17th Parliament · 1st Session
Mr. Speaker (Hon. J. S. Rosevear) took the chair at 10.30 a.m., and read prayers.
Exports from South Australia.
– Is the Minister for Transport able to make a further statement, arising out of the interview which I have had with him on the subject, concerning the transport of apples by rail from South Australia to the eastern States?
– by leave - I have received personal representations from a number of South Australian Labour members, and yesterday the honorable member for Wakefield (Mr. Smith) asked a question, concerning the transport of apples by rail from South Australia to the eastern States. Inquiries were instituted immediately, and a report has been received from the Director of Rail Transport. In it, the Director advises that no restriction order has been placed on the movement of apples from South Australia to Queensland, but in view of the long haulage involved and the problems associated therewith it was considered that some clarity should be reached as to the correct distribution of this traffic, so that Queensland requirements could be met with the least possible problem to the transport authorities, having regard to the serious shortage of coal.
When the disposal of the apple crop was under the control of the Apple and Pear Board, all orders for transportation were made from one central source, and the result, from a transport point of view, was very satisfactory indeed. With the elimination of control by the Apple and Pear Board in New South Wales, Victoria and South Australia, orders for the transportation of apples interstate are now received from all firms and individuals interested, with the result that extreme difficulty is experienced in. determining the justification for the transportation sought. In order to reach a proper understanding, a conference was held between representatives of the Transport Department and the Con- troller-General of Food, at which it was intimated that the chairman of the Apple and Pear Board, Mr. J. B. Mills, had been requested to make a quick survey of the position in order to determine the production, the requirements of the various States, and the justification for transportation, particularly from South Australia.
It is expected that (this information will be available within a week. Meanwhile, in order to ease the position, I have arranged for the acceptance of limited consignments of apples for carriage by rail from South Australia.
I point out that the transportation of apples from South Australia to Queensland is an unsatisfactory arrangement, and ‘should not be necessary if apples were available at any point from which shorter haulage was involved. I shall furnish advice as to the result of the survey that is being made by Mr. Mills, as soon as this is available.
– Will the Minister for Commerce and Agriculture state what assistance has been rendered by the Government to the apple and pear industry of South Australia?
– The Government has given extensive assistance to the apple and pear industry in South Australia. I ask the honorable member to place his question on the notice-paper so that I may make a more detailed reply.
– During last week-end, several radio announcements were made in connexion with a fine scheme of housing which the Commonwealth intends to inaugurate, but so far no statement on the subject has been made in this Parliament. I have received correspondence seeking information as to whether or not plans are available, the manner in which it is intended that payments shall be made, how finance is to be provided, whether the houses are to be built by the Government or by private contractors, and a host of other question’s. Will the Minister for Labour and National Service make a comprehensive statement, in order that the public and the Parliament may be made acquainted with the details of the scheme?
– I shall make a statement before the close of this sessional period.
– The Minister for Labour and National Service has stated publicly that a number of houses is to be built throughout Australia during the next three months. Will this cut across or interfere with tho practice of the Department of War Organization of Industry, by reducing’ the number of permits which that department grants for the building of homes?
– There will not be any cutting across or overlapping. Permits will be issued in special cases, as usual, by the Minister for War Organization of Industry, but they will form a part of the quota fixed for each qua’rter.
– Will the Prime Minister assure the House that equal publicity space will be made available in all Government publications for the statement of the case both for and against the forthcoming referendum proposals, in order that the people may have an opportunity to consider both sides before voting upon the matter?
– I do not know why this question has been put to me. In all probability there will be a referendum bill. There is a practice which has been systematically followed . by all governments in connexion with referenda. There will be less cause to fear partisanship in Government publications than in non-Government publications.
– Has the attention of the Prime Minister been drawn to the Auditor-General’s alarming revelations of incomplete records and unsatisfactory features in connexion with departmental control of major contracts in the Department of Aircraft Production, defaults in relation to supervision in the Department of Munitions, defalcation, frauds, forgery, and theft in the Department of the Army, and unsatisfactory accounting and checking in the Department of Air? [f so, has the right honorable gentleman taken any action to deal with this repetition of the highly unsatisfactory state of affairs which was disclosed in the report of the Auditor-General that was tabled last year? Will the right honorable gentleman ask the Ministers concerned to furnish urgent reports on the comments of that officer, and make a statement before the rising of the House ?
– The , report tff the Auditor-General contains comments on some matters that are very much out of date. Action has* been taken by all the departments in respect of most of the matters mentioned in the last report. These occurrences, of course, are regretted; but defalcation is not new in Commonwealth services. Probably the administration cannot in time of war be as close to officers who are saddled with responsibility as would normally be the case I have read tho reports of the AuditorGeneral for very many years, and have never seen one which ha3 not directed attention to some defalcation. That i-e the function of the Auditor-General.
– Has the attention of the Prime Minister been drawn to the statement published in the Sydney Morning Herald last Tuesday, in which Professor Copland rehashed the whole of the academic theories which he propounded before the Summer School of the Australian Institute of Political Science, and said that, at the conclusion of this war, controls will continue to be necessary? Has the right honorable gentleman also seen the statement by Dr. Lloyd Ross in the Sydney Sun of Tuesday last, that one cannot live without bureaucrats? Are we to understand from those statements that, if the additional powers which the people are to be asked to confer on the Commonwealth at the proposed referendum are granted, the design for living which will be inflicted upon the Australian community will bc additional controls by bureaucrats ?
– Bureaucrats were not invented by this Government, nor have they emerged as the result of any policy which it has initiated. The particular bureaucrat who is the subject of the honorable gentleman’s first reference was a very able servant of previous governments, and his appointment by a predecessor of mine was, I feel sure, a first class one, justified by the capabilities of the appointee. As to the opinions of Professor Copland concerning a design for living, I am under no obligation to share them; but I confess that I would study much more deeply views advanced by Professor Copland than I would the generalizations of the honorable member for Wentworth.
– Can the Minister for War Organization of Industry say whether government publications on supercalender paper of various types go before the Book Sponsorship Committee for approval? If so, do they receive any sort of priority over literature that may, in other quarters, be considered quite equal to the government productions?
– The paper used in government publications is not the concern of the Book Sponsorship Committee. The control of paper is in the hands of the Minister for Trade and Customs, to whose attention I shall bring the honorable member’s question.
– Has the Treasurer seen statements by Mr. Turnbull, secretary of Hoyt’s Theatres Limited, and Mr. Bezant, of Western Suburban Cinemas Limited, that Hoyt’s Theatres Limited have taken a shareholding interest in Western Suburbs Cinemas Limited, which controls 24 theatres? Has permission been granted by the Capital Issues Board for this transfer of interest?
– I was not aware of some of the details mentioned by the honorable member, but I shall make inquiries and supply him with a complete answer later.
.- I move-
That the bill be now read a second time.
In introducing an earlier measure making similar provision in relation to invalid and old-age pensions, I outlined the reasons which prompted the Govern ment to depart from the principle of making periodical adjustments in the maximum rate of pension according to the variations of the price index number as ascertained by the Commonwealth Statistician. I also justified the Government’s action in dealing with the matter temporarily by means of a national security regulation. The remarks made in submitting that bill apply equally to the Widows’ . Pensions Bill, because, when the legislation for the introduction of widows’ pensions was before the House, it was decided that cost-of-living adjustments in regard to these pensions should be made in almost precisely the same manner as that in force for invalid and old-age pensions.
For the reasons indicated in the secondreading speech on the Invalid and Old-age Pensions Bill, therefore, the Government has decided to repeal those sections of the Widows’ Pensions Act which provide that the maximum rates of widows’ pensions and allowances shall be related to the cost-of-living variations. As in the case of invalid and old-age pensions, the standard rates of widows’ pensions and allowances are being advanced to the rates at present actually payable, thereby avoiding any reduction in the amount of pension or allowance available to the recipients.Future adjustment of the maximum rates of widows’ pensions and allowances will be determined by Parliament.
Under the existing provisions of the principal act, a widow, who has not attained the age of 50 years and who was granted a pension on the basis that she was maintaining a child under the age of sixteen years, can be deprived of that pension within a few weeks after the death of her husband, for the reason that her only or youngest child has attained the age of sixteen years, has ceased to be maintained by her, or has died. In such a case, the widow, although in necessitous circumstances, is placed at a disadvantage as compared with a widow of the same age and in similar circumstances who was not maintaining a child at the time of her husband’s death, for the latter may receive an allowance at the rate of £1 7s. a week for a period not exceeding 26 weeks immediately after the death of her husband.
In order to remove this anomaly, provision is made in the bill that a widow who, at the time of the death, of her husband or within 26 weeks thereafter, is not maintaining a child, is less than 50 years of age, and is in necessitous circumstances, may receive an allowance at the rate of fi 7s. a week for a period not exceeding 26 weeks immediately following the death of her husband. An allowance will not be paid, however, for any period in respect of which a pension has been paid.
The bill also makes provision for the repeal of section 42 of the Widow’s Pensions Act, which requires that a widow’s pension or allowance shall be cancelled in any case where the recipient is convicted twice within any period of twelve months of any offence punishable by imprisonment for not less than one month or is convicted of an offence punishable by imprisonment for twelve months. In order that no hardship may be caused in any case where a widow pensioner who is imprisoned has a child dependent upon her, provision is made for the payment to some person approved by the Commissioner or a deputy commissioner of the whole or any portion of the instalment of pension falling due during the term of the widow’s imprisonment for the benefit of the child. I feel sure that honorable members will appreciate the genuine desire of the Government to improve still further the social service legislation, and will therefore co-operate in the passing of this measure.
Debate (on motion by Sir Frederick Stewart) adjourned.
Bill presented by Mr. Scully, and read a first time.
– by leave - I move -
That the bill be now read a second time.
This bill is one of three necessary to carry out the policy of the Commonwealth Government on payment for wheat to growers in Australia. Two other bills are closely associated with it - one, to repeal a tax imposed when the return on wheat exceeded 3s. lOd. a bushel, f.o.b., bagged basis, and another to make consequential amendments to restore the position established by the Wheat Industry (War-time Control) Act of 1940. The Wheat Subsidy Bill provides for a subsidy on wheat acquired by the Commonwealth, and covers the 1942-43 crop and subsequent crops of wheat in Australia. It gives effect to the Curtin Government’s quota plan for wheat, which has come to be known as the “ Scully Plan “. Under this plan, 4s. a bushel was payable to growers for bagged wheat at growers’ sidings, and this payment applies to a quota of 3,000 bushels for each grower.
Recently, a Commonwealth award was made covering harvest-workers. This had the effect of increasing harvesting costs, and, after an inquiry into those increased costs, the Government decided to add 1-Jd. to .the advance paid to wheat-growers to cover that increased cost. The amount payable on quota wheat for this season, therefore, becomes 4s. ltd. a bushel. Besides the quota wheat, there is surplus wheat which consists of the quantity above 3,000 bushels acquired from any wheat-grower. This wheat goes into the same pool, and is sold as a part of the pool. Growers will receive the ordinary pool return for surplus wheat. The effect, therefore, is to divide the contents of any wheat pool into two distinct classes of wheat. First, there is quota wheat on which the Government pays 4s. 1 1/3d. at sidings shortly after delivery, and, secondly, there is the surplus wheat on which advances are made in the normal way according to the prospects of the pool concerned. As the expenses of the pools have been about lOd. a bushel, it will be seen that the return on quota wheat must approach 5s. a bushel if the liability of the Treasury for the advance, plus the pool expenses on this wheat, is to be cleared.
With surplus wheat, on the other hand, there is no possibility of loss to the Treasury, since growers will receive the net proceeds of. the pool. They will get the actual market return for their crop after the expenses of storing and selling are deducted. Before leaving this point, I should like to make it clear that all wheat each season goes into a separate annual pool, and each bushel of wheat in that pool will bear its fair share of the costs. It is necessary to explain this again, because it is sometimes erroneously said that the Government intends to make surplus wheat bear all the costs of the pool.
Payments provided for quota wheat are well above the expected receipts from existing pools and, as a result, it is expected that there will be a loss on quota wheat. This bill provides for that loss, and subsidizes the wheat-growers to the extent of the loss.
It is not possible to say at present how rauch will be involved. The quota payment operated for the first time last season, and payments of 4s. a bushel at sidings have been made on the 1942-43 crop, which makes up No. 6 pool. Payment at 4s. 1 1/3d. is now being made for the 1943-44 crop in No. 7 pool.
It is the practice of the Australian Wheat Board to credit to the current pool the proceeds of wheat sold for the manufacture of flour to be consumed in Australia during the year concerned. All other sales made in any year are credited to the oldest pool operating. This course is necessary because, otherwise, it would be impossible to bring to finality any pool until the last bushel of wheat for that particular season had been sold. As the seasons went by, we would have a number of pools all active, with the difficult task of allocating the sales made between these, pools. As it is, however, the oldest pool is cleared first, and can then be completed. At any time, therefore, the Australian Wheat Board will be selling wheat from two pools only. The sales for local flour, which involve the payment of flour tax, are credited to the current season’s pool, while all other sales are credited to the oldest pool in existence.
The quota plan embodies control of the wheat industry which was introduced in 1940. Wheat can be grown only on a registered wheat farm by a registered wheat-grower. This principle was adopted to prevent an uncontrolled extension of the area under wheat in Australia - an essential feature of stabilization. Of course, some deviations are necessary in circumstances brought about by war.
Transport difficulties, and the need to provide wheat close to the consumption point, have made it necessary to try to increase the production of wheat in Queensland. Consequently, temporary licences have been granted in that State to farms which were not growing wheat during the basic period taken for registration. This, however, is action taken to meet a war demand. We do not know what may have to be done in the future to meet special demands, but the principle remains, and the effect of the quota plan is to alter the basis on which payments are made to growers.
Previously, advances were made to growers on a business basis, and the Commonwealth Bank advanced money to the Australian Wheat Board on the guarantee of the Commonwealth. This money was used to pay advances to wheat-growers in anticipation of sales of the crop. The Commonwealth was liable for payment of 3s. lOd. a bushel for a crop of 140,000,000 bushels but, subject to this, growers were to get the exact return from the pool concerned. With growers’ costs rising at that stage of the war, and having regard to the acknowledged right of growers to security and to a better deal for the wheat they produced, the present Government decided that this system was totally inadequate. The Government decided to attack the problem at its most vital point - the basis of payment. It was here that the previous Government’s plan had principally failed to give a reasonable return to producers. Accordingly, the present quota plan was introduced. The basis of payment was improved so that all -growers should benefit, and small growers should not suffer bankruptcy because of the poor return offered and the protracted period before payment could be expected. Not only was the previous limitation on the extent of the guarantee cancelled, but provision was made for an immediate payment on a large part of the total crop, thus providing a good return and security for growers. These benefits of the plan have been recognized by growers. Under the quota plan, every grower can expect -to get more than the pool return for a quota of 3,000 bushels, and will still get the pool return on the excess where they deliver more than 3,000 bushels to the Australian Wheat Board. In determination of the quotas, it is a fixed principle that no grower shall get more than one quota. There are instances of men who own more than one farm, but a quota is not allocated for each farm. Farmers and not farms is the basis. The grower must be licensed and must grow wheat on a registered wheat farm.
Provision is made to cover special cases. Wheat is, next to wool, our biggest primary industry, and the crop is grown under widely varying arrangements as to ownership. The various share-farming agreements, partnerships, the complications of family arrangements, and the entangling interests as between husband and wife, make it impossible to work on the basis that every person with a licence or every holder of a registered farm shall get a full quota. In many cases, the persons concerned are not fully-fledged wheat-growers, but they do hold an intermediate position. It will he noticed that the bill provides for a reasonable discretion to be exercised by the Commonwealth Minister in charge. This is necessary to cover the large number of individual cases and the numerous variations of the manner in which, wheat is produced. It would be impossible to lay down in the act a hard-and-fast method of allocating the quotas so that it should not confer undeserved benefits on some whilst keeping benefits from others who do deserve them.- Many cases have occurred in which growers were trying to vary their practice so as to get additional quotas for themselves or for members of their families. If these devices succeeded, we should shortly have nothing else but quota wheat and, at the same time, a great deal of discontent among a large number of growers. These men have co-operated willingly in carrying out the spirit of the plan and naturally nothing incenses them more than to find that some unscrupulous grower has derived a benefit from sharp practice. So it is necessary to deal justly with all cases. In that way we may hope to keep the confidence and support of growers, and the confidence of the growers gives the real basis for the success of the plan. This in turn means that a hard-and-fast plan cannot be laid down; it must be flexible enough to deal with varying individuals. Therefore, somebody must be able to show discretion where it is required. We are not trying to fit wheat-growers into a rigid scheme, but we are trying to fit a scheme into established wheat-farming practice. The method of dealing with these cases has been laid down and growers have been given the right to appeal against the quotas allotted to them. As a result, allocations are made in each case according to the merits of that case. In numerous cases which get away from the simplest one, and where the owner is not also -the grower,- less than full quotas may be granted. Where several persons are involved, it is often necessary, in order .to deal fairly with all, that more than one quota be granted for the particular licence concerned ; so, in some cases, two persons may get one and a half quotas between them. These problem cases are numerous, but they form only a small proportion of the total number. In dealing with them, the wheat-growers themselves play an important part. Local committees exist throughout the wheat areas, each consisting of two prominent wheat-growers and an officer of a State government. They report on the various cases. Then there is an appeal committee consisting of two wheat-growers and the State officer in charge. These State committees of review make recommendations on appeals, and the result is that wheatgrowers play an important part in the administration of the stabilization plan.
I wish to emphasize the part played by the growers themselves for several reasons: - First, to point out the way in which they co-operated in all stage? in carrying the government policy into effect; secondly, -to show that the Government, in its wheat policy, is not imposing a . bureaucratic control on the industry, but is enlisting the services of the growers in the control of their own affairs; and, thirdly, to make it clear that the system adopted ensures that every grower shall receive a fair deal and shall have his particular case reported on by fellow growers of his own district and by wheatgrowers’ representatives who have a good knowledge of practical farming difficulties. The method adopted of enlisting the co-operation of growers has proved most successful. It has done a lot to meet the growers and allows them to put forward their views fully on the various details of the plan. Without this cooperation from growers, administrative difficulties may have been so great as to cause a serious dislocation of the system of control. In addition to the co-operation of growers, we have in this plan the cooperation of State governments. The detailed work of administration in each State is carried out by State officers. This, in turn, has the advantage of enlisting the co-operation of the State departments concerned with wheat-growing. It enables the “Wheat Industry Stabilization Board to obtain the assistance of State officers who know their wheat-growing districts thoroughly and have an extensive acquaintance with growers themselves.
I have been asked recently by some honorable members for a statement on wheat pools that are now operating. As it is relevant to this measure, I propose to give the House a survey of current pools. Three pools are active, and they cover the crops for 1941-42, 1942-43, and 1943-44. Tho first pool - No. 5 - is nearing finality alter more than two years of operations; No. ti pool after more than a year of operations still has about half its life before it; whilst No. 7 pool, covering the crop just harvested, is only commencing operations. The following is the position of pools as at the beginning of this month - March, 1944: -
No. 5 pool covers the 1941-42 crop from which 153,000,000 bushels was delivered to the Australian Wheat Board. All the wheat in the pool has been sold, but payment will not be received until the quantity remaining is shipped, either as . heat or as flour, during the next few months. The middle of the year may see the completion of shipments and the pool transactions will be adjusted soon after that. Payments in No. 5 pool amount to £31,300,000. So f:>r £26,900,000 has been paid to growers, with expenses absorbing another £4,400,000. The receipt? of the pool have been £29,300,000, and there is an overdraft of £2,000,000. This overdraft is being reduced as shipment is made, and a final advance to growers will be made. The amount cannot be estimated accurately at present as adjustments are still to be made, but it is likely to be 3d. or a little more a bushel. The payments to date are equivalent to 3s. 7d. a bushel less freight for bagged wheat.
No. 6 pool covers the 1942-43 crop, and the Wheat Board received 143,000,000 bushels of this wheat a little over twelve months ago. So far 34,000,000 bushels has been sold and delivered to cover local flour needs during 1943. Sales have also been made for forward delivery, but these deliveries will not take place for some months, since deliveries from No. 5 pool are to be made first. In the latter half of the year, these deliveries will be in full swing, so that, with export demands and the local produce trade, it is expected that the quantity in the pool will be reduced to 30,000,000 bushels by the end of the season. Payments made in this pool amount to £28,500,000 and receipts are £6,300,000. The overdraft is just over £20,000,000. Growers have received £23,700,000 in advances, with the expenses account showing £4,800,000. There is still more than 60,000,000 bushels to sell from this pool, whilst recent sales have to be converted into flour and shipped. As a result it is too early to forecast the final return from the pool. With both quota and non-quota wheat in the pool a loss is expected on quota wheat, but a substantial additional payment will be made on non-quota wheat. There are 43,000,000 bushels of non-quota wheat, and another advance on this of ls. a bushel has now been approved. This means an additional distribution to growers of more than £2,000,000. The loss on quota wheat, of course, will be met by the Treasury. For quota wheat, which was 70 per .cent, of the pool, 4s. a bushel net was paid to growers, and, with charges for storage, handling and interest added to this, the payment is equal to about 5s. a bushel f.o.’b. This is substantially above the return likely on the wheat concerned, and the Government will bear the loss. Non-quota wheat, on the other hand, will receive the full payment from the pool after the necessary expenses are deducted.
No. 7 pool covers the 1943-44 crop which has just been harvested. The Australian Wheat Board has received 94,000,000 bushels into this pool. Sales made from it during the season will cover local flour needs only. With these sales estimated at 34,000,000 bushels, there will be 60,000,000 bushels left in this pool to carry over to the next season.
Payments are still being made for the wheat delivered, and it seems that the quantity of quota wheat will be almost 80 per cent. The board’s accounts show payments of £15,500,000 to growers, and expenses of £250,000, whilst sales are £500,000. These figures, of course, indicate that transactions in the pool are not far advanced, and payment of the first advance to growers is not yet finished as payment is still being made for wheat delivered late.
It should be noted that overdrafts guaranteed by the Commonwealth for these three pools amount to £70,000,000, and there will be still more to come. The actual liability at any given time, of course, did not reach the total after allowing for receipts of the pools, but, at the present time, overdrafts outstanding for wheat total more than £37,000,000. In the individual pools the same position is seen. There is an overdraft in each pool which is operating, and it is not correct to say that anything is owing to wheatgrowers. At a later stage, there will be receipts in each to permit of additional payments, but wheatgrowers have received more in payments than the return to date for wheat sold, and the Commonwealth is contriving to finance payments as time makes clearer the prospects of each pool. Honorable members will note that the Commonwealth incurs a considerable liability in guaranteeing these pools so that advances shall be made to growers. Besides this, the position of each pool is kept constantly under review so that additional advances shall be made as quickly as possible. Growers, naturally, are anxious to get their money quickly, and, equally naturally, tend to take a rather more optimistic view of prospects than is possible for a government which has to guard against losses on sales to be made in future. But between the two views we do manage to strike a reasonable basis which treats the growers fairly.
Debate (on motion by Mr. Archie Cameron) adjourned.
Bill presented by Mr. Scully, and read a first time.
– by leave - I move -
That the bill be now read a second time.
This bill is one of three concerned with the Government’s quota plan for wheat payments. It is complementary to the Wheat Tax (War-time)Repeal Bill 1944, and it is necessary because of the effect of that bill on the Wheat Industry (War-time Control) Act. It amends various sections of the Wheat Industry (War-time Control) Act 1939-1940. The sections’ affected are those concerned with the application of moneys to be received from the tax on wheat in years when wheat prices are higher than the guaranteed price fixed by a previous government. As a bill has been presented to this House to repeal the wheat tax, the provisions for applying the money from that tax will be inoperative when that bill becomes law. Accordingly, this bill proposes their repeal. By an amendment contained in the Wheat Industry (War-time Control) Act, No. 70 of 1940, it was provided that the amount obtained from flour tax, less certain deductions, should be added to the amount obtained from the wheat tax. After this, the total was to be used, first, to repay to the Commonwealth Bank the amount due for advances made to the Australian Wheat Board, and, secondly, to build up a fund from which to meet the payments made necessary by the guaranteed price of 3s.10d. a bushel for a crop of 140,000,000 bushels. The guarantee for a crop of 140,000,000 bushels is now replaced by the quota plan which provides for a higher guaranteed price for quota wheat. Any loss resulting from the quota plan will be met by the Treasury, and so the fund composed of the combined flour tax and wheat tax receipts will not be required. The bill repealing the wheat tax will be presented to the House, and, with the wheat tax disposed of, it will be necessary to decide how flour tax receipts shall be used. This will be done by reverting to the position established by the Wheat Industry (War-time Control) Act, No. 84 of 1939. In effect, this bill means that the moneys from flour tax will be paid to the credit of the Australian Wheat Board’s account with the
Commonwealth Bank, as an offset against advances made by the bank. This is a provision, in the rather unlikely event of the board not having an overdraft with the Commonwealth Bank, for payment to be made direct to the growers concerned. In practice, however, it is safe to assume that, when the funds do become available, there will be an overdraft for the pool concerned and that the money will be used to reduce that overdraft. The result is that flour tax will reduce the overdraft owing by the Wheat Board to the Commonwealth Bank for advances. This will in turn increase the amount which ultimately will be available for distribution to growers from the pool. Flour tax will thus become a part of the receipts of the wheat pool, and growers will receive the benefit in the shape of compensation, at a higher rate than they would receive otherwise.
Debate (on motion by Mr. Abohie Cameron) adjourned.
Bill presented by Mr. Scully, and read a first time.
– by leave - I move -
That the bill be now read a second time.
The wheat stabilization plan was introduced by a previous government in 1940. It provided for a guaranteed price of 3s. dOd. a bushel f.o.b. porta for bagged wheat, for a crop of 140,000,000 bushels. It was recognized that wheat prices would vary through the years. The plan provided that growers would receive payment on a basis of 3s. lOd. a bushel less freight for low-price years, although this would exceed the actual return from the crop. Against this, a tax was imposed on wheat so that, in seasons of high prices, half the excess amount would go to growers and the other half to a fund to be retained to make up the deficiency in seasons of low prices. Wheat-growers, therefore, would be providing a reserve in good years which would be used for their benefit in lean periods. The tax has not operated. The first season to which it was to apply was that of 1941 to 1942, on wheat placed in No. 5 pool. The operations of this pool are not yet completed. The full quantity of wheat in the pool has been sold as a result of heavy orders received lately by the Wheat Board, but several months will elapse before the flour can be manufactured, deliveries made, and payment received. Until then, the result of the pool will not be known definitely.
Later pools still hold a considerable quantity of wheat for sale, and, unlike No. 5 pool, are pools to which quota payments apply. In view of the quota plan, it is not intended that the tax shall continue, and the Government has also decided that wheat-growers shall get the full return from No. 5 pool. I have said that No. 5 pool is not completed, but it is clear that it will return more than the guaranteed price of 3s. lOd. a bushel f.o.b. for bagged wheat, and the present bill will ensure that growers get the full return from the pool and are absolved from the tax which would be paid under existing legislation. The effect of the bill, therefore, is to abolish the wheat tax. The reasons for its abolition are, first, that the quota plan does away with the need for that tax for No. 6 and later wheat pools, and, secondly, that wheat-growers are to be given the full return from the 1941-42 season’s wheat in No. 5 pool.
Debate (on motion by Mr. Archie Cameron) adjourned.
– As chairman, I present the first report of the Printing Committee.
Report read by the Clerk, and - by leave - adopted.
In committee: Consideration resumed from the 22nd March (vide page 1827).
Clause 7 -
Section sixty-six of the Principal Act is repealed and the following section inserted in its stead: - “66. - (1.) Where a taxpayer sets apart or pays in the year of income any sum . . . “ (2.) For the purposes of this section, the Commissioner shall determine, in respect of any sum so set apart or paid after the thirtieth day of June, One thousand nine hundred and forty-three - (n.) the number of employees for whom, at the date on which the sum was so set apart or paid, the fund provided present or future individual personal benefits, .pensions or retiring allowances;
Upon which Mr. Fadden had moved by way of amendment -
That, in sub-section (2) of proposed new section sixty-six, after the word “ fortythroe “ the following words be inserted : - “ or the last day of the accounting period, if any, adopted under this Act in lieu of the income year ending on the thirtieth day of June, One thousand nine hundred and forty-three “.
– The contention has been advanced that this clause will operate unfairly in respect of organizations or companies which have set aside a proportion of their income for the benefit of employees. The leader of the Opposition (Mr. Menzies) stated that one company with 5,200 employees was paying an amount equal to 12-J per cent, of the salaries or wages of such employees to a provident fund, and . that if this clause were agreed to the employees would be at a disadvantage. I am in favour of the encouragement of provident funds, but not of measures which would enable certain classes of taxpayers to avoid the payment of income tax which should legitimately be borne by them when other sections of the community are carrying a heavy tax burden. I shall not oppose this clause. It provides that an organization or company may set aside up to £100 a year or 5 per cent, of the annual salary of the employee on whose behalf it is set aside. That sum would be 10 per cent, of the salary of an employee in receipt of £1,000 a year. The limit would apply only in the case of an employee in receipt of £2,000 a year. In respect of employees on salaries up to that sum, a company may still subsidize as at present. All of the employees of the company referred to by the Leader of the Opposition on salaries up to £800 will still be able to have the 12£ per cent, set aside by the company on their behalf. That is not at all unfair. At a time when all sections of the community are required to carry a heavy financial burden, nobody should be permitted to escape a reasonable impost.
– The most objectionable features of the proposal are its retrospective nature and the fact that it deals with the position generally, having regard to specific circumstances. A provision was included in the Queensland Income Tax Assessment Act defining the class of superannuation fund which should be exempt from the provisions of the act. That necessitated a searching inquiry regarding the bona fides of each scheme and the degree to which the employees were protected under it. A similar provision is desirable in connexion with the clause now under consideration Whilst certain people are endeavouring to reduce their income tax as much as possible by unfair or doubtful means, some of the bona fide superannuation and provident schemes in Australia should be encouraged, particularly by a Labour government, because we should encourage the class of employer who is prepared to give the maximum possible consideration to the welfare of his employees. It is quite unfair to rope in everybody because would-be lawbreakers are included in the tax-paying community. The provision contained in the Queensland act should be examined. I think that it states that the section does not relate to funds or schemes which in the opinion of the Commissioner are bona fide. That act provides a formula for application to bona fide schemes for the purpose of protecting the interests of employees, ensuring that the schemes themselves shall not be camouflaged, and insisting upon contractual obligations on the part of the employer to the employee. Apart from those details, the preservation of the economic well-being of this country must take precedence over the mere collecting of revenue. An important principle must be preserved in superannuation: and provident funds. Employers should be encouraged to establish them. During the last twelve months, the Parliament has considered a variety of social welfare measures, to finance which the Government is appropriating a sum of £30,000,000 annually. Is it the policy of the Government to eliminate the provident funds established by private enter. prise in order to consolidate the national fund? I appeal to the Treasurer to reexamine this matter.
Whilst I recognize that Commonwealthrevenues must be protected against acts of fraudulent misrepresentation and against the creation of non-genuine funds, this provision is not only unfair but also unwise. I object to the proposal also to make this provision retrospective. The Treasurer should let bygones be bygones. If the Commonwealth revenues have been affected by the creation of provident funds, the Treasurer must not lose sight of the fact that revenue will also be affected by discouraging them. Old-age pension payments are increasing, and the Government’s social welfare schemes require large sums of money. Consequently, private employers ‘should be encouraged, rather than discouraged, to establish provident funds for the benefit of their employees. The Treasurer should adopt the suggestion made by the Leader of the Opposition last night that the schemes that were in existence at the outbreak of war in 1939 should be exempt from this provision. The fact that they were then established and have been continued on a sound financial basis is evidence of their bona fides.
.- Although I do not desire to flog matters that were mentioned last night, I cannot resist this opportunity to refer to the fact that the Treasurer (Mr. Chifley) adopted an extraordinary pose, appearing to regard the employer who showed a worthy desire to treat his employees generously and liberally, as a .potential burglar of the Treasury. I strongly deprecate the introduction into private schemes of industrial welfare the wretched “means test” that has been desecrating the social services controlled by the State.
– They were desecrated also when the honorable member was Minister for Social Services in a previous government.
– Last night the Treasurer said that, after all, only a few highly paid executives would suffer under this provision. Even while he was making that statement, we dis covered that he made an error in his assumption that the classical illustration that he gave was identical with the case cited by the Leader of the Opposition (Mr. Menzies). We found that there were at least two companies in Australia that were employing more than 5,000 persons, many of whom would be affected by this provision.
– I do not think that we did.
– The Treasurer indicated that the parent company which he had in mind was of American origin, but the Leader of the Opposition asserted that the company to which he referred was of British origin.
– Quite so!
Sir -FREDERICK STEWART.- A few years ago, I had the privilege of spending some days in the home of the head of the Cadbury organization at Bournville, England. I examined the social welfare schemes that the company has undertaken for the benefit of its employees. As one who is not without some interest in the welfare of the working class although I do happen to sit on this side of the chamber, I can only say that I wish that the spirit of Bournville was operating in the industrial life of Australia. But what Cadburys have done for their employees would be discouraged under the limitations proposed in this measure.
– Did Cadburys set aside more than £100 for each employee?
– Yes, with the various amenities that have been provided. The Leader of the Opposition suggested that in order to prevent an injustice being done to schemes which have been in operation for some years and to which the accusation of attempted evasion of taxation cannot be applied, those which were established at the outbreak of war in 1939 should be exempt from this provision. The Leader of the Australian Country party (Mr. Fadden) suggested, as an alternative, that this provision should not have any retrospective application. Whilst either of those proposals would be better than the provision itself, I am not one who believes that we should suspend, even in war-time, social service, schemes or discourage industrial leaders who are prepared to establish, even at this stage, provident funds for their employees. As the bill in general and this clause in particular already vest the Commissioner of Taxation with considerable discretionary power, the next short step would be to grant him absolute discretion in connexion with this particular provision so that, in the exercise of that discretion, he might take adequate steps to prevent the spoliation of Commonwealth revenue by the creation of these funds for the sole purpose of evading taxation. At the same time, I direct attention to the fact that deductions, even those proposed under this clause, will apply only to schemes which have a definite legal status and in which the employees of the taxpayer have a vested interest.
The altered provisions of section 66 will apply to contributions made to provident funds after the 30th June, 1943. Where a part of a contribution to a fund is disallowed owing to the operation of the limitation of £100, or 5 per cent., of the employee’s annual remuneration, sub-section 5 will entitle the taxpayer to recover from the fund the amount by which his income tax and any war-time company tax has been increased by the disallowance. If, however, on the 2nd March, 19441, the fund is insufficient to meet the amount that the taxpayer is entitled to recover from the fund, sub -section 6 provides that the amount of the insufficiency will be an allowable deduction. Sub-section 7 will apply in those cases where the taxpayer is under a legal obligation to contribute to a fund for the provision of benefits for employees. The sub-section will release the taxpayer from his legal obligation to the extent to which the contribution would have been allowed as a deduction under the repealed section, but is not allowed under the section as altered but only up to the 2nd March, even though payments, substantial or otherwise, were made from a fund to an employee who has retired since that .date. This bill, if passed in it3 present form, will absolve the taxpayer from any legal responsibility to continue the contributions on the old basis; but that fact will not make void his legal obligation after the 2nd March. The Treasurer should recognize that, in fairness, those circumstances should be met by substituting for the 2nd March the words “ the date on which this measure becomes law “. I commend that suggestion to the Treasurer for consideration.
.- I support the proposed new section. Like the honorable member for Richmond (Mr. Anthony), I fail to see that a large number of superannuation schemes will be placed at a disadvantage by the proposals of the Government. In comparatively few cases will the full amount suggested, namely, 12^ per cent., not be available, as the maximum amount of £100 allowable would enable an allocation of 12^ per cent, on incomes up to and including £S00 a year. Even when a person in receipt of an income exceeding £2,000 a year is involved, the basis of 5 per cent, will operate. I do not favour retrospective legislation, because I believe that the principle is wrong. This provision will have effect as from the 1st July, 1943. That retrospection has the same effect as all our taxation legislation, in that it begins to operate from the commencement of the current year of income. Consequently, its operation cannot be more harsh than our current taxation legislation. The proposed new section is wise. The fears expressed by members of the Opposition - I hope sincerely - that ordinary employees will suffer some disadvantage will not have any substance in fact.
– Although the honorable member for Perth (Mr. Burke) agreed with the contentions of the honorable member for Richmond (Mr. Anthony), he did not consider that many firms would be affected by this provision. My approach to this subject is that, even if only one firm be affected, the proposal is unjust. I do not for one moment contend that the net should be so small as to catch some and not others; but, in casting its net, the Government has unfortunately missed its mark. In order to catch one rogue, it will catch 99 honest men. That is reprehensible. If some persons have sought to evade the payment of taxes or have built up a racket in this matter, there are ways of dealing with them, and I shall be pleased to assist the Government to catch them. But the Opposition will not help the Government to pass this provision. Every modern and progressive industry has introduced a superannuation scheme for the benefit of its employees. That the Treasurer of a Labour government should discountenance those funds is a matter that puzzles me. The establishment of these funds should be encouraged. If the Treasurer seeks to prevent private enterprise -from establishing superannuation or -welfare funds for the benefit of employees he should say so, so that we all shall know where he stands. However, we are concerned mainly with the retrospective effect of this clause. To apply a provision such as this retrospectively is definitely wrong. The honorable member for Perth (Mr. Burke) said that retrospectivity applied generally in taxation measures; but surely this proposal is in a different category. The honorable member’s experience may be as he stated, but I point out that this clause applies to funds set up after June, 1943, and that already organizations will have set aside funds based upon the old law. “We are well into the current financial year, and these funds will not be recoverable. Although I could understand the Treasurer enforcing a provision of this nature in respect of firms which were violating common decencies by endeavouring to evade their tax liabilities, these firms which have long established welfare and superannuation schemes and have accepted the law as it stands, should be given some benefit. We on this side of the chamber shall do all in our power to bring to justice those individuals who are breaking the law, because we do not condone sharp practices; but we ask the Treasurer to have some consideration for organizations which in the past have observed the law and have attempted to make conditions better for their employees by establishing superannuation and welfare schemes.
.- I am opposed to the whole principle underlying this new section. I believe that the Government is pursuing an unsound policy which will have damaging repercussions throughout our entire industrial and economic fabric. I say that because I believe that once again, in order to meet a difficulty which has arisen solely as a
Treasury administrative problem, the Government is adopting a course which will have damaging consequences upon industry. Is it not a most desirable thing that in efficiently conducted organizations, the future of employees who have rendered long and loyal service should be safeguarded by schemes such as are referred to in this amendment? I know that the view held by some honorable members supporting the Government is that the effect of this amendment will not be to reduce the amount that is payable to the great mass of employees in these undertakings, but that is a very superficial argument because one effect of legislation of this nature will be to discourage the introduction of welfare fund schemes where they are not in existence to-day. Once a government indulges in interference of the type that we find in this measure, it is difficult to predict just where it will end, and the enactment of obstacles to developments of this nature does a great disservice to the working community of this country. There are only two classes of cases in which it could be argued legitimately and soundly that such action was necessary. The first class includes cases in which it can be shown clearly that abuse is taking place in that highly placed executives are putting aside disproportionate sums for their own future benefit. No doubt that is the type of case which the Treasurer (Mr. Chifley) is endeavouring to meet. The second class includes cases in which an organization has a virtual monopoly of the Australian field, and by charging unreasonable prices for its products, is able to pay to its employees benefits which are out of all relationship to corresponding benefits enjoyed by the rest of the community. In regard to the second class of cases, the position can be met by stable price-fixing measures, and it seems to me that the other cases to which I have referred, also could be met without damaging the general structure of social welfare and superannuation schemes. Too frequently we find that to meet a difficult problem which has cropped up, the Treasury is inclined to indulge in retrospective action of this kind, which goes far beyond the requirements of the problem that it is trying to solve. Recently in this chamber, I referred to action taken some time ago in regard to insurance policies in respect of which premiums were paid by husbands in favour of their -wives. Believing that abuses were taking place, the Treasury took action to make the proceeds from these insurance policies form a part of the estate of the husband upon his death. Although that action met the problem to some degree, it also has had the effect of discouraging a most desirable practice which was becoming quite a regular feature of the domestic security of this country. That was one illustration of a Treasury measure, designed to meet a particular administration difficulty, having quite damaging effects far outweighing the good which it accomplished. This proposed new section is another instance of that practice. I regret very rauch that the Treasurer has found it necessary to introduce this provision, because I believe that the expansion of superannuation and welfare funds will be even more desirable and necessary iii the post-war period, if we are to have that era of full employment of which we are assured by Government supporters. A great weakness which is becoming evident to-day, is that when there is a period of full employment and there is no threat to the security of a worker by the presence of a body of unemployed people who are willing to take his job if he does not give efficient and loyal service, there is - and it is a sad commentary on the state of mind of some citizens of this country - a degree of slackness involving absenteeism and poor service, which does not offer much hope of improved living standards in the post-war period. If that weakness can be overcome by the introduction of schemes which provide rewards for loyalty, long service, and good attendance, that is something which this Parliament should encourage.
In regard to the restrospectivity of this provision, there again the effect will be to create an atmosphere of uncertainty and discouragement amongst companies which, although they may not have these schemes in operation at present, are considering their introduction. A company has to prepare its budget for a particular year, and included in that budget, there may be provision for a welfare scheme of the type referred to in this clause; but now the Treasurer seeks to make this imposition retrospective, and it does not necessarily follow that even this will be the limit of the Treasury’s action. In these circumstances, companies will feel that they can no longer be certain that the provision which they make at any given time in the light of existing legislation, will be sufficient to meet the’ contingencies that they desire to cover, and I repeat we are introducing an element of uncertainty and discouragement, which will not foster the schemes of the kind we desire to see established throughout Australia. Therefore, I join with other honorable members who have expressed dissatisfaction with this proposed new section. I believe that the Treasurer is taking a narrow and short-sighted view, and one which will not render the best possible service to the community.
– This provision affects the existing taxation structure of this country. It has nothing to do with the “ pay-as-you-earn “ principle. I had considerable experience of provident funds in the ‘twenties, when I was preparing a national insurance scheme for presentation to Parliament in 1928. I found that both employers and employees generally feared that something might be done by the Government to jeopardize the benefits which already were enjoyed under existing provident schemes, and which were very much greater than those which could be hoped for under a general scheme. At that time, of course, taxation was comparatively light, and there was no incentive to introduce provident schemes to evade taxes. Those schemes were introduced primarily to make certain that the entire business organization, of which they were an essential part, should work smoothly, and to engender in the employees confidence in the future. The manner in which the provisions of section 66 have been interpreted has been regarded generally as satisfactory, and, so far as I can understand the proposed substitute section, the Treasurer (Mr. Chifley) is quite willing to ensure that bona .fide schemes shall continue to be treated as they have been in the past. It is sometimes difficult to understand the verbiage of taxation measures. For instance, in one sub-clause ..here are three negatives in two lines. I fear that the taxation officers ‘ themselves will develop a headache in trying to understand the meaning. If the Treasurer will say that the future course of action with regard to bona fide schemes will be along the lines pursued in the past, further argument would be obviated. Should it be considered necessary to put the matter beyond doubt we might adopt the suggestion of the Leader of the Opposition that funds which were established or being prepared before the war, when there was no question of attempting to evade heavy taxation, should be substantially entitled tO’ such consideration. If that were don*, much of the objection to the limitation of the system would disappear. Apart from that, it seems dangerous to pass retrospective legislation in regard to taxation. In the past, circumstances have arisen which have necessitated retrospective legislation in order ito meet attempts at fraud. I do not know of any retrospective action in regard to taxation which was not forced on the Parliament by attempts to defraud the revenue. No one was more insistent on this than was the right honorable member for Yarra (Mr. Scullin), whose knowledge of taxation law is exceptional and who, I add., has always adopted a consistent attitude. The position should be the same in this connexion; any retrospective provisions of this legislation should be restricted to cases in which there has been a deliberate attempt to avoid taxation. If that were done, and the Treasurer would say that the clause means just that,, the position would be clear, and much of the feeling in regard to this matter would disappear.
.- The proposed new section that we are discussing has been rendered necessary in order to prevent what can only be described as the abuse of a most generous provision in the act. The authorities in the United States of Amenca were confronted with the same difficulty, particularly when taxation rates rose to high levels. They appointed a special committee to investigate abuses.
The committee reported that the concession provided for in the law was being abused, and the result was that a provision almost identical with that now before this committee was embodied in the legislation of the United States of America. When the tax was brought to the notice of the taxation officers they had not read the American act; nevertheless, their recommendation was along similar lines, although the wording was not exactly the same. They, too, fixed 5 per cent., and gave a discretionary power to the Commissioner to deal with special cases. I agree with what the right . honorable member for Cowper (Sir Earle Page) has said. When the Parliament sat in Melbourne, in the days before I was Leader of the Opposition, the right honorable gentleman as Treasurer, time after time, brought in amending legislation designed to close loopholes in the act which people were using in order to evade taxation. Although the right honorable gentleman was subjected to criticism by his own supporters for introducing retrospective legislation, I always supported him in any attempt to deal retrospectively with persons who were attempting to evade taxation, and to defeat the intention of the Parliament. I have always supported legislation of that kind, but I would not support retrospective legislation contrary to the intention of the Parliament when the act was passed. This retrospective provision is embodied in the bill because there have been some flagrant abuses of a concession granted under the existing legislation. As honorable members know, a concession is granted in respect of contributions to a provident fund, that concession being made by means of a rebate. Now that the rates of tax are high, that concession has great value. I do not say that all the provident funds which have been established since taxation became high are illegitimate, because I know that some firms which have established such funds were not in a position to do so before the war. Indeed, their ability to establish them now is a direct outcome of the war. I believe that every honorable member agrees that the practice of establishing funds out of which payments may be made to employees should be encouraged. But under cover of that beneficent ideal, selfish people have put huge sums of money into funds for the benefit of a select few, not the general body, of their employees. The Treasurer cited the case of a company which placed £50,000 in a fund for the benefit of about half a dozen of its executive officers, and £20,000 for the benefit of the head of the concern. It was not the intention of the Parliament that contributions of that kind should be exempt from taxation.
– We cannot stand for that kind of thing.
– The point arises whether we are to let them get away with it, or are to go back to 1943.
– It is a general sweeping clause.
– It will not sweep aside legitimate cases, except that it does impose a limit. Previously, employers had “ an open go “ ; any contributions by them to a provident fund were entitled to a concession without any limit in the law. The action of such employers - indeed the action of the company to which specific reference has been made - was legal. The question therefore arises: what can be done to prevent these acts from being repeated? We must ask ourselves what is a fair thing in the circumstances. The bill before us sets out what the Government considers is a fair thing. A legal act may constitute as great a moral offence as an act that is illegal. The provisions of the bill are generous; they provide for contributions up to 5 per cent, of the wages of the employee, or £100, whichever is the greater. The Treasurer told , us that under the present Income Tax Assessment Act, any contribution by a taxpayer towards a provident fund, a benefit society, or for insurance or sick benefits or any similar service, up to £100 a year, is allowed as a deduction for income tax purposes.
– That is a provision made by a person for his own benefit, whereas this section deals with provision made by an employer. for the benefit of his employees.
– That is so. An employer may make provision up to £100 for the benefit of any employee. The employee may contribute an equal sum. That is to say, there can be placed in the fund a sum of £200 for the benefit of one man, and that total amount is completely exempted from tax. The tax concession of a man, who is not working for such an employer - and the firms which make such provision for their employees are not numerous - is limited to a contribution of £100 for his own benefit. The exemption of £200 is fairly generous. I have sympathy with the proposal of the Leader of the Opposition, but I have no sympathy with the contention that retrospective legislation should not be enacted to deal with abuses. There is something to be said for the suggestion that old-established funds - funds which were in existence before the war and before their establishment were regarded with suspicion, as a possible attempt to evade taxes - might continue to enjoy the present concession, but I know that the Treasurer (Mr. Chifley) does not want to be accused of discriminating between one fund and another. After all, a new firm may be just as generously disposed towards its employees as any old firm, but did not have the opportunity to establish a fund for them before taxation rates became high. Under the proposal of the Leader of the Opposition, the newer firms would not be allowed the same concession as the older firms would enjoy. It is rather serious to discriminate between firms which have been established for a long time and those which have come into existence more recently.
– The discrimination is only in favour of firms which seek to promote the welfare of their employees.
– A line of demarcation must be drawn somewhere. The application of this section to the scheme to which the Leader of the Opposition referred is most generous. Under this bill, that firm will get a tax concession of about £100,000 a year in respect of approximately 5,000 employees. That represents about £20 each, and is a substantial concession. That scheme is one of the most generous that has come to my notice. It provides for contributions up to 12£ per cent, of the wages or salaries of employees. Under the £100 limit now proposed a 12-J per cent, contribution will still be possible in respect of employees drawing up to £800 a year. Alternatively contributions at the rate of 5 per cent, may be made on salaries up to £2,000 a year before the limit of tax concession is reached. I am informed that there is another fund - a non-contributory pensions scheme - which means that contributions may be made on salaries up to only £500. However, as I have said, it is a most generous scheme. This Parliament should not do anything to discourage such schemes, so long as they operate at their own expense, and not at the expense of the general taxpayer. It is all very well to “say that a scheme is generous, but it is another matter if half of the generosity is at the expense of the general taxpayer. In that event, the ordinary man in the street has to pay taxes to contribute to concessions in which he will not share. We must try to hold the balance fairly. A company may put £200,000 into a fund, but in effect, the country has to provide half of that amount. So, it will be seen that a limit must be fixed somewhere. The limit in the proposed new section is generous in that provision twice as great as the employee can make for himself can be made for him and still be free from tax. I agree with the right honorable member for Cowper that the wording of the clause is difficult to understand. It has been drawn in legal form to meet the cases that are likely to arise. I know the mind of the Treasurer and of the Commissioner of Taxation in regard to this matter. The bill gives to the Commissioner a discretionary power. A new scheme may just have started, and the firm wishes to do something to recognize the services of a faithful employee who has been with it for, say, 40 years. The £100 would not nearly suffice. That is the only discretion which the Commissioner would exercise in allowing more than the bill prescribes. There would be nothing to prevent him from giving to any firm which has contributed to a fund a concession in respect of the full amount contributed, provided that he was satisfied regarding the bona fides of the case. Therefore, 1 submit that we should agree to the proposed new section.
.- I wish to refer to only one aspect of the remarks made by the right honorable member for Yarra (Mr. Scullin), because I believe that they indicate a superficial process of reasoning. He spoke about these benefits being given at the public expense. When one analyses that statement one sees that it is false ; and for this reason : A company in competition with other companies in the manufacture of products - I exclude for the purposes of these remarks a monopoly - makes a reasonable profit on the capital invested in it and pays proper wages to its employees ; and if it is able to compete so successfully that it has a margin from which it can make a contribution to a welfare fund for employees, by what process of reasoning can such action be said to be taken at the public expense? The public are the gainers. The establishment of a scheme of the kind now under discussion may have contributed to the efficiency of the company because the company gets better and more devoted work from its employees as lie result. It is about time that this Parliament stopped thinking that the taxpayers make up the differences in cases of this kind when one company by its own efficiency is able to produce better results than others. Eather than discourage we should do our best to encourage that sort of thing. I am astonished that the right honorable member for Yarra, in view of his long political experience, should engage in reasoning of this kind which, I suggest, is most superficial.
– I do not want to repeat what was said in the course of this discussion last night, or early this morning. The right honorable member for Yarra (Mr. Scullin) has adduced the argument which has just been criticized by the honorable member for Fawkner (Mr. Holt) that the public will be required to pay a certain percentage of the benefit conferred by the company upon its employees. That, if it is true at all, is equally true of all cases in which a company pays wages above the legal minimum.
– But to a greater degree with regard to depreciation; and this is in respect of human depreciation.
– I welcome that illustration; but let me continue with the illustration I have in mind: Suppose a company, being prosperous, pays to its employees 10 per cent, more than the minimum legal wage. That is allowed as a deduction because the payment is an outgoing of its business.
– That is taxable in the hands of the recipient.
– I am not discussing whether it is taxable in the hands of the employee; it is a disbursement and the company’s expenses will include the wages it actually paid. For instance, if the honorable member for Henty (Mr. Coles) pays his employees more than the minimum legal wage he is perfectly entitled to do so. I always thought he would be encouraged to do so - and it is not to the point for some one to say that 50 per cent, of what a company pays to its employees is being found by the taxpayer. A company may seek to get better service, and it may give its employees better terms and better stability for the future, either by paying extra wages, or by paying a bonus, say, at Christmas, or periodically, or by establishing a superannuation scheme. All of these are alternative methods of conferring benefits upon employees, and if it is true to say that the criticism is valid that the public are paying this because the Commissioner is losing revenue as the result, then it is just as true of any of these three methods. I do not propose to say any more on that point because I expounded my view on it at 2 o’clock this morning.
I am not very much bothered about the notion of retrospectivity in this problem. I doubt whether in a real sense this provision is retrospective. On the contrary, it takes existing schemes and provides that in future those schemes shall be operated in a certain way. But I am very much concerned with the problem of the scheme which came into existence at a time when there was no inducement whatever to evade taxation, when taxation rates were low, and nobody ever dreamed that a superannuation scheme set up by an employer was set up in order to dodge tax. It is quite true that there is a clause which gives to the Commissioner discretion. No doubt the right honorable member for Yarra had that in mind when he said that it does not follow that these old schemes will be cut out by the operation of the bill. That is quite true. They will not necessarily be cut out; whether or not they are will depend entirely upon the exercise of a discretion by the Commissioner. I sympathize with the Commissioner. When he is asked to exercise his discretion in favour of some large enterprise he will be something more than human if he does not say to himself, “ I had better be a little careful over this, because if I give it to this big show, won’t it be said I should give it to a little show ? “ Why cannot the Treasurer (Mr. Chifley) meet the position by providing that if a scheme was in existence before the war began the discretion shall be exercised in favour of that scheme by the Commissioner unless there are circumstances which persuade him to the contrary. In other words, prima facie discretion would be exercised in favour of the scheme, but if the Commissioner were satisfied to the contrary heshould not exercise it. To be quite technical there should be a special onus upon the Commissioner to refuse the exercise of his discretion in cases where the scheme existed before the war. There would still be the discretion; but that would be a long way nearer to providing a fairer deal to schemes existing before the war.
The only other matter I wish to mention has been drawn to my attention by the honorable member for Parramatta (Sir Frederick Stewart). Sub-clause 5 contains a provision designed to enable an employer who has in the result overpaid the contribution by going beyond £100 or 5 per cent, to recover the excess from the fund. That is very fair. If he is not being allowed the deduction it is perfectly fair that he should be allowed to recover the excess from the fund, but sub-clause 5 begins -
Where any part of any sum so set apart or paid on or before the second day of March, One thousand nine hundred and forty-four has. by reason of paragraph (o) of sub-section (3.) of this section, been excluded from the deduction . . .
Presumably that date was put in became that was the date on which this bill was introduced; but. why should we not provide, “ Where any part of any sum so set apart or paid on or before the coming into operation of this Act . . .”
Suppose this measure comes into operation not on the 2nd March, but on the 2nd April, some employer may under his superannuation scheme be legally obliged to make payments not as up to the 2nd March, but between the 2nd March and the passing of the bill, and if there te some such person - and he has to perform his legal obligation - why should he not be allowed to recover the excess from the fund? I do not see why in this measure a date has been prescribed earlier than the date of the passing of the act.
– Would it not be possible for an employer to pay a large sum of money into the fund between the 2nd March and the passing of this bill?
– That would not be of any advantage to an employer because he would have no deduction in relation to that amount. The whole point of the clause is simply this: If a man has entered into a contractual obligation in respect of some duly established superannuation fund he has a legal obligation to pay on the stipulated date. My point is that that man’s obligation is not affected by this bill until it becomes an act, yet the bill says that if he has performed bis obligation prior to the 2nd March, he can recover the excess which is not deductible, but if he pays it after the 2nd March and before the passing of the act he must stand the loss. That cannot be supported. I earnestly invite the Treasurer to have a look at this provision with his officers in order to see whether some suitable amendment cannot be made. I see no possibility of fraud being practised, but I see quite plainly that an employer will say, “ This bill is going to be passed and so I will not make my payments falling due between the 2nd March and the 2nd April.”
– In his wisdom.
– It is not the kind of wisdom that should be forced upon a citizen. After all, there have been instances of bills being passed which have not become acts. If I were a citizen I should wait and see what the law was. Why should I be punished for doing so?
.- One point arising in the speech made by the Leader of the Opposition (Mr. Menzies) has not been clearly explained. The right honorable gentle man took the right honorable member for Yarra (Mr. Scullin) to task for saying that a portion of the money paid to these funds comes out of the public purse. There is some truth in that argument. The case is not so simple as the Leader of the Opposition made out, when he contended that the contribution to the provident fund is in the same category as paying wages above award rates. There is a vast difference between the two. I admit that the proposed new section is a wide drag-net, and I do not like the Commissioner being tied in his judgment. He should have a discretion to allow funds that have been approved for years to continue on the basis of past contributions regardless of what the deductions have been. I agree with the Leader of the Opposition in that view, but the payment of added wages is definitely not in the same category as these payments. There are two’ advantages that have accrued to the recipients of the fund in this particular instance. Large amounts have been paid quite legally into superannuation funds in the last twelve months or so by several companies. The reason for paying them was not that the company might escape taxation, but that the individual recipients would avoid heavy war-time taxation, and credits be built up for them to draw in future years. In some cases, executives have been drawing high bonuses and, by agreement with the company, those bonuses may be placed in the superannuation fund to their credit. Not only does the company escape the taxation for that payment, but also an individual who is possibly on the- high rate of 18s. fid. in the £1, legally avoids payment of tax on the amount paid to the fund ‘ for his future benefit. These are the basic principles behind the payment: - The company does not want to make it for its own sake, but the executives, who are the promoters, want to safeguard their own pockets in the future at the expense of the nation when war-time tax rates are high. I agree that the Treasurer should put a stop to that practice because, although it is legal, it is an avoidance of tax, of which other people are not in a position to obtain the benefit, I have had such cases brought to my notice, and know what has been going on. I rose principally to draw the attention of the Leader of the Opposition to the fact that, in paying moneys to a superannuation fund, tax is lost twice to the Treasury, whereas when wages are paid in excess of award rates the money is still taxable in the hands of the recipients.
.- I have been criticized by the honorable member for Fawkner (Mr. Holt) and the Leader of the Opposition (Mr. Menzies) for saying that the public does make a contribution to this fund, probably about half of what is paid in. They dispute it.
– No, the right honorable member should not do such an injustice to my argument. I did not dispute it for a moment. I said that it was equally true in other instances, but the honorable member for Henty (Mr. Coles), to whom I am grateful, has pointed out that there is a qualification to be imposed on my statement.
– The -honorable member for Henty has really answered the right honorable member’s argument, because, if excessive wages were paid, they would be taxed, whereas a generous contribution paid to a provident fund is not taxed in the hands either of the company or of the employee.
– Not yet.
– -NO. not yet.
– What is the difference between provision for human depreciation and provision for depreciation of plant and machinery, allowed by the Taxation Department?
– In the case of depreciation of machinery, the Commissioner of Taxation says that what is allowed is actual depreciation incurred in the earning of the income, and unavoidable. In this case, it is avoidable, and the question simply is how far and to what extent we should encourage them to deduct. Human depreciation certainly appeals to me more than machinery depreciation, but when the heads of a firm pay in fabulous sums-
– I think that should be provided against.
– Then the question is : What shall be the limit ? The answer to the question of the Leader of the Opposition is that the cases he has instanced are not parallel. The other question raised was as to what happens after the 2nd March. The particular firm that has abused this concession has put this money in for its employees, who are its executive heads, and there is nothing to prevent it, between the 2nd March and the date of the passing of the bill, from paying in another £50,000 and tying it up in the provident fund. Then, under this bill, that amount would be allowable as a deduction.
– In order to avoid that, the Government penalizes the honest man who is carrying out his legal obligation.
– But if we do not do it, we offer a premium to the dishonest man.
– That is the new political morality.
– The matter was discussed at some length early this morning, and I do not propose to traverse now the arguments which I used at that time to show why I could not agree to any amendments. This is one of the clauses of the bill which have had a very extensive examination. The suggestion by the Leader of the Opposition that funds which had been in existence in 1939 should be excluded was considered carefully by me and I was satisfied that what he proposed would create a discrimination between those funds and other funds established at later dates. The right honorable gentleman’s view was that a company which he instanced had been established a long time, and that for that reason the amendment moved by the Leader of the Australian Country party (Mr. Fadden) should be agreed to. Only two schemes in Australia have been able to date to show that the new section would be likely to affect them adversely. The argument of the honorable member for Parramatta (Sir Frederick Stewart), that it applies to the other funds,, is plain nonsense, and likely to mislead people associated with those funds. The honorable member knows as well as I do that in none of these funds is the employer contributing anything like £100 towards the £100 of each employee, and we have had, as I say, only two cases where the proposed new section is likely to cause difficulty. One of those cases is the one mentioned by the
Leader of the Opposition. Having heard the wisdom of many counsellors on the subject, and given great consideration to it prior to the proposed new section being inserted in the bill, and after the representations were made, I do not intend at this stage to accept any amendment.
– That seems to be a very curious answer to the point regarding proposed sub-section 5.
– Certain drafting amendments have been circulated in relation to this clause and also clause 9. They are designed to remove a legal doubt which has arisen regarding interpretation. It was intended as these clauses were drafted, and it is still intended, that contributions made by an employer in respect of any one employee should, subject to the exercise of the Commissioner’s discretion, be limited to an annual sum of £100, or 5 per cent, of the annual remuneration of the employee, whichever deduction was the greater. Upon one construction of the two clauses, it is possible to take the view that the permitted maximum would apply to each separate contribution made during the year to a fund, and not to the annual aggregation of those contributions. Correspondingly, where an employer has established more than one fund for the benefit of his employees, it might be contended that the permitted maximum applies to contributions to each fund separately. The amendments to the two clauses will remove any doubts regarding their construction and will ‘ensure that the permitted maximum shall apply to the yearly aggregation of contributions made to all funds in respect of any employee. The legal advisers of the Government regard these as necessary drafting amendments. Proposed new sub-section 2 provides -
For the purposes of this section, the Commissioner shall determine in respect of any sum so set apart or paid after the 30th day of June, 1943 -
The number of employees for whom, at the date on which the sum was so set apart or paid, the fund provided present or future individual personal benefits . . .
I move -
That in proposed sub-section (2), paragraph (a) of proposed section 66, the words “at the date on which the sum was so set apart or paid “ be left out, with a view to insert in lieu thereof the following words : - “ during the year of income “.
Amendment agreed to.
Amendment (by Mr. Chifley) agreed to-
That, after proposed sub-section (4.), the following sub-section be inserted: - “ (4a.) In the application of this section -
the aggregate of all sums set apart or paid (after the thirtieth day of June, One thousand nine hundred and fortythree) in the year of income by the taxpayer as or to any one fund shall be deemed to be one sum so set apart or paid; and
) in the case of a taxpayer who has, in the year of income, set apart or paid sums as or to more than one fund, the deductions allowable under this section shall be ascertained in respect of the funds in such order as the Commissioner thinks fit, and, in the application of this section in relation to any such fund, the amounts specified in sub-paragraphs (i) and (ii) of paragraph (c) of sub-section (3.) of this section shall, in relation to any employee, be reduced by the aggregate of any amounts determined in respect of that employee under paragraph (d) of sub-section (2.) of this section in relation to any other funds, to the extent to which the amounts so determined have not been excluded in ascertaining the deductions allowable in relation to those other funds.”.
Clause, as amended, agreed to.
Clause 8 agreed to.
Clause 9 -
After section seventyeight of the Principal Act the following section is inserted: - “79. - (1.) Where a taxpayer sets apart or pays in the year of income any sum . . . “ (2.) For the purposes of this section, the Commissioner shall determine, in respect of any sum so set apart or paid after the thirtieth day of June, One thousand nine hundred and fortythree -
the number of employees for whom, or for the dependants of whom, the fund, at the date on which the sum was so set apart or paid, provided present or future individual personal benefits, pensions or retiring allowances; “ (5.) Where any part of any sum so set apartor paid on or before the second day of March, One thousand nine hundred and fortyfour has . . .been excluded from the deduction . . .
– Sub-section 2 of proposed new section 79, which this clause will insert into the principal act after section 78, provides -
For the purposes of this section, the Commissioner shall determine in respect of any sum so set apart or paid after the 30th day of June, 1943 -
The number of employees for whom, or for the dependants of whom, the fund, at the date on which the sum was so set apart or paid, provided present or future individual personal benefits . . .
I move, for the reasons given by me in discussing clause 7 -
That in proposed sub-section (2.), paragraph
of proposed section seventynine the words: “ the fund, at the date on which the sum was so set apart or paid “ be left out, with a view to insert in lieu thereof the following words: - “during the year of income, the fund “.
Amendment agreed to.
Amendment (by Mr. Chifley) agreed to-
That, after proposed sub-section (4.) the following sub-section be inserted: - “ (4a.) In the application of this section -
the aggregate of all sums set apart or paid (after the thirtieth day of June, One thousand nine hundred and fortythree) in the year of income by the taxpayer as or to any one fund shall be deemed to be one sum so set apart or paid; and
) in the case of a taxpayer who has, in the year of income, set apart or paid sums as or to more than one fund, the deductions allowable under this section shall be ascertained in respect of the funds in such order as the Commissioner thinks fit, and, in the application of this section in relation to any such fund, the amounts specified in sub-paragraphs (i) and (ii) of paragraph (c) of sub-section (3.) of this section shall, in relation to any employee, be reduced by the aggregate of any amounts determined in respect of that employee under paragraph (d) of sub-section (2.) of this section in relation to any other funds, to the extent to which the amounts so determined have not been excluded in ascertaining the deductions allowable in relation to those other funds.”.
– I know that a majority is a very useful answer, but the Treasurer (Mr. Chifley) might extend to the committee the courtesy of a reply to the question raised about overpayments after the 2nd March. The same provision occurs in this clause, and I desire once more to state the case. A perfectly honest person, who is a party to a superannuation scheme under a deed of trust, has an obligation to make payments into the fund, which obligation matures after the 2nd March and before the date of the passing of this bill. What justification is there for saying that he has no right to recover an overpayment made to the fund? The Treasurer should illuminate our minds on that question. After all, it is not to the point to say that some furtive or dishonest fellow may make a big payment into the fund between the 2nd March and the date of the passing of the bill, and then to ask whether, if he does, he will be allowed a deduction for it. Of course, he will not, so that there is no inducement to him to come rushing in with a payment of thousands of pounds. Therefore, what this clause does is to penalize the honest man. It is about time that we in this Parliament began to have a little regard to honest men in the community, and refrained from constantly penalizing them because a few “ crooks “ exist.
Sitting suspended from12. 45 to2.15 p.m.
. –I move -
That, in proposed sub-section (5.), the words “ on or before the second day of March, One thousand nine hundred and forty four “ he left out, with a view to insert in lieu thereof the following words: - “ up to the date on which this Act became operative “.
The clause purports to do the perfectly right thing, by saying to the taxpayer who has been contributing to a provident or a similar fund in accordance with the conditions which prevailed prior to the introduction of this proposal, “A ceiling is imposed on your operations, and if your contributions exceed the new limit you will be entitled to recover that surplus money from the fund into which you have paid it, to the extent that your tax obligation has been increased”. I hasten to emphasize that this provision has no relation whatever to the Treasury or the Commissioner of Taxation, inasmuch as it will not affect by one iota the collection of tax, but will merely be a perfectly correct adjustment as between the taxpayer and the fund which he is operating in respect ofhis employees. It recognizes the justification; of the taxpayer recovering from the fund to the extent to -which he may be prejudiced by compulsorily changed circumstances. As the provision stands, that right of recovery is to operate up to the 2nd March; in other words, although the bill generally is to have retrospective effect to the 1st July, 1943, the taxpayer, in the circumstances to which I am alluding, will have the right of recovery up to the 2nd March. Why should the limitation of the 2nd March be imposed? Mechanically, the explanation is that that is the date on which the bill was introduced. I am aware that we are here dealing with a voluntary contribution, as distinct from the legal contribution referred to in an earlier provision. Nevertheless, the fact that the fund must be fully secured before it can come within the ambit of the act, suggests that there is still a legal obligation on the taxpayer to continue to make contributions to the fund, not merely until the 2nd March but also until the bill becomes operative; because the bill provides for the validation of non-payments after the 2nd March. How could an accountant of a firm, or an individual taxpayer who is interested in a trust fund of this kind, be expected to know all the ramifications of this most complicated measure immediately it was placed on the table of the House? It is not derogatory of the Treasurer (Mr. Chifley) to say that he cannot be fully aware of all the implications of the measure. Let us consider the facts of the situation. Contributions to provident and similar funds will inevitably be made week by week or month by month. The obligation to make them will continue to exist legally until Royal Assent has been given to this enactment. Why the 2nd March should be fixed as the date beyond which the right to recover will be denied, is beyond my comprehension. It might be reasonable to suggest that the taxpayer should have the right to recover the whole of the overpayment in respect of that portion of the benefits which- it is now proposed he shall be precluded from recovering. But that is not what the provision does; it merely stipulates that he shall be entitled to be reimbursed to the extent that he incurs extra tax liability.. I concede that if he did recover the whole of the sum he would be obligated directly to the Commissioner of Taxation. As I have stated, this does not affect the volume of taxation one iota, but is merely an adjustment as between the taxpayer and the benefit fund. My only complaint is that there is no justification for fixing a date anterior to that upon which the bill will become law, because that will be the date upon which the taxpayer will’ be legally absolved from responsibility to make such contributions.
– This matter and other matters having been raised by the Leader of the Opposition (Mr. Menzies), I asked the taxation officials to examine them during the luncheon hour. I have known amendments to be accepted which have created anomalies worse than those sought to be removed. Although I am always prepared to consider any proposal that is made, it is not my intention to accept amendments without first knowing all that they imply.
The Leader of the Opposition directed attention to the provisions of sub-sections 5 and 6 of section 79. Briefly, these provisions are to the effect that when there is a disallowance of any part of a sum contributed to a fund on or before the 2nd March, 1944, the employer shall be entitled to recover out of the fund as it stood on the 2nd March, 1944, the amount by which his taxation has been increased by the disallowance of the sum. If, however, on the 2nd March, 1944, the fund is insufficient to pay the tax that the employer is entitled to recover,, to the extent of the deficiency the employer will be allowed a deduction. In themselves, these are very equitable provisions. But the right honorable member also, called attention to the case of an employer making a contribution to a f.11 nd between the 2nd March, 1944, and the date upon which this bill becomes the law of the Commonwealth. I assume that the right honorable gentleman cited hypothetical cases.
– That is so.
– If such cases exist, the bill, as the right honorable gentleman indicated, contains no power of recovery for the employer in respect of contributions made by him after the 2nd March, 1944. As the right honorable member for Yarra (Mr. Scullin) explained, these provisions operate having regard to contributions made on or before the 2nd March, 1944, and the state of the fund as at that date. There is a very good reason for this. The legislation is designed to circumvent an abuse that has taken place in regard to the application of this portion of the income tax law. The Government is not only determined to prevent a recurrence of that abuse, but also is equally determined that the persons who have misused the income tax provisions shall derive no benefit from that misuse. If a date later than ihe 2nd March had been adopted in sub-sections 5 and 6, a full opportunity would have been afforded to these executives of companies to disperse the fund in effecting life assurances or in some such manner; thus when the bill became law, there would be nothing in the fund from which the employer could effect a recovery. There are cases which have actually occurred since the 30th June, 1943, to which these new provisions will apply. But it is doubtful whether there will be any case in which an employer will contribute to any of these funds between the 2nd March, 1944, and the date of the enactment, any sums which might be disallowed as deductions. If, however, there are such cases, I undertake to examine them so as to ensure that no injustice shall be done. That there could be juggling iti connexion with particular funds is readily understandable. I repeat, that I am always prepared to have proposals fully examined ; but I will not accept snap suggestions for the amendment ‘of a complicated piece of legislation which has been carefully prepared by legal men and taxation officials. The statement that I am not likely to have complete knowledge of every provision is perfectly correct. I do not pretend to understand every provision, or its implications.
The Leader of the Australian Country party (Mr. Fadden) made a. suggestion which we discussed during the luncheon hour. Although I was not able to express in the technical language which the occasion required the reason^ foi its non- acceptance, the right honorable gentleman, could see that there is ground for nonacceptance.
Clause, as amended, agreed to.
Clause 10 -
Section eighty of the Principal Act i» amended by adding at the end thereof the following sub-sections : - “ (5.) Notwithstanding any other provision of this section, in the case of a taxpayer which is a private company within the meaning nf Division 7 of this Part, no loss incurred by the company in any year prior to the year of income shall be an allowable deduction unless the company establishes to the satisfaction of the Commissioner that, on the last day of the year of income, shares of the company carrying not less than seventy-five per centum of the voting power were beneficially held by persons, who beneficially held shares of the company carrying not less than seventy-five per centum of the voting power on the last day of thi year in which the loss was incurred.
.- I move -
That, in proposed sub-section (5.) the words “ seventy-five per centum “, twice occurring, be left out, with a view to insert in lieu thereof the following words: - “twenty-five per centum “.
The clause proposes that no losses incurred by a private company in any year prior to the year of income shall be an allowable deduction, unless the company establishes to the satisfaction of the Commissioner that, at the end of the year of income, 75 per cent, of the shares were held by persons who also held 75 per cent, of the shares at the end of the year in which the loss was incurred. A close examination has revealed that, as the Leader of the Opposition (Mr. Menzies) and the honorable member for Fawkner (Mr. Holt) contended, some hardship might be caused by this provision. Quite a number of instances of the likelihood of it were brought to my notice, and representations which bore out the opinion that had been stressed hy the two honorable gentleman to whom I have referred, were made by certain companies. The right honorable member for Yarra (Mr. Scullin) has relieved me of a portion of the work involved, by meeting deputations on the subject. We have had this matter thoroughly examined, and though the cases involved may not be numerous, we recognize the force of the argument advanced, and I have moved an amendment to correct the position. The honorable member for Wentworth (Mr. Harrison)wrote to me of a theatrical company which had experienced many financial difficulties in the last year or so. Apparently, the theatricalbusiness is one of ups and downs. The amendment proposes to reduce the test applied in the clause from 75 per cent, of the shareholding to 25 per cent., but I make the reservation that if it is found that abuses still exist, we shall ask Parliament to amend the provision further. The Government was informed that alien refugees, who had been refused by the Capital Issues Board permission to form companies for purposes not likely to aid the war effort, had evaded the prohibition by buying up shares in practically defunct companies, and then operating those companies for purposes other than those for which they were originally registered.
Amendment agreed to.
Clause, as amended, agreed to.
Clauses 11 to 13 agreed to.
Clause 14 (Interpretation).
.- I move-
That the clause be postponed as an instruction to the Government - to provide that instalment deductions made between the 1st April and the 30th June, 1944, shall be applied by the Commissioner at the option of the taxpayer as follows: -
in part payment of the tax assessment for the financial year 1943-44 and/or
in part payment of the tax assessment for the financial year 1944-45 and/or
be held as an interestbearing credit to be repayable to the taxpayer within a period of twelve months after the termination of the war.
This should achieve the purpose which the Treasurer (Mr. Chifley) had in mind when he imposed this surcharge of 25 per cent. Dealing with thispoint, the report of the special committee states -
The only reason advanced by the committee, and the reason which was accepted by the Treasurer, for doing what it is proposed to do in this bill, is that the revenue requirements of the Commonwealth will not permit the Treasurer to forgo the £15,000,000 collected from employees before the due date. That £15,000,000 is the estimated value of the instalments that would have been precollected had the old system of taxation remained. Up to the 30th June next, employees will have paid 27 instalments in respect of 24 months’ income. Had the present system continued in force the instalments paid from the 1st April to the 30th June, 1944, would have constituted a pre-payment of tax. It is because this £15,000,000 has been collected in this way that the Government finds itself unable to give 100 per cent. “ forgiveness “ of one year’s tax in order to introduce the payasyouearn system. I do not propose to embark upon arguments as to whether or not there is a tax lag, or whether or not the instalments for those three months represent pre-payment. I base my argument on the statement of the committee itself when it gave the reason why the £15,000,000 collected during those three months could not be treated as an ordinary tax payment. The Government’s idea of justice is to take from non-employees an equivalent amount of 25 per cent., but to spread the payments over three years. This is what the committee says on the subject -
I agree that, having regard to the budgetary requirements of the Treasurer., the £15,000,000 must be retained. As a matter of fact, the Commissioner for Taxation will have difficulty in collecting i he £192,500,000 budgeted for, judging by the amount collected up to the 28th February last. My amendment will protect the revenue, while at the same time doing justice to the taxpayers. The £15,000,000 should be collected and used, but it should bc regarded not as a tax but as a premium to secure future benefits. There is no need for me to go deeply into t he other aspects or to emphasize that the £15,000,000 that will have been collected between the 1st April and the 30th June is consistent with the method of taxation which would continue “but for the proposed introduction of the pay-as-you-earn plan, and that that £15,000,000 will be a valuable contribution to the revenues of the Commonwealth and, more than that, a most necessary brake against everincreasing inflation. In order that we may check inflation, it is desirable that the maximum amount of money that can be economically withdrawn from the people so that their purchasing power shall be curbed should be withdrawn, and this £15,000,000 represents a substantial withdrawal. The dangers of inflation that this country is facing are little less than the dangers of “the war in which it is engaged. The excessive purchasing power of the people is shown by the mounting arrears of income tax. The arrears amounted to £33,800,000 on the 31st December last, as against £17,000,000 on the 30th June last. But whether income tax assessments are piling up in the Taxation Department instead of being sent to the taxpayers is not the issue. The important thing is that a vast amount of revenue which should be available to the Commonwealth Government is not collected or not collectable. What will happen about the uncollectable part of the £192,500,000, to which I referred, time alone will prove. I leave all that aside to press home my point that the only reason given by the Government and the committee it appointed to investigate pay-a3-you-earn taxation for the infliction of an additional 25 per cent, of tax as a premium for benefits to come, is that £15,000,000 would be collectable or collected by the 30th June from the deductions made from the weekly wages or salaries of employees. In order to put non-employees in a position as nearly similar as is possible, that committee recommended that they also pay an additional 25 per cent, of tax, but not in three , months, as is the case with employees, or even a year, but over three years in three equal payments of 8^ per cent. The Government cannot justify the differential treatment of employees and non-employees. I hope I shall not be judged guilty of tedious repetition when I stress the fact that fee only reason given for this added imposition of 25 per cent, up to the 30th Junenext by way of instalments from the pay envelopes of employees is that the Treasurer must keep his hands on that £15,000,000 .because it is included in the Estimates for the current financial year and probably has been expended. No scientific measurement has been made by that committee, the Treasurer, the Government, or this committee, of a reasonable premium to be paid by taxpayers for benefits which will accrue to them from the pay-as-you-earn scheme over a generation of Australian citizens. The amount that will he added to Commonwealth revenue as the result of the imposition of the 25 per cent, will be £15,000,000 from the employees in three months, and £20,000,000 from the non-employees in three years, a total of £35,000,000. That amount was arrived at as the premium on the basis of needs from employees.
– Order! The honorable member’s time has expired.
– As no other honorable member has risen, I will take my second period now. I again express agreement that the Treasurer needs that £15,000,000, not only to assist in prosecuting the war to victory, but also to check the cancerous growth of inflation. It is because I desire that the Treasurer shall have the full use of that £15,000,000 for those two purposes that I submit my amendment. I hope that the amendment and what I have said in support of it will weigh with the Treasurer. I agree entirely with the remark of the committee that -
Revenue requirements would not permit either of the refunding of this amount or the cessation of deductions for one quarter of the year.
The adoption of my first suggestion that the deductions made between the 1st April and the 30th June, 1944, should be applied by the Commissioner of Taxation to part payment of the tax for the financial year 1943-44 would enable those whose taxation payments arc in arrears to make up those arrears without being unduly embarrassed. That consideration is owed to the workers of Australia. It would not cost the Commonwealth revenue anything, but it would be of real benefit to many taxpayers. My second suggestion, that the deductions should be applied to part payment of the tax assessment for the financial year 1944-45, the first year in which the payasyouearn plan will operate, if adopted, would mean that the time of payment of the tax would synchronize with the year in which the income was earned. My third suggestion, that any residue should be held as an interest-bearing credit to be repaid within twelve months of the termination of the war, if adopted, would not disturb the Government’s revenues, during the war, but again would be a great help to the taxpayers after the war. My plan provides the alternative to the surrender by the Government of 100 per cent, of the tax which, I agree, would not be possible if it involved a suspension of the collection of the instalments of tax or the making of heavy refunds. It would be inconsistent for the Government to turn this proposal down and at the same time ask, as it proposes, the people to grant it extra powers in order to enable il: to maintain the wages and living standards of the people of Australia. “We have been told that the very basis of the post-war plan formulated by the Government is that there shall be full employment for everybody who is available and able to work. If that plan is to be implemented the national income must be maintained.
– I support the amendment moved by the Leader of the Aus tralian Country party (Mr. Fadden). As an authority, which I think the Treasurer will not dispute, he has used the words of the committee on whose recommendation the pay-as-you-earn plan was formulated. The committee’s report does not pretend to be a deliberate evaluation of the benefits that will accrue to the taxpayers from, pay-as-you-earn taxation, but it admits that, because, adventitiously, three months’ tax will have been collected in advance by the 30th June from the wage-earners of Australia, and because it would embarrass the Treasury to have to refund that amount, it is, therefore, quite right that a similar burden should be placed on the section of .the community which is not paying tax by instalments. I agree that there should be equality of treatment as between all classes of taxpayers, but that was not the only alternative open to the Government. The other alternative is presented by the amendment submitted by the Leader of the Australian Country party. The prepayment of taxation by three months is an innovation which was made last year. Previously there was a period of three months during which no deductions were made from the pay envelopes of employees, but, for reasons that the Government considered desirable, it was decided that the weekly deductions should be continued without interruption. “Sot even the Treasurer would suggest that his action in changing the method of tax collections last year was to meet the requirements of a change-over to payasyouearn. Therefore, I claim that it is purely adventitious that the arrangements for the collection of weekly tax instalments without interruption must be regarded. Yet apparently that fact, and the possibility that the refund of that money would embarrass the Government, are the only reasons why the parliamentary committee made their recommendation. Last Friday, the right honorable member for Yarra (Mr. Scullin) very passionately claimed that this legislation would not increase the payments of tax by employees. I ask the Treasurer: Is it not a fact that if this legislation had not been introduced, employee taxpayers would have, by *he end of March of next year, met their tax liability in full for the next financial year? Furthermore, if, as is now intended, these payments were continued until the 30th June next, would not taxpayers have been entitled to a refund of three months’ contributions? By insisting upon the commencement of the payments three months before the beginning of the financial year and continuing them for the full financial year, the Government will require employee taxpayers to make fifteen months’ contributions. The embarrassment which the parliamentary committee foresaw if taxpayers were entitled to a refund, will be overcome in an equitable manner, by the adoption of the amendment.
.- I support the amendment. This matter was discussed at length during the secondreading debate, and is the piece de resistance of the bill. The Government introduced this legislation because it offers a convenient form for collecting tax. If this bill becomes law, taxpayers will be on the pay-as-you-earn basis and will not have to pay a substantial lump sum at the end of the financial year in order to meet their assessments. This principle was forced upon a government reluctant to accept it. After long deliberation, the Treasurer (Mr. Chifley) accepted the principle but at the same time decided to grab £15,000,000 from employee taxpayers during the period April-June. The Government is not honest enough to admit that. Paragraphs 85 to 87 of the parliamentary committee’s report reveal the nigger in the woodpile. Paragraph 85 reads -
The committee had regard to the fact that, of the 2,000,000 persons now liable to pay tax, approximately 1,500,000 are employees. At present the deduction year in respect of these employees ends on the 31st March, as explained in paragraphs 38 to 40. By the 30th June, 1944, they will have had deductions made from salary and wages of approximately 25 per cent, of the tax payable under the present system for the financial year 1944-45 on the income of the year ended 30th June, 1944. The amount of the deductions made in this period will be about £15,000,000. Revenue requirements would not permit either pf the refunding of this amount or of the cessation of deductions for one quarter of the year.
Briefly, the Government has expended those collections. What would we think of a life assurance company which, after collecting premiums annually for a long period, suddenly decided to collect them weekly and then informed each assured person, “ As your widow will benefit from this alteration, we propose to keep three months’ premiums for ourselves “ ? That is precisely what the Government is doing. From employee taxpayers in the last quarter of this financial year, the Government will take £15,000,000, and during the next three years it will obtain an additional £20,000,000 from nonemployee taxpayers, making a total of £35,000,000. Some honorable members have contended that the Government is not levying an impost. If that be so, the Treasurer has a grand opportunity now to clear the air by accepting the amendment. The Melbourne Age, which has often supported many of the activities of this Government, has strongly opposed this tax grab. What the Government is putting over is an impost disguised as a benefaction. Why should not taxpayers be placed in the same position as members of the forces? A percentage of a soldier’s pay is retained as “deferred pay” and is made available to him after demobilization. It is of great value in assisting him to re-establish himself in civil life. In addition, this deferred pay will, in the post-war period, maintain the volume of spending power which, if suddenly reduced by the cessation of wartime activities, would be the precursor of a slump. We do (not want that to happen. Why should not a system of “ deferred pay “ be introduced for the benefit of taxpayers? In Great Britain, taxpayers have the definite knowledge that a portion of their payments will be returned to them immediately after the war in the form of post-war credits. The Treasurer is about to launch a big loan. Already, many life assurance companies have made big advance subscriptions, but it is infinitely better to get a large number of contributors to the loan. How can people have confidence in a government which, under the cloak of a new method of collecting taxes, grabs from them £15,000,000 without an assurance that at least some of it will be returned to them after the war? Apparently, the representations of the Opposition do not interest the Treasurer. Having the numbers, the Government is determined to reject our fair and reasonable proposals for preventing this exorbitant imposition. But the Government should heed the protests of the Australasian Council of Trade Unions and various unions, which advocate the adoption of a more equitable plan than the bill provides. This Government will be branded as the one which, for the first time in our history, introduced a method of tax extortion.
– Does the honorable member really believe that?
– I certainly do. If the Treasurer wants to do justice to taxpayers, ho should accept the eminently fair amendment submitted by the Leader of the Australian Country party.
.- During the last election I advocated on the hustings the adoption of payasyouearn taxation. As the outstanding points in favour of this system have been repeated in this House ad nauseam, I content myself with pointing out that the Government’s proposal to retain 25 per cent, of the tax differs from the payasyouearn proposition submitted by the Leader of the then joint Opposition parties (Mr. Fadden). Under the present proposals, the Government will put an additional £15,000,000 into “kitty”, and the community strongly objects to that. Many protests against this grab have been made by representative organizations throughout Australia, including the Australasian Council of Trade Unions, which is the hierarchy of the trade union movement. I ask the Treasurer (Mr. Chifley) to adopt a genuine pay-as-you-earn proposal by providing that people who are required to contribute this extra tax shall have it offset against their assessments for 1943-44, or 1944-45.
– The amendment urges that those payments shall be regarded as post-war credits.
– My third proposition is that the money shall be held at as an interest-bearing credit, to be repaid to taxpayers within twelve months after the war. These are reasonable propositions. It will disperse all fears that inflation will upset the economic balance which the Treasurer claims he has struggled for years to preserve. We of the Opposition do not object- to the principle of pay-as-you-earn; in fact, we fathered it. Originally, the Treasurer rejected it. I urge him to give to taxpayers much-needed relief by accepting the amendment.
.- Apparently, the Treasurer (Mr. Chifley) is determined not to be influenced by the logical reasoning of the Opposition. I support the amendment because I believe that the Government proposes to grab an additional sum from unfortunate taxpayers. The honorable member for Henty (Mr. Coles) admitted that the Government would have been embarrassed if the parliamentary committee had made certain other recommendations. In making that statement, he confessed that the committee was concerned not with pay-as-you-earn, but with saving the Government from embarrassment to the amount of £15,000,000, because it had collected and expended that money and was not in a position to refund it to taxpayers. The unfortunate working class, whom the Treasurer claims to represent, will be compelled to pay a considerable proportion of that sum of £15,000,000 in order to save the Government from embarrassment. I venture to say that many honorable members opposite will be severely embarrassed at the next election.
– That should please the honorable member.
– The right honorable member for Yarra (Mr. Scullin) and the Treasurer declared repeatedly that an additional impost is not being levied upon taxpayers.
– Is the honorable member adressing his remarks to the clause?
– What is the right honorable gentleman afraid of? Does he fear that the contentions of the Opposition will embarrass the Government? Does he fear criticism?
– Does the right honorable gentleman suggest that the amendments foreshadowed by the Opposion in the second-reading debate must not be discussed because they referred to matters mentioned in the second-reading debate ? Surely he is misinterpreting the Standing Orders! Perhaps he made a loose statement in his second-reading speech, and is not willing ro have it exposed.
– I did not.
– Order ! I ask the honorable member to address his remarks to the clause.
– I direct attention to proposed new section 160ag, relating to the income tax of persons other than companies on income of the year ending on the 30th June, 1944. The proposed new section begins -
In addition to any income tax levied in pursuance of section 17 of this Act . . .
That makes it perfectly clear that an additional amount will be collected by the Government. If the Treasurer desires to resolve any doubts upon the matter, I refer him to certain resolutions of a public meeting in the Sydney Town Hall. One resolution was that the Treasurer might accept an amendment or add a new clause in these terms -
No taxpayer shall be liable to pay for any financial year any tax additional to the amount which would have been payable had this act not been enacted.
If such a proposal were accepted, the taxpayers would know where they stood; but, apparently, the Treasurer is unwilling to budge from his present attitude.. In my opinion simple language should be employed which ordinary people can understand; but the workers have been overwhelmed by a flood of verbosity from the Treasurer. Of the 49 private members who have addressed themselves to the bill only two, other than Ministers, have spoken from the Labour benches, and one of them did not know what he was talking about. Of course honorable gentlemen opposite have not addressed themselves to this subject because they know the danger of it. Perhaps the right honorable member for Yarra threatened them in the caucus room as to what “attitude they should adopt, though, of course, he would not use such terms as the Minister for War Organization of Industry was accused of having used towards the honorable member for Reid. If the proposed amendment were accepted, all doubt on this issue would be eliminated-. The Leader of the Australian Country party (Mr. Fadden) has shown clearly that the workers will be asked to pay an additional. £15,000,000 in taxation by the end of June, over and above the’ir just indebtedness for the financial year; and then the payments by other than employee taxpayers will bring the total to £35,000,000. This, of course, is causing the Treasurer some embarrassment. I ask the honorable gentleman to look al this matter fairly and squarely. If he does so, I am sure that he will accept either the amendment of the Leader of the Australian Country party or the proposal which I have just made.
– So far I have taken no part in the debate on this measure. I decided to reserve any remarks I wished to make until the committee was considering the clause now before it. But it is now just over twelve months since I first spoke in this House on the so-called pay-as-you-earn system of taxation. During that time the Treasurer’s ears have been bombarded by many unpleasant sounds.
– But I remember clearly what the honorable member said a year ago.
– Perhaps some other honorable gentlemen may noi remember, so I remind them that I said that the pay-as-you-earn proposal was the greatest frost we have ever known, and I make no exception of the Minister for Repatriation (Mr. Frost). Sooner or later the taxpayers of Australia will be sorry that they were ever led into the awkward position in which they have now been placed by reason of the enthusiasm of two or three honorable gentlemen on both sides of the chamber. One of the gentlemen to whom I refer formerly sat with the Opposition, but is now missing from among us. His advocacy was assisted .by what I shall describe as the most “ un-understanding “ metropolitan press in the ‘Commonwealth. Yesterday afternoon I listened to a speech which, in parts, was most informative; but the honorable gentleman who made it was missing when the vote on the second reading of the bill was taken last night. I refer to the honorable member for Warringah (Mr. Spender). When I left the chamber last evening, he was tearing to shreds the arguments of the Leader of the Opposition (Mr. Menzies), and later, I understand, he treated those of the honorable member for Fawkner (Mr. Holt) similarly. I am not surprised that honorable gentlemen who have declared themselves to be so strongly in favour of this proposal should be diffident about voting for it. This is a most unusual clause, for we have been told that it will confer a very great benefit on both the Australian taxpayers and also the Treasury, which will benefit by the collection, in the period from the 1st April to the 30th June, of £15,000,000, which it could hardly have expected to receive. We have been informed that the taxpayers are being “ forgiven “75 per cent, of their indebtedness. As honorable members know, I am among those who at times “ search the scriptures “ ; but I have never been able to find therein anything that would justify the acceptance of “ five bob in the til “ and the surrender of 15s. as satisfactory settlement for £1 of indebtedness. According to the scriptures, a man must be on one side of the fence, in comfort, or on the other side of it, among the brimstone. I have found nothing in the scripture which suggests a “ let-off “ of the kind the Government is proposing. There is no scriptural authority whatever for forgiving a man 15s. if he pays “ five bob in the £1 “.
– The scriptures refer to the forgiveness of sins.
– Perhaps that is very helpful, from the Minister’s point of view. In the course of the years, I have read a good deal about the financial theories of Major Douglas, the A plus B theory, and so on. It seems that the Treasurer gives credence to some such theories ; but I have never been able to appreciate that the more you spend the better off you are. The Treasurer has contended that both the country and the taxpayers will be better off if this bill becomes law: but I consider we are facing a delicate situation. I repeat that the payment of “five bob in the £1 “ has never been regarded, in scripture, as a justification for forgiving the other 15s. When the misguided and unfortunate taxpayers realize what is being done, they will be very sorry for themselves and they will regard the 21st August, 1943, as a sorry day. Of course, they may be told: “It serves you right, you got what you asked for”, but that will not be much consolation to them. It seems, however, that the Treasurer is not likely to be moved by any arguments that he may hear, for he said before the luncheon adjournment, and he has repeated since, that he will not take any notice of the suggestions made from this side of the committee. His attitude reminds me of the words of James Russell Lowell -
Truth, forever on the scaffold;
Wrong, forever on the throne.
– I support the amendment, for it has introduced an atmosphere of reality into this discussion. It is quite useless for the Government to persist in declaring that the whole of the income tax due from wageearners will have been paid by the 30th March and that therefore they will be able to start, on their next pay day, to meet the so-called tax lag and thus fulfil the Government’s desire to make a complete change-over by the 30th June next to the payasyouearn system with, of course, the help of the alleged 75 per cent. “ forgiveness “. The Treasurer’s statement that no extra taxation will be collected from the people of this country by means of deductions between the 1st April and the 30th June next is sheer untruthfulness.
– The honorable member for Richmond (Mr. Anthony) does not think so.
– I do not agree with the honorable member for Richmond on this subject, and I remind the honorable member for Lang (Mr. Mulcahy) that his blood-brother in politics, Mr. A. E. Monk, the secretary of the Australasian Council of Trade Unions, has said that because of the extra taxation that will be wrung out of employee taxpayers in this country in the next three months, for the doubtful privilege of transferring to the payasyouearn system, they will have to live on the smell of an oil rag for months ahead.
– That has been explained.
– Some people will explain that black is white, and others will sell brass and say it is gold ; but that does not alter the facts. Black remains black, and brass remain brass. All the cant and hypocrisy, and the specious pleading we have heard in support of the Govern-, ment’s proposal, do not in any sense alter the facts of the case. I have heard such cheap claptrap on many occasions. It is the sort of talk one expects to hear from pickpockets. The Leader of the Australian Country party (Mr. Fadden) has pointed out that on the 30th December last taxpayers were in arrears in their payments to an amount of £33,000,000. Much of this leeway must have been among the employee taxpayers, which surely indicates that it is unlikely that the arrears will have been completely overtaken by the 30th March, and that the way will be clear for the Government to proceed with the collection of the additional 25 per cent, of tax. By the end of March, probably 50 per cent, of the employee taxpayers of this country will be in arrears with their tax liabilities for the current year. The Treasurer says that he will charge the taxpayers £15,000,000 for the privilege of changing from the present to the new system. As a counter to that, he will have very many bad debts on his books, and a large number of discontented taxpayers. The acceptance of the amendment would result in a continuous flow of payments, few bad debts, and a contented people. Eventually, the balance of the tax of many wage and salary earners will have to be cancelled. Blood cannot be obtained from a stone, and people who have not the necessary money will not be able to discharge their tax liability. At least let us have sincerity, instead of the pretence that these payments will be made when in reality they will have to be cancelled. I should like the honorable gentleman to explain how the administration will operate in connexion with primary producers. In respect of the income for 1944-45, a provisional assessment will be issued, based on the known income for 1943-44, plus 8^ per cent., at a rate calculated on the average income of the previous five years up to 1944. At the end of June, 1945, the primary producer will lodge a return of his actual income, an adjustment will be made, and an assessment will be issued at the rate applicable to an averaging of the income over five years. I ask the Treasurer : which five years will be taken, those ending in 1944 or those ending in 1945? Will the honorable gentleman examine the position and make an explanation of it, so that we may know how the act will be administered in this particular respect.
I urge the Treasurer to view these matters in the light of realities, and to give sympathetic consideration to the claims of those unfortunate people who, according to Mr. Monk, will have to live on “the smell of an oil rag” for many months, owing to the proposals of th6 Government.
.- As the second-reading debate proceeded, and the House heard the explanations of members of the parliamentary committee which made the recommendations that have been embodied by the Government in this measure in relation to the 25 per cent, provision, it became clear that the important factor which had influenced the members of the committee was the consequence to collections by the Treasury, particularly from wage and salary earners, which, would result without the inclusion of this provision. In order to meet the difficulty the Treasurer (Mr. Chifley), instead of giving effect to a provision that would benefit those who make payments in advance, intends to impose an additional burden on other kinds of income. The right honorable member for Darling Downs (Mr. Fadden) has submitted a much more effective solution of the problem. It has been contended that substantial benefits are to be given under the pay-as-you-earn scheme, and that the taxpayer should without reluctance pay a premium of at least 25 per cent, in return therefor. If one can believe the evidence of one’s eyes and ears, it is clear that the mass of the people outside this chamber are not convinced that the substantial benefits mentioned will eventuate, and are not prepared to concede that they are worth an immediate payment, or even a payment over a period of three years, aggregating 25 per cent, of their tax for the current year. There are very good reasons for scepticism in relation to this proposal. We have had experience of the insurance salesman who promises to improve our insurance position if we will adopt a new scheme that he is prepared to place before us. He never produces a scheme that will cost less, but always an attractively sounding one that will cost more. From time to time, also, we have seen an itinerant salesman produce a fountain pen, a few pencils, and other articles that are useful for office purposes, wrap them in a piece of paper, and magnanimously offer to sell the lot for ls. One wonders where the “ catch “ can be. Somewhere between those two illustrations will be found the scheme which the Treasurer has placed before us. He says that, if we pay this premium of 25 per cent., we shall, in effect, save the whole of our tax for one year. But he does not give the undertaking that that benefit will not be whittled down by a number of factors that may subsequently arise. Honorable members of the Opposition have referred to the possibility of estate duties being increased, thus offsetting some of the benefit that might otherwise accrue. There is a further possibility. Non.employees are to pay one-twelfth of a year’s tax in each of the next three years. What guarantee is there that at the end of that time the Treasurer will not say, “ You seem to have had no difficulty in providing this additional 8 1/3 per cent. ; therefore, I shall continue to impose it “ ? The undertaking has not been given that the rate will be reduced. The present Treasurer is not able to bind a future Treasurer in that regard. I recall to the minds of honorable members the debates on the sales tax. We then heard the Treasurer give the assurance that that tax was imposed for a specific purpose, at the rate mentioned, and for the limited period specified; yet what has been. our experience? The sales tax has remained, and it has grown. Consequently, I see no reason to believe that there will be an automatic removal of this per cent, at the end of the three-year period.
– The federal income tax was originally imposed as a war measure.
– That is so. The uniform tax legislation is to operate only for the duration of the war and one year thereafter. Should a later Parliament decide not to re-enact that legislation, what will happen to the benefits which the Treasurer now tells us we are to have? How can he bind any State legislature of the future ?
– That is an argument against any form of pay-as-you-earn.
– I do not accept that. We contend that the honorable gentleman here has an opportunity to make a full rebate; but he proposes to charge a premium, in return for certain benefits, without giving, any guarantee that those benefits will be obtained. On the contrary, non-employees will have to suffer the inconvenience, and perhaps the hardship, of being obliged to find an additional Si per cent, in each of the next three years, on the basis of the heaviest tax that has over .been imposed in the Commonwealth. Let us consider the matter from another stand-point. If, instead of paying this additional per cent, the taxpayer were to invest the money at compound interest, he would have, in about twenty years’ time, more than double the amount of the 25 per cent. Yet, in the main, he is not to receive the alleged benefits, even assuming that there is no interference with them by the application of the factors to which I have referred. Benefit may not accrue until the point of death has been reached, when the estate and not the individual will derive it. Om? could continue to analyse the alleged benefits, and produce the result that, after all, the transaction will not be so profitable as has been stated. In the course of the next three years, some taxpayers will be required to pay more than 20s. in the £1. This will not be healthy for the Australian economy, nor will it create for the worker an atmosphere conducive to the best output of which he is capable.
– Do not make such an evil suggestion.
– I am not the originator of it. The honorable member for Hunter (Mir. James) informed us a few weeks ago that a real cause of absenteeism on the coal-fields is the. high income tax which the coal-miners are required to pay. This, scheme will certainly not improve the prospects of greater coal production. On the other hand, some non-employee taxpayers will, during the next three years, be called upon to pay more than 20s. in the £1, yet it is to these persons, and to the industries which they control, that we must look in connexion with our plans for post-war reconstruction. The proposal of the Government is a damaging one. 1 I know that the House gave a decision on the matter in the vote on the second reading of the bill, but the Leader of the Australian Country party (Mr. Fadden) has now come forward with an alternative proposal - one which will not deprive the Treasury of the £15,000,000 in question, but will require the Government to credit to the taxpayer the extra amount collected. Therefore, I support the amendment.
– The amendment of the Leader of the Australian Country party (Mr. Fadden) is intelligible, and is in line with what he has always advocated. He says, “ Let us take this money from the wage and salary earners from the 1st April, but instead of regarding it as a tax, let us regard it as a credit to be repaid after the war “.
– I do not say that. I say that part of it should be credited against the tax assessment for 1943-44, part against the assessment for 1944-45, and the remainder held as an interest-bearing credit until after the war.
– I do not know how the honorable member proposes to make those various distributions. Only a small proportion of taxpayers will be in arrears on the 31st March. We have sent taxation officers to investigate complaints from factories where as many as 4,500 employees, formerly drawing overtime, have reverted to ordinary rates, and it was found that only a small number would not be fully paid up on the 31st March. What does the honorable member propose to do for the man who has already paid his tax in full? What proportion of the three months’ deductions will in his case be credited to the year 1944-45, and how much will be held as a post-war credit? ‘ Honorable members opposite supported the Government’s proposal last year to continue the monthly collections of tax from the 1st April, because they agreed that, in order to prevent inflation, too much spending power should not be left in the hands of the public. If the pay-as-you-earn scheme were not introduced, these deductions would go on from the 1st April this year just the same as they did last year. Honorable members are agreed that the £15,000,000 should be collected this year. That being so, the statements of the honorable member for New England (Mr. Abbott) about workers living on the smell of an oil rag-
– That was not my statement. It was made by Mr. Monk.
– But the honorable member was very glad to seize upon it. I want to make it clear that I have not the faintest intention of accepting the amendment of-, the Leader of the Australian Country party. His amendment proposes that £15,000,000 be taken from wage and salary earners.- Why does he propose to do that if the deductions represent such a great penalty, while the nonwage and salary earners are to suffer no similar penalty?
– The Government is to blame for that, because, had not the payasyouearn scheme been introduced, the money would have been collected from wage and salary earners in any case, but would not have been collected from nonemployees.
– Honorable members seem to assume that there will be a falling off in collections of tax in the future, but, at the same time, they proclaim that there is too much money in the hands of the people. How can they reconcile those ideas? I believe that the report of the committee on this point is eminently fair. It proposes a. plan which will give a valuable concession to the taxpayer for the payment of a moderate premium.
During the course of the debate last night, the honorable member for New England (Mr. Abbott) asked a question regarding the effect of the application of the averaging provisions on the taxable incomes of primary producers. The honorable member particularly desired to know how these provisions would be applied in ascertaining the tax payable on income derived during the year ended the 30th June, 1944, and in ascertaining the provisional tax payable in the year ending the 30th June, 1945. The tax on income of the transition year will be calculated in just the same way as it is calculated at present, that is, the taxable income of the transition year will be aggregated with the taxable incomes of the preceding four years, and an average income will be ascertained. The rate of tax appropriate to this average income will be applied to the taxable income actually derived during the yea:’ ended the 30th June, 1944. Of the amount of tax so calculated, a rebate of 75 per cent, of tax will be allowed in accordance with section 160ah, which it is proposed to include in the act.
So far as the provisional tax is concerned, the amount that the primary producer will be required to pay during the year ending the 30th June, 1945, will be the amount of tax assessed in respect of income derived during the year ended the 30th June, 1944, prior to the cancellation of 75 per cent, of that tax. In other words, the primary producer, in common with other individual taxpayers, will be required to pay as provisional tax an amount equal to the full amount of tax assessable in respect of income of the transition year. After the primary producer has furnished a return showing the income actually derived during the, year ending the 30th June, 1945, an assessment will be made, and the tax calculated in accordance with the taxable income so assessed. The provisional tax is in the nature of an interim payment, and will be applied in the payment of the tax which is finally assessed.
Question put -
That the clause be postponed (Mr. Fadden’s amendment).
The committee divided. (The Chairman - Mr.riordan.)
Majority . . . . 25
Question so resolved in the negative.
.- I refer to those portions of clause 14 which relate to what has been called windfall income. Honorable members will recall that the allparty committee which considered this matter recommended that in cases of abnormally high incomes the rebate of tax owing to the introduction of the payasyouearn plan should be reduced. It recommended that -
In such cases taxpayers should be allowed a rebate of 75 per cent, of the tax assessed on the income of the year ended the 30th June, 1943, with the addition of 20 per cent., in lieu of the rebate of 75 per cent, of the tax on the income of the year ended the 30th June, 1944.
In the course of the secondreading debate, it contended that that provision, if given full effect, would cause great hardship and inconvenience to growing one-man businesses or partnerships, and private individuals. With regard to private individuals, it was pointed out that, under the provisions made in the bill to carry out the committee’s recommendation, a man who earned £2,000 in each of two succeeding years would be placed in a more advantageous position than that of a man whose income rose from £1,000 in one year to £2,000 in the next year. I did intend to move an amendment which I thought would express more clearly what the committee had in mind when it pointed out .that it was fair that the rebate should be based on the normal income, and not on abnormally high income inflated as the result of either a windfall or some manipulation of accounts. I think that honorable members willingly accept the contention that the full rebate of 75 per cent, should not be allowed to operate in respect of incomes which are abnormally high as the result of windfalls of income or manipulation of accounts, but I do think that it should be allowed to operate in respect of incomes whose increase is not attributable to either of those causes. In the explanatory notes on section 160aj of the principal act it is mentioned that instances could, arise of additional incomeproducing assets coming into the possession of taxpayers. The acquisition ofadditional assets should not be regarded as a windfall in the ordinary sense. I would proceed with my amendment, but for the fact that I have learned from taxation officials that the Commissioner of Taxation will ensure that the provision for the reduction of the rebate shall apply only to swollen incomes resulting from windfalls or improper manipulation of accounts, which the committee had in. mind in making its recommendation, and that the full rebate shall be made in the other instances I have mentioned. For the benefit of the committee I shall read the concluding paragraph of the explanatory notes on section 160a.t -
Sub-section (2.) permits tho Commissioner to regard as the normal income of a year assessable income of a recurring nature received in the transition year from a source from which assessable income was not derived in the previous year. For example, a taxpayer may, in the transition year, have derived assessable income for the first time, or may have acquired additional income producing assets.
If what I conceive is to be the attitude of the Commissioner of Taxation is right - and I have no reason to doubt it - the Treasurer (Mr. Chifley) should, for the guidance of the public, set out in black and white that that is the way in which the Government considers that those incomes should be dealt with. I doubt whether the persons who would come within this provision would amount to 2 per cent, of the taxpayers. Those whose incomes are swollen unduly by windfalls or manipulations of accounts would be far outnumbered by those whose accessions of income are genuine. Their minds would be considerably relieved if the Treasurer would make a clear-cut statement that the Commissioner of Taxation will exercise his discretion in their favour. If it be not exercised in their favour, they will he gravely disadvantaged in the next three financial years. I point out to the committee that an organization, having gone through the developmental period, may earn only £2,000 in the year preceding the year in which the income, which is the subject of the rebate, is earned, and in that year its earnings may rise to £5,000 as the result of extended activities. Unless the Commissioner exercises his discretion iii its favour it would, in the first place, have to find provisional tax based on the £5,000 and then l-12th of the tax on £2,400, which is the £2,000 earned in the previous year, plus 20 per cent., and in addition of the tax on £2,600, that tax being calculated at the rate applicable to the full £5,000. The Treasurer will realize that, in those circumstances, such an organization would be placed in grave difficulties. It is not customary for small businesses to have readily available resources. Most of their profits go back into the business and indeed, very often, in these days, extra capital out of the proprietor’s own pockets goes into the business for the purchase of additional stocks or equipment.
– Arid certainly the provision for depreciation!
– That is so. . If, instead of the normal provision for income tax, an organization of that kind will have to pay one-twelfth of the tax on £2,400 plus one-third of the tax on £2,600, it will be crippled during the next three years Therefore, I ask the Treasurer to give a general undertaking that except where it can be shown that there is a true windfall or manipulation of accounts, the Commissioner of Taxation will exercise his discretion in favour of the taxpayer. .
– A primary producer could experieuce a total crop failure one yea?, and in the following year have a good crop, so that his income would be obviously 20 per cent, greater than that of the first year. I ask the Treasurer (Mr. Chifley) to give me a definite assurance that a primary producer will not be penalized because of a crop failure one year and a bountiful harvest in the following year.
– In that case the Commissioner of Taxation would exercise his discretion. An appeal would also lie to the Board of Referees.
– In Queensland, some crops are grown in the summer and harvested in the winter. Adverse weather might delay the harvesting, and the primary producer might not receive payment until after the 30th June. The succeeding crop might be harvested and sold in that financial year, so that the primary producer would receive payments for two crops in one year. Consequently, his return would show a great increase of income. Peanut-growers and maizegrowers could be so affected. So long as no doubt exists upon that point, I have nothing more to say.
– The honorable member for Fawkner (Mr. Holt) cited a similar instance when making his secondreading speech, and although the matter had been studied by the parliamentary committee, I had it re-examined in the light of his remarks. The honorable member asked me to place on record a statement as to the .way in which this matter is viewed and, in effect, what was in the mind of the committee when it made this particular recommendation.
Section 160aj is designed to afford equitable treatment in those cases where the taxable income of the transition year exceeds £500 and exceeds by more than one-fifth the taxable income of the preceding year and where, owing to some unusual circumstances or set of circumstances, the taxable income of the previous year is not the taxable income of a normal year. The excess of the taxable income of the transition year by more than one-fifth of the taxable income of the preceding year may arise, not because the taxable income of the transition year is abnormally high but because the taxable income of the preceding year is abnormally low, including cases of the receipt of assessable income in the transition year of a permanent and recurring nature from sources from which assessable income was not derived in the pretransition year.
Section 160a,t will authorize the Commissioner of Taxation in such cases to determine the amount of the taxable income which might be expected normally to be derived by the taxpayer in a year. The Commissioner will allow a rebate by reference to the normal taxable income so determined. The Commissioner has been- granted wide discretionary powersin relation to the application of section 160aj, even without the aid of sub-section 2. The effect of that sub-section is merely to furnish a guide or indication to the Commissioner that he may have regard to the sources of income of the transition year in satisfying himself whether the income of the pre-transition year was less than the income which might be expected normally to he derived in a year by the taxpayer and, if so, in determining an amount of normal income.
The honorable member for Fawkner has described a ease of a partnership which was established since the outbreak of the present war and which, during the year ended the 30th June, 1943, made a profit of some £2,000. In the following year, that is, the transition year, the business of the partnership had developed to such an extent that a profit of £5,000 was derived. I do not know at this stage whether the case described by the honorable member is an actual- one or whether he has merely put before the House a hypothetical example.
– I know of a specific case. The figures were hypothetical.
– If the case is an actual one, it will be considered by the Commissioner upon the basis that the normal income for the purposes of section 160aj is not necessarily an income the normality of which is determined by reference to the year ended the 30th June, 1943 only. The Commissioner is expressly authorized by sub-section 2 of section 160aj to consider the income of the 1944 year and the sources from which it is derived. It is within the compass of the Commissioner’s authority to compare the 1944 income with the 1943 income. If the comparison reveals that the 1944 income is increased by reason of the normal expansion of the business activities of the taxpayer, due, say, to plant and machinery coming into its full production, and is not inflated by windfall income or by the manipulation of accounts, then the Commissioner may determine that the income derived in 1944 was an income that might be expected normally to be derived in a year by the taxpayer. If the Commissioner so determines the amount of cancellation would be 75 per cent, of the tax assessable on the full income of the taxpayer.
– I suggest that there is an advantage to the Treasury inasmuch as the Treasurer would be justified in fixing a provisional tax on the amount of £5,000. If he treats it as a windfall, he would not be justified , in fixing a provisional tax on a windfall basis.
Mr.SCULLIN. - There would still be a re-adjustment. He would only be taxed in the following year on the actual income.
– On what was treated as actual income for rebate purposes.
– The parliamentary committee gave a good deal of consideration to this matter. I regret to note that the honorable member suspects that the Treasury always tries to get advantages over and above what it is entitled to receive.
– If the Taxation Department treats certain income as a windfall, it cannot say that that is the normal income for fixing the provisional tax.
– I understand the point. Perhaps this provision will require re-examination at a later date. I am sure that if an anomaly were disclosed, no Treasurer would object to reexamining it.
Clause agreed to.
Clauses 15 to 20 agreed to.
Section two hundred and twentyone k of the Principal Act is repealed and the following sections are inserted in its stead: -
– I move -
That, after proposed section 221kc, the following section be added: - “ ‘ 221kd. - (1.) The regulations may provide that all or any employers (not being em ployers registered as group employers), instead of delivering tax stamps, as provided in this Division, to employees from whose salaries or wages deductions are made in pursuance of this Division, shall deal with amounts so deducted in the manner prescribed. “’ (2.) Any regulations made for the purpose of this section -
shall be expressed so that the right which any employee would have, but for the regulations, to obtain any credit or payment in respect of any deduction made from his salary or wages shall be preserved;
may contain such incidental and supplementary provisions (including provisions applying to employees) as the GovernorGeneral considers necessary; and
shall, subject to this section, have effect notwithstanding anything contained in this Division.’ “.
This is a machinery amendment, and does not affect the principle of the bill. The purpose of the new section is to provide the machinery whereby a new scheme, at present under consideration, may be substituted for the existing procedure under which employers are required to deliver taxinstalment stamps to employees. The scheme under consideration will eliminate trafficking in taxinstalment stamps, which is at present carried on for the purpose of evading tax, and will also overcome the difficulties experienced by employees when their stamps are lost. Although the reform envisaged by this amendment does not directly relate to the payasyouearn provisions of the bill, it will facilitate the application of deductions made under the payasyouearn plan in payment of the tax to which those deductions relate. An essential feature of the payasyouearn plan is that when tax is being paid, instalment deductions should be identified with the earnings from which they are made, or, in other words, the deductions for each financial year should be separately recorded. Under the projected scheme, stamps representing one month’s deductions will be purchased by employers at monthly intervals, and will be affixed to a record of earnings for each employee. The record of earnings, with stamps affixed, will be delivered to each employee at the end of the year, and will thus provide a separate record of the deductions made in each year.
Clause 21 provides that every employer of ten or more persons will be registered as a group employer. Because a group certificate of deductions will be issued by the employer to each employee each year, no difficulty will arise in identifying group deductions with the earnings from which they are made. It is intended that the stamp scheme in project will apply primarily to employers who have less than ten employees, but the Commissioner may permit any employer with more than ten employees to adopt the contemplated stamp scheme in preference- to the group scheme. The practicability of adopting the new stamp scheme is at present being explored and discussed with representative bodies of employers. If the scheme is to be adopted, the procedure to be followed will need to be set out in regulations made under this section.
Amendment agreed to.
Clause, as amended, agreed to.
Clauses 22 to 27 agreed to.
Clause 2S (Application of amendments).
– This is probably the last opportunity that I shall have to say a few words more about some of the accredited persons dealt with in this bill. Last night, the honorable member for Henty (Mr. Coles) referred to such people as Red Cross officers and representatives of the Comforts Fund. The honorable member for Balaclava (Mr. White) mentioned one or two additional groups, and the Treasurer (Mr. Chifley) will recall that in my secondreading speech I spoke of this matter.’ The concession that is given, for example, ro Red ‘Cross representatives - I select them as a good example - is a disappearing deduction. It disappears at an income rate of £587 a year. Admittedly the. provisions of the bill will improve the earlier state of affairs, and I assure the Treasurer that I appreciate this; but I most earnestly appeal to him to consider whether it is not practicable to grant the same degree of tax exemption as is granted to the troops, to Red Cross workers and other personnel of a like character, who are serving with the troops outside Australia and accepting m a great degree the risk that the troops in operational areas accept. I cannot believe that the relatively few pounds involved in extending the exemption is seriously considered as a just reason for withholding it. Red Cross workers, as the Treasurer knows, are highly regarded in Army circles. My attention has been drawn to an order issued by General Sir Thomas Blarney in March 1943, which states -
The Red Cross Society is a recognized auxiliary of the medical services of the Army and its representatives serving with the Army are under the administration of the DirectorGeneral, Medical Services.
The order also sets out in parallel columns the Red Cross grading and the corresponding Army rank. Here is a body which is regarded as an auxiliary of the Army Medical Services, and which is engaged in work with the troops on operations overseas, but some members of which do not receive the same tax concession as some of the men with whom they serve. Many Red Cross officers undertook their initial service at a substantial personal loss.
– I take it that the Leader of the Opposition does not suggest that the Red Cross officers run the same risk as front-line soldiers?
– I say that they run as much risk as a great number of persons who are serving overseas, and who are entitled to the exemption which I am seeking for such personnel. I do not desire to exaggerate my ease. I suggest that an invidious distinction between these men is undesirable.
– All soldiers are under an obligation to go into the front line.
– That is so; but the disposition of the troops is such that the duty of front-line service does not fall evenly on all personnel. All our armies overseas, and also armies which visit Australia, are divided into those who serve in actual operations, and those who serve at supply bases; but no distinction is made among our own men on this account in relation to tax exemption. 1 do not press the Treasurer to give me an immediate reply to my representations;
I ask him to give me an assurance that he will consider removing the disability to which 1 draw attention. I have never been favorable to the acceptance of impromptu amendments in taxing bills. I realize that all such proposals should be carefully considered. I ask the Treasurer to undertake to consider my representations and also those of other honorable gentlemen on this side with the object of introducing amendments, if possible, in the Senate.
– The points raised by the Leader of the Opposition (Mr. Menzies) and by other honorable members, including the honorable member for Henty (Mr. Coles) and the honorable member for Wentworth (Mr. Harrison), concern not only Red Cross personnel but also personnel associated with the Young Men’s Christian Association, the Salvation Army, and certain other organizations. It was represented to me earlier that the concession that is now being granted in respect of these individuals would go a long way to meet the case that had been submitted. I must point out to the Leader of the Opposition that a very fine line has been drawn between those who have been granted the exemption and those who have not been granted it. The Minister for Information (Mr. Calwell) has made certain representations to me in the interests of officers of his department who are required to go very near to the firing line, and sometimes, in fact, beyond it. All the requests were carefully considered, both by me and by Cabinet. Whilst I am quite prepared to assure the Leader of the Opposition that I will examine the case again, and also discuss it with my colleagues, I cannot promise him that any action will be taken while this bill is before the Senate. We will look at the whole matter on the widest basis, with the object of action at a later stage.
Clause agreed to.
Title agreed to.
Bill reported with amendments; report - by leave - adopted.
Bill - by leave - read a third time.
Message recommending appropriation reported.
In Committee of Supply:
Motion (by Mr. Chifley) agreed to -
That there be granted to His Majesty for or towards defraying the service of the year 1944-45 a sura not exceeding £37,141,000.
Standing Orders suspended; resolution adopted.
Resolution of Ways and Means, founded on Resolution of Supply, reported and adopted.
That Mr. Chifley and Mr. Lazzarini do prepare and bring in a bill to carry out the foregoing resolution.
Bill presented by Mr. Chifley, and read a first time.
– I move -
That the bill be now read a second time.
The purpose of this bill is to grant supply to carry on the ordinary services of Government for the first two months of the financial year 1944-45. The amount involved is £37,141,000.
The provision may be summarized under the following heads: -
The provision made in the bill covers only the estimated requirements to carry on the essential services on the basis of the provision in the Appropriation Act passed by Parliament for the current year 1943-44. The amounts set down for ordinary services represent, with minor exceptions, approximately onesixth of the 1943-44 appropriations.
Excluding special appropriations it is estimated that, in the first two months of 1944-45, the total war expenditure will amount to £84,831,000. This is somewhat less than one-sixth of last year’s appropriations as expenditure in the first two months is invariably below the average of the year. The sum of £25,000,000 provided for war services in this bill represents the estimated amount which will be available from revenue receipts for the first two months of the year after making due allowance for other obligations. The balance of war expenditure will be met from loan appropriations.
As in previous years, provision is made in the bill for Advance to the Treasurer “, the amount being £5,000,000. This sum is required mainly to carry on uncompleted civil works which will be in progress at the 30th June and also to cover unforeseen and miscellaneous expenditure. No. provision has been made for any new expenditure except in respect of defence and war services and there is no departure from existing policy.
. -The introduction of this bill gives to the House an opportunity to deal with matters which concern the financial policy of the Government. I take advantage of it in order to refer to certain financial arrangements, as well as the financial policy of the Commonwealth alone and in association with the States.
On the 25th January last, the Prime Minister (Mr. Curtin) and the Treasurer (Mr. Chifley) approached the State Premiers, in conference at Canberra, and suggested that those States which were enjoying surpluses as the result of Commonwealth expenditure might consider forgoing certain money grants from the Commonwealth. Yet the Treasurer, who is in duty bound to carry out the laws of this Parliament, could demand from the States the immediate repayment of approximately £17,000,000 which they would be bound to disgorge under the provisions of the Financial Agreement Validation Act 1929. That Commonwealth statute provides that contributions shall be paid into the National Debt Sinking Fund during each year - first, on each loan raised after the 1st July, 1927, 5s. per £100 by each State from revenue, and 5s. per £100 by the Commonwealth from revenue, for a period of 53 years; and, secondly, in respect of any loan raised after the 30th June, 1927, in order to meet a revenue deficit accruing after that date, at least £4 per £100 per annum by the State concerned from revenue for a period sufficient to provide for the redemption of that loan. Those, shortly, are the relevant provisions; they are quoted at length at page 22 of the 20th annual report of the National Debt Commission, presented to this Parliament and signed by, among others, the Federal Treasurer and the Chief Justice of the High Court. The responsibility which I place on the Treasurer is that of seeingthat the States shall disgorge the amount which I consider, and the facts establish,, is due by them to the Commonwealth, Paragraph 12 of the report states that,during the depression years, the Loan Council arranged to finance- deficits experienced by State governments up to and including the year 1934-35, by borrowing from the Commonwealth Bank by means of short-term treasury-bills. According to the last report of the Commonwealth Bank Board, dated the 19th August, 1943, more than £50,000,000 of these bills is still outstanding. In flagrant breach of the Financial Agreement Act, contributions were allowed to be made to the sinking fund in redemption of this £50,000,000 right up to the 30th June, 1943, at the rate of 5s. per £100 per annum by the Commonwealth and 5s. per . £100 per annum by the States, whereas the States concerned were bound by statute to pay to the sinking fund in respect of these .borrowings an amount of not less than £4 per £100 per annum. The illegality of this procedure is clearly admitted in paragraph 13 of the report of the National’Debt Commission, which states that four leading counsel gave the opinion that the proper contributions payable in respect of the borrowings are contributions by the States concerned, and not by the Commonwealth, at a rate of not less than 4 per cent, per annum. The report of the Auditor-General, tabled yesterday, contained this highly significant admission at page 14: -
It would seem that legislative action will be necessary to validate the rates of contributions made and being continued on this debt.
In other words, the Commonwealth has’ been paying into the sinking fund for between eight and nine years 5s. per £100 per annum on £50,000,000, in flagrant breach of the relevant statute. An approximate estimate of the amount lost to Commonwealth revenue, and recoverable under this head, would be £1.000,000; that is, 5s. per cent, on £50,000,000 for between eight and nine years. Furthermore, the States concerned have illegally short-paid to the sinking fund. Instead of paying into it at least £4 per £100 per annum on £50,000,000, as Commonwealth law provides, they have paid and are still paying only 5s. per £100. The amount immediately repayable by the States to the Commonwealth under this head is approximately £16,000,000, being 4 per cent, per annum on £50,000,000 for between eight and nine years, less about £1,000,000 already paid under the scheme in relation to the payment of 5s. In all, approximately £17,000,000 is immediately due from the States to the Commonwealth, which has the responsibility of financing the war on behalf of the nation. Painstaking investigation by skilled officers would be needed in order to estimate the amount exactly, and the result would in all probability be higher than I have estimated. According to paragraph 15 of the report, the Loan Council recommended that the financial agreement should be amended in order to validate its own illegal acts. This would be tantamount to allowing approximately £17,000,000 to remain with the States at a time when, according to the latest report of the Commonwealth Bank Board, “largely as a result of the war, the cash resources of the States have increased to the very substantial figure of approximately £34,000,000 at the 30th June, 1943 “. The Treasurer stated that he could not afford to forgo £15,000,000 by giving effect to a complete payasyouearn taxation plan; yet he apparently makes no attempt to collect this £17,000,000 from the States. The report of the Commonwealth Bank Board makes this recommendation -
This provides a suitable opportunity for redeeming part of the treasury-bills which were taken up by the Commonwealth Bank to finance State deficits in the years prior to 1934. Over £50,000,000 of these bills are still outstanding, and the board lias made representations that arrangements should now be made for permanent redemption of a substantial portion of them.
The Treasurer, the Prime Minister, and every other honorable member of this House should see that the laws of this Parliament shall be carried out, and that there shall be insistence on the return by the States of the amounts which are due in law to the Commonwealth. The voluntary principle has been overdone by the present Government, and it has not achieved beneficial or desirable results. The reports and acts which I have quoted are public documents, and are available to every honorable member. A perusal of them will substantiate every statement that I have made. The National Debt Commission has admitted quite openly the illegality that has occurred. I remind honorable members that the admissions are contained in paragraphs 12 to 16 of a report signed by the Federal Treasurer, the Chief Justice of the High Court, the Governor of the Commonwealth Bank, the Secretary to the Treasury, the Solicitor-General, a representative of the States, and the Secretary to the Commission. It is no wonder that the Commonwealth Auditor-General gave a limited and qualified certificate as to the correctness of the transactions of the sinking fund. Consequently, no course is open to this Parliament other than to insist that £17,000,000 shall be forthwith handed over by the States from their buoyant revenues, for use by the Commonwealth, which is in such dire need of revenue to carry on the war that it proposes to sweat an extra £15,000,000 of income tax out of wage-earners during this year. Upon the Treasurer devolves the duty of financing the war. He has the responsibility of giving effect tothe provisions of the laws of this Parliament. Four months ago, I asked the honorable gentleman a question, upon notice, touching upon another aspect of this important matter. The reply given to me on the 9th February contained a statement quite irreconcilable with the report of the National Debt Commission, and indicating that the report embodied statements which were not in accordance with fact and were misleading. In view of the nature of the charges that I have made, and of the surrounding circumstances, together with the effects on Commonwealth revenue, I invite the Prime Minister to appoint a competent commission, with a view to having the matter satisfactorily and expeditiously adjusted as between the States and the Commonwealth. The terms of reference should be wide enough to embrace the transactions of the National Debt Sinking Fund from 1929-30 onwards, and the financial statements and budgets of the States, with a view to determining the true deficits of each of them and the consequential sinking fund contributions which are now due and payable by them in respect of such deficits. The Treasurer, in the budget statement that he made last year, contemplated the raising of £103,000,000 during this financial year by means of bank credit, that sum being a portion of an estimated deficiency of £403,000,000 which then had to be financed. On the 8 th October last, I sounded a note of warning to the honorable gentleman. I then forecast that, in the light of experience, he had dangerously underestimated the amount of bank credit upon which he would have to rely during this financial year. At the end of June, 1941, treasury-bills outstanding on behalf of the ‘Commonwealth were only £1,750,000. By the end of June, 1943, they had risen to £298,500,000. The figures available on the 20th March show that by that date they had further increased by £130,000,000 to £428,500,000. “With less than nine months of the financial year completed, the Treasurer had exceeded his estimate for the full year’ by more than £27,000,000 by this easy but dangerous method of finance. The disproportionate increase of treasury-bills is naturally reflected in .an increase of purchasing power in the hands of the public. In the year ended December, 1943, savings bank deposits increased by £105,000,000 to the startling total of £414,000,000. Notes in circulation and held by the public had increased from £34,S00,000 in 1939 to a little over £150,000,000 at the end of December, 1943 - the latest date for which figures are available. Therefore, the potential spending power at the command of the Australian public to-day can be stated to be in excess of. £560,000,000. The report of the Commonwealth Bank Board for 1942-43 made this statement -
Since treasury-bills have this effect their use, in view of the considerable accumulations of purchasing power which are already in the hands of the public, should be reduced to a minimum.
I should fail in my duty did I not repeat my warning against the continuance of this unprecedented use by the Treasury of this most dangerous, yet easy method of finance.
On the 25th . March and the 8th October of last year the attention of the Treasurer was directed by me in this House to the appalling instances of waste, extravagance and mismanagement which had been revealed by the report of the Auditor-General for 1941-42. Far too many instances of irregularity and excessive expenditure were given. The profit or loss of the Defence Clothing Material Trust Account had not been ascertained, nor had the value of stock on hand been checked with the control account since the 30th June, 1939. Royal Australian Air Force unit accounts, except for very limited supervisory checks, had not been departmental^ checked, in many cases, since their inception. As expenditure under several headings was not ascertainable, the AuditorGeneral found it impracticable to mako a conclusive analysis of the manufacture of Munitions Trust Account. Advances to this account amounted to the abnormal sum of £44,700,000, of which all but £1,S00,000 had been expended, yet no explanation of the method of expenditure of this huge sum could be given, because it was not ascertainable. The accounts maintained by the airscrew annexe of the Department of Aircraft Production were described by the Auditor-General as “most unsatisfactory and inaccurate, indicating a lack of supervision and control “. A perusal of the report of the Auditor-General for the year 1942-43, recently presented to Parliament, indicates that this unsatisfactory position continues to exist. I cite the following examples from the report : -
Suitable records of plant and machinery are not maintained by the board. The absence of complete and reliable inventories supporting the accounts of these assets is’ an unsatisfactory feature and this office has stressed the needs for their establishment.
Expenditure over financial authority. An aspect of considerable prominence in the activities controlled by the Allied Works Council lias been the occasions on which the completed costs of works have exceeded estimates with, in many instances, expenditure in excess of financial authority. This applies to estimates prepared by departments authorizing the projects and to estimates prepared by the Council. This exceeding of financial authority has been an unsatisfactory feature, particularly on works carried out on behalf of the Council by State Government and semigovernment authorities. As all other considerations wore subordinated to urgency it would appear that many works were put in hand on estimates and plans of a rudimentary nature with consequent lack of control over the ultimate extent of the project and the final cost. It has been noticed that these aspects have received attention by the Council and the Board of Business Administration in recent months. If it may be assumed that the factor or urgency is not now so dominant, it is reasonable to expect considerable improvement in financial control with consequent effect upon costs,
As regards the goods transferred to service departments an unsatisfactory position has existed owing to the failure of the departments to inform the division of the receipt of all lend-lease goods invoiced to them.
Remittances from the agent of the department in this matter of portion of moneys arising from the sole of nitrate of soda and from the increase in the price of sulphate of ammonia have been made to the Department of Commerce and Agriculture and aggregate £485,930 to the 7th February, 1944. The first remittance was received early in October, 1943. The agent was apparently not subject to supervision by the department. Accounting instructions given by the department were inadequate and it would seem that large sums could have been in the hands of the Receiver of Public Moneys for credit to Commonwealth public account at a much earlier date.
To date the request for access to files and documents has not been granted. The interests of the Commonwealth are so obviously related to the financial transactions under notice that the co-operation of the department was expected . . . Much delay is occurring in the circumstances in the completion of the audit of a large amount of expenditure. The matterhas been referred to the Solicitor General for advice.
Although extra staff has been trained by the department to improve the unsatisfactory position referred to in my last report, the results have not met with the success anticipated and arrears of stocktakings continue to accumulate at naval depots and establishments.
Reference was made in former reports to the inadequacy of the records of assets acquired or constructed by the Department of the Army.
A finance liaison section of the Engineer Services Branch has now been established, the duties of which include the creation and maintenance of records of such assets. The form of record has been determined and the necessary accounting instructions promulgated. The task of the department has greatly increased by the delay in taking this matter in hand and may prejudice the attainment of accuracy in these most important records.
Store accounting, at page 73 -
The number of unit accounts which are in such a state as to preclude an accurate stocktaking is considerable. The departmental instructions provide for a complete check of unit accounts when changes of command occur. In a large number of instances, this check was not done.
Audit reports on unit stores reveal a bad accounting position in many units. The following are examples of extracts from reports: -
The check revealed numerous errors which proved that the stock ledgers were unreliable.
The ledger accounts recording these transactions have been found to bo unreliable and the postings unduly in arrears.
Incorrect accounting and faulty stocktakings.
The “ take-over “ was unsatisfactory and the correct liability of the Department of the Army at transfer extremely difficult to ascertain.
Action to obtain competent authority to write off discrepancies (due to theft and fire) at stocktakings not completed.
Unit stocktakings. - Arrears of stocktakings continue. Discrepancies in some units are considerable.
The unsatisfactory position of stocktaking in the Department of Air has been reported previously and little improvement is revealed in a review of the position for theyear 1942-43.
The British Ministry of War Transport decided not to effect repairs (on a damaged ship) at an estimated cost of £22,000, but at a later date, owing to Australia’s coastal requirements, the Commonwealth decided to effect repairs. The amount expended to the 30th June, 1043, was £7,804, but perusal of the departmental files indicates that repairs will cost probably £45,000.
In a minute on the file the Minister expressed amazement at the wide variations in Iiic estimates, stating they had more than doubled since his original approval was given.
Minerals production, at page 81 -
An item of expenditure of £221,750 - Mining for wolfram and copper in Central Australia. The expenditure on this project from inception to the 30th June, 1043, was £245,079. The receipts to the same date totalled £10,725. The respective figures at the 30th November, 1943, were £308,939 and £29,127. The value of stock on hand at 30th November, 1943, could not be ascertained owing to the absence of satisfactory records.
Although the Trust Fund control ledger for sundry debtors’ accounts has been maintained it was found that certain overseas authorities were shown therein as being creditors for amounts aggregating £1,592,370, whilst the records of the departmental section responsible for claims on overseas authorities correctly showed such authorities to be in debit to the extent of £1,388,201. This matter is the subject of correspondence with the department.
It is evident that the Government should take immediate action to correct the position. ‘Taxation rates are very high, and although the public, do not mind, at a time like this, paying taxes or contributing to war loans or buying war savings certificates, they do not like to think that their money is being wasted through lack of proper control. After all, the money comes out of the pockets of the people, and they are entitled to expect that it should not be wastefully expended because of loose accounting methods and extravagance of the kind revealed in the Auditor-General’s report. I sympathize with the Treasurer. I know that he has a heavy load to bear, but he should deal with those who are responsible for the conditions commented upon in the report of the AuditorGeneral.
I repeat that there is a legal responsibility on the Government to collect the £17,000,000 owing to it by the State
Governments in connexion with treasurybills. The position in regard to treasurybills has been allowed to drift until we are now faced with a problem of dangerous dimensions, which threatens to cause financial disaster unless something be done about it.
.-Every precaution should be taken by the institution of checks and safeguards to prevent wasteful expenditure of public money. I have been saying this for the last two years, but my voice has been like that of one crying in the wilderness. I repeat that the Public Accounts Committee should be reconstituted in order to examine public expenditure. This fact is emphasized by the report of the Auditor-General, as indicated in the following newspaper report : -
Because of inadequate safeguards and inefficiency many thefts of money and stores have occurred in the Army, according to the annual report of the Auditor-General for the year ended the 30th June, 1943. The report which was tabled in Parliament to-day, said that it was rather disturbing that courts of inquiry had been lenient in a number of such cases. It was felt that Commonwealth interests were not sufficiently protected by the existing military regulations, and related procedure, the report said. By the application and interpretation of the regulations, Army personnel frequently obtained freedom from action or blame whereas in relatively similar circumstances in the Civil Service, the existence of deficiencies would have established negligence. These observations held good regarding happenings in areas where the stress of operational duties existed.
That is the excuse usually advanced, and we are expected to close our eyes to the waste that is going on not only in the Army but also in the Allied Works Council which has been given powers to spend very large sums of money almost’ without question. The result is now being brought home to .us. I have been given information which shows that there has been colossal waste and inefficiency in many allied works projects in New South Wales. Many of the undertakings that have been entrusted to that organization have cost, two, three and four times the original estimate, which, in itself, is an indication that something is radically wrong, and that the fault is not just inefficiency but is maladministration, calling for close investigation on behalf of Parliament by a reconstituted Public Accounts Committee or the War Expenditure Committee. If the latter body were given the necessary powers to conduct such an examination, it should be given the services of costing experts, quantity surveyors and the like to make preliminary investigations on its behalf, because the committee is able to operate only in parliamentary recesses, whereas a committee of experts working for it would be able to operate the year round. The contract price for one job in New South Wales which the Allied Works Council took over from the contractor was about £18,000 and the contract provided that the job should be completed within two months. Now that the Allied Works Council is doing the job, it has already cost more than £60,000 and ten months have gone by with the job not yet finished. Another job let by the Allied Works ‘Council to a building company was to have beendone for £14,000 or £15,000. When the excavations were just about started, storm-water was concentrated on the work by the Allied Works Council and the cost of putting it right was between £400 and £500. The company was not financially strong and it probably would have become bankrupt, so the Allied Works Council put the job on a doandcharge basis with the result that the cost ran into £70,000 or £80,000, and, instead of being bankrupt, the company cleared a profit of £5,000. The building of a guardhouse was let to a contractor who was satisfied to be allowed £87 for the job. The work was done by the Allied Works Council at a cost of more than £1,000. We have already heard much about the graving dock, the cost of which will more than treble the original estimate of £3,000,000. The cost is approaching £10,000,000. I am reliably informed that the fee that will be paid to the British experts on the construction will be £600,000. On cost-plus projects there is no inducement to keep down costs, because the more they cost the more those who undertake them will receive. I do not think that it was ever contemplated that the cost of the graving flock would run into such a colossal figure or that the Commonwealth would be, as the result of the huge increase of the cost, called upon to pay such a high fee. I think the Government would be justified in asking for a reduction. Another matter requiring urgent investigation is the basis on which the Commonwealth Aircraft Corporation aero-engine works in my electorate operate. Those works have already cost about £8,000,000. From time to time during the regime of previous governments as well as this Government, I have asked why no formal agreement as to the operation of those works has been entered into between the Government and the corporation, which is a private concern. Every time I have raised the matter I have been told that negotiations are proceeding. Questions stretching over a period of four years asked by me in regard to that matter in this chamber are in Hansard. The Government ought to allay misgivings in the community generally and among workers, particularly in the factory, as to what will happen to that factory when the war ends. We should know whether it will be conducted as a government concern or be sacrificed to private enterprise.
The Lend-Lease Agreement, so far as it affects this country, calls for immediate reconsideration. Frequently we have had brought to our notice the fact that goods brought to Australia from the United States of America under lend-lease are charged for at prices which are not favorable to this country. I was shown in a factory in my electorate one machine the price of which was £750. It was second-hand and the manager told me that he would not pay £100 for it because it was junk ; the company returned it to the department. The other side of the picture is shown by the following newspaper paragraph : -
New York, Tuesday. - The United States would charge £2 8s. for a 16s. Australian blanket, says tho New York Times.
The paper uses this example as a warning that dollar figures give a false perspective of lend-lease aid. “ When it comes to lend-lease in reverse, an arithmetical situation arises, which strongly resembles the plight of an American citizen filling in his income tax form,” it says. “ Especially is this the case with the 1,000,000 blankets with which Australia is supplying us.
Cheaper WOOL, LABOR “The 1,000,000 blankets which we are getting from Australia are billed to us at 10s. a blanket. “ But if we were giving these blankets to Australia we would be charging £2 8s. a blanket. “ In other words, for exactly the same amount of lend-lease in actual commodities, Australia would be recorded as lending us only £825,000, but we should be Australia’s benefactor to the extent of £2,470,000. “ The difference, we presume, is explained by the lower cost of wool and labor in Australia. “ But it sounds a little odd. “ The only practical lesson is that on their way back from Tokio after the war, our boys would do well to drop off at Australia ana pick up half a dozen nice blankets for the folks at home.”
That indicates that Australians, particularly primary producers, are not receiving adequate prices for the commodities they export to America under reverse lend-lease. The lend-lease transactions ultimately must be balanced, but those goods which are being provided to the United States of America by Australia have to be paid for now by the Australian taxpayers. I urge that the Government take up this matter with the Government of the United States in order that lend-lease may be put on a basis more satisfactory to the taxpayers of this country.
All honorable members know that the housing shortage is such that the time is over-ripe for the Government to give consideration to the institution of a housing programme. A constituent of mine at Bankstown has written to me a letter indicating the desperate need for housing some Australian families. It 13 perhaps a coincidence that my correspondent lives at Bankstown, where, it seems, materials can be made available to some people, although there is a shortage of materials and labour for the building of houses. This lady wrote to me on Monday in the following terms: -
I am writing to ask you if could help mc. I have been granted by Housing Commission additional ‘building on to my home the plans have been drawn and passed by all but they are having trouble in getting contractor to do the building. My home is from home and unemployment * trust. I have eleven (11) children and I am on my way again for my 12th child.
A very good Australian!
I have only three beds to put them into. I have no more room to put my children into to rear in the right way. My eldest child is a girl aged sixteen years old and she is being married on Saturday 25th of March this month. She is also going to have a baby and they have nowhere to go. They have tried hard to get rooms. He is a soldier, so the only thing I can do is to put them up at my place. You can call any time to see how we are crowded in one small house. Surely something can be done to help me to rear my eleven little Australians. I have one little boy aged seven years a cripple. He was born cripple and if something ib not done it will mean thirteen children four adults living in three rooms and kitchen. It is awful. “ Horrible “ would be a better word !
I have written and seen Mr. McGirr. H*> knows how I am placed and so far nothing has been done. Surely some thing can be done to help me. It is seven months since the matter was put in their hands. I do hope and pray that you will be able to do something. There must be some way out.
I know that this Government has many problems to face, but it must be aware of the desperate plight in which the shortage of houses has placed many families. Now that the Allied Works Council is reducing its staff owing to a diminution of the volume of defence works, surely sufficient labour and material could be made available to ensure the adequate bousing of munitions workers and men discharged from the fighting forces.
.- 1 raise the matter of paper rationing, which comes within the control of the Minister for Trade and Customs (Senator Keane). The matter with which I am particularly concerned, however, is one for the consideration of the Prime Minister .(Mr- Curtin). On Sunday night I heard Professor Boss, a wellknown public servant, broadcast on Australian literature. He counselled a wider reading by the Australian public of the works of Australian authors. We are familiar with the slogans designed to influence people to read Australian works, but what is the use of such a campaign when we know that Australian authors cannot have a book published in Australia to-day.
– Plenty of rubbish is being published.
– Exactly. Plenty of rubbish does circulate. I do not include government booklets in the rubbish; but I do impress upon the Prime Minister that the bulk of them find a straight route to the waste-paper baskets. If William Shakespeare were resurrected to-day and went in search of a publisher for Julius Caesar or The Tempest, and he was not known, he would not find one. That is no exaggeration. Here is a letter written by William Hatfield, the Australian author, to the Sydney Morning Herald -
The report that 200,000 books have been purchased in England for the use of Australian troops in forward areas, because Australian supplies are inadequate, should give concern to many people outside the small group of Australian writers concerned. Apparently Australia is the only civilized country at war which imagines it can win with munitions alone.
Two London publications of mine still sell in Australia, while eight perennially selling titles of mine published in Australia are- out of print through lack of paper. Naturally, ns an interested party, as an author deprived of income at this, the greatest bookbuying period in our history, I have a personal grouch. Beyond that, however, lies something vitally and nationally important, transcending the pecuniary interests of individual literary men. A nation’s soul does breathe in its literature.
Surely, if shipping space can be provided for completed books, some can be found for the raw material. Cannot somebody impress upon the Government the necessity for keeping alive an Australian literature?
Many efforts have been made by wellmeaning societies to .encourage the development of literature in Australia.Indeed, we have a great heritage in literature. Yet the publishing of books is prevented by the insatiable demands of the Government for paper. To-day I asked the Minister for War Organization of Industry (Mr. Dedman) whether the Government was obliged to submit its publications to the Book Sponsorship Committee for approval. He replied in the negative. About one-half of the output of the Burnie mills, which is the only manufacturer of calender paper of the kind used in books, isabsorbed by governmental printing. That is tragic. Yet newsprint is becoming so abundant that the press announced today that newspapers will receive an increased issue. Every day, honorable members find in their lockers printed matter on foolscap sheets. The Votes and Proceedings of this chamber could well be printed on newsprint, instead of upon the best paper. Governmental printing has made exorbitant demands upon supplies of paper and has prevented the publication of literature. One author, whose name I shall not mention, published a book that was an immediate success, and all copies were quickly sold. Although the proceeds were given to a welfare society, no paper was available to reprint the book. At the same time, volumes of propaganda and statistical bulletins were published by the Government.
When I was in England recently, I had an opportunity to find out what was happening in the publishing world. British publishers do not experience the same difficulties as Australian publishers have, although Great Britain obtains its supplies of pulp from overseas. Great Britain has made a proper allocation of paper to the publishers and effected economies in many directions. When Paternoster Bow was destroyed by enemy bombs, many millions of books were ruined, but the British people are still able to .purchase numerous booklets and good literature. The explanation is that the British Government tackled the problem wisely from the outset and made a proper allocation of supplies. I understood that the supply of paper available to British publishers was fully 80 per cent, of the pre-war quantity. I do not know how much is available to Australian publishers, but our authors have not managed to have their literature published because the paper is used for materials of less importance. One does not see in London buses the litter of paper that one notices in Australian trams. Bus tickets are placed in containers by the passengers, and, where possible, all postal matter is used over and over again. One rarely secs an envelope that has not been used many times. The Post Office approves the use of stickers to be placed over the previous “d dress and to seal the envelope. But in Parliament House, Canberra, letters written on the finest stationery are sent from one room to another.
– Even the Army has declared war on waste and has set out its efforts in a booklet.
– That was further waste. We have not attempted to salvage waste paper on a big scale. The Book Sponsorship Committee is doubtless doing its best, but has to cut its coat according to its cloth. The members of the committee look a formidable array and include the Commonwealth Parliamentary Librarian, the chief officer of the. Mitchell Library, and an officer of the Department of Trade and Customs. The time is long overdue for the Government to consider the curtailment of many of its publications in order to conserve paper and make it available for the publication of books. If our writers are not given an opportunity to bring forward their efforts at this juncture, they may be stifled. Even when paper is made available, the printers themselves are so busy that they cannot always undertake work for publishers because of government demand. I understand that the Department of Trade and Customs is examining the matter; I hope that it will make a new allocation of paper, and endeavour to reduce the appalling amount of waste that is occurring at the present, time.
Secondly, I am most concerned about the lack of housing, particularly for soldiers who are now being discharged from the forces. They have to scramble for accommodation in competition with people in a stronger financial position than themselves. Recently, I asked the Minister for Repatriation (Mr. Frost) to inform me how many homes have been built by the War Service Homes Commission since the outbreak of war, first, for men who fought in the last war, and, secondly, for mcn discharged from the fighting forces in this war. The amazing reply that T received was that the commission had built thirteen houses for soldiers of the last war and two houses for soldiers of this war.
– Over what period?
– Since the outbreak of war in 1939. It amazes me almost as much a1; it amazes the Minister for Home Security. The commission, explained that because of building restrictions imposed to meet the exigencies of war it could not estimate the number of homes that would bc erected for returned soldier applicants in 1944-45. It added that the position regarding building materials and man-power was constantly under review by the Government, but that no indication could be given as to when it was expected to build homes for persons eligible for assistance under the act. What an ironical position ! What will soldiers think when they learn that their dreams of having their own homes after the war will not be fulfilled ?
– That is not fair.
– Whatever the reasons may be, the number of houses built by the commission since the outbreak of war is negligible.
– Materials will be available in the post-war period.
– When I raised this matter in the House last Friday, the Prime Minister (Mr. Curtin) said firmly that bricks could not be made without straw, and that because of building restrictions, the commission was not able to erect a greater number of homes. I had to accept that answer. But imagine my surprise when I heard last week-end over the radio an announcement by the Minister for Labour and National Service (Mr. Holloway) that a great housing scheme would be commenced immediately. Many people have since written to me seeking additional information upon the subject. It is expected that thousands of homes will be constructed.
– Not by the War Service Homes Commission. The houses erected by the commission are permanent structures. The housing programme to which the honorable member refers envisages the erection of structures that will really be shacks.
– If materials are available for the erection of shacks, why cannot they be made available to the commission for the construction of permanent dwellings so urgently needed.
– Because the two classes of houses require different materials.
– That is questionable. The materials can be adapted to the needs. Once a builder obtains a permit to get the necessary materials, he can proceed with the job because labour is available. Sometimes there is a waitinglist of men at the Allied Works Council. If materials can be provided for the Allied Works Council and the Housing Commission, they should be made available to the War Service Homes Commission. Believing that the department was anxious to get on with the job, but was more or less moribund because of the lack of materials, I asked further questions on the subject. I asked what was the strength of the staff and how had they been employed during the period 1.940-44. The Minister replied that there is a permanent establishment of 165 persons, including a commissioner, 6 deputy commissioners, 6 architects, 2 works inspectors, 123 clerks and 27 typists. He added that 46 were on war service and six had been lent to war departments, leaving a staff of 323 at the present time. What have these six architects been doing during the last four years, if only fifteen homes have been erected during that period? When I put that question to the Minister ho obviously found difficulty in answering it, because he went to considerable trouble to give an explanation. He said -
General administrative duties in connexion with loans and assistance granted in pursuance of the provisions of the War Service Homes Act 1918-1941, including the keeping of personal and other accounts in respect of some 23,000 homes, collection of moneys which for the last financial year equalled £1,391,000, sinking fund transactions, war service homes insurance and war damage insurance of homes, relief for widows and others, discharge of liabilities, transfers of homes, inspection and maintenance of properties, advances for utility services and additional accommodation, discharge Qf onerous mortgages and other encumbrances and general legal work in connexion with transactions on behalf of applicants. &c.
In addition, work is proceeding in relation to examination of proposals and establishment of eligibility of ex-service ‘personnel, including those of the present war, in anticipation of resources later becoming available which will permit the commencement of active building on behalf of persons eligible within the meaning of the act.
I express the view that whilst it is admirable to provide homes for workers at the present time, we must remember that returned soldiers were exposed to greater danger and received considerably lower pay than civilians. Therefore, returned servicemen are entitled to consideration in this matter.
– Would the honorable member advise a returned soldier to build a home now, when building costs are so high?
– The Melbourne press, particularly the Sun, has been publishing a series of photographs of the distressful conditions in some suburbs. Returned soldiers have not been able to get houses of any kind and have been forced to live under squalid conditions. A few minutes ago, the honorable member for Reid (Mr. Morgan) explained that the position was similar in Sydney.
– We have been studying that position for months.
– It has got beyond the Minister.
– lt has not. I would not advise a returned soldier to build a house now when building costs are so high. We are endeavouring to obtain homes and allow returned soldiers to rent them.
– I disagree with the Minister on that point, although he may be wiser than I am in relation to real estate transactions. I would buy a house of any description at present as an investment, and would expect to sell it later at a profit. We talked about building homes for heroes to live in; the men would need to be heroes to live in those that are obtainable. I believe that decent homes should he erected, but I should greatly like to know what the architectural and general staff of the War Service Homes Commission has been doing in the last four years seeing that only fifteen homes have been built in that period. I stress the urgency of the subject.
M-r. Frost. - The Government is treating it as urgent.
– I hope that from now on the War Service Homes Commission will be as active as other instrumentalities in building homes.
.- Considerable criticism has been levelled against the Government because an accumulation of war materials has occurred. If this state of affairs had been peculiar to Australia some criticism might have been justified ; but practically every other country finds itself in the same position. Owing to the interruption of normal manufacturing and importing, all countries engaged in the war were obliged to do everything possible to obtain supplies, and it is natural that accumulations have occurred. To show the position in the United States of America I quote the following paragraph which appeared in an article in The Times Trade and Engineering for January, 1944-
During the period of increasing scarcity of raw materials in 1942 and the early part of 1943 the Government of the United States had fostered production from every possible source, however small. Disused mines were brought back into operation, the exploitation of marginal mines was rendered profitable and the development of low-grade mines was actively stimulated. To-day supplies from many of the marginal and low-grade mines a’re no longer required, and in order to divert labour from those mines to more essential war work, the United States War Production Hoard has now withdrawn premium price concessions from many marginal mines producing such minerals as bauxite, lead, vanadium, tungsten, chrome, graphite, molybdenum and cobalt. This is only a first step, which may before very long be followed by others, and clearly shows that supplies of a number of key raw materials for war have now outstripped war requirements.
Like the United States of America, Australia had to do everything in its power to obtain minerals in short supply, and had to accept the incidental risks. Had it not done so, it would have been justifiably criticized. Canada was in the same position. Because of the demands of the aircraft manufacturing industry, all countries were at their wit’s end to secure adequate supplies of aluminium. It seemed, for some time, that this would present an unsurmountable barrier to Australian aircraft production, but I am glad to say that ultimately we shall find ourselves in a satisfactory position. The aluminium industry, however, is likely to cause a great deal of difficulty in the days to come because it appears that there will be an over-production everywhere. In this regard I quote a paragraph, also from The Times Trade and Engineering, January, 1944 -
Canadian mining is one of the industries which may be severely affected by the accumulation of stocks and the enlargement of productive capacity to meet war-time demands. The situation as regards aluminium seems likely to be specially difficult. Mr. George Bateman, Canada’s Metal Controller, told a parliamentary committee that he expected aluminium to remain one of the great Canadian industries aud to improve on its pre-war markets, but that he also believed that any great expansion of the pre-war markets “ is going to represent a very difficult time or condition, and can only be attained at the expenditure of a great deal of money carried on over a period of a good many years “. Canada’s’ aluminium producing capacity is now twelve times as great as it was when the present war started, and production to-day is running at a rate equivalent to 100 times the pre-war consumption of this metal in the dominion. The entire output is being used for war purposes, mostly aircraft, with the result that peace-time markets have been lost. Not only must the big Canadian industry begin anew to build up outlets after the war, .but it will have to do so in competition not only with other metals and non-metallic materials, but also with great tonnages of scrap aluminium.
The observations in that paragraph cause me to turn my attention to a provision in the Canadian Mutual Aid Agreement which Australia and Canada have just concluded. One of. the articles of that agreement provides that Canada shall be entitled to supply nonferrous metals and electrical equipment to Australia. We are endeavouring to establish an aluminium industry in this country, for aluminium is just as important for us, for our aircraft industry, in particular, as’ it is to .any other country. If Canada is to be authorized to off-load into Australia tremendous quantities of its surplus aluminium, the outlook for the Tasmanian aluminium industry is not promising. The North American countries which have a very fine hydro-electric power supply are already considering the possibility of the replacement of copper by aluminium materials in electrical transmission lines and equipment generally. Aluminium has only 62 per cent, of the conductivity of copper, but in view of the favorable conditions under which aluminium can be produced in North American countries it may be practicable for something to be done m this regard. One authority points out that normally the replacement of copper by aluminium for electrical conducting purposes becomes economically possible if the price of high-grade aluminium does not exceed the quotation for electrolytic copper by more than 30 per cent. Before the war the price relation between the two metals was seldom, and only for short periods, in favour of aluminium, with the result that the use of that metal in the electrical industry remained limited. We have to face the fact, however, that this situation may be entirely altered after the war. Moreover, a strong move has been proceeding for some time for the replacement, in the postwar period, of heavy metals by light metals. This may have serious implications in relation to the Australian iron and steel industry. For various reasons in the pre-war years it was not possible for us to make an economic comparison in regard to production costs and the like, between the Australian iron and steel industry and such industries overseas ; hut during the war period we have ascertained beyond question that our industry is able to compete on very favorable terms. Now, however, we are faced with the prospect of a new situation altogether, in consequence of the move to replace heavy metals by light metals. This may ‘be of considerable importance to the secondary industries of Australia, and it may also affect our primary production if the provisions of the Atlantic Charter are fully observed, for our manufacturers will not enjoy such favorable tariff conditions and the like as they enjoyed in the pre-war years. In other words, we may not be able to nurse them in the future as we have done in the past.
Sitting suspended from 6 to 8 p.m.
– If Australia is to be a force in world affairs when the war is over, and also is to become selfsufficient so that it may deal with a crisis similar to that through which it has gone during the last few years, it will have to develop its light metals to a greater1 degree than they have been developed in the past. Their development is allied to the development of electrical resources. The smelting and treatment of light’ minerals are largely dependent upon the use of big blocks of electric power, in contradistinction to the old blast furnace, which required large quantities of fuel for the smelting of heavy metals. This brings into the scope of discussion the supply of electric power for primary industries. If we are to compete in the markets of the world with the commodities of other primary producing countries’, we must produce just as economically as they do, and we shall have to work rapidly in order to make our conditions comparable with those of Canada and the United States of America, which have practically an unlimited power potential. I shall relate an incident which indicates the unfortunate position in which primary industries are placed by being far removed from sources of cheap electric power. Perhaps twenty years ago, a move was made to decentralize the meatprocessing industry. Financial and other companies interested in this development were well supplied with cash resources. Angliss and Company, which is allied to Vesteys, the great international meat-processing and producing company, expended approximately £250,000 at Daroobalgie, near Forbes, in the Lachlan Valley, in order to develop country killing. “Much argument had been advanced as to the merits of country killing and processing, compared with the carriage of live-stock to the metropolitan area and its treatment there. This costly experiment was continued for several years, but even with such tremendous financial resources as they could command, the Angliss-Vestey interests had to withdraw from the project, because of the economic conditions which then prevailed. The principal difficulty was the supply of electric power. Angliss and Company has a big meatworks at Riverstone, close to. the metropolitan area, for which it obtains electric power from the authorities in that area at less than Jd. a unit. The power supplied at Daroobalgie costs approximately 4d. a unit. It is clear that, with electric energy figuring so largely in the cost of production, a company endeavouring to operate where live-stock is produced is greatly handicapped in comparison with a company operating in the metropolitan area, where cheap electric power is available, even though it is costly also to transport live-stock for treatment there. At the outbreak of the war, the Commonwealth Government subsidized this company, because it required that the old meatworks should be put in order for the production of meat. On account of the danger of big manufacturing enterprises on the coast being put out of action, the work became doubly urgent; consequently, the Commonwealth Government and the company between them had the works put in operation immediately. It has since been found that the electrical equipment originally used in that plant i3 obsolete; consequently, a very great strain is imposed on the machinery. Unless the industry is to languish and expire in the post-war period, the whole of the electrical portion of the plant will have to be renewed. No works of a seasonal character away from the metropolitan area can stand the strain of the establishment of big electric-generating ‘ plants, involving possibly 33 per cent, of the total capital cost of plant. The needs of the times impelled the Commonwealth Government to allocate priorities in the development of our electrical resources, particularly in New South “Wales. The authority which tic-vises the Commonwealth Government, in its wisdom, placed this concern on a low priority for connexion with the electrical generating system of New South Wales. If such a project as the Daroobalgie meat-works were hooked to the general grid system, Angliss and Company would be able to operate country works on level terms with similar plants in the metropolitan area. Unless the Government or some other authority is prepared to give to the company £50,000 or £100,000 with which to establish a generating plant to supply electricity which- would !be used for only three or four months of the year, it is evident that, having the paramount consideration of conserving :the interests of its shareholders, the company cannot incur the expense on its own account, and the only alternative -would be a transmission line from the grid system for a distance of approximately 50 miles to the works. There is an alternative which the Government should seriously consider. A class of labour which has been called into industry because of the needs of war would he regarded in peace-time as border-line labour, possibly employable and possibly unemployable, but definitely engaged under seasonal conditions in places such as this; but it cannot be employed unless projects of the character of country meatworks continue to operate. In the neighbourhood of these meatworks, the
Commonwealth has established munitions works, which operate under the same disadvantage in regard - to electric-power, and employ labour of the border-line type. Undoubtedly, quite a lot of this labour is Al; but some of it is not. If the Al labour were withdrawn, the whole structure would collapse, and the border-line labour would be thrown on the industrial scrap-heap. There would be no means of taking up the slack, and it would be useless for the Government to offer its factories to private concerns, because they would not be able to produce economically so long as they had to pay such a high price for electric power. A transmission line to the meatworks would enable these factories to take the offpeak load, and the whole of the background of the scheme would be economically sound. I urge the responsible Minister seriously to consider this project immediately. He can well understand that time would be needed to change over the generating and electrical equipment of a plant which has cost £250,000. Seasonal work will not await somebody’s leisure. In this district, that work consists of lamb-killing and treatment, and the season commences about September. If action be not taken immediately to enable the company to determine its programme from the beginning of September, production will suffer considerably, because the use of an obsolete plant which cannot stand up to the strain imposed during the peak of the season would cause a lowering of the production rate, and possibly a complete breakdown would put an end to killing at a vital stage of the season. The company has expressed willingness to cooperate with the Commonwealth Government in the conversion of its plant to the production of highpriority foodstuffs. The matter is governed entirely by the element of time. The Government is anxious to take up the employment slack that will result from, the change-over from war industries to .peace-time occupations, and I believe that what I have suggested would be helpful. When a private business enterprise so financially sound as that of Angliss and Company has demonstrated that it is capable of assisting the primary industries by the processing of meat, every facility should be given to it. In this way, we may encourage the decentralization of industry. The Atlantic Charter envisages the lowering of tariff barriers created for the purpose of fostering industries which are unable to exist without a great deal of assistance. Therefore, we must do what we can to develop our natural primary industries.
.- The honorable member for Calare (Mr. Breen) referred to a fundamental defect in our national economy. For a long time, I have believed that we ought to link up our power systems all over the Commonwealth in order to ensure that power may be obtained at any point where it is required, and so that country industries may be able to obtain power at the same price as is paid in the cities. I advocated this scheme at the Premiers Conferences in 1923, 1929 and again in the 1930’s, but all I could achieve was agreement regarding standards of electrical equipment. We now have an opportunity to do something more ambitious, and I assure the honorable member for Calare of my support. In return I ask -him to assist me to secure the linking up of power systems, not only within the States themselves, but also between one State and another. In this way, the water power stations on the Clarence river in northern New South Wales would be linked up with coal power stations in southern Queensland, that system again with Sydney, Port Kembla, Newcastle and Burrinjuck, all of which would form a part of one network serving the central part of the State, and the power stations in the southern part would be connected with those in Victoria. This is a work which cannot wait to receive a post-war priority. It is urgent, and action should be taken now.
I urge upon the Government the need to do something to promote the health of the community by ensuring more plentiful supplies of health-giving food. As the Government of the Commonwealth appears to have substantial funds to expend for health purposes and for free medicine, I suggest that charity should begin at home, and that health facilities in the Australian Capital Territory should be made a model for the rest of Australia. When
I was Minister for Health some years ago, I was able, at the suggestion of the Lady Gowrie, to obtain funds with which to establish in each capital city a model kindergarten to serve as a pattern for ‘State activities, and the institutions were run at the Commonwealth expense. I suggest that something of the same kind should be done in Canberra in regard to the treatment of tuberculosis. Within the last two or three years a very fine hospital has been built in Canberra suitable for a population of 20,000 people. There should be associated with it facilities for the treatment of tuberculosis according to the latest methods. There should also be associated with the hospital the finest maternity block in any hospital of the size in Australia. This would be an example and an inspiration to other towns to provide suitable facilities of the kind.
I also urge the Government, if it has money to dispose of, to take steps to improve the nutrition of the people, especially by making available more milk to women and children. In this connexion, I was interested to read the statement of th~e representative of the United States of America at the Hot Springs International Food Conference, which was attended by our own AttorneyGeneral (Dr. Evatt). I quote as follows from the report: -
A striking report on the influence of improved pre-natal nutrition upon the infant has come from Toronto. Three groups of pregnant women attending the pre-natal clinic before the sixth month of .pregnancy were observed: (1) A group of 120 women on poor diets, not altered during the study. (2) A second group of 90 women on diets as poor as those of the first group, but supplemented by the daily addition of 30 oz. of milk, 1 egg, 1 orange, 34 oz. of canned tomatoes, 1 oz. of cheese, 1 viosterol capsule, and two tablespoonfuls of wheat germ. This brought dietary levels up to moderate requirements. (3) A third group of 170 women whose diets were moderately good and who had incomes sufficient to purchase a good diet. This group was given advice on diet, but no supplement.
Women in group (1) suffered most and women in group (2) least -from such complications of .pregnancy as anemia, eclampsia, and threatened miscarriages. No miscarriages occurred among the women in group (2), while 6 per cent, occurred in group (1). There were no stillbirths in group (2), while 3.4 per cent, of the women in group (1) suffered this complication. Pelvic and breast inflammation were twice as common in group (1). as in (2). Group (3) occupied an intermediate position in almost all respects less favorable, than group (2), more favorable than group (I). While the offspring of fourteen group (1) mothers .perished, every mother in group (2) gave birth to a living child. More striking still was the freedom from illness of group (2) infants during the first six months of life. There was, of course, no rickets or tetany of the newborn among them, while the incidence of these conditions was high in group ( 1 ) . But group (2) infants also had a far more favorable experience than the others as regards pneumonia, bronchitis, and anemia. The last is particularly significant. Percentages °” infants who suffered from anemia were, in group (1) (poor diet), 25.0; group (2) (supplemented), 0.4; group (3) (good diet), 17.1. lt may well lie that adequate pre-natal feeding will ‘ be the answer to part at least of the problem of neonatal mortality, which in Canada accounts for more than one-half of the infant mortality.
It is interesting to read what happens to the babies afterwards. Sir John Orr, of the Raith Institute, Aberdeen, who is an authority on this subject, published a book in 1936 entitled Food, Health and Income?.* Here is an extract -
The most significant infectious disease illustrating the influence of nutrition on susceptibility to infection is tuberculosis. Infection is very widespread and in the great majority of cases it is the resistance of the individual which determines the extent to which the disease develops. Striking evidence of the influence of diet on resistance is afforded by the experience of Germany during the recent war. In the highly industralized parts of the country, where the food shortage was most acute, the tuberculosis mortality showed an enormous increase. In Saxony it was almost doubled. This increase was accompanied by an increased virulence in the type of the disease (3, 1). The RegistrarGeneral’s report of 1027 shows that the mortality rate from tuberculosis amongst occupied males was nearly three times as high for unskilled labour as for the higher ranks of business and professional life (40). It is probable that the most effective line of attack on tuberculosis is by the improvement of diet.
Dealing with the actual growth and vigour of children, he says -
In 1927 a series of tests was carried out in Scotland in which a.bout 1,500 children in the ordinary elementary schools in the seven largest towns were given additional milk at school for a period of seven months. Periodic measurements of the children showed that the rate of growth in those ‘ getting the additional milk was about 20 per cent, greater than in those not getting the additional milk. The increased rate of growth was accompanied by a noticeable improvement in health and vigour (33, 34). This experiment was twice repeated by different observers, who obtained substantially the same results on numbers up to 20,000 children.
I suggest to the Government that it should consider carefully the effect of food on public health, and should arrange to make available to the poorer people milk at the lowest possible price. If milk were reduced in price to 2d. a pint, as it could be by the payment of a subsidy which would cost little more than the free medicine scheme, the consumption of milk could be doubled, and the risk of still-births and infantile diseases could be largely avoided. 1 believe that the making available of this highly protective food would, ultimately save much more from our health bil! than anything else we could do. The honorable member for Denison (Dr. Gaha) has raised the subject of the birthrate on several occasions in this house. I have indicated a method by which the number of still-births can be greatly reduced, and the care of infants can be rendered more effective. I commend that practical suggestion to the Government. A report in the issue of. the London Times which came to hand yesterday stated that the quantity of raw milk being consumed by humans in Great Britain in this the fourth year of war is 30 per cent, greater than that consumed in the year before the war. Mainly because the authorities in Great Britain, have maintained the full quality of milk the incidence of tuberculosis has not increased since the war started. I regard this as the most astonishing feature of the war. Great Britain’s achievement in holding this dread disease at bay is greater than any of. the wonderful victories which the Allied Nations have won in the air, on the sea, or on land. Tuberculosis is invariably accompanied by malnutrition, resulting in the dislocation of man-power for essential war work. Previously the incidence of this disease always increased during a time of war. Lord Woolton told me on my recent visit to his country that he saw in his own family the effect of malnutrition in the last war; and resolved right from the start of this conflict that the experience of the people of Britain on that occasion would not be repeated in this war, no matter how hard pressed the nation might be. We cannot afford to postpone consideration of this matter. To-day, owing to the absence of adult males from most families an extra burden is being thrown upon mothers, whose health and that of their children is consequently endangered. One of our first responsibilities is to safeguard the health of our people, and we must do sp if we are obliged to ask the healthier of our citizens to do with less of these essential foods.
The annual report of the AuditorGeneral discloses that the Grafton-South Brisbane railway, after allowing for working expenses, depreciation, sinking fund and interest, and after setting aside £150,000 to meet accruing maintenance of track, rolling-stock and equipment, and remodelling accommodation, showed a credit balance of £679,263 for the year ended the 30th June, 1942-43. This means that that railway is showing a profit of nearly £1,000,000 per annum. It is worth while recalling the history of this line. It was built by the Bruce-Page Government in 1920 as the first instalment of. a national scheme for the. standardization of railway gauges. The necessary finance was found by the Commonwealth, with New South Wales and Queensland agreeing to contribute a share of the capital. It was agreed that the first charges against surpluses should be in respect of interest to the Commonwealth, and the two States, and the latter should be entitled to divide profits af ter meeting those charges. The prosperity now being enjoyed by this line is due mainly to the enormous volume of Commonwealth traffic including munitions, timber and foodstuffs for the fighting forces. In addition, from 80 per cent, to 90 per cent. of. the passenger freight is accounted for by service personnel. In view of these facts it seems reasonable to suggest at a time like tho present, when every State is showing a fairly substantial surplus, that a greater share of this profit should be returned to the Commonwealth either directly, or indirectly through a reduction of freights and fares to civilians. In view of the differential rates and fares being charged on this line, one would scarcely credit that it was constructed as the first unit in a national scheme to standardize railway gauges. After we had been at war’ for two years, the Commonwealth was able to have removed the differential rate in respect of military material. To-day we must use this line as we must use all internal transport to carry the greatest possible volume of war traffic. Prior to the entry of Japan into the war, 90 per cent, of our interstate traffic was carried, by sea. Despite the fact that this traffic must now be handled by our railways and other means of internal transport, differential rates are still charged on this line. The distance from Brisbane to the New South Wales border is approximately 90 miles, and the freight charged for the carriage of a special article of produce over that distance is £2 10s., whereas for the next 100 miles to Grafton the charge is £11 10s. Differential rates are also being charged on other interstate railways. The charge for conveying potatoes from Llangothlin to Brisbane direct is £20 a truck, whereas via Maitland to Brisbane it is £16 a truck, although the latter distance is considerably the greater. The freight rate for potatoes from Mount Gambier to Adelaide, a distance of 303 miles, is £2 10s. a ton, but from Mount Gambier to Melbourne, a distance of 292 (miles, it is £8 9s. 4d. a ton. This means that producers and the people generally are paying unnecessarily high rates under these differential systems. One conclusion to be drawn from these facts is that this Parliament, before it embarks on the job of standardizing railway gauges, should make certain that when the lines are standardized, the services so provided will be used in the national interest, and will not be used by one State railway system to compete against that of another State to the detriment of the nation as a whole. A portion of the handsome profits now being shown on the line from Brisbane to Grafton should be used to help the Commonwealth in its war effort, because the Commonwealth is doing the major job in this country to-day. Alternatively, the freights and fares being charged on that line to civilians should be reduced, because our people as a whole are doing essential national work. After all, they are the taxpayers, and these charges are an indirect tax.
The last matter with which I wish to deal concerns the operation of district war agricultural committees. The Auditor-General in his annual report points out that of £100,000 voted for the purpose of financing these committees, only £14,000 was expended during the first six months of the last financial year. I regard these committees as the most useful and practical organizations yet set up in our war-time economy. The members of the committees are practical farmers, nearly all of whom have sons in the fighting services. Despite the fact that they are short of man-power on their farms they devote their spare time to the work of these committees, which are assisted by officers of the State Departments of Agriculture. However, the committees are hamstrung, first, because they are not provided with sufficient clerical assistance; and, secondly, because their recommendations - the decision of experts, and the result of careful consideration and investigation - are very often turned down. Recently, when I was visiting the north coast district I interviewed the administrative member of one of these committees. He is in charge of the issue of tyres and petrol and gas-producer units to primary pro Queers. His ability is undoubted, and the district in which he operates is a? familiar to him as is the palm of his hand. However, he is directed to make a detailed investigation of every application to his committee, despite the fact that in many cases he is already familiar with the facte. The result is that he is unable to keep abreast of correspondence. “When I saw him he had practically two months’ leeway to make up, and was being assisted in this work by his wife. It would be difficult for that particular committee to obtain the services of a second man of equal ability, but it should not be difficult for the Government to provide a typist to assist in the work of the committee. Every one knows that the most important thing in rural industry is to catch the season before it passes. It is very discouraging to members of these committees, after they go to infinite pains to make complete reports on the subjects coming before them, to find that their recommendations are turned down, or amended by officers at head-quarters situated hundreds of miles and, sometimes, over 1,000 miles, from the district. The latter’ do not know the local conditions, and are not so competent as the members of the committees to say what should be done. If we desire to keepthese useful ‘bodies functioning efficiently they must be vested with executive power. In order to indicate the feeling that is developing among producers in this respect I quote the following letter which I have received from a farmer at Jones Island: -
Before taking the drastic step which J. anticipate, i.e., reduce my dairy herd by 50 per cent., I -am making this appeal to you, to see if you can do anything for me, in having my son released from the forces, to assist me. I applied through the proper channels some months ago. Approved by man-power authorities, but - well, you know the rest. 1 have spent 30 years building up a high producing herd (1941-42 production 324 lb. per cow), but it seems inevitable, if release is not granted, that half the herd must go, and Scully is crying out “ more butter
My position is briefly this: Farm of 74 acres rich flats (you know Jones Island), 50 cows. My wife and myself to run it. One daughter at home eighteen years. Used to help me, but broken down under the strain (nerves), and ordered by Dr. Stokes to get off the farm at once. My age is 53, not strong, have a double hernia, and just about reached the end of my endurance. Cows get supplementary feed nine months of the year, all grown on the farm. They will be lucky if they are hand-fed for three months this year. T had to burn half of my lucerne hay on the field, as I could not handle it. I Cannot carry on without the help I have asked for. I will do all I can, and may go under doing so, but I am not going to drag my wife with me. The production result for 1944-45 will be about 6,000 or 7,000 lb. short.
I know, Sir Earle, that you know the coast and the conditions under which we are labouring and have, voiced your opinion in the House,” and in the press, pretty strongly at times. I also know my fellow dairymen, and of late i have noted a new element creeping in. As a physician you know that continued physical exhaustion has a psychological effect. That is what is creeping, unconsciously, into the middle-aged and aged people carrying the burden in the dairying industry. A state of mind “ oh, what is the use “, a weariness, something akin to “war weariness”, and if that rot sets in God help the dairying industry, if some of our young men do not get back on the job.
Thanking you in anticipation, and hoping you can do something for me in my difficulties.
That letter is typical of many that I have received. I urge the Government to adopt the New Zealand pattern in respect of this aspect of the nation’s manpower problem. New Zealand has a system under which the men in the front line and reinforcements are in No. 1 priority; the men needed for essential work are in No. 2 priority, and the men in the military hack areas are in No. 3 priority. The essential land industries come in between the two sections of the Army and the Army authorities cannot interfere with them, because that policy has been laid down by the War Cabinet and must be applied.
– I take this opportunity to direct the attention of the Treasurer (Mr. Chifley) to an occurrence in the last sessional period which I hope will never recur in this Parliament. The honorable gentleman will remember that in the one day he brought down in this chamber all the bills relating to the Government’s financial policy, including the bills to give effect to the recommendations of the Commonwealth Grants Commission on the claims of Tasmania and other States for financial assistance from the Commonwealth. Unfortunately, as all that legislation was introduced at the tail-end of the sessional period, neither we nor the State Governments had the opportunity to examine the effects of the grants proposed on the economy of the States. I understand that some State governments have surpluses on which the avaricious eyes of the Commonwealth Ministry are fixed. I suppose that it is appropriate to the occasion that the Treasurer and treasury officials should have “ a lean and hungry look “ and are difficult to circumvent. They wrap themselves in an atmosphere of mysticism when taxation and other financial measures are being considered, with the result that the most capable of us can never properly understand them. In the last couple of days there have been some notable examples of that. Whilst that is all very well from the point of view of the Treasurer, I remind this House that there are six Australian States and that finance is centralized in theCommonwealth. It is of particular importance that each year the Commonwealth should acquaint the States of the amounts of money that it intends to make available to them in sufficient time to enable them to plan their activities for the year. When legislation for Commonwealth grants to the States was last considered by the Commonwealth Parliament honorable members were deluged with financial measures introduced late in the sessional period, with the result that they were denied the opportunity to analyse the Commonwealth’s proposals in respect of their States. It ought to be possible for the Treasurer and his officials to drop their air of mysticism and their surprise tactics and supply the States with details as to the Commonwealth Government’s intentions in sufficient time to enable them, if necessary, to enter a protest against the inadequacy of the intended provisions. That would do much to improve the relations between the States and the Commonwealth, and ensure a better reception of the referendum on extension of the federal powers. Not even the parsimonious practices of the Commonwealth Government should be an obstacle to the granting of that simple request. I will not labour the matter further now, but I shall be driven to say unpleasant things if the Commonwealth Government continues to deal with my own State as in the past. I do not care about the other States because I am not here to represent them.
– Yes, I am one of the minotaurs. Each has to fight for his own under the jungle law of this honorable place. I will blare with the best in order to achieve what I consider to be the best interests of my constituents.
– Is that not parochial?’
– The honorable member for Kalgoorlie (Mr. Johnson) has the opportunity to speak for Western Australia, but he will realize that in presenting the case on behalf of Tasmania, I also present it on behalf of all’ the claimant States.
All honorable members, in the course of a sessional period, receive voluminous papers, all of which no one could read, but by a strange coincidence, I did, in perusing one document, come upon some significant information which I present to the Government. Governments never understand the significance of their own figures and it generally remains for outsiders to indicate that significance to them. The second report of the Director-General of Social Services for the year ended the 30th June, 1943, contains most significant figures in respect of invalid pensioners. In 1939, there were 128 invalid pensioners in each 10,000 of the population, but, in 1940, after the outbreak of war, there were only 84, and in the next three years there were respectively 83, 84 and SO, showing a constant ratio during the war years. To show that the 1939 figures were not abnormal, I point out that equally constant was the ratio in the four years before the war - 128 in 10,000 in 1939, 125 in 10,000 in 1938, 122 in 10,000 in 1937, and 119 in 10,000 in 1936. Since the war began the number of invalid pensioners has dropped by about 46 per cent. - a most extraordinary, occurrence, from which the only inference is that the majority have taken employment, although, in order to qualify for the pension, these applicants had to present medical certificates testifying to their incapacity. I do not intend to tell laymen the secrets of the obscure profession of medicine. He who wishes to discover them must pay. All I say now is that 4S,000 people whose eligibility for the pension had been certified because they were unfit for work are apparently at work. There are two possibilities. The first is that all the medical certificates in respect of those former invalid pensioners were wrong. Having made that remark I will say no more, because I will not attack my own profession. The second is that the war has brought to light work which they can undertake and which was not available to them or did not exist here previously. It will be the task of the Department of Post-war Reconstruction to ascertain what quantity and quality of work will continue to be available for former invalid pensioners who, of their own volition, have returned to work. The more 1 ponder these figures the more paradoxical they become. It is sufficiently a paradox that, whereas between 1936 and 1939 the ratio of invalid pensioners to the general population was fairly constant between 119 in 10,000 and 128 in 10,000, in 1943, after four years of war, the ratio was as low as 80 in 10,000. But a greater paradox is a comparison between 1939 and 1929, when the depression began, for in 1929 there were only 93 invalid pensioners to each 10,000 of the population. One would expect that there would be more invalidity in days of poverty than in days of plenty, but the reverse appears to be the truth. I leave honorable members to work the problem out for themselves. I do not know the answer.
– Would it be that the population is gradually becoming older?
– Yes, but at nothing like that rate. The honorable member’s supposition does not account for the fact that 48 of every 128 invalid pensioners in 1939 are no longer invalid pensioners. Does it not seem reasonable to suppose that most of them have seized the opportunity to take work when plenty of work “ is available?
– Until a couple of years ago .total and permanent incapacity had to be established before a person could draw the invalid pension.
– The honorable member has pulled the lever the wrong way, because there were more invalid pensioners when eligibility for the pension was less liberal. I do not raise this matter merely to ridicule the situation. My purpose is to indicate to the Minister for Post-war Reconstruction (Mr. Chifley) that he should instruct his officers to examine every aspect of the causes of 48 of every 128 invalid pensioners in 1939 being no longer invalid pensioners in 1943, in the hope that those people will, in the post-war years, be able to continue at work and thereby relieve the taxpayer of an enormous financial burden. The department ought first to try to discover the reason for the sudden decline of the number of invalid pensions in the first year of the war. It certainly appears to me that, notwithstanding their certification as being unfit for work, they have found work in which they can engage with profit to themselves and saving to the country.
.- I direct the attention of the Minister representing the Minister for the Interior (Mr. Lazzarini) to the shabby treatment which has been meted out to me and my constituents by the Minister for the Interior (Senator Collings). The Minister’s treatment of me and my constituents was not only unfair and unwarranted, but also discourteous. Shortly after the last general elections, the Commonwealth Electoral Officer in Tasmania reported to me that the head-quarters of my electoral division were to be moved beyond the boundaries of the division. I immediately protested to the Chief Commonwealth Electoral Officer at Canberra, Mr. Turner, that I thought the decision was wrong and asked that he take no further action until I had had the opportunity personally to discuss ‘ the matter with him, and he agreed. Imagine my astonishment, therefore, when a few weeks later I received from him a telegram stating that he had recommended that the Minister approve of the transfer of the headquarters forthwith owing to the unsatis-factory .staffing position. He recommended that the head-quarters should be removed outside of the division altogether. 1”. immediately telegraphed to the Minister as follows : -
Most strongly object proposed transfer head-quarters my electoral division Wilmot. Gravely misled by Commonwealth Electoral Officer, who promised no definite action would he taken until conference with me as member for division. Alleged staff difficulties greatly exaggerated. Will you withhold approval until personal discussion With me?
I deemed that a fair proposal ; but I thought that the Chief Electoral Officer -and consequently, the Minister - should at least stay his hand until I had an opportunity to discuss the matter with him. I also telegraphed to the Chief Electoral Officer, Mr. Turner, personally, regretting that he had failed to carry out his compact with me to give me an opportunity to discuss the matter. Mr. Turner did reply in a sort of apologetic way, as follows: -
I desire to assure you it was with sincere regret I felt compelled by the urgent pleading of the Commonwealth Electoral Officer for Tasmania to recommend tho immediate transfer of the Wilmot division head-quarters without adhering to my promise to first discuss tho matter with you.
Mr. Turner was frank and open. He admitted that he had failed to carry out his promise to me, and apologized, but the Minister for the Interior sent me the following telegram: -
Proposal reference electoral transfer will probably be submitted to me for decision early next week. Suggest you air-mail any matters you desire to have considered. Understand Turner wired you yesterday to give you opportunity to contact me. lt will be readily understood that it is difficult to prepare a case for the retention of the head-quarters of an electoral division, when the reasons for the suggested transfer have been withheld. I wanted a discussion with the Minister in order to ascertain the reasons for this unusual departure. I knew that the reasons’ put up in relation to staff wore unreal. I knew that there was no difficulty in that direction, and in response to the Minister’s request I wrote to him in the following terms, after acknowledging receipt of his telegram: -
It is difficult to prepare a case for the retention of Deloraine as the head-quarters for the Wilmot Division without having knowledge of reasons why the electoral officer has recom mended the change. The only reason advanced as far as I know is the question of the alleged staff difficulties. With all due respect I suggest that this question of the staff has been grossly exaggerated. In any case the public servant goes wherever his duty takes him - there is no suggestion of closing a post office if it is inconvenient to the stall’ - a railway station is not closed down because there are staff difficulties. When such difficulties arise they are overcome. I suggest, however, there are ho staff difficulties at Deloraine which are not surmountable, and, knowing that staff can bo obtained, I am forced to the conclusion that there is some other reason which has caused the suggestion for the -removal to Launceston. Deloraine has been the head-quarters since federation and no insuperable difficulties have arisen in the past. Wilmot is a country electorate with public bodies and private citizens in this district are very incensed at this proposal to centralize everything in the cities. I suggest we should aim generally at a policy of decentralization. So far as staff difficulties are concerned I can guarantee toprovide suitable personnel to carry on the work year in and year out, quite efficiently. In any case, there are not elections due in Tasmania, either State or Federal, for the next three years. Why this ‘unseemly haste, especially in view of the fact that suitable personnel can be found to carry on the work efficiently both between elections and at theelections. -Just after the elections in August last I was told by the Commonwealth Chief Electoral Officer for Tasmania that there was a proposal to remove Wilmot head-quarters toLaunceston. I at once expressed my opposition to this proposal and wrote the Chief
Electoral Officer for the Commonwealth asking if he would give me an opportunity to discuss the matter with him before he took any definite action. He agreed; and you can imagine my surprise when I received a telegram from Mr. Turner on Friday last stating that he had recommended to you the transfer of the office forthwith without consulting me. I thought, at least, that he would have conferred with me prior to making a definite recommendation to you.
I am told that never before in the history of Australia lias the head-quarters of a division .116011 transferred without the consent of the member concerned and I hope that this record will not now be broken.
The staff at the recent elections were equal to any other electorate. There were new officers, of course, but this was universal throughout Australia owing to the fact that the more-or-less permanent officers have joined the services. There was no delay; and the counting was completed as early as any other country electorate. No: T am afraid something else has caused the agitation for this proposed transfer. In view of this position it cannot be regarded as urgent, and no action should be taken forthwith. There U no election for three years and the office can be efficiently carried on in the meantime and I again urge you to refuse to approve of li,is recommendation. If you feel inclined to iri ve it further consideration, I beg of you to take no action until I have an opportunity of personally discussing it with you.
T suggest that that was a fair and reasonable request. I received from the Minister the following letter: -
I have very carefully considered the terms of your letter of 22nd November in which you submit reasons for your opposition to the transfer of the head-quarters of the Electoral Division of Wilmot from Deloraine to Launceston. However, having regard to all factors, I have approved of the transfer :md believe that it will be in the interests of departmental efficiency and that it will provide an improved service to the people.
With regard to your statement that you have been told that “ never before has the head-quarters of a division been transferred without the consent of the .member concerned”, I may state that divisional headquarters have on many occasions been changed without any reference to the member for the particular division.
When the permanent officers - the returning officer through ill health, and the clerk to the returning officer through taking another position - had resigned, an incompetent person, deliberately or otherwise, was put into the position, although others more competent were available. The feeling is that this person was appointed definitely to create an unsatisfactory situation, in order to justify the recommendation for the removal of the head-quarters. In answer to the Minister, I wrote, after acknowledging receipt of his letter, that I was very sorry that he approved the transfer of the head-quarters of the Electoral Division of Wilmot from Deloraine to Launceston, and added -
Because I feel sure you have not been advised of all the circumstances surrounding the case and to say the very least of it, it livery disappointing that you have not extended the ordinary courtesy to me in giving me an opportunity, as the member concerned, to discuss this matter with you before you made such a drastic transfer.
I repeat that the alleged staff difficulties’ have been grossly exaggerated. In fact, then* arc no staff difficulties and it is more than passing strange that there are local ‘.nen, willing and capable of carrying on this work and yet they have never been approached in relation to staff.
They are public servants in the district, not men running round the streets. They are capable of carrying on the work, and, in fact, some of them had acted temporarily. My letter went on -
I am sure there is some other reason which actuated the recommendation for this transfer other than staff matters. It may be that the unsatisfactory position at Deloraine has been deliberately created in order to provide an excuse for this recommendation and I repeat that there are local men of repute willing and capable of carrying out this work efficiently and why the transfer has been recommended is beyond my comprehension.
You say “ that divisional head-quarters have on many occasions been changed without any reference to the member for the particular division”. I shall be very glad if you will name the divisions where head-quarters have been transferred outside the boundaries of the division, without the consent of the member concerned during the last ten years; showing the locality in which the divisional headquarters were and to where they have been transferred.
To that letter I received what I regard as an insolent reply from the Minister. He simply wrote -
I acknowledge receipt of your letter of 14th December, in further reference to the transfer of the head-quarters of the Electoral Division of Wilmot from Deloraine to .Launceston.
He therefore definitely refused to answer what I had written to him about his statement that on many occasions headquarters had been transferred without discussing the matter with the member concerned. I claim that his is a very curt, discourteous and insolent letter.
When the House met, I put a question on the notice-paper. As the Minister had refused to answer me, I asked him -
What are the names of the electoral divisions where the head-quarters have been transferred outside the boundaries of the division during the last ten years?
The answer was -
The only division head-quarters which have been transferred outside the boundaries of the division during the last ten years is Wilmot.
Yet the Minister in reply to my previous letter stated that it had been done on many occasions. To be quite fair, he added the following memorandum: -
It may be mentioned that the head-quarter* of the Division of Franklin were established many years ago at Hobart, which is outside the division.
It is perfectly true that the head-quarters of the Division of Franklin have been in Hobart for many years, but that is simply a transfer from one side of the river to the other, although it is certainly outside the boundary of a division. I am anxious to know the necessity for the transfer. What actuated the officer concerned to recommend to the Minister that the head-quarters be transferred from Deloraine outside the boundaries of the division altogether? I asked the Minister to place the file on the table of the Library, but this he has absolutely refused to do. Why is the Minister afraid to table the file? What has he to hide? Is there some ulterior motive behind it ?
– What does the honorable member think is behind it?
– It is because a section of the Labour party recommended the transfer, and is frightened to admit it. If the Minister for Transport (Mr. Ward) looks at the file, which has been denied me, he will find a letter from the section of the Labour party there, recommending it and supporting the Minister. The Minister, is afraid to come out into the open and tell the public of Wilmot that the Labour party recommended the transfer. Will the Minister for Transport confer with the Minister for the Interior and let us have light thrown on to this strange action? I should like to know what the Minister has to hide, why the recommen dation was made, and why he has refused the information to which I claim as member for the division to be justly entitled.
.- This is one of the few occasions upon which honorable members have the opportunity to bring before Ministers matters which they consider should have some attention. I was particularly struck to-night with the remarks of the right honorable member for Cowper (Sir Earle Page) with regard to the production of more milk for distribution amongst children. A few years ago the right honorable member was Commonwealth Treasurer and the country was going through a very serious depression. The children were undernourished because their parents could- not provide the necessary sustenance for them. The right honorable member then had the opportunity of doing a great national service by encouraging the production of more milk and distributing it among the children.
– Mr. E. G. Theodore was Federal Treasurer during the depression, when the Scullin Government was in office.
– A United Australia party administration succeeded the Scullin Government and the anti-Labour parties remained in office for ten years. The right honorable gentleman had an opportunity to do this work.
– That is not a reason why it should not be done now.
– It was said that as soon as the “ Nats.” took office, the depression lifted. Prosperity was always “ just around the corner “.
– The first division of the Australian Imperial Force, which was recruited in 1939 to fight our battles in. the Middle East, included many men who had been unemployed. Most of them enlisted because it was their only chance of getting a livelihood.
– That is a terrible statement to make.
– I know it to be a fact.
– They had been unemployed for years.
– During the last few days the Government has made important announcements about an extension of home building. This matter is urgent in the big cities, particularly in Sydney. A munitions worker was ordered by the court to vacate the house he was renting, because the owner desired to take possession. He was unable to get another house, and to-day the mother and two daughters live at Bondi, the father and two sons live in the city and another daughter is living with friends in a suburb. The breaking up of families in that manner is bad from the national standpoint. I am gratified that the Government has decided to proceed with the erection of homes. For some time I have urged that materials should be made available and permits issued to persons who desire to build dwellings for themselves. Labour is available to undertake the work. With the Commonwealth Government providing the finance, the States will undertake the building programme and I have no doubt that the Labour Government of New South Wales will press on as quickly as possible with this great national work.
Because of the high cost of living, invalid and aged persons find that their pensions are entirely inadequate to maintain them.. They have made representations to the Minister for Social Services (Senator Fraser) and have interviewed their parliamentary representatives, emphasizing the necessity for increasing the pension to £2 a week. I consider that their claim is very moderate. Invalid and old-age pensioners deserve every consideration, and I hope that the Treasurer (Mr. Chifley) will . provide the necessary finance to enable the increase of pension. I realize that the Commonwealth Government is now giving to people under its free social services schemes many things which they did not enjoy before; but aged and invalid persons do ‘not require’ medicine so much as proper food and reasonable accommodation.
Recently, the Main Roads Board of New South Wales decided to repair eight or nine miles of main road in my electorate, and the local municipality intimated its willingness to do the job, provided the necessary labour was made available. The National Service Office refused to supply the labour and the
Main Roads Board decided to let the job to contract. If a contractor can get the labour to do this work, surely a semi-governmental body which does not seek to make any profit from the job ought not to be denied it. The matter is now in the hands of the Minister for La’bour and National Service (Mr. Holloway), and I know that he will rectify the anomaly.
I am not entirely in agreement with the methods adopted by the National Service Office in Sydney. Its recent action in calling up a large number of women on a Sunday was, in my opinion, wrong. They were to work in canning and processing factories. I happen to know that some of those factories have few hygienic facilities. It was all very well for the National Service Office to declare that the fruit must be canned without delay, but the hygienic arrangements of factories should be satisfactory so that people will be able to work under the best conditions. Many of the women who were called u,p were married and had family responsibilities, and they could ill-afford to leave their homes during that period. Personally, I do not consider that they were obliged to answer the call, but they were afraid that if they disregarded it, they would be prosecuted. After working for a few days, many of them absented themselves from the factories. Many of the younger women called up for this class of work were transferred from other occupations where they received higher remuneration than they were paid for canning and processing fruit. The National Service Office asked them to make too great a sacrifice. Even girls have home responsibilities, and they should not have been expected to make a financial sacrifice of 30s. or £2 a week in order to do the processing work. If their services were of any value, they should have been paid the same wages as they were receiving in their permanent occupations.
My attention has been drawn to the position of a youth working in a canister factory. Concerns of this kind employ cheap juvenile labour. A big city manufacturer was prepared to indenture the lad as an apprentice, thus giving him an opportunity to learn a trade, but his greedy employer declared that he should not he released from his present job, as his services “were essential to the industry. I have referred that matter to the Minister for Labour and National Service, and I hope to receive within the next 48 hours a letter stating that the youth must be released.
I should like to know how far plam for post-war reconstruction have progressed. I am aware that the Department of Post-war Reconstruction was created some time ago, but the Government should give honorable members some information about its activities. I have been requested by organizations in my electorate to address them upon the subject of post-war planning. I know that works of great national importance require to be done, such as water conservation, irrigation, electrification of rural areas and the standardization of railway gauges, but I arn not aware that the Ministry of Post-war Reconstruction has included them in its post-war projects. I advocate the construction at the first convenient, opportunity of a railway line from Yass to Canberra. At the present time, people travelling to *the National Capital from the southern States are obliged to make a long and tedious journey via Goulburn and Queanbeyan. That could be avoided by the construction of 40 miles of railway from Yass to Canberra. I understand that the construction of -this line was contemplated when the capital was established.
I hope that the Government will give attention to the matters that I have mentioned, particularly to my suggestion for the increase of invalid and oldage pensions to £2 a week, so that the aged and infirm may live in comfort in their declining years.
.-In this bill, the Government is seeking Supply for two months. As it has. already obtained supply until the 30th June, I assume that the parliamentary recess will last for about five months. I should strongly object to granting Supply if I thought that this Parliament was to go into recess for that period. “When members of the present Government were in opposition, they strenuously advocated that the Ministry of which I was a member should take steps to see that the Parliament was called together at least one week in every three” months. I am pleased that the Prime Minister (Mr. Curtin) intends to go overseas, and I wish him all possible success in his important mission. In view of the fact that the Government has an extraordinary steam-roller majority in this branch of the legislature, it will be unnecessary for the Parliament to go into recess for the whole of the period that he is abroad.
I bring to his notice the fact that a special voluntary organization has been set up in Queensland to help the people of Great Britain in the matter of their food supplies. Many people in that State are anxious to surrender, voluntarily, meat, butter and sugar coupons, so that increased supplies of those commodities may be made available to the people of Great Britain. I received the following telegram this afternoon from Corinda, near Brisbane: -
Strong movement here for voluntary surrender of meat, butter and sugar coupons to send more food to people in Britain now existing on bare minimum ration which is in danger of being reduced. Sir Thomas Gordon states shipping available. Lord Mayor willing sponsor appeal but understand Rationing Commission regulation prohibits any outside body handling coupons. Would appreciate your getting this regulation relaxed.
This patriotic gesture on the part, of the people of Queensland should commend itself to the Prime Minister. As this is possibly the last occasion on which we shall see him in this House before he leaves Australia, I hope that he will give an assurance to-night to the House and to the country, and also to the people of Great Britain, that he will take steps to see that the regulation which prohibits the surrender of the ration coupons so that the people of Great Britain may have an increased supply of those commodities is relaxed.
– The people are already surrendering their food coupons in Victoria.
– The Government has the necessary power to take effective action, but it is exercised in such a way that the people are denied an opportunity to surrender their ration coupons voluntarily for this purpose.
– They need not surrender them; they need only destroy them. Then the margin of food which could be made available for export to Great Britain could be increased.
– That is most unsatisfactory. The people responsible for this patriotic gesture wish to be certain that the extra food made available by the surrender of their coupons will be specially ear-marked in order to enable an additional quota of food to be made available to the people of Great Britain. Those who return their food coupons wish to be sure that they are helping the people of the Mother Country in the hour of their greatest trial. Those people to-day receive 2 oz. of butter a week and about ls. 2d. worth of meat a week, together with very little tea and sugar. By comparison with the food available to the people of Australia, we do not yet know the meaning of the word “ sacrifice “, yet the Prime Minister says “ Tear up the ration tickets “. That is an impracticable suggestion. Australians who refrain from using some of their own food coupons desire to know definitely that the extra food made available by their action will be received by the residents of some “blitzed” area in the Old Country. In Australia the people are not seriously short of any food at all, thanks to the efforts of the primary producers. Action speaks louder than words, and I hope that the Prime Minister will act on my suggestion.
– It should not be thought for a moment that as great a contribution of food as possible is not being made to Great Britain. If we can do what the honorable member suggests so much the better. Every step taken to reduce the consumption in Australia of the commodities referred to leaves a larger margin for export.
– Will the Government remove the prohibition and allow people to surrender their ration tickets, so that they will know definitely that to the extent to which they surrender them the people of Great Britain will receive an increased supply? On the eve of the right honorable gentleman’s departure for Great Britain, I make this appeal to him on behalf of the people of Queensland and also of Great Britain.
– Can the honorable member give an assurance that the persons who surrender coupons will not partake of substitutes which may be in short supply?
– The people must live, and I do not know how they can live without eating. If they are prepared to use substitutes which do not provide as much nourishment as the food usually purchased by them, that would be a patriotic gesture, a genuine sacrifice. If the people of Great Britain were aware of the sacrifice some are prepared to make they would receive a moral uplift to help them in the great trial which they must shortly undergo. A second front will be opened shortly, and that will certainly add to the trials already being experienced. The greatest trials of the people of Great Britain are immediately ahead of them, and we shudder to think of the casualties that may occur. If the people of the Old Country know that, in order to help them, those living under the Southern Cross are ready to take substitute foods, that will be of incalculable help to them. Again I ask the Prime Minister to reflect on the matter.
I am pleased to see the Minister for Munitions (Mr. Makin) in the chamber. I draw his attention to a telegram which I have received since the suspension of the sitting for dinner from the firm of Cribb and Foote, of Ipswich. It reads -
Shipment of household hardware ex South Australia banned for Queensland. _ Would appreciate you contacting Senator Wilson and endorse protest on our behalf. Brisbane merchants also protesting.
Kitchen utensils which are urgently required, such, as tin and enamel pots, pans, dishes, &c, have been denied to the people of Queensland by an arbitrary order of the newly appointed Controller of Utensils and Appliances, Mr. N. H. Keysor, of Sydney. The action of Mr. Keysor has created a shortage of those articles not only in Queensland but also in many other parts of Australia. It is almost impossible to purchase kitchen utensils in Queensland. At auction sales of household goods kitchen utensils reach alarming prices because of the acute shortage. Many returned soldiers who have married since their return from service in the Middle East, Greece, Crete, Syria and New Guinea have found it impossible to equip their homes or flats because of their inability to purchase these utensils. For many years Queensland warehouses purchased their requirements from A. Simpson and Son Limited, of Adelaide.
– Does the honorable member know that there is a shortage of those utensils even in South Australia?
– I understand that they can be readily purchased in that State.
– There is an acute shortage of them in Western Australia and South Australia. It is more acute in those States than in any other parts of Australia.
– I know that they are in short supply in Tasmania and Western Australia because of the prohibition of export, but that has been recently removed.
– As I happen to be the Minister acting for the Minister concerned, I am Aware of the actual position.
– My advice is that A. Simpson and Son Limited has goods packed ready for shipment from South Australia to Queensland. The new order issued by the controller was most peremptory. The following is a copy of the order received by A. Simpson and Son Limited : -
I now request that no deliveries of Hollowware (i.e., kitchen utensils) be made by you outside the State of South Australia until further instructed by myself.
In telegrams that I have received, and as a result of inquiries I have made, I understand that these goods which cannot be sent to Queensland are already packed and labelled for transport to that State. I am informed that no difficulty would be experienced in obtaining railway or shipping facilities, because the necessary space is available. I am advised that Mr. Keysor is a director of F. Metters and Company, which firm trades in competition with A. Simpson and Son Limited. I am advised that Mr. Keysor’s reason for prohibiting the export of the utensils was an urgent shortage of transport, and I am further advised that empty shipping and rail space has been available almost every week from South Australia. My inquiries show that no difficulty is experienced in transporting goods from South Australia to Victoria or New South Wales, ample space being available both on trains and steamers. I ask the Government to examine this extraordinary and unfair position. I am not infringing the security regulations when I say that there are more troops and other defence personnel in Queensland than in any of the other three States mentioned, and that owing to the shortage of kitchenware it is almost impossible for Queensland to extend hospitality to the military personnel of Australia and our Allies. I believe” that the people of Queensland are doing their best in the circumstances, but their problems have been accentuated by the shortage of these utensils. The following is an extract from a leading article in a newspaper published in Adelaide : -
The people of Australia will learn with melancholy interest that the war-time hierarchy of federal departmentalism now includes a Director-General of Tin Pots, or, at the very least, a factotum who discharges this momentous function, under the official title of Controller of Utensils and Appliances.
The result is a literal tiu-pot dictatorship, exercised from some convenient centre of authority in one of the capitals of the eastern States; and, as almost always happens in such a case, South Australia is being given another sharp lesson in the evils of centralization. The Director-General of Tin Pots, it. appears, is Mr. M. H. Keysor, a director of the firm of Metters Limited, which is a. manufacturer in Sydney and Melbourne of the sort of “ utensils and appliances “ placed under his absolute and exclusive control. It cannot be objected, therefore, that the dictatorial official is not a specialist; and it would be highly improper to suggest that he would ‘ ever be tempted to use his power as a bureaucrat to advance the special interests of his own company. South Australia’s quarrel, perhaps, is less with. Mr. Keysor than with the system which has made him a dictator over tin pots, with authority to do things that, to all appearances, it would not be necessary to attempt, if federal departmentalism were less inclined to strive after federal absolutism.
In any event, however, Mr. Keysor may be suspected to have that eastern States complex which is more or less normal among business men situated as he happens to be. He doubtless knows a great deal about “ utensils and appliances “ ; but it has yet to be shown that he understands, or is at all concerned to safeguard, the perfectly legitimate commercial interests of South Australia which, after all, cannot be betrayed without grave detriment to Australia as a whole. Two or three weeks ago, the well-known firm of A. Simpson and Son Limited, which manufactures “ utensils and appliances” in this State, and which bae long supplied customers all over the Commonwealth, received from Mr. Keysor a communication eminently dictatorial in form and substance: “I now request that no deliveries of hollowware be made by you outside the State of South Australia until further instructed by myself”. The management of Simpsons rightly deemed this a matter that would interest the South Australian Auditor-General (Mr. J. W. Wainwright), who was recently appointed by the Playford Government to assist and advise State manufacturers, particularly in regard to the problems that will beset them when post-war reconstruction has to be undertaken. Mr. Wainwright was not only interested, but indignant; for here was a clear ease in which a South Australian concern, being needlessly shut out of the general Australian market, faced the certainty of a most formidable obstacle to the recovery of its rightful position after the war.
The Auditor-General himself controls the State Branch of the Department for War Organization of- Industry, and is thus in close touch with federal affairs; but he is far too good a South Australian to stand idly by while Mr. Keysor- “ this dictator”, he calls him - dislocates the business of A. Simpson and Son Limited for no valid reason. Empty shipping and rail space being constantly available from Adelaide to Melbourne - and produces a mild famine in “hollowware” not only in places as far away as Queensland, but in all those towns just over the South Australian border whiCh naturally look to Adelaide as their source of supply. Mr. Wain-‘ wright’s angry question, addressed to the chairman of the Civilian Requirements Board, “ Is tin’s the way the Commonwealth Government is going to implement the powers which it possesses!” will be echoed by most of the people of South Australia. Unhappily, although Simpson’s experience of the tin-pot dictatorship is singular in some ways, the spirit of the order which Mr. Wainwright so properly resents is not new. Several of the industries of this State are suffering disproportionately, and not always unavoidably, under the weight of the Commonwealth’s wartime control; and the secretary of the Chamber of Manufactures is fully entitled to say, by way of comment on Simpson’s case in particular, that the circumstances constitute a definite warning to the smaller States of the risk6 they would run if the federal authorities wore given increased peace-time power to. govern interstate trade.
I trust that the Minister will re-examine this problem, and ensure that the shortage -of these very essential domestic articles in Queensland is not permitted to continue. The matter warrants serious consideration. I am informed that there will be no difficulty in transport ing these goods from South Australia to Queensland, either by rail or steamer, and that cases of these utensils are already packed in South Australia awaiting despatch.
I shall deal now with a matter concerning food rationing. Fishermen, particularly those whose work involves sailing fairly long distances from their home ports, have the greatest difficulty at present in providing themselves with sufficient food to cover the period of their absence from their homes. I am not referring to fishermen who go out for a few hours with lines and catch big fish such as schnapper for the Brisbane market; the disability to which I have referred is suffered by men who are away from their homes for perhaps a week. Usually they leave on a Sunday and take with them large quantities of ice. They catch fish until perhaps the following Thursday, when they return to port. Whilst they are away they live mainly on meat, butter and sugar. The ordinary ration of these commodities is quite inadequate to meet their needs,, and there are no other foods on which, they can rely. I have already made representations upon this matter to the Minister for Trade and Customs (Senator Keane), but it was only after a month had elapsed that I received an acknowledgment. I ask that this matter be treated as urgent. Whilst these men are engaged on their fishing work, they’ may be 20, 30 or 40 miles from the nearest settlement. All that they have to sustain them on these trips is “what they can carry with them. Other unrationed goods are not available to them. I urge that consideration be given ito this question with a view to granting to these men an extra ration pf the foodstuffs to which I have referred in view of the strenuous life which they lead. I made successful representations in a somewhat similar case some time ago. The people concerned were men engaged in the lumber industry who had to go away from the cities for weeks on end into the mountains and forests to fell log timber. As a result of the representations which I made, these men were granted an extra ration, because it was utterly impossible for them to take with them other types of foods. In both cases they are so far removed from sources of supply that they are unable to purchase fresh supplies. They depend ‘mainly upon butter, sugar, mutton, beef, lamb and pig meats. I urge the Minister to extend the same consideration to the fishermen as has been given to the timber workers.
– I shall preface my remarks by referring to the question raised by the honorable member for Moreton (Mr. Francis). Each South Australian mem’ber of this Parliament - members of the Labour party at least - received from an unknown sender a copy of the article headed “ Tinpot Dictator “, which appeared in the Adelaide Advertiser. After conferring with my colleagues I made a trunk line call to Adelaide in an endeavour to contact the secretary of A. Simpson and Son Limited. I took this action not because I was concerned about the forwarding of supplies of these goods to Queensland, but because I was concerned about what was going to happen to this factory in South Australia. I received an answer from a Mr. Loam, thanking me for my inquiries, and stating that some one else was already looking after the job. We on this side of the chamber were quite prepared to do everything in our power to ascertain what was wrong in regard to this matter. We contacted the Minister for War Organization of Industry (Mr. Dedman), and he informed us that supplies were short in South Australia, Tasmania and Western Australia, and that the Adelaide firm had the right to supply those States.
On a recent occasion, and again tonight, the honorable member for Denison (Dr. Gaha) drew attention to the falling birth-rate in this country, and to the fact that should the fall continue the population figures would remain stationary in the not distant future. The honorable member placed the facts before this chamber and admitted frankly that he could not say what should be done to remedy the position. Whilst my colleague has been busy in Tasmania bringing little Australians into the world, and probably signing documents for some who have left the State I have been mingling with the great mass of the people of South Australia in an endeavour to ascertain, from young people particularly, some of the reasons for the low birth-rate in this country. One case which came to my notice concerned a young man and woman who were about to be married in 1929. They built and furnished a house in readiness, but in 1930, just when the house was being finished, the depression occurred, and these people were forced to remain single until 1933, because the would-be breadwinner was unable to obtain employment. In 1935, they had a child. Fifteen years have now elapsed since they first decided to get married and set up a home. They are now about 44 or 45 years of age, and there is only one child in the family. I contend that if social security were guaranteed to the young people of this country there would be no need to worry about the birth-rate. I have heard young men in various industries during the last few years say that their present job was the first constant work they have ever had. Whatever government is in power in this country, if it earnestly desires to check the falling birth-rate, it must give social justice and social security to the young people.
The honorable member for Denison also referred to the fact that many people were leaving the ranks of invalid and old-age pensioners and obtaining employment in industry. The reason for that is of course, the scarcity of man-power brought about by this war. To-day Australia is called, upon to produce many commodities which previously it imported. I have mingled with quite a number of former pensioners who are now employed, mainly in aircraft production. Modern aircraft have so many components that their manufacture provides a wide diversity of jobs. I have seen employees hobbling into factories on crutches; yet, prior to the war, it was considered that a man had to be 100 per cent, fit before engaging in employment of that kind. These partially incapacitated workers perform jobs which enable them to sit all day. For that reason, quite a number of persons are going off the invalid pension. South Australia has played a great part in the production of Beaufort bombers, and I ask the responsible authority to give to that State a proportion of the production of aircraft that will be carried out in this country in the post-war period. When France fell, Great Britain was unable to help Australia by providing’ it with aircraft, and a commencement was made in this country with the production of the high-class aircraft that we. have to-day. Tools that were sent from Great Britain were sunk on the journey, and we had to produce those that were needed. In South Australia, many persons who had not had any experience previously were trained in toolmaking, with the result that some of the finest aircraft tool-makers in the Commonwealth are now in that State and have done a magnificent job. Invalid pensioners who have engaged in aircraft production could and should be continued in that occupation.
has referred. That, however, is not the beginning of the story. I gained my first experience last year, when the Commonwealth Potato Board issued the instruction that potatoes from Mount Gambier, which it was proposed to send to Albury in New South Wales, were not to be consigned by broad gauge from Mount Gambier to Adelaide, but were to be put on the narrow gauge and transhipped at Wolseley. Normally, on account of the break-of-gauge difficulty, the market for a fair proportion of Mount Gambier potatoes was in Albury, and the shortage in South Australia was made up by broad-gauge rail transportation from Ballarat. With the very best intentions, some federal instrumentality broke with common sense and decided to lay down conditions which were not, in my opinion, the best that we could have had.
My next experience occurred late last year. Another Commonwealth instrumentality decided that a little stud pig should not be sent from Toowoomba, in Queensland, to South Australia, and the would-be purchaser had his cheque returned to him through the auctioneers. He was in the habit of purchasing a stud pig every year, but was told that this could no longer be allowed. A pig of that’ type could be transported in a little crate which could be put into the guard’s van. It could be taken into the carriage if one had a fair-sized suitcase in which to put it. Yet, in the interest of the prosecution of the war, this pig must not come from Toowoomba to my electorate.
Another incident aroused quite a lot of controversy. I shall not argue the merits of the case; if I did I should immediately come into conflict with the Minister for the Navy (Mr. Makin). Some Commonwealth authority ruled that a certain race-horse should not be sent ‘from Victoria to South Australia. In that case, a division of Commonwealth authority was witnessed. I believe that the horse in question was sent to Port Adelaide, won the race for which it had been entered, and was returned to its home in Victoria; and the revenue benefited by a small amount.
The latest decision was in regard to kitchenware. I shall not challenge the statement of the Minister that there are shortages in South Australia, Western Australia, and everywhere else. The longer this war lasts, the more likely is it that these shortages will occur; and they will he greater in variety as well as in intensity. But we do not want to get ourselves into the ridiculous position of not being allowed to send kitchenware from South Australia to Queensland, and a stud pig from Queensland to my electorate, the pig-owners in Toowoomba having to resort to the old Chinese custom of roasting a pig in the house because they cannot get frying-pans from South Australia. That may be drawing rather a long shot; but in the times in which we live the range is rather long. It must be admitted that this practice is a growing one. It is also a bad one, and unquestionably is a violation of section 92 of the Constitution. On the last occasion on which the people of Australia were consulted on the very delicate question of altering the Constitution, they decided that trade between the States should be absolutely free. I should be the very first to admit that there are compelling reasons, which I should support, warranting any government in time of war varying the practice in regard to interstate transport. But I also have the strong feeling that there is just a little too much interference in these matters. I do not lay that directly at the door of some Ministers; because I am afraid that in these days the delegation of power is the fashionable procedure, and one does not do a thing oneself, but invests Tom, Dick or Harry with the appropriate authority and allows him to set out on uncharted seas, with the result that he arrives at rather unexpected destinations. But in the final analysis the responsibility for what is done must rest with the Ministers whom these delegates serve. Therefore, Ministers should have a look at this matter, in order to see whether or not a better method of treating interstate trade than that which we have to-day may be devised. There seems to be altogether too great a multiplicity of authorities, and too many strange decisions are being made. I received a letter from my friend the Minister for the Navy (Mr. Makin) in respect of ordinary household needs. Some persons in the isolated spot in my electorate which is known as Kangaroo Island wrote to me concerning some burners for lamps. I naturally believed that the Minister ‘acting for the Minister for Supply and Shipping (Mr. Beasley) would deal with such a matter; consequently, I addressed a letter to him. I was informed that it is not a supply matter, but is dealt with by the Minister for War Organization of Industry (Mr. Dedman). As one who has had a fairly long life in this Parliament, as political life in the Commonwealth Parliament goes, and some experience of administration, may I say with very great deference to my friends on the front treasury bench that I am not quite able to’ figure out where some of these departments begin and end. I am just a little bit puzzled. Now and again, there seems to be a “ no-man’s land “ between two departments - more often, perhaps, a “ two-men’s land “, in which two authorities attempt to exercise jurisdiction. “When it comes to the supply of a commodity of that sort,- one would expect the Minister for Supply and Shipping to deal with it; yet apparently one of the duties of the Minister for War Organization of Industry is to see that burners for the particular sorts of kerosene lamps which are used in districts in which there is not electric power are either manufactured or supplied; I do not know which, so far, because I have not heard from the Minister.
Another matter to which I wish to refer was mentioned this morning at question time, and the mention of it resulted in my being asked by the Minister for the Navy to place a question on notice, which I did.
Early in the days of what is known as the “blitz” in the Northern Territory, a certain secretary of the Northern Australian Workers Union was, in the interests of peace, order, good government, the prosecution of the war, and everything else, rather firmly invited to leave the Northern Territory. I am afraid that, had he not accepted the invitation, the Commonwealth would have done something about it. While I was there recently, members of the union told me that they had selected another secretary - an excellent man whom no member would invite to leave the Northern Territory. He is employed by the Allied Works Council. It appears that there is an argument between the Northern Australian Workers Union and the Australian Workers Union. The claim of the men of the Northern Australian Workers Union is that the secretary of the Australian Workers Union is given every facility for travel which a man in the Northern Territory can possibly require; he can go to any place where members of his union are working. But the other union is not so fortunate. A secretary, or organizer, has been appointed, but he has been told that he must stick to his job with the Allied Works Council. He has remained there, and, so far as we can see, he will have to remain there for the duration of the war. This is not a matter which can be taken lightly. I do not know the merits of the dispute between the two unions; so far as I am aware, they are estimable bodies. One of them is a powerful Australia-wide organization of which you, Mr. Deputy Speaker, may possibly be a member. The Northern
Australian Workers Union, as its name indicates, is a body whose operations are confined to North Australia.
– One of them is dinkum and the other is not.
– The honorable member’s interjection raises the question of what constitutes a dinkum union. I remember that in the days of the great Labour victory in South Australia, in 1930, we had three absolutely dinkum Lang Labour members elected for the district of Adelaide. They were declared to be not dinkum by the rest of the Labour party. Shortly after their election, the three men had a conference and each of them declared the other two to be not dinkum.. The net result was that we had three Lang Labour parties in the State Parliament, each declaring that the other two were bogus, and not dinkum. I do not pretend to be an authority on matters affecting the two unions to which I have referred, but [ should he happy to be enlightened regarding them, preferably outside the House, by the honorable member for Batman (Mr. Brennan) when we have a cup of tea together.
– The Deputy Speaker has a horseshoe in his glove.
– I do not believe that. I believe that if he struck at me it would be with a feather duster. I hold no brief for one trade union as against another, .but I should like some Minister to explain why the secretary of one organization should have the free run of the Northern Territory and be provided with facilities for travel, whilst the secretary of the other union cannot even obtain his release from the Allied Works Council to look after his union’s affairs. We have heard a good deal lately about freedom of speech and freedom of association. I am sure that if the Attorney-General (Dr. Evatt) were to visit the Northern Territory in connexion with the referendum he would be asked a number of extremely pointed questions on the merits of the case that I have mentioned. There are many other things that I should like to mention, but I shall refrain from doing so now, in the belief that I shall have an opportunity to do so next week.
.- Before dealing with the subject-matter to which I particularly wish to refer, I desire to comment on the remarks of the right honorable member for Cowper (Sir Earle Page), who made reference to a number of subjects with which I have had something to do during recent months. I do not pretend to have any special medical knowledge, but because of my association with the Social Security Committee I have come in contact with a number of medical men and others who have taken a great deal of interest in. the subject to which the right honorable gentleman referred. It is interesting to note the change of heart on the part of some honorable members who are now in opposition. I well recall their attitude towards social questions when previous governments, of which the right honorable member for Cowper was a member, were in office. In those days money -could have been made available to do the things which the right honorable gentleman said the present Government should do, although he knows that money is now being expended to destroy life rather than to preserve it. The right honorable gentleman referred to the treatment of tuberculosis and had a good deal to say on the subject of diet. He referred also to the low incidence of this disease in Great Britain. I believe that the incidence of tuberculosis in that country has been reduced considerably since the present war began. The Social Security Committee, of which I am chairman, has made some positive recommendations in relation to tuberculosis. State Ministers- of Health have gathered at Can’berra to consider this and other matters affecting the health of the people, whilst the National Health and Research Council has been dealing with the subject for some time, even as long ago as when the right honorable member for Cowper was a Minister. It is remarkable that in those days, when the right honorable gentleman had ample opportunity to express his. views in places where they should have counted, so little was done. From the information placed before my committee regarding tuberculosis, I am convinced that more than the question of diet needs to be considered. My committee referred to these matters in its sixth interim report which it presented to Parliament in July, 1943. The report stated that in order to grapple effectively with this disease, the population should be X-rayed, so that tuberculosis could be detected in its early stages. We recommended also that, after detection, something should be done to provide treatment in sanatoriums for the persons affected. There is also an economic side to this question. The dependants of sufferers need to be provided for. That raises important questions of man-power and materials. It is useless to detect the presence of tuberculosis among the people unless we can provide the affected persons with proper diet and attention in sanatoriums. Until we can tackle the problem over the whole field, it is almost useless to talk about the diet of the people. It is largely a matter of the education of the sufferer from tuberculosis, not only while in a sanatorium, but also after he again mingles with others in the community, so that the work performed by those in charge of these institutions for the treatment of tuberculosis shall not be lost. The right honorable gentleman also referred to child welfare centres. I agree that these are excellent institutions. I should like their work to be extended to cover the pre-school child, but until labour and materials are available that cannot be done. When I was in South Australia with the Social Security Committee, we inquired into a scheme in operation in the Adelaide Hills district, under which school children are medically examined periodically to ascertain whether they have any defects and also to see their reactions to treatment. Doctor C. Jungfer, who is in charge of. the scheme, is doing an excellent job. In emphasizing the need to educate the people in health matters, he stated that malnutrition was evident even among the children of dairy-farmers, because they did not take enough milk. I hope that the Social Security Committee will be able to make a recommendation to Parliament for a comprehensive health scheme, covering the whole field of the health of the people from childhood. The question of the pre-school child is important. I agree with the right honorable member for Cowper that an im- provement of the birth-rate is not the only matter with which we should concern ourselves; it is just as important to preserve the health of the child after it is born. I am convinced that this section of the community has been badly neglected over the years. These are things which should have been tackled when the right honorable member for Cowper was in office and could have used his medical knowledge to advantage. Instead of doing that, he has waited until he is in Opposition, and when money and men and materials to do the things that he recommends are unprocurable. I hope that we shall be able to deal with these things as time goes on. My committee is already considering them.
I wish to direct the attention of honorable members to the need for a more active policy in regard to afforestation. My mind goes back to 1935, when I asked the then Minister for the Interior, Mr. Paterson, a question concerning an article that had -appeared in that year’s September issue of The New Nation. I asked him if he had seen the article, and whether he would give favorable consideration to the suggestions made in it by the writer, Mr. Macintosh Ellis. The article dealt with the weaknesses of our forestry policy, and suggested that a vigorous scheme of reafforestation be carried out in order to replace the timber which had been destroyed, and to prevent soil erosion. In 1927, the Commonwealth Government of the day established at Canberra the Commonwealth Forestry Bureau associated with which is a Forestry school designed to accommodate a maximum number of 30 students. Since then, 100 students have passed through the school. At the present time, even making allowances for the situation arising out of the war, the number of students at the school is far too low, there being only eight. No doubt that the number would have been greater but for the war. However, I do not think that, at any time since the school was established, have there been as many students as it could accommodate. I consider the InspectorGeneral of Forests, Mr. Lane Poole, who is the principal of the school, to be an excellent officer. No one could have done more than he has to promote an active afforestation policy, but, unfortunately, successive governments have not paid as much attention to this matter as they should. The natural forests of Australia have been destroyed in wholesale fashion, and excellent timber has been burned indiscriminately. The people have not been taught to protect their forests, and proper fire-breaks have not been cleared and maintained, with the result that the forests have been destroyed, and soil erosion has followed.
An example of what can be achieved in the way of reafforestation is provided in the Australian Capital Territory, where Pinus insignia trees have been planted during the last 25 years. To-day we are reaping some benefit from that work, although the trees have not yet reached maturity. We are now cutting about 1,000,000 feet of timber per annum. That at least indicates what can be done if we replant our forests with quick-growing timber for commercial use. To-day, locally grown timbers are being used for flooring boards and for general constructional purposes in the Australian Capital Territory, whilst, as the result of experiments carried out at the Forestry School, skis have been made of Australian timber for some years past. I recommend to the Minister for the Interior (Senator Collings) the article to which I have referred. At this juncture I shall content myself by quoting only two extracts from the New Nation, to which I have referred -
To the end that the forest lands may produce larger returns in terms of profits and human welfare the co-operation of the public is essential. The achievement of this cooperation suggests the introduction of effective forest extension facilities and the popularization of forestry as an instrumentality for social service in the respective States.
The writer goes on to show the worth of forests first on a man-power basis and, secondly, as a crop producer. He continues -
Europe has shown that 250 acres of managed woodlands will support eleven persons. We in Australia can hope for no such result, but assuming that an equivalent area of commercial forest could support one worker and sustain five people, it follows that the capacity of the Australian national forests for settlement and industry would be at least 270,000 souls. In contrast to the exquisitely kept forests of Europe “the Australian way m forestry will be rather toward maximum pro ductivity of labour instead of land “. Continuous crop production is no wild and impracticable idealist’s dream, and it only remains for the public to grasp the significance of perpetual forest industries and the task will be well begun. The realization of this objective is a worthy one and is of practical attainment. Successful timber management and controlled use suggests, however, the necessity of a complete intermeshing of the timber industry. The avenues of permanent forest exploitation in Australia are immense. For example, the production and manufacture of sawn timber can keep all our commercial forests completely engaged in satisfying the domestic requirements of overseas demands, and in the growing of hardwood species for sleepers, poles and piling there is a field of immense international service.
The article from which those extracts have been taken was published in Australia in 1935. The Tasmanian Government has directed close attention to the problem of afforestation for many years. I recall that the Commonwealth Grants Commission in its report for 1935 dealt at length with the possibilities of afforestation in, that State. The commission reported -
The position of Tasmania differs radically from that of the other two States. If it suffers from Commonwealth tariff policy it benefits from interstate free trade. It has, however, no monopoly of its more specialized products and its comparative advantages have been whittled away by the growth of a selfsufficient agricultural policy in other States which has not always been effectively restrained by the constitutional provision for freedom of trade. Tasmania was settled at a fairly early date, and at one time exported largely to the mainland produce which is now grown there. It had a mining boom which brought it prosperity for a period, but the base metals on which it mainly depended have suffered severely from the fall in prices. Its main difficulty comes from its poverty of resources and the small area of good land. At this date only 7,000,000 out of 17,000,000 acres have been alienated from the Crown and a considerable proportion of the island is undeveloped and uninhabited . . . We think therefore that there is occasion for special help or encouragement beyond the scope of special grants and -we recommend this need for the consideration of the Commonwealth Government and Parliament. The form such help should take would require technical examination, and we do not consider it our province to recommend it except in general terms. An example, however, may make our meaning clearer. Tasmania has great forestry possibilities, but her assets have been depleted. A long-term forestry policy involving considerable expenditure over a term of years is needed. This policy has now been worked out with the help of the Commonwealth grant for forestry, but it is hampered by uncertainty as to the necessary funds in future years, which prevents, for example, the recruiting of an adequate technical staff.
I have before me a plan which was worked out by the Conservator of Forests in Tasmania in which the following paragraph appears: -
We have already seen that many of the forests, if properly managed, could provide half-time employment (i.e., 120 working days per year) for one man per 200 acres; so that by establishing one holding per 200 acres (five per 1,000 acres) each worker so established could be guaranteed 120 days’ forest work each year.
The point I emphasize is that we should now be evolving a definite afforestation scheme in relation to the post-war period. We must not only preserve, but also develop, our existing forests. I should like to know whether the Government has given this matter any attention in relation to post-war problems. I urge the Government to put a stop to the indiscriminate destruction of forests, which brings in its wake the evil of soil erosion. I urge it to evolve a positive plan for the preservation of our forests. I suggest that a statement from the Minister for the Interior on the matter would be particularly welcome at present. The first step might well be the formation of a national council which would work in harmony with the States to solve these vital national problems of soil erosion, forest production, development, management and use. Plans should be made now so that in time to come, when we have labour available, we shall be able to place it in such a way that we shall be able to preserve our forests by the application of a scientific policy which will ensure that timber shall be replaced either by natural means or by planting, as it is cut, and that, by a process of education, at least the number of man-kindled forest fires shall diminish. I hope for an early announcement by the Minister of a positive plan for forest development.
– I am glad that the Minister for Commerce and Agriculture (Mr. Scully) is in the chamber, because this is the first opportunity I have had to express my gratification at the action which the Government took last week in answer to some representations I made about the meat situation in Tasmania. I refer particularly to the admission of fat lambs to the local market. The Minister was good enough to say on that occasion that the Government greatly appreciated the action of the fat-lamb raisers in Tasmania who had shipped a record output of fat lambs during the season. J. do not know the exact figure, but 90,000 carcasses, after the local demand had been supplied, was the average over the last four or five years. I point out to the Government that the industry in Tasmania is likely to suffer very much in the near future as are other rural industries from the lack of fertilizers. The circumstances of the industry in Tasmania are rather different from those of the industry in the other States. It has been organized on a thoroughly scientific basis. The Department of Agriculture, of Tasmania, set out to make the industry thoroughly efficient. It imported breeding ewes and made them available at reasonable prices. It appointed field officers, who instructed farmers in improved methods of laying down pastures. It thereby brought the industry into a thoroughly first-rate condition. But, if the pastures are to be maintained, it will be necessary that larger supplies of fertilizers than the farmers are able to obtain be made available. Otherwise, as the Minister must realize, the capacity of the fat-lamb industry in Tasmania is likely to drop considerably. I know the difficulties that confront the Government, but, I submit with good authority, that the industry has been so efficiently organized that it has a special claim, in support of which I furnish a table contained in the eighth annual report of. the Australian Meat Board, published in June, 1943. It is a comparison of State returns computed on weight. There are three grades of meat for export; - first, second, and third -
I stress the Tasmanian figures. The output of first grade is very high, showing conclusively that in Tasmania a far better return for outlay is assured than in any other State. On that basis, there is a special claim for extra consideration when distribution of fertilizers is being considered. Every one knows, of course, that the fat lamb industry in Tasmania is controlled under the meat agreement with Great Britain, but one of the things which is causing thought and no little concern m Tasmania is that the New Zealand price has always been greater than that commanded by Australian growers, although, as is contended in Tasmania, I think with good authority, firstclass Tasmanian lamb is equal to the best New Zealand lamb. The records of the Smithfield market over a number of years confirm that. The fat lamb raisers in Tasmania are anxious that they receive some consideration for the extra quality meat they produce. It is believed there that recently a variation was made in the agreement between Great Britain and New Zealand. I have not been able to verify that from official sources, but I will read a paragraph bearing on this matter in the Burnie Advocate -
With a view to meeting the increased demand for meat for Great Britain and allied services in the Pacific the New Zealand Meat Board has increased prices for the heavier weight export lambs and ewes so as to encourage farmers to produce heavier carcasses and thus obtain a greater quantity of meat from the same number of lambs. According to the New Zealand farming journal Straight Furrow these increases range from *d. per lb. for prime lambs weighing 36-42 lb. up to 2d. per lb. for overweight lambs weighing 51-56 lb. Mr. Hiscock said that the New Zealand farmers already had been receiving approximately Id. per lb. more as a basic weight with monthly increases as the season advanced, which brought the price up another penny last year between January and July. The New Zealand farmer had the further advantage that lambs up to 36 lb. could qualify for top price whereas in Tasmania a reduced price operated above 28 lb.
I strongly urge that the Minister investigate the rumours that the agreement between New Zealand and the United Kingdom has been varied with a view to ascertaining the possibility of variation of the contract between Australia and Great Britain. I urge further the desirability of looking into the question of creating a super grade, which I would call “ Tasmanian grade “. I do hope that I shall not be accused of commercial dishonesty when I suggest that. The Minister will know that there is a certain brand of New Zealand lamb known as Canterbury lamb. No one pretends that Canterbury lamb is all raised on the plains of Canterbury. It is a supergrade lamb, and commands the highest price. I feel that the figures I have quoted, and what the Minister, I am sure, already knows about the Tasmanian product, would justify the . investigation of my claim. In the Smithfield market, before the agreement was made, Tasmanian lamb could command a price equal’ to that of New Zealand. If what I suggest can be done, it will keep open after the war an avenue of trade which will be invaluable not only to Tasmania but also to the whole Commonwealth. It will be necessary for advertising to be undertaken more extensively. When in Great Britain, what surprised me most . was the volume and style of advertising of all New Zealand primary products, particularly fat lambs and butter. One particular form which I commend to the Minister was that every recipe in the women’s magazines, instead of referring to “ butter “ or “ lamb “ specified New Zealand butter or lamb. I hope that the time will come when every recipe book and every women’s magazine in Great Britain will carry advertisements extolling the virtues of Australian lamb, and particularly super-grade Tasmanian lamb.
.- At some time during the evening an honorable member, speaking from the Opposition benches, expressed his reluctance to vote supply for an extended period, if it was to be regarded as an encouragement to the Government to enter a long recess. I have no intention to address myself to that subject, other than to say that my views in regard to more frequent and regular meetings of Parliament have not changed as the result of any transition from the eastern to the western side of the chamber. Those which I expressed from the other side I confirm from this side. I deprecate, and even go so far as to condemn, the suggestion that Parliament should be regarded as a kind of registry of the decisions of the Executive. It appears to me that that is not the highest function of Parliament. I have always been opposed to very long recesses, and think that Parliament, in its character as a debating assembly, should be retained and fostered.
Last week the Leader of the Opposition (Mr. Menzies) initiated a discussion upon the issue of what are known as the “flats” of Hansard to Ministers, leaders of parties, and departmental heads. “ Flats “ in that connexion is not a term with which I was hitherto familiar. Although I had heard it employed occasionally as appropriate to honorable members of the Opposition, I knew nothing of it from the technical side of the printer’s art and craft. In that debate I said that the issuing of Hansard in that way in its uncorrected form to a chosen few was “ news “ to me. I soon found that the Leader of the Opposition was barking up another tree, as he was really making inquiries which had little relation to the subject of “ flats “. I expressed my opposition to the practice of issuing “ flats “, and am still opposed to it; but, presumably, my opposition will have but little weight. I should rather judge from the discussion which followed the raising of the matter by the Leader of the Opposition that the majority of honorable members would favour the continuance of the practice, which, in my view, is neither desirable nor necessary. Clearly, however, I must take warning from the discovery of this apparently old practice, and express myself with greater care, more clearly, in more ringing voice, in order to make sure that I am correctly heard by the Hansard reporters, who, I admitted on another occasion, did a very good job with a high degree of skill, but who could not, especially in the noise sometimes incidental to debate, be expected to achieve perfection, in their difficult and responsible task.
The view which I expressed seems to have been borne out by your own experience, Mr. Speaker, because in a recent statement made to the House upon this subject you referred to a misuse of these proofs. That there was misuse appears to have been admitted. The honorable member for Hunter (Mr. James) stated that he had found these proofs in circulation in his own electorate, far removed from Canberra. There is a further proof of misuse in the fact that a more distinct and unequivocal notice is now stamped upon these “ flats “, intimating that they are not to be quoted from, that they are unrevised and confidential, and, in plain language, not to be relied upon as a faithful record of what an honorable member desired to say. As I have stated, you, Mr. Speaker, made a statement on this matter last Tuesday. I did not have the advantage of hearing your important address upon the subject, as I was absent from the chamber. But you thought fit to use my name in your address to the House, with an intimation that I had in 1938, through the medium of a question, raised tie matter of alleged deficiencies in printing. I remember very well raising that matter, because I found it difficult to read Hansard at night when I desired to refresh my mind about what had taken place in Parliament. But I confess that I am quite unaware why my name was imported into the discussion originated by the Leader of the Opposition, with which my reference to deficiencies in printing had nothing to do. This introduction of my name has given rise to absurd gossip in the lobbies, extending to “ another place “, sometimes called the Senate. You will be aware that conclusions are frequently arrived at by honorable members with relatively very little association with the argument advanced in support of them. Therefore, you will not be surprised that the use of my name in that connexion led to a report which honorable members of the Opposition were quick to circulate as widely as possible that I had originated the “ flats “. Of course, I had nothing whatever to do with it. Nor was it alleged by you that I had anything to do with it. You merely referred to the fact that I had spoken on a totally different matter relating to Hansard. I can only say on that point that I still regard the practice as both undesirable and unnecessary.
The view has been expressed that if Ministers were not supplied with advance copies of Hansard reports, they would have to retain an army of officials in the House to record questions without notice in which their departments were interested ; but presumably ‘ no record would be made of questions upon notice. That prompts me to refer to a change of practice that has gradually developed in this chamber. Ministers, if they will allow me to say so, ought to check it. Questions without notice should be asked only in reference to urgent and important matters. But the truth is that questions are constantly asked which Ministers could not be expected to answer impromptu. As questions follow one upon another, honorable members think of a subject upon which they can direct a question to a Minister for the purpose of showing constituents, when they read Hansard, that the member has not been entirely inactive. The result is that questions are constantly asked which are neither urgent nor important. Questions are frequently asked which could not possibly be answered by Ministers without reference to records.
The practice which is developing is that many questions which are now asked, without notice, ought to be placed upon the noticepaper. Ministers and this is what I say is an objectionable practice reply, “I shall have the matter investigated and furnish an answer at an early date “. Very often, the consequence is that a Minister comes into the House two or three days later and obtains leave to make a statement. The time of the House is then occupied while the statement is read. Had the questioner been asked to place the question on the notice paper, he would probably not take the trouble to do so. An honorable member asks the question because he can start a hare running in that way. This engages the attention of busy Ministers, whose time might be better employed. I was glad to notice to-day a disposition on the part of some Ministers to depart from the practice of replying, “ I shall make inquiries and submit a reply at a later stage “. The old rule was that questions which required research or reference to departments should be put on the noticepaper, or not asked at all, and that is the rule which in my opinion should be followed.
It would save the time of Ministers, and many questions asked, without notice, would not be heard of again, because the member would not take the trouble to put them on the noticepaper. I was pleased to learn today that there was a disposition on the part of Ministers to ask that notice should be given, and I hope that that practice will be followed. There is no need for an army of officials to be present in the House. The answers to questions on notice are supplied to the members concerned as soon as they are available. Honorable members can obtain information from Ministers whom they meet from day to day, or they can place questions on the notice paper and ensure that they will be dealt with in the regular way. There is no occasion whatever for an army of officials or any officials to be present in the House.
Summing up those few observations, I endorse and repeat my protest against the issue of uncorrected proofs to the “ elite “. They should not be issued to anybody but the member concerned, who knows what alterations should be made to provide a faithful report of what he has said. There is no occasion whatever for the presence in the chamber of officials to pick up the threads of questions and answers if the regular practice in regard to them be followed, and questions that should be asked are put on the noticepaper, and only urgent questions are asked without notice.
Debate (on motion by Mr. McEwen) adjourned.
Bill returned from theSenate without amendment.
The following papers were presented : -
National Security Act -
National Security (Exchange Control) Regulations - Order - Sterling area.
National Security (General) Regulations - Orders -
Control of fibres and jute goods (No. 3).
Cordage and fibre.
House adjourned at 11.19 p.m.
The following answers to questions were circulated: -
n asked the Minister for Labour and National Service, upon notice -
– The answers to the right honorable member’s questions are as follows: - 1. (a) The DirectorGeneral of Man Power, Mr. Wurth, . continues to receive only his salary as Chairman of the Public Service Board of New South Wales, namely, £2,500 per annum. He receives no additional remuneration in respect of his duties as DirectorGeneral of Man Power.
The salaries of Assistant Deputy DirectorsGeneral are: Queensland, Assistant Deputy DirectorGeneral, £808. New South Wales Principal Assistant Deputy, £1,052; Assistant Deputy DirectorGeneral (Administration) (State remuneration), £986; Assistant Deputy DirectorGeneral (Rural), £808. Victoria Assistant Deputy DirectorGeneral (Rural), £1,052; Assistant Deputy Director General (Industrial), £1,052. Tasmania Assistant Deputy DirectorGeneral, vacant. South Australia Assistant Deputy Director General, £832. Western Australia Assistant Deputy DirectorGeneral, £832.
South Wales Principal Assistant Deputy, allowance of £110 per annum from 21st January, 1943; Assistant Deputy Director General (Rural), allowance of £109 per annum from 21st January, 1943. Victoria Deputy DirectorGeneral, allowance of £200 per annum from 1st October, 1942; Assistant Deputy DirectorGeneral (Rural), allowance of £14 per annum from 21st January, 1943; Assistant Deputy DirectorGeneral (Industrial), allowance of £34 per annum from 21st January, 1943. South Australia Deputy DirectorGeneral, allowance of £200 per annum from 1st October, 1942; Assistant Deputy DirectorGeneral, allowance of £30 per annum from 21st January, 1943. Western Australia Deputy DirectorGeneral, allowance of £100 per annum from 1st October, 1943.
Australian Army: Citizen Military Forces: Enlistmentofmen Discharged from Other Services : Motor Vehicles for Primary Producers.
E.- On the 2nd March, the honorable member for Moreton (Mr. Francis) asked whether men who had been discharged from the Navy, Army, and Air Force were being again called up for medical examination for the purpose of serving in the Militia.
I now desire to advise the honorable member that action has been taken to revoke the notice, dated the 20th February, 1943, and previous notices calling upon male British subjects to enrol for military service, but the proclamations calling on persons specified to enlist and serve remain in existence. The necessity to enrol, however, has been suspended. Under this policy, only those persons who are actually made available for service in the Navy, Army, or Air Force by the national service officers of the Department of Man Power will, in future, be called up for medical examination. Any man who had been discharged from the service on medical grounds would not ‘be further re-examined or required to perform additional service, and no persons who have been discharged from such service are again called up unless they are made available by the Man-power Directorate, and declared to be medically fit class “ A “. If, as stated by the honorable member, men discharged from the service are now being called up for medical examination for the purpose of serving in the Australian Military Forces, it will be apparent that they are not members who were discharged from the forces on medical grounds, and for whatever other reason their discharge from the service had been fleeted, the man-power authorities are evidently now of the opinion that their services should again be made available in the fighting forces.
On the Sth March the honorable member for Wide Bay (Mr. Corser) inquired as to the possibility of making available to primary producers, on a No. 1 preference, some of the Army stocks of used and unused motor vehicles to enable them, to market their products.
I now inform the honorable member that I have had inquiries made and find that the Department of the Army has no new or unused vehicles available for disposal. The policy in regard to the disposal of any disclosed surplus of used army vehicles is at present the subject of consideration. Supplies of commercial vehicles have been imported by the Division of Import Procurement, Department of Trade and Customs, and are available to essential users. Before purchase can be made, however, it will bc necessary for a permit to be obtained from the Director of Land Transport.
Cite as: Australia, House of Representatives, Debates, 23 March 1944, viewed 22 October 2017, <http://historichansard.net/hofreps/1944/19440323_reps_17_178/>.