. John Lawson),** in introducing this hill, dealt with various phases of the Tariff Board's report. I propose to refer to some aspects of the report and to offer reasonable comment upon the board's findings. In its report of the 7th May, 1936, the Tariff Board statedWhile tlie board is convinced that the continuance of the duties on imported vessels is not in the best interests of the community, it is, nevertheless, convinced that an effort should be made to support the ship-builders in Australia, particularly in the construction of smaller craft. In arriving at this conclusion, the board apparently had' in mind the removal of the 37J per cent. British preferential tariff now applicable to vessels built in1 Great Britain. This belief was afterwards endorsed by -the second-reading speech of the Minister. In the course of his speech, the honorable gentleman said that the tariff on vessels up to 500 gross tons had failed to encourage the building of vessels of that tonnage in Australia. This only goes to 3how the callous indifference of the shipping companies in Australia to their obligation at least to provide employment for the workers of a country which give them an assured and healthy income each year. In fact, their actions in continuing to build their vessels overseas, and to pay the duty of 37-J per cent, rather than construct their vessels locally, shows the degree of their contempt for the welfare of the local industries. We have felt all along the need for some compulsion to force the shipping companies to recognize what we believe are their simple obligations in this matter. The removal of the duty and the substitution of a bounty of £12 10s. a ton absolves the shipowners from the payment of the duty to the Consolidated Revenue of the Commonwealth, and at the same time provides no guarantee that by the substitution of the bounty for the tariff the shipowners will revise their present policy of building their vessels overseas. This is greatly emphasized by a perusal of Australia's Overseas Trade and Customs and Excise Revenue, 1937-38, Bulletin. No. 35. Under item 1435, "Vessels including all fittings imported therewith ", it is shown that dredge plant, &c, to the value of £1,159, on which a special rate of 25 per cent. British preferential tariff for this class of vessel was paid,, amounted to £221 in 1937-38. Under item 1437, "Other Vessels Dutiable ", page 545, it is shown that on one vessel valued at £17,098, imported from China, duty at 15 per cent, general tariff of £2,565 was paid in 1937-38. Item 1438, " Other Vessels Free ", page 545, has application to other vessels in excess of the present operative tariff, that is vessels exceeding 500 gross tons. These vessels or their parts imported into Australia in 1937-38, were valued at £1,580,460, and were admitted free, under the general and preferential tariffs, and preferential by-laws, or because they were for use by the Commonwealth Government. It will be readily observed from the f oregoing that under the proposals of the Tariff Board which have been accepted by the Government, the Government will in future, under these new proposals, surrender all revenues previously collected under items 1435 and 1437, in addition to the revenue already lost under item 1438. This has a particular significance to .item 1437, as it is understood that the Newcastle and Hunter River Steamship Company are now building a vessel in China on which a duty of 15 per cent, would be paid under this item. I have not been able to ascertain whether, under the new proposals, this or any other vessel will in the future be admitted free. I have been informed that the 15 per f:ent. general tariff may apply according to compliance with certain conditions. What would these conditions be is an important point for determination? The Tariff Board's report went on to deal with this subject by stating - >Plant and machinery are in existence in the local shipyards. Skilled workmen are available. The advantages of keeping the plant and personnel engaged are obvious. Extensive employment, both direct and indirect, is involved in the construction of a ship. The local shipbuilders have expressed the opinion that, in the construction of a 700-ton cargo vessel, the direct and indirect employment offered would be roughly equivalent to one year's -work for 170 men. This estimate in my opinion is excessive to the extent of at least 35 per cent, in the number of the men that would be given employment, and also in the period stated, and the opinion is based on certain facts. The steel sections and plates used in the construction of any vessel are those, with few exceptions, commonly used in the fabrication of any other steel constructional work outside a shipbuilding yard. The sections referred to would consist of what is. known in the trade as "T", " H ", "Z", "L", "R.S.J.", "channels", "bulb" and "half round heading ", and plates of various dimensions which are standard products of any steel mill overseas or in Australia. The quantity of this material used in the construction of a vessel of 700 gross tons would be only a small percentage of the output of any steel mill, not involving to any extent, if any, the employment of additional labour in the production of the raw materials. The construction of the hull and superstructure would without question require additional boilermakers and assistants to those usually carried in a shipyard, but this would be the only section of the metal trades that would secure any material advantage of more employment under the proposals, whereas in the manufacture of the machinery for the vessels, work would be available to other sections of the metal trade, such as patternmakers, moulders, blacksmiths, fitters, turners, machinists, &c, although not in the same ratio as that of the boilermaking section, by reason of the fact that many of the fitments and component parts involved in fitting out a ship are governed by the same circumstances as apply to the steel sections ; they are a standard product of many of the engineering companies. Ship auxiliaries patterns to some extent are available for castings, where castings are not required or involved, such as bar steel. This material could be secured at short notice from the stocks of any reliable steel merchant or steel mill. Where forgings are necessary in ship construction, these would be procurable from many of the larger engineering establishments specializing in this class of work, or from the shipyards themselves. Further, the engineering staff usually carried in a shipyard are engaged on work other than ship construction and repairs, which would be dovetailed with the constructional work of the ship machinery going through the Workshop. Generally speaking, the employment of the number of men directly or indirectly under the present proposals would not reach the proportions indicated in the report. The Tariff Board's report also states - >All the data available tend to confirm the view that the price of a completed vessel from an Australian shipyard is, roughly twice the price, in sterling, at which a similar vessel could, he supplied from the United Kingdom. However, the Board is satisfied that this disparity in prices can be reduced. The ratio of costs of two to one is based on the assumption that in the Australian-built vessel the engines and boilers are built in Australia. It would, of course, be highly desirable to have the motive power machinery constructed in Australia., but if that machinery were so highly priced that it would place the local shipbuilder in the position of having to quote too high for his tenders to be acceptable .... > >As an illustration, the Board has calculated that, on a representative cargo vessel of 700 tons gross, if the engines and boiler were manufactured in Australia, the amount of bounty per ton necessary to cover the Australian shipbuilder would be approximately £20 per ton. In the opinion of the board this figure is unreasonably high, and cannot be recommended. This estimate cannot be accepted as correct in the absence of any authoritative evidence to support the board's analysis. I am of the opinion, guided by the information I have been able to obtain from practical men with experience of costing within the engineering trade, that the proportional costs involved in the construction of a vessel of 750 gross tons would be 70 per cent, for hull, superstructure and other requirements; the balance, 30 per cent., would cover the cost of the boilers, main engines and other auxiliaries. These percentages would apply generally to vessels of any gross tonnage. This estimate is supported by the board's own figures in the example quoted by it in the report, which is as follows: - >Typical cargo vessels in the range up to 1,500 tons would cost at the port of clearance in the United Kingdom from £25 to £35 per ton gross. Thirty pound per ton gross would represent a reasonable average export price at United Kingdom ports. Again taking the -example of the 700-ton vessel, the export price would be approximately £21,000. Included in that price would be approximately £6,000 worth of machinery, &c, which it is suggested should be admissible free of duty to the Australian ship-builders. The balance of the vessel would be worth approximately £15,000, or approximately £2] per ton. The figures of the board's own example are 71 per cent, hull superstructure and' 29 per cent, boilers, main engines and auxiliaries, respectively, for the sections mentioned, and approximate my own estimate. If these estimated percentages are applied to the bounty of £12 10s. a ton recommended by the board, the approximate increase of the bounty as the result of the whole vessel being built in Australia would be £4 a ton, and not £7 10s. a ton, as indicated by the board, or a total bounty of £16 10s. a ton. My estimate is approximately 46 per cent, of the cost a ton for a finished vessel built in Great Britain. From my information, there has been great difficulty for some time in securing vessels at less than £35 a ton, and, in view of the international position, from £38 to £40 would be about the present price a ton in Great Britain. Confirmation of this estimate is contained in the following news item cabled from London on the 28th October, 1939, and appearing in the *Sunday Sun* on the 29th October, 1939 :- > In three months the first ship of Britain's special war cargo fleet will be launched, and after that the shipyards will turn out ships like motor cars. > >The designers, peacetime rivals, are collaborating to produce perfect wartime freighters of 2,000 tons gross, having the greatest possible cargo space, doing 12 knots and costing £80.000 each. ... That works out at £40 a ton. The Tariff Board's report continues - >After giving the question the fullest consideration, the board is satisfied that the Australian ship-builders should be permitted the right to import free of duty from the United Kingdom the engines, boilers, and auxiliaries required for inclusion in. vessels built by them under bounty. Free admission of these items would reduce the cost of the loyally-constructed vessel and would, in many instances, lower the amount of the bounty necessary to a figure the board will support. It is worthy of mention that a large percentage of the auxiliaries and special fittings, if not imported under by-law, would be manufactured by the ship-builders themselves, and not by outside engineers. The importation of machinery and auxiliaries duty free for installation in the vessels to be built in Australia under the proposals directly affects the employ ment of engineers and allied tradesmen, and is viewed with apprehension by the unions covering these callings, particularly because opportunities for employment of their members are restricted, as they would be the principal men employed in the manufacture of the machinery and auxiliaries. The machinery and other auxiliaries installed in any vessel comprise the following essentials : - Main engines - >Reciprocating turbine or diesel. The first two named can and have been efficiently manufactured in Australia at a reasonable cost - >Diesel engines. Diesel engines of the required brake horse-power for vessels of any tonnage mentioned in the board's report have not been manufactured in Australia. Only in recent years has this form of propulsion gained general favour in Great Britain. The shipping companies of Norway, Denmark, Sweden and Holland have favoured diesel engines for many years, because of their lower running cost, with the consequence that the engineering and ship-building companies of those countries have experimented with their use to such a degree that they have momentarily outstripped other countries as to cost, &c. - >Auxiliary engines - > >Electric light, fan, steering and turning and reversing engines. These present no great mechanical and/or technical engineering problem to any of the well-known and reputable engineering companies in Australia. If the main "engines were of the reciprocating type and imported, the unit would embody the turning and reversing engines - Pumps - Circulating, general service, sanitary, oil fuel, boiler feed pumps. There are companies in Australia that specialize in the manufacture of pumps of this type. These pumps are extensively installed throughout Australia, and the companies, if given the opportunity, would surprise the Tariff Board as to their capacity to manufacture at reasonable cost as compared with overseas prices for similar plant. Of course, it must be understood that the oil-feed pump is only necessary where the* heating agent adopted on the boilers for steam-raising purposes is oil fuel instead of coal - >Boiler feed pump. This is generally of the Weir type, owing to world-wide reputation as an ideal auxiliary for this purpose, although in the "E" and "D" class vessels built from 1918 to 1922, under the shipbuilding programme of that period, Australian manufactured pumps were installed in lieu of the Weir pump for the boiler-feed service, and from my knowledge they gave efficient service. Many and varied types of condensers have been built in Australia over many years, for other phases of industry requiring this equipment, and their manufacture for installation in any class of vessel presents no difficulties to engineering companies. My remarks on condensers would have a similar application to distillers, evaporators, oil coolers, heaters and filters. The engineering companies specializing in ventilating machinery would welcome the opportunity to demonstrate to the Tariff Board and the Government their capabilities and the efficiency of their plants installed in other spheres of industry requiring ventilation plants. Winches, windlasses and ash hoists installed in the " E " and " D " class cargo vessels were manufactured in Australia and could again be made here with no difficulty. In his second-reading speech the Minister stated that the scheme would apply to- >The payment of a bounty on iron or steel vessels (other than war vessels) over 100 tons but not exceeding 1,500 tons, gross register. It would appear that by the fixation of the limit of the application of the bounty at 1,500 gross tons, the Tariff Board was guided by the number of vessels constructed overseas for Australian companies and/or governments from 1919 to 1937. The number of vessels built overseas and coming within the minimum and maximum gross tonnage mentioned in the Government proposals for the years 1919- 1937 was as follow: - Of this total 63 were for private companies; the balance of fourteen were for the various State governments or their departments. The companies who had vessels built overseas between the . ranges mentioned above are as follows: - The various State governments or their departments who had vessels built within' the same ranges are as follows: - By limiting the bounties payable to 1,500 gross tons the class of vessels that would be built in Australia under the scheme, if the companies availed themselves of the proposed bounty, would be limited to tugs, trawlers, ferries, colliers, cargo vessels, and general utility vessels of the smaller type. This would at the same time restrict the experience to be gained in their construction to very narrow limits, as vessels of this type have not to any great degree undergone any radical structural changes over many years. It is my considered opinion that the maximum tonnage range to which the bounty should apply should be raised to at least 5,000 gross tons. By raising the tonnage to this maximum a far wider scope for gainful .experience would be made available for Australian artisans. Vessels coming within the class of 500 gross tons to 5,000 gross tons have always been considered experimental vessels because they have incorporated in their hull design and construction the latest results of research and experience gained from tank tests and from actual and practical performances. Based on this data, the necessary modifications are then incorporated in the construction of later and larger vessels of any type, securing the objective of progressive improved economy and efficiency of the mercantile fleet and navy. In the engines of vessels - reciprocating, turbine, or diesel - economy of running cost is mainly aimed at - the economic consumption of coal or .fuel oil for steam raising purposes, and crude oil for diesel engined vessels. The objective of this is apparent. Apart from the running cost, a greater range of mileage *is obtained with a minimum of encroachment upon the ship's space, leaving a greater cubic cargo-carrying capacity. The Minister has declared that - >The rate of bounty to be £12 10s. per ton on vessels over 100 tons but not exceeding 750 tons. Such rate to be gradually reduced so that on vessels of 1,500 tons gross register the rate would be £10 per ton. I consider that the rate of the bounty is not sufficient to accomplish the objective desired by the Government. To emphasize this point, a typical case would perhaps illustrate the point to better advantage. As near as we can ascertain, the SS *Bangalow,* of approximately 500 gross ton3, built in Great Britain for the North Coast Steamship Company, cost £28,000, plus the exchange of £7,000 at the rate of 25 per cent. In addition to these amounts, the tariff payable on the vessel in accordance with item 424 6 1, Customs Tariff 1933-1938, as amended, at the rate of 42 per cent., would be £11,900, so that the total cost of this vessel was approximately £46,900, excluding cost of delivery and repatriation of the crew, which is no small item. A vessel of this tonnage built in Australia under the proposals of the Tariff Board would cost the Government by way of the bounty £5,000 paid mainly for the hull and superstructure of the vessel. This small amount of bounty offers no inducement to shipowners to build vessels in Australia. The Government's proposal is that the total bounty paid in any one year be limited to £50,000. . The final determination of this yearly bounty would, of necessity, have to be amended should the Government decide to extend the maximum tonnage to which the bounty would apply and if the machinery was to be subjected to a duty on the whole or in part. In regard to the item - >Machinery, boilers and auxiliaries required in the construction in Australia of vessels eligible for bounty to be admitted free of duty from the United Kingdom and at 15 per cent, from foreign sources - it may be argued that this duty is sufficient at the present time to secure the objective of the Government, as great difficulty will be experienced in securing this equipment while the present European upheaval exists. I would point out, however, that the United States of America is a neutral nation and its ability to supply this essential equipment is in no way restricted as it is a favoured nation. The same argument can logically be applied to the building of a complete vessel. The shipping companies could refuse to build any further vessels until the international dispute is settled, but this would not further the objective of the ship-building scheme as designed by the Government. There is no guarantee that the present international position will last beyond the three years, at the end of which the present proposals will be reviewed, and should the shipping companies apply the policy I have indicated, the Tariff Board and the Government would be in a similar position to that which existed on the 7th May, 193ft, and which still exists. The boilers for vessels up to the gross tonnage suggested by the engineering unions can be efficiently and expeditiously manufactured at a reasonable cost by the larger engineering companies in Australia, such -as Thompson, Castlemaine, Victoria; Mort's Dock, Balmain, New South Wales; Babcock and Wilcox, Regent's Park, New South Wales; Cockatoo Dock and Engineering Company, Sydney, New South Wales; Clyde Engineering Company, Clyde, New South Wales; Walkers Limited, Maryborough, Queensland ; and should not be admitted free of duty. Taking into consideration the question of exchange, a reasonable duty to impose would be 25 per cent. British preferential tariff, and 42^ per cent, general tariff. Regarding the main engines only, the admission of steam engines, turbines or reciprocating, should not be permitted free of duty, and the same duty of 25 per cent. British preferential tariff- and 42£ per cent, general tariff as applied to the boilers should ' apply to this equipment. These engines, apart from the turbines, present no technical or engineering problems to Thompson's, Castlemaine, Victoria; Mort's Dock, Balmain, New South Wales; Cockatoo Dock and Engineering Company, Sydney, New South Wales; Clyde Engineering Company, Clyde, New South Wales; Walkers Limited, Maryborough, Queensland. Turbines for practically all naval vessels built in Australia have been manufactured by the Cockatoo Dock and Engineering Company, which could, without any serious difficulty,, supply this type of propulsion for any vessel to the specification required. The manufacture of diesel propulsion engines of the required brake horse-power has never been undertaken in this country. In all the circumstances, no objection at tlie present time could be raised to their admission duty free (British preferential tariff), but I consider that the 15 per cent, general tariff should be raised to 25 per cent. The Minister said that the duties on vessels of the type eligible for the bounty would be fixed at free British preferential, and 15s. general tariff. What the Government hopes to achieve by the substitution of this duty for the current duty is difficult to understand, in the light of the fact that there is nothing to indicate that these people will be forced to build ships in Australia. Commenting further on this aspect of the contemplated legislation, even at the risk of becoming a false prophet, I am convinced that, if this be done, shipbuilding in Australia will remain in the doldrums, a state from which the Minister for Trade and Customs is so anxious to lift the industry. What is really achieved is that the Government will lose revenue to the extent of 37£ per cent, ad valorem on vessels built in Great Britain, and will obtain only 15 per cent, ad valorem on vessels built elsewhere, which would include Hong Kong, where the Newcastle and Hunter River Steamship Company recently had a vessel built; that is, if the rate is to be applied in all cases. With the removal of the duty in respect of British vessels, and the conditional application of only 15 per cent, duty in respect of foreign vessels, the Government has disarmed itself of any weapon to enforce a policy of ship-building in Australia, thereby providing employment for the training of artisans in secondary industries, so that they may also be of assistance to the primary industries of Australia, to whom the marine transport question is an important matter. The Minister further stated - >It is quite obvious that the present method of assistance, which provides for protective duties only on vessels up to 500 gross .tons register, has not succeeded in establishing ship-building on a satisfactory footing. Very few vessels within the protective duty range have been built in Australia within recent years, and it is a long time since any commercial vessels exceeding 500 tons register have been built here. If the present duties have failed to obtain the objective, how can the Minister, or the Government, expect to achieve the desired result by the removal of the duty in one instance, and the lowering of duty in the second instance, unless it is based on the assumption that by the sacrifice of a " mackerel " a " whale " may be caught? The fishing and whaling industries are now conducted upon a more modern basis with the aid of trawling nets and harpoon guns. Shipping companies are not potential philanthropists and they conduct their business, not on the basis of ancient proverbs, but on a sound business basis as a means to secure the maximum income for the minimum expenditure. The Minister should act in accordance with this precept by retaining, irrespective of the bounty, the present duty of 37^ per cent. British preferential tariff and at least per cent, general tariff, if he is not prepared to increase the present duties to enforce the shipping companies to comply with the contemplated ship-building proposals of the Government. The Minister went on to say - >The matter to be reviewed by the Tariff Board after the bounty has been in operation for a period of three years. Why is it so necessary to fix a minimum of three years before the matter can be reviewed? Revolutionary changes sometimes take place overnight. Where an affirmative answer is the correct one to-day, a. negative answer may well be the correct one to-morrow. The matter should be subject to review before three years if considered necessary by a changed set of circumstances. Even since the Minister introduced his measure, circumstances have changed considerably, and, in view of what is happening on the other side of the world and the almost daily loss of British tonnage, a more radical programme may yet be necessary. The Minister proceeded - >The variation to which I have referred is in respect of machinery, boilers and auxiliaries. The Government proposes that, subject to consultation with the United Kingdom Government, such equipment should be admitted free, of duty irrespective of the country of origin, whereas the board recommends admission at rates of free (British preferential tariff) 15 per cent, (general tariff). I may mention that the Government's proposal with respect to this equipment is the same as that adopted by the United Kingdom Government in connexion with its scheme of assistance to shipping. That statement does not coincide with the following leading article in *The Marine Engineer.* Details of the Government plan to assist British shipping and shipbuilding are given in a White Paper, and are incorporated in the British Shipping (Assistance) Bill, which passed its second reading on the 19th July, 1939. The general outlines of the Government's intentions were set Out- in a statement by **Mr. Oliver** Stanley on the 28th March, the terms of which we have previously published. The whole scheme is directed to helping the shipping industry to operate with maximum efficiency, and shipowners to find the wherewithal to maintain their fleets, both as to size and age, in a thoroughly fit state. It is the shipowners who will receive direct financial aid. To that extent .the benefit to shipbuilders is indirect, but no less effective for that. The Government have been at pains to ensure that tlie construction of new cargo vessels required for British shipping trades will not be postponed on account of limited financial resources or current shipbuilding costs. The response to the scheme was immediate, as witness- the fact that as a result of the promise that tonnage ordered as from the 11th April would be considered for inclusion in the scheme of shipbuilding grants, by the 28th April, preliminary notifications covering about 190 vessels, aggregating 'over 850,000 gross tons, had been received by the Board of Trade, the majority of which were reported to have been already ordered. Of these about 150 were tramp ships and 40 were cargo liners. Assistance to shipowners for shipbuilding is to be both by way of loans and grants. It is proposed that a total sum not exceeding £10,000,000 should be made available for shipbuilding loan in respect of the building of new cargo vessels ordered after the 28th March, 1939, and begun within two years of the passing of the act. These loans will be available for the building of cargo liners, and trump ships, with the exception of (<t) vessels with an amount of refrigerated space exceeding 80.000 cubic feet or 10 per cent, of the total space available for cargo, whichever is the greater, and (6) vessels constructed or adopted for the carriage of more than twelve passengers. Loans will not be made in respect of tankers, fishing vessels, or tugs, lighters, and similar craft. Shipbuilding grants wilt likewise not be made for vessels coming under category *(d)* or (6), and will not apply to tankers or fishing vessels. A sum of £2,500,000 is to be set aside for shipbuilding grants, which will bc spread over five years, and which will be in respect of the building of new cargo vessels ordered after the 28th March, 1939, and completed not later than the 31st December, 1941. The initial grant payable in respect of each vessel will not exceed rates fixed according to certain classifications, and if the total amount of the initial :grants payable to all ships to be assisted exceeded £500,000, the rates would be proportionately reduced so that the total amount payable as nearly as possible equalled £500,000. These rates, it may be recalled, differentiate between the different fuels which the ships are constructed to burn, and are as follows: - The first grant will bc made as soon as practicable after the 31st March, 1940. or the date of completion of the vessel, whichever is the later, and subsequent grants will be made, after the 31st December for each of the years 1041-44. These grants, however, are conditional on the average level of freights not rising to a point at which the Board of Trade would consider them unnecessary. Moreover any grants payable to a shipowner who is in receipt nf assistance under the shipbuilding loans scheme, would not be remitted to him, but applied in reduction of the loan. Prom the shipbuilding point of view an important provision in the bill is the appointment of a joint committee representing shipowners and shipbuilders to consider the possibility of devising means for securing in the future the more regular ordering of new tonnage. Most will agree that this problem is a hard nut to crack, but' a satisfactory solution towards this end would be very much welcomed by the shipbuilding industry. Of dissatisfaction expressed over the , bill, it is difficult to understand the omission of shipbuilding grants for vessels employed in the home trade. Coastal tramps operate in competition with foreign vessels, and high shipbuilding costs due to armament activity affect small ship construction equally with vessels of larger tonnage. It is to be noted that in the case of deep-sea ships of under 3,500 tons gross, special allowances are to be made in the scale of tramp shipping subsidies (which are not applicable to the home trade) owing to the "greater costs of building and operation of small vessels ". It can be expected that the £10,000,000 to be made available for the grant of assistance to liner companies, whose services are endangered by foreign subsidized competition, will materially assist liner tonnage replacement, although the forms of assistance have yet to be worked out. British liner trades in the East are among those most urgently in need of new tonnage. Another factor affecting shipbuilding, which may yet arise in a more acute form, is the replacement of passenger liner tonnage by the Canadian-Australasian and other lines. It may be a long time before the present high cost of shipbuilding, said to be 25 to 30 per cent, above what is considered practicable, is brought down to a more normal level. Meanwhile the urgency of replacement will become greater rather than less. It is not correct for the Minister to say that this scheme is based on the British scheme which embraces the mercantile marine in its widest sense. {: .speaker-KZR} ##### Mr White: -- It is an immense scheme. {: #debate-41-s1 .speaker-JOM} ##### Mr BEASLEY: -- We can appreciate the position of the mercantile marine in this connexion, because we have evidence of British ships being forced off the seas in the Eastern trade and in the Pacific. The British authorities thought that it was desirable to tackle this question on what it considered to be an effective basis. We seem to be taking an entirely different method of dealing with the subject. It will be noted that the scheme of the British Government differs entirely from that of the. Australian proposal as to the basis of the subsidy. It is interesting to note the approximate number of vessels that have been ordered since the announcement of the subsidy. The following statement appeared in the *Motor Ship,* a leading motor shipping review: - >It was stated by the president of the Board of Trade last month that since the Government made its announcement relating to the provision of a subsidy for ships, 144 vessels of a gross tonnage of 714,000 had been ordered; 78 in .England and Wales, 58 in Scotland, and 8 in Northern Ireland, some of the vessels, however are not in the Government scheme of assistance. Vessels employed in the home trade, coastal tramps, tankers, fishing vessels, tugs lighters, &c. In order to ascertain the tonnage of shipping being purchased by British owners from foreign builders, an examination of the figures published in *The Marine Engineer,* a leading shipping review containing extracts from *Lloyd's Register of Shipping* discloses the following information : - >The present total of tonnage under construction in this country (Great Britain and Ireland) is 791,455 gross tons, about 108,000 gross tons - or 13.7 per cent, is intended for registration abroad, or for sale. The tonnage now under construction abroad is 2,067,837 gross tons, of this tonnage. The leading countries building abroad are: United > >States of America 391,824 gross tons, Germany 347,832 gross tons, Japan 308,849 gross tons, Italy 224,016 gross tons, Holland 223,381 gross tons, Sweden 160,620 gross tons, Denmark 122,440 gross tons, about 536,000 gross tons, or 25.9 per cent, is intended for. registration elsewhere than in the country where built, or for sale, of the total gross tonnage 92,748 gross tons or approximately 4 per cent, is for Great Britain and Ireland. > >These figures show that Great Britain sold to foreign owners 13.7 per cent, of her total tonnage and purchased only 4 per cent, from foreign builders, an advantage in her (Great Britain) favour of 9.7 per cent. This confirms the analysis and statement made in regard to foreign engineering and shipbuilding companies extensive diesel engine experience had given them a momentary advantage over British companies. Tlie Minister's remarks may apply in some small degree to shipping companies which are receiving a subsidy in consequence of having engined their vessels with foreign-manufactured main diesel engines and diesel auxiliaries for the reasons already set out. They could apply only to the operation of the general tariff, as it would not be sensible to import boilers, engines, or auxiliaries into a country where they are being manufactured. A practical comment on turbine and reciprocating engines may be helpful to emphasize this point. The Parsons turbine is manufactured in Great Britain and is recognized, at least within Great Britain and the British Dominions, as being superior to any turbine of foreign manufacture. This also applies to boilers and/or reciprocating engines. In these circumstances, I cannot visualize a foreign-manufactured turbine boiler, or reciprocating engine being installed in a hull of British construction. For the reasons which. I have set out, the duty on the boilers, steam machinery and auxiliaries should be 25 per centBritish, and 42^ per cent, general ; on the main diesel propulsion engines it should be free British and 25 per cent, general. The diesel auxiliaries should have ' the same duties applied to them as are prescribed for crude oil engines, except marine engines, under item 178 *d* 1 and 2, namely, 45 per cent. British; 65 per cent, intermediate, and 65 per cent, general. My reason for saying this is that, the auxiliaries, diesel engines, are, to all intents and purposes, a type of diesel auxiliary and are adaptable for marine purposes. In his second-reading speech the Minister said that another point upon which the Government had been criticized was in respect of its proposal to grant free admission to machinery and boilers and auxiliaries required in the construction of vessels on which bounty will be paid. This criticism is levelled on the ground that the free admission of such equipment will not result in additional employment being given in the appropriate industries. Both the Government and the Tariff Board are fully seised of this fact in principle, but the important consideration that cannot be avoided is that, if shipowners are to be induced to purchase vessels of local construction, and if freight rates are to be kept within reasonable limits, costs must be kept as low as possible. The decision to admit this equipment free of duty cannot result in the loss of employment in the boiler-making and engineering industries for the reason that vessels required by Australian shipowners are at present purchased overseas. Some additional employment in the engineering industries must result from a building construction programme. The Minister in his statement candidly admits that there has been criticism of his proposal to admit boilers, machinery, and auxiliaries, duty free, on the ground that no additional employment will be given to the appropriate industries, in this instance, the engineering trade. As a further defence of the proposals, the Minister has stated that the admission of the boilers, machinery, and auxiliaries, duty free, cannot result in a loss of employment because this equipment was not previously manufactured in Australia for the ships that were purchased overseas. This may be true, but it was anticipated that the Minister, and other Cabinet Ministers, in formulating the proposal would have had sufficient foresight to see that they could not eradicate a malady by perpetuating its worst symptoms. Progress is only accomplished by learning from experience and errors of the past. "What I am concerned with, and apprehensive of - apart, from the main employment question at this stage - is the prospect of employment for apprentices who entered the engineering trade prior to January, *1936,* and who will complete their apprenticeship at the end of this year, or during 1940; also, those apprentices who have entered the trade since 1937. The following figures obtained from the Apprenticeship Council, of New South Wales, show the influx of apprentices into the engineering trade during the years mentioned : - According to the Minister for Labour and Industry in New South Wales, the number of apprentices in the engineering trade covered by the Federal Metal Trades Award and the Engineers State. Award, exclusive of those in the Railway, Tramway, and Road Transport Services, of New South Wales, at the 31st August, 1939, was 3,465, covering all classifications in the engineering trade. The number of apprentices at the same date in the other sections of the metal trades was as follows : - *[Leave to continue given.)* This gives a total of 1,689, compared with 3,465 in the engineering trade. These figures show that there are two apprentices in the engineering trade to one in the other four combined sections of the metal trade. Under the Government's proposals, tho hull and superstructure of a vessel constructed in Australia would make available to the boilermaking trade approximately 70 per cent, of the work. The remaining 30 per cent, of the work, covering machinery and auxiliaries, would still be done overseas. If this work could also be clone here, it would help, to some degree, to provide a future avenue of employment in the engineering trade, which has the greatest preponderance of apprentices, as shown by the official figures I have given. The Minister admits the importance of the adverse comment on his proposal, but then proceeds to defend the principle by asserting that it is essential that the costs of construction shall be kept within reasonable limits to induce the ship- owners to build their vessels locally. If this, benevolent attitude was adopted as a guiding principle in the drafting of legislation that affected the workers' interests, one could applaud the reasonableness of the Government's point of view, but, honestly, such has not been the experience of the workers under the legislation of recent years. After examining the available financial statements of the shipping companies, I am at a loss to understand why it should be necessary to admit the boilers, machinery and auxiliaries as an added inducement to the companies to have their vessels built in Australia. My financial analysis of the progress of the shipping companies has not been made so as to present my submission in a more favorable aspect, for the figures are sufficiently removed from the past, post and the present pre-war trading period as not to embrace any abnormal trading cycle. I do not desire to delay honorable members with numerous figures. A vast fund of information on this subject may be ob;tained by reference to the *Wild Cat. Monthly* from May, 1938, to June, 1939, in respect of Burns, Philp. Limited; April, 1939, in respect of Huddart, Parker Limited; December, 1938, in respect of The Melbourne Steamship Company Limited; October, 1938, in respect of The Adelaide Steamship Company Limited, and the Port Jackson and Manly Steamship Company Limited; May, 1938, in respect of the Illawarra and South Coast Steam Navigation Company Limited; August; 1938, in respect of the North Coast Steam Navigation Company Limited; and March, 1939, in respect of Sydney Ferries Limited. Even a brief examination of tho financial position of some of the principal shipping companies shows their ability to make great progress in this country whatever their alleged disabilities may be, or special pleading by the Government, for they have distributed vast profits by dividends, bonus shares and the many processes known to the commercial world to-day. One factor that has been instrumental in protecting the Australian shipping companies from a post-war intrusion upon their preserves by British or foreign shipping, has been the provisions of Sections 248 to 293a of Part VI. of. the Navigation Act, which were proclaimed on the 1st July, 1921. The purport of these sections is to prohibit trading on the Australian coast by British and foreign vessels to the detriment of the Australian shipowners Unless the Government amends its proposals, as I have suggested, I cannot see any hope that Australia will develop into a self-reliant British dominion, which will provide employment and experience for potential engineering tradesmen in the ship-building industry. I am not at all impressed by the argument advanced by the Minister that in the final consideration of this matter costs are the only factor, and that the Government's scheme is a real contribution to this industry. I consider that a moral responsibility rests upon many of the big industrial enterprises of this country to build their ships here. In the past they have 'been assisted by both Commonwealth and State Governments. The Commonwealth Government has assisted by means of bounties, duties and the like, and the State Governments have assisted by granting freight concessions on the railways and in other very generous ways. The Broken Hill Proprietary Company Limited, in particular, which has been permitted to exploit the mineral resources of this country, and which has received substantial aid from various governments from time to time, particularly in respect of the establishment of the iron and steel industry, should have been prepared to reciprocate when it had the opportunity; but it failed to do so. I well remember that about three years ago when the company required two vessels to assist in the transport of its raw materials and finished products, it declined to have them built in Australia, and obtained them from abroad, justifying itself by arguing that the cost was less 12,000 miles away than it would have been in Australia. This, to my mind, was' a very poor argument coming from a company for which Australiahad done so much. {: .speaker-KMZ} ##### Mr Martens: -- Where would the Broken Hill Proprietary Company Limited have been but for government assistance in years gone by? {: .speaker-JOM} ##### Mr BEASLEY: -- Quite so. When the company had the opportunity to assist the ship-building industry of this country it should have done so. We shall not be able to establish a flourishing ship-building industry until some continuity of operations can be assured. Given encouragement, it would be- possible for us to build not only merchant ships, but also naval vessels of any class and design. The work on both classes of construction is somewhat similar. Blue prints are prepared and patterns made, to which skilled artisans can work. We ought to be training men for shipbuilding, not only for commercial purposes, but also for defence requirements. While we, naturally, welcome the short step which the Government has now taken, we feel that it should be going much farther. After all, the assistance now being provided is on a niggardly basis. We feel resentful that the Government is only prepared to extend assistance in respect of the building of vessels not exceeding 1,500 tons gross. That is only tinkering with the matter. Assistance should be available for the construction of vessels of up to 5,000 tons. At the very least the Government should be prepared to extend the proposal now and grant assistance in respect of all such vessels up to at least their first 1,500 tons, no matter what their total tonnage may be. I sincerely hope that that will be done. We are particularly disappointed by the removal of the duty on engines, boilers and auxiliaries. This class of work can and should be done in Australia. We have the plant and the men available for the purpose. I hope that before this measure is passed we shall be able, with the help of some honorable members opposite who are also interested in the development of the shipbuilding industry, to induce the Government to liberalize its policy at least to the extent that assistance will be provided for the construe^ tion of vessels of up to 5,000 tons ; if not altogether, at any rate for their first 1,500 tons. Finally, we also hope that the Government's proposal in regard to boilers, engines and auxiliaries will be varied and in no circumstances will they be admitted duty free. {: #debate-41-s2 .speaker-KZR} ##### Mr WHITE:
Balaclava .- I have always believed in the development of the shipbuilding industry of Australia and am responsible for the Tariff Board inquiries and the Customs inquiry being made so that this industry might be assisted. In many ways, this industy could be made of great assistance for migration and development. It it were properly established here, many artisans from the 'Clyde and other British shipbuilding centres would be prepared to settle in this country. On two occasions at least this industry has been the subject of very close investigation. The Tariff Board has 'been, particularly thorough. While I appreciate what the Government is now proposing to do, I should like to see more effective action taken. Obviously it is not possible to provide a bounty for the construction of very heavy ships, for it would make the cost prohibitive, and this would react adversely on the primary producers whose goods have to be transported by ship to overseas markets. But the bounty-cum-duty basis of assistance could well be extended. Such action could have been taken even before the war occurred, but now it becomes more imperative in my opinion, because, owing to the heavy losses at sea, there will undoubtedly be a shortage of merchant ships in the years ahead of us. When air raids really begin, it is quite feasible that the docks and shipyards of Britain will be attacked as well as its shipping at sea. If the shipyards suffer, Britain will have difficulty in replacing ships, although it is the greatest shipbuilding nation, in the world to-day. It is in this respect that wc in Australia can help. A few years ago, it seemed impossible that we could take any important part in the construction of aircraft; now, just as we are now helping the Empire in that respect, so we should be able to help in the direction of building ships here in safety, whereas in Great Britain they will, during the next few years, be built under great difficulties. The Government should examine this matter again in the light of the new situation which has arisen. These provisions were drawn up ju3t prior to the war. The rate of bounty is fixed at 12 10s. a ton on ships of more than 100 tons, hut less 'than 750 tons, and it declines progressively until it becomes £10 a ton on ships exceeding 1,350 tons, but not exceeding 1,500 tons. This bounty will encourage the building of small vessels only, but Australia can build much bigger ships than arc provided for here. We have done it before, and the Government should encourage it to be done again, as it could be at little extra cost. Instead of paying the bounty on ships of not more than 1,500 tons, the Government should pay it on the first 1,500 tons of every ship built. Then the bounty would he payable, not only on ferries and small coastal craft, but also on ships up to 10,000 tons or more. Some time ago, I asked the Government to consider that scheme, and to put it in this bill. I am disappointed that it has not been done. The Government, it is true, has given some recognition to the claims of the industry, but the assistance should have been on a more generous basis. It is proposed to admit boilers and machinery free because the British tariff admits them free to Britain. I believe, however, that the Government should protect the machinery manufacturing industry in Australia. A duty should be imposed on boilers and machinery, but, where necessary, they could be admitted duty free under by-law. Last year, I visited the shipyards of Harland and Wolff, in Belfast, the biggest shipbuilding firm m the world, and learned that they import hardly any machinery, making most of their own. The truth is that, whilst boilers and machinery may be imported free into Great Britain, it is not often done. It would be a very rare thing for a turbine to be imported. The Australian machinery-manufacturing industry should be protected so that it may expand side by side with the shipbuilding industry. It would not be satisfactory merely to build the hulls in Australia, while the boilers and machinery have to be imported. Only machinery which cannot he made in Australia should be admitted free, under by-law if necessary, and the by-laws could be amended where necessary to make this workable. We should not retard the development of the Australian machinery-manufacturing industry by allowing all marine machinery to be admitted free. While I applaud the Government for having at last extended a measure of assistance to the shipbuilding industry, I ask that the suggestions I" have put forward be considered. {: #debate-41-s3 .speaker-KXB} ##### Mr WATKINS:
Newcastle .- The proposals of the Government for the assistance to the shipbuilding industry do not como up to expectations, particularly in view of the importance of this industry to defence, and the further development of the economic resources of the Commonwealth. Assistance is limited to builders of vessels between 100 and 1,500 tons gross register - between an extra powerful tugboat and the smallest of vessels operating on our coast. The Government proposes to expend £50,000 a. year for three years as an experiment to assist shipbuilders. I believe that the proposals are totally inadequate. Figures supplied by the Minister for Trade and Customs **(Mr. John Lawson)** show that the demand for small vessels is falling. Particularly was this noticeable in the year 1938. Only four out of thirteen imported vessels were tinder 1,500 tons gross. This is due to the increased volume of interstate trade, and more economical working of larger ships ; but, even if the demand were growing for small ships, the following figures will give some idea of the paucity of the Government's assistance. The cost of a steamship would depend largely upon itsequipment, design and classification. The requirements of a ship of 1,250 tons capacity would he approximately as follows : - Tlie Government proposes to subsidize this to the extent of about £15,625, so that after nine ships of this size had been built the bounty of £150,000 over the three years would be exhausted. The cost of machinery and plant for the building of ships is high, and prospective shipbuilders cannot be expected to go to this expense with a falling off in demand for smaller ships, and such limited financial assistance for the building of nine small vessels. The further proposal by the Government to remove the present tariff on imported machinery, boilers, &c, necessary for ship construction is even more serious and is to be strongly condemned. The present tariff rates on all machinery, &c, are 33 per cent., plus 5 per cent, primage duty, from the United Kingdom and 65 per cent., plus 10 per cent, primage, from foreign1 countries. The value of machinery, boilers and other fittings is about 30 per cent, of the total cost of the ship, and would give work to a large number of mechanics and artisans in their construction. The removal of this tariff, which has assisted in the establishment of our mechanical, engineering and boiler shops, would open wide the door for the flooding of Australia with cheap foreign articles to the detriment of Australian workmen and manufacturers. This will more than outweigh the benefit of the bounty proposals. In addition, if this work is clone overseas, it will be impossible to train skilled technicians in engineering in preparation for an emergency. In view of the issues involved, defence, the relief of unemployment, openings for our youth and further development of Australia, it is considered that far greater assistance should be given by the Government. The measures taken to establish the galvanized sheet plate works of John Lysaght (Australia) Limited, could be adopted without any extra cost to the Government. Total bounties of £469,061 were paid, and a tariff was imposed which, raised altogether £1,040,623. A similar policy adopted now by the present, Government would place the shipbuilding industry on a firm basis, leading to greater stability in the whole of our national life. Australia has been pre-eminently, in tlie past, a country which made its living by exporting primary produce and importing manufactured articles in exchange. Since federation, under the shelter of fostering tariffs, our manufacturing industries have multiplied and increased, but, broadly speaking, the situation is very largely the same to-day as it was yesterday. Australia is still largely dependent upon its mercantile shipping for the transport of its products to overseas markets, and, for its intra and interstate trade. To-day, Australia's reliance upon its mercantile shipping has been greatly increased due to the war, and its position as a supplier of products to the United Kingdom. I draw reference to the British Government's decision to purchase our wool clip, and I assume similar decisions will be made in relation to wheat and other primary products. To fulfil our contracts, there must be an increase of mercantile shipping, as it is reported that the tonnage available to-day is smaller than the tonnage of 1914-18. Added to the necessity for increased transportation, an augmented mercantile fleet is essential as an auxiliary to our naval strength. It ie necessary for Australia to develop its mercantile shipbuilding industry, so as to meet the demand which must arise from Australia's position as an exporting nation, and from the part it is playing in this war. As to the methods of developing the shipbuilding industry, it appears that the first factor is to maintain continuity of shipbuilding. I do not believe that such continuity will be derived from private enterprise; but reasonable continuity could be guaranteed by the building of a Commonwealth, mercantile fleet. Australia is capable of building vessels up to 1.0,000 tons, and possibly more. This is substantiated by the SS. *Ferndale* and the SS. *Fordsdale,* two 10,000 tons refrigeration vessels, which were constructed in Australian shipyards. Australia is favorably placed in comparison with overseas shipyards in regard to costs. It is reported that steel can be produced in Australia at prices which are 25 per cont. under British prices. This is due very largely to the fact that the Broken Hill Proprietary ' Company Limited is advantageously placed in regard to the supply of raw materials and other essentials, in that it has its own coal mines, and its own iron ore deposits and deposits of fluxing materials. This steel industry is more self-contained than probably any other steel manufacturing concern in the world. At this stage, I draw attention to a report which appeared in the Sydney *Sun* on the 11th September last, stating that an increase of freight rates by 25 per cent, would apply forthwith on all vessels sailing from Australia. Doubtess, honorable members are aware that such skyrocketing freight charges will add tremendously to the cost of shipping Australia's products to the United Kingdom. This shows how foolish was the action of the Nationalist Government in disposing of the Australian Commonwealth Line of Steamers which saved this country in inward and outward freights approximately £18,000,000. There is urgent necessity for the development of the shipbuilding industry in Australia. An essential contributing factor for the development of the industry is the continuity of orders, and reasonable continuity of orders could be guaranteed by the introduction by the Government of a wellplanned programme for the building of a Commonwealth mercantile fleet. The construction of such a fleet would not only increase employment in this country, but also save this country millions of pounds in excess freight rates. The following table, compiled from information supplied by the Comptroller-General of Customs, Canberra, sets out the vessels built outside Australia and registered in Australia, during the years 1932 to 1938 inclusive:- The following table, derived from the same source, gives particulars of vessels imported, including fittings : - The following table sets out. the financial position of Australian shipping companies :- The Federated Shipwrights and Ship Constructors Association of Australia, writing with regard to the shipbuilding industry, states - >At the last meeting of the committee of management of the above association, it was decided I write to you and express the thanks of the organization for your work in connexion with the light for recognition of the shipbuilding industry. The recent decision of the Government is certainly the result of theclaimsoftheunionbeingpresentedto the Government through the medium of yourself, and has given us hopes that out of that, decision eventually our objective of having all Australian vessels constructed in Australia may become an established fact. > >Commenting on the proposals outlined in the copy kindly sent by you, there are one or two points that I would like to mention. > >Clause (c) provides that on vessels of the type eligible for bounty the duties be free (British Preferential Tariff) and 15 per cent. (General Tariff). > >I think that there should be a heavy duty on those vessels eligible for bounty, the effect of which would ensure that Australian builders would be certain of getting the orders for such vessels. > >Secondly,I think that the bounty should have covered vessels up to 5,000 tons or at least of a higher tonnage than 1,500. > >Thirdly, at the request of some of the builders who specialize in wooden shipbuilding mostly under 100 tons, and who. are in competition with overseas boatbuilders, I would ask that you advocate that the bounty extend to these craft or that a heavy tariff be imposed on such vessels which are imported from overseas. > >Our objective of course is that at some future date all vessels irrespective of tonnage will be constructed in Australia. We realize thatwe must work up to that, a step at a time, and no doubt as a start we will have to discipline those shipping companies who require ships of the tonnage eligible for bounty in the meantime. On the same subject the Blacksmiths Society of Australasia writes - >It is very satisfactory to know that something practical has been accomplished even though it fulls far short of our objective. > > *Re* my view - according to a statement given to us in connexion with vessels trading on the harbour or on the coast of New South Wales which have been imported into Australia from1919 to 1937, the total tonnage was 28,980 or an approximate yearly average of 1.525 gross tons. Assuming that the rate of building in connexion with those small vessels in the future is the same as in the past, the Commonwealth's decision will not be of very great advantage to shipbuilding here. With respect, however, to vessels of 5.000 tons and under which have been imported into Australia from 1919 to 1937, the gross tonnage was 137,238 or an approximate yearly average of 7,223 gross tons. > >If the above is the case would it be possible for you to move that: - > >The Federal Government pay a bounty of 5,000 gross tons or under. > >The bounty to be paid up to a limit of 1.500 tons. > >The rate to be £12 10s. on the first 750 tons and to be gradually reduced so that when 1,500 tons was reached the rate would be £10 per ton. > >This, in effect, would mean that the bounty would be paid on vessels of 1,500 gross register or under, at the rate set out in the Government's proposal and vessels up to 5,000 tons would be subsidized up to the same amount as vessels of 1,500 tons, or, put another way, a vessel of 5,000 tons would be subsidized at a rateperton on 5,000 tons of approximately l-3rd the rate on a vessel of 1.500 tons. I think this will be of considerable assistance in influencing shipowners to have vessels up to 5,000 tons built here. Certain objections may be raised against this suggestion but 1 send it along for your consideration. This proposal should have been brought down years ago. The need for it is amply demonstrated by the statement of the Prime Minister that the Government is worried at the moment by the' upward trend of freight rates. It is not toolate even now to get on with the job. I welcome the bill, but I regret that it does not. go far enough to provide continuity of employment, or to encourage the construction of large ships in this country. Many of the small vessels which would be covered by this bill are no longer being constructed. I trust that the Minister will give due consideration to our representations on behalf of this important industry. {: #debate-41-s4 .speaker-KYH} ##### Mr PRICE:
Boothby -- I support the bill, though I regret that it does not go far enough. In common with other honorable members, I should like to see provision made in it for the payment of a bounty in respect of vessels of much greater tonnage. In 1917, the firm of Poole and Steele, of Port Adelaide, was engaged in the manufacture of ships but I regret to say that it was given no encouragement and "finally went out, of business. This bill provides for the payment of a sliding-scale bounty for a period of three years, in accordance with the tonnage of the ship constructed. Reference has been made during this debate to the Broken Hill Proprietary Company Limited. That great organization has been an invaluable help to Australia, and its value in time of war is incalculable. Some time ago a bill was brought down in this House providing for a bounty on the production of motor *car* engines. A special duty of 0.7d. per lb. was imposed on all chassis coming into this country to establish a fund to meet the bounty payments. Although there is at present " in the kitty " over £1,500.000, not one engine has yet been manufactured in this country. 1hope that this money will be used. The. Government would act wisely by making a decision on the tenders that were presented. No one knows what happened to those tenders. The shipping industry could be developed with advantage to Australia, particularly in wartime. There are not sufficient docking facilities in Australia. A vessel coming from England via the Suez Canal has to reach Sydney before decent docking facilities can be provided for it. Docks atFremantle and Adelaide are necessary, whether they be graving docks or floating docks, especially if the shipbuilding industry is to be developed. We are already building aeroplanes in Australia, and I see no reason why the motors for sea vessels should not also be built here. I support the bill, because it is a step in the right direction, but I hope that in the near future the Government will see the wisdom of applying this bounty to vessels of more than 1,500 tons. *Friday, 1 December 1989* {: #debate-41-s5 .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- *in reply* - I listened with keen interest to the criticism levelled at t his bill by the honorable members for West Sydney **(Mr. Beasley),** Newcastle **(Mr. Watkins),** and Boothby **(Mr. Price).** I realize that it was prompted by a desire to see. a more comprehensive measure of assistance given to the ship-building industry in Australia. I do not apologize for this bill, but I am prepared ' to admit that it is only a modest attempt to assist the industry. Nevertheless, it is a genuine attempt to place the industry on a sound foundation. I offer this to the Opposition. I undertake again to review the position of the shipbuilding industry twelve months hence. {: .speaker-KZ9} ##### Mr Riordan: -- The Minister will not be here then. {: .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- I realize that we live in very dangerous times, and that any. promise I make is conditioned by what, may happen to me and this Government between now and twelve months hence. Who knows but that the honorable member for Kennedy **(Mr. Riordan)** may not himself be piloting legislation through this chamber. The Government, however, undertakes to review this industry in twelve months' time, and to give serious consideration to a reference of the whole question to the Tariff Board for consideration and report. I would ask the unions associated with this industry to keep a close check upon the effect of the bounty during the next twelve months. I would welcome the criticism of those unions. I assure honorable members that it is my desire, just as much as it is the desire of any member of the Opposition, to see the shipbuilding industry in Australia soundly developed. I am prepared to do everything in my power to encourage that development. I repeat that the present proposal is modest, but it does provide a foundation upon which we can build. The experience that will be gained by the operation of this legislation will enable us to do something more than is proposed in this bill. Question resolved in the affirmative. Bill read a second time. *In committee:* Clauses 1 to 23 agreed to. {: #debate-41-s6 .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- I move - >That the following new clausebe inserted: - "10a. - (1) Where, in the locality where ships or parts of ships in respect of the construction of which bounty is claimed are constructed,any standard rates of wages or conditions of employment to be paid or observed in respect of any persons employed in the construction of those ships or parts of ships have been - > >prescribed by any award, order or determination of the Commonwealth Court of Conciliation and Arbitration or of any other industrial authority of the Commonwealth ora Statu of a Territory or in any industrial agreement registered under any law of the Commonwealth, or of a State or Territory; or > >declared to be fair and reasonable in accordance with the provisions of subsection (2.) of this section, a builder when making any claim for bounty in respect of the construction of any ships or parts of ships shall certify to the Collector that the rates of wages and the conditions of employment observed by him in respect of the persons employed in the construction of ships and parts of ships were not less favorable to the persons so employed than the rates and conditions so prescribed or declared. (2.) If, in the locality where ships or parts of ships in respect of the construction of which bounty is claimed are constructed, the rates of wages and conditions of employment to he paid andobserved in respect of any persons employed in the construction of those ships or parts of ships have not been proscribed by any award, order or determination of the > >Commonwealth Court of Conciliation and Arbitration or of any other industrial authority of the Commonwealth or a State or a Territory or in any industrial agreement registered under any law of the Commonwealth, a Slate or a Territory, the Minister may make application to the Chief Judge or a Judge of the Commonwealth Court of Conciliation and Arbitration for a declaration as to what rates of wages and conditions of employment are fair and reasonable for persons employed in the construction of ships and parts of ships in that locality. " (3.) If the Minister finds that the rates of wages paid to, or the conditions of employment, or any of them, observed in respect of, persons employed in the construction of ships and parts of ships upon which bounty is claimed were less favorable to those persons than the rates and conditions proscribed or declared as specified in paragraph (a) or paragraph (6), as the case may be, of sub-section (1.) of this section, he may direct that the whole or any part of any bounty shall not be payable and . that whole or part, as the ease may be, shall thereupon not be payable.". Honorable members will recall that until last year it was usual for all bounty bills to include a provision designed to enable the payment of bounty to be withheld if award rates of wages and conditions of employment were not observed. Last year this provision was omitted from several bills in order that their constitutional validity might be examined. That examination has now been made and the Government is satisfied that the provision is quite legal. Action is therefore being taken to introduce amending bills to insert the provision in those acts passed last year and earlier this year. Also, of course, it is necessary to insert the provision in this bill which was drafted and introduced into this House before the legal advice to which I have referred was obtained. Proposed new clause agreed to. Schedule agreed to. Preamble and title agreed to. Bill reported with an amendment; report adopted. Bill read a third time. {: .page-start } page 1911 {:#debate-42} ### ADJOURNMENT Case of H. H. Tilby - Price of Bricks -HoursofFirebrigadeOfficers. Motion (by **Mr. John** Lawson) proposed - >That the House do now adjourn. {: #debate-42-s0 .speaker-KLL} ##### Mr MAKIN:
Hindmarsh -- The Limbless Soldiers' Association of South Australia ha? asked me to bring before the Minister for Repatriation **(Mr. Harrison)** the case of Henry Herbert Tilby. I shall be brief, although 1 have a statement fully setting out the details of the case. This man enlisted in September, 1914, and fought at Gallipoli. He received a bullet wound in the left elbow which necessitated amputation of the arm from above the elbow, at the clearing casualty station on the beach. It took about ten weeks before the healing of the wound could be regarded as in any way satisfactory. In 1930 gangrene manifested itself. He told **Dr. O'Brien** that he had pains in both legs similar to the pains that he was suffering in his arm. He thought that there was an association between the condition in the arm and the pains in the legs. The doctor thought that there could be no such relation, but ultimately, after a conference, a leading Adelaide surgeon, **Sir Henry** Newland, found it necessary to amputate both legs. It is thought that there is a direct association between the amputation of the legs and the amputation of the elbow at Gallipoli in 1915, but the Repatriation Department takes the view that it has no obligation to the man in respect of the amputated legs, although it recognizes its obligation in respect of the amputated arm. This is a most distressing case. The Repatriation Department, I know, has given very earnest consideration to this man's case, but it finds that the present Repatriation Act is not wide enough in its scope to enable it to do anything for him. I take the view that the medical report on this man's condition is more than harsh. I submit to the Minister that he give this case his personal attention. I suggest either a compassionate allowance dr an amendment of the Repatriation Act in order that this man shall receive the justice which he deserves. A man who lost an arm on active service and then lost both legs warrants special consideration. I ask the Minister to examine this case thoroughly. I shall be glad to furnish him with details of it, although I understand that there is a. very full statement of the claim on the files of the Repatriation Department. I hope that at least the Minister will be able to make some helpful suggestion as to the best way in which this applicant could be assisted by the department, either by means of a compassionate allowance or by an amendment of the act to permit of the more generous expression of the department's views. **Mr.** RIORDAN (Kennedy) [12.1(5 a.m.. J. - I direct the attention of the Government to a matter which was brought to my notice during the dinner adjournment of this House to-night. I received a telephone call from Brisbane informing me that the Commonwealth Prices Commissioner had authorized an increase of the price of bricks by 10s. 6d. a thousand. That is tantamount to an increase of 10 per cent. Not many months ago the State price-fixing authority, after making a very exhaustive inquiry, in consequence of ' continual applications by the brick manufacturers, refused an application for an increase of the price of bricks by 5s. a thousand, yet this is an increase of 10s. 6d. a thousand. Obviously it is an attempt to secure a return to the conditions that operated during the last war, when building prices rose tremendously. The passing of the Profiteering Prevention Act in Queensland in 1920 at. least had the effect of preventing building costs from rising any further, but the Commonwealth Government apparently is now prepared to permit a repetition of the profiteering of 1914r-18 by giving to its greedy supporters - the brick manufacturers do not support the Labour party - opportunities to profit as much as possible from war conditions which actually do not affect their industry. The Government has intimated that it will not on any pretext permit anybody to make undue profit out of this war, yet the brick manufacturers have made this increase on the authority of the Commonwealth Prices Commissioner. It appears to me that since the Government has been given special powers it intends to use them to give handouts to its wealthy supporters. {: #debate-42-s1 .speaker-JOS} ##### Mr SPEAKER (Hon G J Bell: Order ! The honorable member is anticipating debate on Order of the Day No. 14. He is entitled to refer to a particular case but he may not discuss the whole question of price-fixing. {: #debate-42-s2 .speaker-KZ9} ##### Mr RIORDAN: -- This increase of the pi-ice of bricks will have an adverse affect on employment in Brisbane. Not. only will the earnings of building trade workers, such as painters, plasterers, bricklayers and other artisans, be depleted, but also thousands of nien will be thrown out of employment. In 1932 the Queensland Government instituted a building revival scheme, because it realized that an increase of building activity would create more employment than any other trade revival. The action of the Commonwealth Prices Commissioner in this case shows definitely that the Commonwealth Government is not seriously concerned about unemployment; if it were it would not permit this form of exploitation. When the Acting Treasurer **(Mr. Spender)** delivered his Financial Statement this afternoon, he said that the country was passing through a period of business repression. The increasing of the price of bricks in Queensland will certainly cause business repression, because people will not now be prepared to erect brick houses or buildings. The war has already had an adverse affect on the industry. I can see no reason to justify the increase. In recent cases of price increases the argument has been advanced that the higher freights and insurance rates have been responsible ; but on this occasion that argument will not apply, because freights and. insurance rates do not affect the building trade Neither has there been any wage increase to warrant a price increase. If the Government intends to stand by its promise to peg prices at the levels obtaining on the 31st August last, it must prevent the manufacturers from increasing the price of bricks in Queensland. {: #debate-42-s3 .speaker-KX7} ##### Mr WARD:
East Sydney -- I bring to the notice of the Government a very serious matter concerning interference with industrial conditions in New South Wales on the meagre plea that certain information has been passed on by the Commonwealth Government to the Chief Fire Officer in New South Wales, **Mr. Richardson,** to the effect that a state of emergency exists. The hours of labour of fire brigade officers *a* New South Wales have been unduly increased. Those officers have no award, Jut they work under an agreement which arose "from a declaration made by the full bench of the Industrial Commission in 1.938. ' The weekly hours fixed by the agreement were 112. On the 25th August, 1939, **Mr. Richardson,** on his own initiative, increased the total to 168 hours a week. That meant that fire brigade officers were to be on duty for 24 hours a day on every day of the week. Those hours were subsequently reduced to 144 a week. The Fire Brigade Officers Association then applied for an award in the terms of the agreement of 1938 for a total working week of 112 hours. This application was heard before the full Industrial Commission in New South Wales. Counsel for the board stated that abnormal times existed and that the Chief Fire Officer had in his possession information on which hu had decided that a state of emergency existed which warranted the fixing of a working week of 144 hours. **Mr. Richardson** was then asked to go into the witness box to be cross-examined, but he said that although he was in possession of this special information, he was not able to divulge it. A suggestion was acted upon that **Mr. Richardson** should retire with the bench to discuss the matter. It was later stated that he had been able to satisfy the bench that a state of emergency did exist. The only persons who could inform **Mr. Richardson** authoritatively that a state of emergency existed were the Commonwealth authorities. The Minister for the Army **(Mr. .Street)** has, under the National Security Regulations, power to declare by order that certain conditions exist and to make stipulations with regard to the working hours of fire brigade officers, but the fact that the Minister has not made such an order indicates that the state of emergency which **Mr. Richardson** claims to exist, does not, in fact, exist at all. I ask the Minister to inform me whether any special information was passed on to **Mr. Richardson** to justify him, on his own initiative, introducing a working week of 168 hours. The Prime Minister has repeatedly given undertakings in this chamber that industrial conditions will not be interfered with by the Government and that any alterations will only be made after a complete and open inquiry. There has been a distinct departure from this procedure in the case to which I have referred, in that the commission actually went into *camera* during part of tlie proceedings with the result that counsel representing the Fire Brigade Officers Association did riot have an opportunity to examine the evidence upon which the decision of the Commission was based. Nor did he have an opportunity to crossexamine the witness. This is a very serious matter and the Governmentshould make a statement to clarify the position, if certain information was passed on to **Mr. Richardson,** it appears to me that the general public has been misled. I hope that the Government will, at. the earliest moment, clear up the whole matter. The trade union movement in New South Wales has taken a very serious view of the whole case. {: #debate-42-s4 .speaker-KNX} ##### Mr HARRISON:
Minister for Repatriation · Wentworth · UAP -- I have some knowledge of the rase raised by the honorable member for Hindmarsh **(Mr. Makin),** and 1 agree with him that' it is a most distressing one. In the main, the position is as set out by the honorable member. My department Iia.* given serious and sympathetic consideration to the question of how it may be able to help this unfortunate returned soldier, and the Repatriation Commission and the War Pensions Entitlement Appeal Tribunal have reviewed the case exhaustively. Both before coming to decisions and after making their primary decisions, they have referred the matter to specialists in order to pee whether some indication could -be given as to the origin of the disease known as Berger's from which the applicant is suffering. Only recently, notwithstanding the decision of the Appeal Tribunal, which, prior to making its second decision, referred the case to an Adelaide specialist, the commission referred the applicant to its own medical advisory panel, a body of specialists. Apparently, the onset of this disease did not, take place until fourteen years after the return of Tilby from active service in the war zone. Unfortunately, the medical advisory panel could not give any indication to the commission that the disease was actually a w-ar disability. I know that the honorable member for Hindmarsh will agree that the commission is not empowered to grant pensions in cafe6 where the disability from which the applicant is suffering cannot be definitely classed as being due to war service. The hands of the commission are tied. I am interested in the honorable member's suggestion of a compassionate allowance, and shall discuss it with the commission, although I do not know whether there is power to grant such an allowance. I remind the honorable member that there is now functioning an inter-departmental committee which is studying the Repatriation Act' in relation to the proposal that the 2nd Australian Imperial Force should serve overseas. In view of the many complaints that have been made as to anomalies in the act, and also as to its rigidity, I intend to suggest that the committee should view the legislation and the proposed amendments in the light of cases of the kind referred to by the honorable gentleman. I shall give my personal consideration to the honorable member's representations. {: #debate-42-s5 .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- *in reply* - I am not personally acquainted with the case set out by the honorable member for East Sydney **(Mr. Ward)** but 1 shall refer it to the Attorney-General **(Mr. Hughes)** and shall ask him to give to it his closest attention. The honorable member for Kennedy **(Mr. Riordan)** referred to the increased price of bricks in Queensland, and criticized the Commonwealth Prices Commissioner for permitting it. The Commissioner made his decision after a study of a carefully, compiled report which was furnished to him by. the Deputy Prices Commissioner in Queensland, **Mr. Lindsay,** who is particularly well qualified to give an opinion on such matters since he enjoyed for a number of years the fullest confidence of the Government of Queensland when he was deputy commissioner and later Commissioner of Prices under the State legislation. He was appointed to his present, position as the nominee of the Premier of Queensland, **Mr. Forgan** Smith. **Mr. Lindsay** has reported as follows: - >That some relief should be granted to the brick industry in Queensland. > >That the statements submitted by the companies, and supported by an examination of balance-sheets by reputable accountants, clearly indicate that it, is unprofitable for manufacturers to sell bricks at the present fixed prices > >The price of bricks in Brisbane had been reduced by 5s. per 1,000 in October, 1938, but the information available to the Deputy Prices Commissioner now was not available when the price was reduced by the State Price Fixing Commissioner in October, 1938. {: .speaker-KMZ} ##### Mr Martens: -- Who fixed the price in 1938? {: .speaker-KZZ} ##### Mr JOHN LAWSON:
MACQUARIE, NEW SOUTH WALES · UAP -- I understand thatit was the State Commissioner. The claim of the companies, supported by investigating accountants, was for a rise of 18s. 6d. a 1,000; but having regard to all the facts obtainable, the Commonwealth Prices Commissioner approved an increase of 10s. 6d. a 1,000 bricks, making the price 95s. 6d. a 1,000 in Brisbane. Question resolved in the affirmative. {: .page-start } page 1915 {:#debate-43} ### PAPERS The following papers were presented : - National Security Act - Butter and Cheese Acquisition Regulations - Notice. Australian Soldiers' Repatriation Act - Repatriation Commission - Report for year 1938-39. Lands Acquisition Act - Land acquired for Defence purposes - Derrimut, Victoria. National Security Act - Wheat Acquisition Regulations - Order. New Guinea Act - Ordinances of 1939 - No. 13 - Weights and measures. No. 18-Medical. No. 22 - Appropriation 1939-1940. Wireless Telegraphy Act - Regulations Amended - Statutory Rules 1939, No. 156. Northern Territory - Expedition to South West Aboriginal Reserve organized by **Mr. M.** Cutlack - Report by the Director of Mines for the Northern Territory. House adjourned at 12.34 a.m. (Friday). {: .page-start } page 1915 {:#debate-44} ### ANSWERS TO QUESTIONS *The followinganswers to questions were circulated : -* {:#subdebate-44-0} #### Port Augusta Wharf {: #subdebate-44-0-s0 .speaker-JNM} ##### Mr Badman:
GREY, SOUTH AUSTRALIA n asked the Minister representing the Minister for the Interior, *upon notice -* {: type="1" start="1"} 0. What is the amount of revenue received from wharfage dues at Port Augusta since the acquisition of the wharf by the Commonwealth Government ? 1. What amount has been expended on repairs since the wharf has been controlled by the Commonwealth? 2. Is it a fact that there is an urgent need for extensive repairs to the wharf? 3. Is it intended to put in hand forthwith the necessary repairs? 4. Is it a fact that Spencer's Gulf at Port Augusta is in a serious condition and a menace to shipping? 5. If so, will the Minister confer with the South Australian Harbours Board on the subject of harbour dredging while dredges are working within the confines of the Gulf at Port Pirie? {: #subdebate-44-0-s1 .speaker-KXY} ##### Mr Perkins:
UAP -- The information is being obtained. Enemy Organization in Sydney. {: #subdebate-44-0-s2 .speaker-KLC} ##### Mr Mahoney: y asked the Minister for Defence Co-ordination, *upon notice -* >With reference to his statement that the *Verbund der Deutscher Vereine Im Ausland* is an enemy organization, will he supply the following information : - > >Why the funds and property have not been placed under control; > >Why, seeing that the treasurer and secretary have been arrested, the president has his freedom ; > >Whether the president is a wealthy naturalized Australian of German birth; and *(d.)* Whether, in view of the president's activities, his naturalization should be cancelled? {: #subdebate-44-0-s3 .speaker-N76} ##### Mr Menzies:
UAP -- The answers to the honorable member's questions are as follows : - {: type="a" start="a"} 0. The funds of this organization are not liable to control under the Enemy Property Regulations. 1. It is not in the public interest to make any statement on this. 2. He is a naturalized Australian of German birth. 3. It is not in the public interest to make any statement on this. {:#subdebate-44-1} #### Australian Broadcasting Commission: Free Tickets for Celebrity Concerts {: #subdebate-44-1-s0 .speaker-KZR} ##### Mr White: e asked the PostmasterGeneral, *upon notice -* {: type="1" start="1"} 0. Did the Australian Broadcasting Commission distribute large numbers of free tickets for celebrity concerts during 1937-38? 1. On what basis were they distributed? 2. What would be the total value at boxoffice prices of the free tickets distributed as above for the season 1937-38? {: #subdebate-44-1-s1 .speaker-KNX} ##### Mr Harrison:
UAP -- Inquiries are being made, and a *reply* will be furnished as soon as possible. Ministers' Shareholdings in Companies. {: #subdebate-44-1-s2 .speaker-KX7} ##### Mr Ward: d asked the Prime Minister, *upon notice -* {: type="1" start="1"} 0. Will he institute inquiries to ascertain whether any members of the Cabinet, or their wives, are, or were during the past two years, shareholders in any company which, directly or indirectly, has benefited as the result of the Commonwealth Government's war expenditure? 1. Will he extend the inquiries to ascertain whether any transfer of shares or stock during that periodhas been as the result of a genuine business transaction? {: #subdebate-44-1-s3 .speaker-N76} ##### Mr Menzies:
UAP -- Innumerable companies in Australia have derived and will continue to derive benefit, directly or indirectly, as the result of the Commonwealth Government's war expenditure. Compliance, therefore, with the honorable member's request undoubtedly would involve the disclosure by Ministers and their wives of financial matters which are their own private concern. In the circumstances I do not propose to take the action he suggests. {:#subdebate-44-2} #### Cutback Mining Expedition {: #subdebate-44-2-s0 .speaker-JPT} ##### Mr Blain: n asked the Minister representing the Minister for the Interior, *upon notice -* {: type="1" start="1"} 0. Isit a fact that Morley Cutlack obtained permission from the Minister to enter an aboriginal reserve to search for Lasseter's Reef, but did not disclose to the Minister that he intended to exploit in the press that he had discovered the hitherto mythical reef? 1. If so, what action does he intend to take? 2. Will he lay the report of the Director of Mines on the table of the House? 3. What was the total cost to the Northern Territory Administration of senior mines officials accompanying Morley Cutlack? 4. Did the mines officials personally take samples from the reef; if so, what is its width and what is the assay value of these samples? 5. How many feet of cross-cutting - on the poundfor pound basis - would the expense incurred by the department have financed approved mining operations at Tennant Creek? {: #subdebate-44-2-s1 .speaker-KXY} ##### Mr Perkins:
UAP -- The Minister for the Interior has supplied the following information : - {: type="1" start="1"} 0. Morley Cutlack was granted permission to enter the south-west Aboriginal Reserve, accompanied by the Director of Mines and a mining inspector of the Northern Territory Administration, to investigate an auriferous area which he alleged he had discovered some time ago. The so-called " Lasseter's Reef " was not mentioned in connexion with the investigation. In his report, the Director of Mines stated that he did not wish to associate the belt of country examined with the mythical Lasseter's Reef. 2.This matter is under consideration. 1. As soon as copies of the report have been made they will be tabled in both Houses. 2. Practically the whole of the expenditure was met by **Mr. Cutlack.** The cost to the Northern Territory Administration would be the salaries and camping allowance of the two officers for the few days they were engaged on the expedition. 3. A few samples were taken by the mines officials, but the assays are not yet available. 4. The expense incurred by the Administration was practically negligible and would have no effect on the amount made available for the assistance of mining in the Territory. Department op Information : Appointment op **Mr. Holtz.** {: #subdebate-44-2-s2 .speaker-KX7} ##### Mr Ward: d asked the Minister for Information, *upon notice -* {: type="1" start="1"} 0. Is it a fact that. a **Mr. A.** C. C. Holtz has been appointed to the staff of his department? 1. If so, is this the same **Mr. Holtz** who indicated his retirement from active business when he left the office of general manager of the *Argus* and the *Australasian* and who went into retirement for a second time when he. relinquished the position of an executive officer of the Australian Newspapers Conference? 2. Is **Mr. Holtz** older than the normal retiring age for public servants? 3. In what capacity is **Mr. Holtz** engaged, and what is his salary, if any? 4. Has **Mr. Holtz,** had any experience as a journalist? {: #subdebate-44-2-s3 .speaker-KFS} ##### Sir Henry Gullett:
UAP -- The answers to the honorable member's questions are as follows : - {: type="1" start="1"} 0. Yes; in a temporary capacity for a few months. **Mr. Holtz** is man of outstanding ability and is doing admirable work. 1. **Mr. Holtz** was general manager of the *Argus* and the *Australasian* and subsequently an executive officer of the Australian Newspapers Conference. 2. His age is65 years. 3. As an organizer at the rate of £500 per annum. 4. Not to my knowledge. He is not engaged in journalism. {:#subdebate-44-3} #### Commonwealth Grants Commission : Remuneration of Sir George Pearce {: #subdebate-44-3-s0 .speaker-L07} ##### Mr Lazzarini:
WERRIWA, NEW SOUTH WALES i asked the Prime Minister, *upon notice -* >What remuneration does **Sir GeorgePearce** receive as a member of the Commonwealth Grants Commission? {: #subdebate-44-3-s1 .speaker-N76} ##### Mr Menzies:
UAP -- As a member of the Commonwealth Grants Commission, **Sir George** Pearce receives a salary of £200 per annum and a fee of £5 5s. for each day of attendance at meetings of the commission. {:#subdebate-44-4} #### Northern Territory: Housing {: #subdebate-44-4-s0 .speaker-JPT} ##### Mr Blain: n asked the. Minister representing the Minister for the Interior, *upon notice -* {: type="1" start="1"} 0. Will the Minister call for a report from the Chief Medical Officer, Darwin, to ascertain the number of people,in Darwin and Alice Springs and intervening towns not on the public payroll who desire to take advantage of a workers' housing scheme through the Commonwealth Bank? {: type="1" start="2"} 0. In view of the desirability of retaining tradesmen in the Northern Territory, will ho take immediate steps to house all artisans in a similar manner as single men of the clerical divisions of the service are 'being housed? {: #subdebate-44-4-s1 .speaker-KXY} ##### Mr Perkins:
UAP -- The matter will receive consideration. Australian Wheat Board. {: #subdebate-44-4-s2 .speaker-KV7} ##### Sir Frederick Stewart:
UAP -- I have received the following information from the Minister for Commerce with reference to a question asked on the 17th November by the honorable member for Kalgoorlie **(Mr. Green)** concerning salaries of members of the Australian Wheat Board: - >I find that the honorable member asked a further question on the 21st November which is not fully covered by my previous answer. The following supplementary information is furnished in response to his request: - > >Members of the Australian Wheat Board, with the exception of the two representatives of the wheatgrowers, are paid a travelling allowance of £2 2s. a day for each day that the member is absent from his home overnight in connexion with attendance at board meetings, or whilst engaged on the business of the board. > >The salary of **Mr. John** Thomson, the general manager of the board, is £3,000 per annum, with a disability allowance of £2,000 for the first year of his occupancy of the office of general manager. Defence Contracts. {: #subdebate-44-4-s3 .speaker-KVN} ##### Mr Street:
UAP t. - On the28th November, the honorable member for Hunter **(Mr. James)** asked if it was proposed to invite fresh tenders for the supply of commodities for the Rutherford Military Camp. I am now in a position to inform the honorable member that tenders for provisions,&c., for camps in Rutherford district have been invited, closing on the 7th December, 1939. The contracts will be operative for a period of six months as from the 1st January, 1940. Tender forms have been sent to all firms, &c, likely to be interested, and in addition the tenders have been advertised in several country newspapers circulating in the Rutherford district as well as in the metropolitan newspapers. inspection ofMilitary Uniforms. {: #subdebate-44-4-s4 .speaker-KVN} ##### Mr Street:
UAP -- On the 23rd November, the honorable member for Lang **(Mr. Mulcahy)** asked a question regarding the inspection of uniforms. I have now ascertained that the salary ranges of the staff employed under the Inspector of Stores and Clothing, who is responsible to the Chief Inspector of Army Stores for the inspection of militia clothing, are as follows: - Assistant Inspector of Stores and. Clothing, £438- £510; Overlookers, £312-£348; Examiners. £240-£288. The above rates are at present reduced by . £8 per annum by costofliving adjustment. At present, examiners, on appointment, receive an allowance of £8 per annum. Thus their actual current commencing salary is £240 per annum. Censorship Appointments. {: #subdebate-44-4-s5 .speaker-N76} ##### Mr Menzies:
UAP s. - On the 28th November, the honorable member for East Sydney **(Mr. Ward)** asked me the following question, *without notice: -* >Will the Prime Minister state whether all the appointments of persons who engage in censorship work are made by the Commonwealth Government, and whether the instructions they receive regarding the manner in which their *work* shall be carried out unissued solely by the Commonwealth Government? I desire to inform thehonorable member that censors are appointed by the Departments of the Army and Information, and receive their instructions solely from those two departments. Wage Increases. {: #subdebate-44-4-s6 .speaker-N76} ##### Mr Menzies:
UAP s. - On the28th November, the honorable member for West Sydney **(Mr. Beasley)** asked me a question, *without notice,* regarding a statement relative to wage increase claims attributed to the Chief Judge of the Commonwealth Arbitration Court. I have obtained the transcript of a discussion which took place in the Commonwealth Arbitration Court, in Sydney, on the 27th November, in the matter of a claim by the Metal Trades Employers' Association and others, and counterclaim by the Amalgamated Engineering Union and other organizations of employee. For the information of the honorable member the relevant portion of the discussion reads as follows : - >Extract from Proceedings before His Honour Chief Judge Beeby, Commonwealth Abitration Court, Sydney, 27th November, 1939. > > **Mr. Mundy** (representing employees). - **Mr. McDonald** said that he was prepared to forgo his claim for reduction of wages if we were prepared to forgo our claimfor higher wages and provided that Your Honour would give thorn a means of considerably reducing their' cost of production by introducing a number of new classifications. That cuts right across the claim we are making for higher wages, and it is cutting across the existing award to a considerabl e extent. There is quite a number of classifications that **Mr. McDonald** has asked to be inserted which would mean that a large part of the men would be working under very small margins. > > **Mr. McDonald** (representing employers). - I said that if the inquiry goes on, those are the matters that we should ask to be considered, but we suggest that other matters could stand over for a period until a little more of the light of day is thrown on the future 'position of the industry. The main matter, so far as I am concerned, is the one dealing with the proportion of apprentices. > > *His Honour, Chief Judge Beeby.* - So far as I am concerned, and I want to be quite frank about it, I am not likely in the present awkward position to interfere at present with wage rates. I do not think anybody expects me to do so. Of course, if the parties press me, I will go on and investigate the matter fully and come to a decision on their respective claims. But it seems to me very difficult for the court at this stage to contemplate any alteration in the wage rates either up or down. But there are some other matters that might call for adjustment, and might be adjusted as the result of a conference or as the result of hearing short evidence and arguments. I want to find out what those matters are. I am not barring anybody from goingon with their claim in respect of wage rates, but no man expects that the court will alter wage rates until we know what is going to happen. There are some matters that call for consideration. If we can confine ourselves to those, the case can be kept within a reasonable area. On that understanding, what are the matters that the union. attach particular importance to? That is what I am anxious to get at. > > **Mr. Mundy.** The trouble is that we do not know just what we have to meet. > > *His Honour.* - Let me put this to you. I know the difficulty of the position. A union advocate cannot face the members of his union and say. "We told the court that only this matter or that matter was important ". Do the parties think that it is worthwhile for us to have another talk around the table in the morning? What do the parties think of that? In a round-table talk, under my guidance, wemight he able toreach atemporary agreement to enable the industry to be carried on for the next six months. Do you think that is worthwhile? > > **Mr. Mundy.** At any rate, we are not adverse to that proposal. If Your Honour will bear with me for one moment, I want to point out the position in which we are placed. **Mr. McDonald** says, in effect, that although he is not asking that margins should be interfered with, he does say that he thinks those things that he put in in Melbourne should be dealt with. > > **Mr. McDonald.** That has been qualified this morning. We are prepared to accept His Honour's suggestion, but we think that the apprenticeship matter is one that should be dealt with. > > **Mr.** *Mundy.* We appreciate the position, and, as we said in Melbourne, if Your Honour thinks the present time is not opportune to pursue the claims, we are not going to raise objection to an adjournment until an opportune time does arrive provided the union's application for annual leave and the employers' claims in regard to the proportion of apprentices and in regard to casual labour are dealt with. > > **Mr. McDonald.** I do not mind if the claim in regard to casual labour is not dealt with. **Mr. Wright** will speak to his case in regard to the apprenticeship question. {: #subdebate-44-4-s7 .speaker-KRE} ##### Mr Sheehan:
COOK, NEW SOUTH WALES -- That is on the list for Wednesday. *His* Honour. - Yes. I think we had better have a talk to-morrow before we go further. I will ask the parties to meet me here at 10.30 a.m. . I will have some definite proposal to put before them. I did not have a definite proposal last time, because I had not reflected very much on the position, but to-morrow I will have definite proposals to put before you.We will adjourn now until half-past ten to-morrow, when we will meet in conference. If we do not achieve anything at the conference, **Mr. McDonald** will have to go on with his case to-morrow. Wheat Industry : Deferred Payments. {: #subdebate-44-4-s8 .speaker-N76} ##### Mr Menzies:
UAP s. - On the 16th November, the honorable member for Werriwa **(Mr. Lazzarini)** asked me the following question, *without notice: -* >In the arrangements that have been made for the acquisition of wheat, will deferred payments be made in the form of certificates, as previously, and will the banks be allowed to discount those certificates, thereby depriving the wheat farmers of part of their returns? The position is that the Australian Wheat Board is not authorized by the regulations under the National Security Act to issue negotiable certificates or scrip. I understand, however, that the bulk storage certificates issued in New South Wales are usually regarded as negotiable. Farmers' Debt Adjustment. {: #subdebate-44-4-s9 .speaker-N76} ##### Mr Menzies:
UAP s. - On the 23rd November, the honorable member for Barton **(Mr. Lane)** asked me the. following question, *without notice: -* >Will tlie Prime Minister have inquiries made regarding the distribution of the amount of £12,000.000 voted by Parliament for tanners' debt adjustment? Kas he noticed that in New South Wales the constitution of the board appointed to administer thu fund has been changed? Will he have particulars gathered From all States with a view to learning whether the fund has been distributed in the way intended by Parliament,' having regard particularly to an amendment which was inserted in the act providing- that farmers were to be removed from marginal land to more suitable urens!' I desire to inform the honorable member that the distribution by the State governments of the funds made available under the farmers' debt adjustment scheme has been watched carefully, and the Auditor-General for the Commonwealth has furnished certificates halfyearly in accordance with section 8 of the Commonwealth Loan (Farmers' Debt Adjustment) Act. The Auditor-General has certified that there has not been any breach by, the States of the conditions of the grant. No provision is made in the Loan (Farmers' Debt Adjustment) Act for the removal of farmers from marginal lands to more suitable areas. The Premier of New South "Wales furnished the Commonwealth Government with a draft of a bill to amend certain provisions of the Farmers' Belief Act s- 1932-1938 of bis State. The draft hill was examined by my colleague the Attorney-General, who advised that no objection could be taken by the Commonwealth Government to the provisions contained therein. The bill has been enacted by the Parliament of New South Wales as the Rural Reconstruction Act 1939.

Cite as: Australia, House of Representatives, Debates, 30 November 1939, viewed 22 October 2017, <http://historichansard.net/hofreps/1939/19391130_reps_15_162/>.