17th Parliament · 3rd Session
Mr. Speaker (Hon. J. S. Rosevear) took the chair at 2.30 p.m., and read prayers.
Borneo Operations - -Hostels A>ll Cas teens.
Hr. CHIFLEY (Macquarie- Acting Prime Minister and Treasurer). - by leave - I informed the House last night that Australian forces were taking part in a landing in Borneo. No further information is yet available, and it is assumed that security considerations associated with the operations preclude the giving of any details.
Last January, the Prime Minister (Mr. Curtin), in a letter to General Macarthur on the subject of communiques relating to the activities of the Australian forces, referred to the special desire of the Government and the people of Australia that, consistent with security requirements, the activities of the three Australian fighting services in the operations in the South-West Pacific Area should be fully and adequately publicized. The Prime Minister informed General MacArthur that he considered he should mention the matter at that stage, in view of the forthcoming active participation of i he A,ustralian Army in his forward offensive operations.
In view of these arrangements, it is to he assumed, as I have said, that military considerations have not so far permitted any further announcement, When additional information comes to hand, I shall acquaint the House, if it should be sitting.
– by leave. - Yesterday the honorable member for Moreton (Mr. Francis) asked a question about disturbances that had occurred in Brisbane! last night and had been attributed by the press to the lack of proper amenities for our troops in Brisbane. The Acting Minister for the Army (Senator Fraser) informs me that he has already investigated this matter, and is satisfied there is no cause for tho Australian troops in Brisbane to bc dissatisfied with the conditions that at present obtain there. When the Minister for the Army (Mr. Forde) was in Brisbane some time ago arrangements were made for extensions to be made to the Lady Bowen Club and for a new hostel to be provided in Rich’s building in Adelaide-street, Brisbane. These additional facilities were immediately taken in hand at a combined cost of over £16,000. The extensions to Lady Bowen Hostel will bo completed in a fortnight’s time, and this will provide 250 additional beds with all reasonable comforts and facilities. The hostel at Rich’s building is being proceeded with as rapidly as possible, but a great deal of reconstruction work is being carried out inside the building. Three floors each of over S,000 square feet are being re-wired and panels of partitions constructed. “When it is completed at the end of this month the centre is expected to provide amenities and facilities equal to, if not better than those at the American centres in Brisbane. The Acting Minister for the Army also informs me that there was no lack of meals or accommodation on tho 30th April, which was the night of the disturbance. On that evening 206 beds were vacant at the Lady Bowen Hostel and St. Oswald’s Club run by the Australian Army Canteens Service, whilst the dining accommodation at the Lady Bowen Hostel was not used to anything like its maximum capacity. In these circumstances the Acting Minister for the Army has no hesitation in stating that, whatever may have been the cause of the’ disturbance, it cannot, by even the greatest stretch of the imagination, be attributed to the lack of proper amenities and facilities for members of the Australian Military Forces.
– Has tho attention of the Minister for Postwar Reconstruction been directed to the statement in to-day’s press that a company, with a capital of £1,000,000, for the manufacture, of motor cars in Australia was- registered in Sydney yesterday, and that the choice of a site and the decision as to whether it would be in New South Wales or Victoria would depend on investigations now being made with the help of the Secondary Industries Commission?In view of the urgent need to decentralize our major industries in the interests of the future defence of this country, will the Minister impressupon the Secondary Industries Commission the necessity for selecting sites for all new major factories in South Australia, Western Australia, Queensland and Tasmania? Will he also impress upon the commission the grave danger that would be caused to the future of Australia if the capital cities of Sydney and Melbourne were allowed to continue to grow in size at the expense of the rest of Australia?
– I have seen the press statement mentioned. Indeed,by courtesy of the Nuffield organization in this country, I was advised beforehand that it was to be made.The Secondary Industries Commission is assisting the organization in every way. It will gave all the advice and render all the assistance possible in the selection of a site. It mustbe understood, however, that thefinal selection will be a matter for determination : by the company itself. I assure the honorable member that the commission is well aware of the Government’s desire that industries generally shall be decentralized as much as possible. In its consultations with the Nuffield organization, the commission undoubtedly will bear that in mind.
Statements by Australian Delegates.
. - by leave- The newspapers inthe last two or three days have carriedaccounts, necessarily abbreviated, ofstatements bythe two principal Australian delegates at theUnited Nations Conference on International Organization atSan Francisco. They have referredon eachoccasion to a proposal for the adoption of the principle oftrusteeship in the administration of dependent peoples orcountries. That expression is not easy to interpret at a distance, and it seems to me very desirable that the House should have an opportunity, as soon as possible, to have before it not only a full account of what has been put. forward by our representatives, but also an explanation of what is involved in the proposal. For example, one may speak in a general fashion about the principle of trusteeship in the administration of native peoples, meaning simply that the whole principle of government will be that the welfare of the peoples concerned will be the primary consideration. After all, that is almost a universal principle of government in civilized countries. But if it means that there is some derogation from the sovereignty of nations in relation to their own colonies - for example, some derogation from the sovereignty of Australia in relation to Papua as distinguished from New Guinea - then, without expressing any concluded view on the matter, because I have not given sufficient thought to it, I urge upon the Government that the matter plainly is so important that we ought to consider it. I cannot say how far the implications go. I have noticed in these reports observations to the effect that no subtraction f rom sovereignty isinvolved. But it is quite easy to see that, on the words used, what is being suggested may amount to some form of international control over the administration by one nation of one of itscolonies, and, if that he so, it affects not only our own position in relation to our own territories but also the position of Great, Britain in relation to a great number of its colonics.
– What do they want - a condominium?
– Atthe moment, I am merely suggesting to (the Acting Leader of the Government that, as the matter plainly is of first-class importance, andnotone upon which anyoneof us should offeran opinion until he is fully cognizant of the precise nature of the proposal, the honorablegentleman shouldtake an early opportunity to place before the House not onlythe full text ofthe statements but, where theutterancesrequire further explanation, thatexplanation as well. I, for one - and I am surethat I speak for all honorable members - have no desire to form, let alone express, views on this problem, until I know exactly what has been put forward by the representatives of this country.
– by leave - Yesterday, an honorable member questioned me about obtaining a copy of a speech that had been delivered at the conference at San Francisco by the Deputy Prime Minister (Mr. Forde). I promised to inquire into the matter. In response to the suggestion by the Leader of the Opposition (Mr. Menzies), I shall endeavour to obtain copies of the statements that have been made by the Australian delegation, and any other matters that may furnish information to this House.
– Will the honorable gentleman obtain a copy of the speech that was made by the Attorney-General?
– Yes ; any official statements that have been made at the conference, and whatever other information I can obtain. That, as the Leader of the Opposition will realize, may require a little time. I shall see that the information is made available when it comes to hand.
– The Acting Prime Minister (Mr. Chifley) stated in his reply to the Leader of the Opposition (Mr. Menzies) that he would make available the text of the speech of the Deputy Prime Minister (Mr. Forde). So far so good, but that does not meet the point raised by the Leader of the Opposition. What are the implications of this policy of trusteeship, and to what degree, if at all, do they affect our relations with the islands over which we had a mandate, which was a form of trusteeship in which we were bound by the terms of the mandate, to consider primarily the welfare of the natives? Does the Acting Prime Minister consider that the statements madeby the Deputy Prime Minister (Mr. Forde) and by the Minister for External Affairs (Dr. Evatt) involve a departure by Australia from its pre-war policy? Have these a still wider application ? I should be glad, therefore, if the Acting Prime
Minister would afford the House an opportunity to learn the mind of the Government, and to do so while the matter is still malleable - that is, before it hasbeen finally decided at San Francisco. This is of immense importance.
-I made it clear yesterday, in reply to a question, that all information on the subject, including the speech of the Deputy Prime Minister, and the statement with which the conference was opened, would be made available to honorable members.
– I have received from a constituent who is interested in broadcasting a telegram which reads -
Many listeners in Bass and elsewhere will be unable to hear the special announcement shortly expected by Acting Prime Minister owing receivers being un useable through lack of recti fier valves, mostly type 80 and 5Y3G. Your approach to Director Radio and Signals may assist and would be much appreciated.
Will the Minister have the matter examined in order to ascertain whether anything can be done to meet the request contained in the telegram?
– I shall give the matter my immediate attention, and I hope that it will be possible to make sufficient supplies available.
– Will the Minister representing the Postmaster-General inform the House whether radio station 2CA Canberra leases a telephone channel permanently between Sydney and Canberra for daily use from 5.40 p.m. till 9 o’clock the following morning? Is it also a fact that the Postmaster-General’s Department refused this B-class station the use of the channel at 9.45 a.m. to-day for transmission of one of the new independent radio news services established yesterday? What repudiation of contractual obligations entered into by the Government was involved in this refusal? Was the department acting under instructions from Cabinet, and was the purpose of the refusal to force station 2CA to take the Australian Broadcasting Commission news service? Will immediate instructions be given to ensure that the Postmaster-General’s Department shall fulfil arrangements existing between it and station 20 A?
– The question, asked by the right honorable gentleman is obviously one for the notice-paper. I am not in a position to furnish the information desired by him without consulting the Postmaster-General. I advise the right honorable gentleman not to get too excited over the so-called news service which certain people desire to establish.
– I have just now received the following telegram : -
All Tasmania!! commercial stations strongly resent action J?.M.G’s. Dept. refusal land-line facilities for commercial news service this State. Would appreciate you taking matter up our behalf.
The telegram is signed by representatives of the commercial stations in Tasmania. l< the Minister representing the PostmasterGeneral in a position to make a statement regarding this matter? If not, will he take it up with the PostmasterGeneral and ascertain the reason why land-line facilities have been denied the commercial broadcasting stations?
– I shall consult with the Postmaster-General on the matter raised by the honorable member and supply a detailed answer. I should like to say, however, that neither the newspapers nor the commercial broadcasting station proprietors - and, very often, they are one and the same group of persons - have a prior claim over ordinary civiliains for the use of interstate trunk lines. In the busiest portion of the day there is a delay of at least five hours in respect of calls by the general public between Melbourne and Sydney, and even a greater delay in respect of calls by persons who desire to communicate from either Melbourne or Sydney with Queensland. It is neither the duty nor the responsibility of the Postmaster-General’s Department to give favoured treatment to people who have been well served since February, 1942, with facilities to enable them to let the people who listen to their programmes know the news of the day. A determined attempt is being .made at present by the newspaper proprietors to obtain a monopolistic control over radio stations.
– And also by the Government.
– The Government has not made any attempt at any time to influence radio stations in respect of news services, let alone attempt to gain monopolistic control over the news service which, up to the present, has been operated by the Australian Broadcasting Commission. That service is entirely independent. Opposition members are given equal time with Government members with regard to the broadcasting of parliamentary news. What the commercial stations are trying to do now is to obtain a monopolistic control over the gathering and dissemination of news throughout, the Commonwealth. They cannot expect a Labour government to help them in that direction.
Conduct of Business
– In view of the fact that one-third of the year has passed and no bill has been put through the House,, will the Acting Prime Minister consider devising some procedure by which the machinery of Parliament could be oiled a little more, to enable the business of the country to be proceeded with more expeditiously? Will he consider the interesting suggestion contained in a book in the. Parliamentary Library by Mr. Rober S. W. Pollard, an English author, for increasing the efficiency of Parliament and utilizing members of the rank and’ file to greater advantage than is possibleunder present conditions?
– I am most anxious,, as I stated yesterday, that honorablemembers shall co-operate with the Government to ensure that, without preventing a full discussion of measures,, the business of the House shall be transacted with reasonable expedition. I hopethat honorable members will comply with the requests which I made yesterday on behalf of the Government, but I do not propose to do anything calculated toprevent free and full discussion of themeasures .before the House. Unless greater expedition can be achieved, it will be necessary for honorable members to sit for much longer hours than they havebeen working up to the present.
Resignation s - Personnel Tran sferred prom Australian Imperial Force - Overseas Service - Recruitment. Mr. HARRISON. - Has the Minister for Air read in this week’s Smith’s Weekly that eight senior officers commanding various units in the First Tactical Air Force have applied to be allowed to resign their commissions with the Royal Australian Air Force? Will the Minister inform the House whether the report is correct, and, if it is, will he statu the reason why the officers propose to resign their commissions?
– I am not sure whether the Deputy Leader of the Opposition vouches for statements published in Smith’s Weekly, but he seems to rely on that newspaper a great deal. I understand that such a statement has been published in that journal. Investigations regarding the matter were being made before the statement was published, and it is only fair to say that the representatives of several newspapers had asked me about it previously. Inquiries are now being made, and I have been furnished with certain particulars. When I have had time to consider them I shall decide whether I shall make a statement to the House.
– Can the Minister for Air give any information concerning the f uture of those lads who transferred from the Australian Imperial Force to the Royal Australian Air Force, and have completed their elementary flying training? For months past they have done nothing but odd jobs, many of them of a menial kind and fruit picking. There is a rumour that their training is to cease, and that they are to be offered the alternative of a, remuster into ground staff units, or discharge. Seeing that it is unfair to them, and bad for morale that they should remain idle, will the Minister say what it is proposed to do about them?
– I appreciate the interest which the honorable member takes in these trainees, but it must be apparent to everybody that if V-E Day occurs soon a large number of trained airmen will be returning from overseas to take the place of those here who are only partly trained. Surely the honorable member does not suggest that we should go on training men unnecessarily. If it is a fact that a number of men who transferred from the Army are being kept idle, I am not aware of it.
– They have passed their flying tests.
– If that is so, they will be used where they can give the best service, and no one will be passed over who is competent to do a job. The return to Australia of trained and experienced men will mean that some others will not he flying as soon as they otherwise would. That is inevitable. We should not deplore the circumstances that bring that about; we should be glad of them.
– Can the Minister for Air say whether there is any foundation for the report in the Sydney press that airmen who have had some years of service in Great Britain will be sent to the Far East in the near future to continue their service there? Will he give consideration to the return to Australia of men with long service overseas; and should that involve their replacement, will he see that men who have not had overseas service shall have an opportunity to go abroad as substitutes?
– The honorable member will realize that many complications will arise in connexion with airmen who have served in various theatres of war. It will be apparent to all honorable members that men cannot be moved backwards and forwards continually, but the House may rest assured’ that fully trained men who are ready to return to Australia will be brought back as soon as shipping is available. I have not seen the newspaper report’s to which the honorable member has referred, but if he will’ furnish them to me I shall examine them, and supply an answer later. The position is being watched carefully, and the Government will do its best to utilize’ the services of the men for whom he speaks as quickly as possible in places where they will be of the greatest value.
– As there is now a surplus of air crews in the Royal Australian. Air Force, and many men will be return- ing from overseas in the near future; can the Minister for Air explain why appeals for recruits for air crews arebeing broadcast when so many men. have not yet completed their initial training?
– The honorable member’s assumption that I have admitted that there is a surplus of air crews is incorrect. All I have said is that, probably, following the cessation of hostilities in Europe, large numbers of air crew personnel will be returning to this country. I am not aware that the recruiting branch of the Air Force is calling for recruits for air crews. I shall have inquiries made into the matter, and see whether such recruiting is justified. If not, I shall have it discontinued.
Celebration of V-E Day
– Can the Acting Prime Minister say whether it is to be understood from his statement of last evening that both the preliminary and official announcements of the cessation of European hostilities are to be made over the national broadcasting stations only? If so, why should the commercial stations be denied participation in this most important event in Australian history, seeing that they have contributed so much to the war effort, and to the various war loans? Why should country listeners, not served by the national stations, be penalized ?
– I have been given to understand by the Minister for Information that this matter is under consideration, and a reply will be given to the question as soon as possible.
– It has been announced in connexion with the proposed V-E Day observance that, on the day following the announcement of the cessation of hostilities, workers other than those engaged in essential industries are to be given a holiday. Does the Acting Prime Minister propose to give a more precise definition of essential industry, or is the matter to be left to the discretion of the managements concerned?
– It is difficult to define an essential industry. However, so far as the Commonwealth Government is concerned, I have arranged with the Ministers of the various departments that they shall decide what employees under the control of their departments are to work on that day. Thus, each Minister will make the decision for his own department, perhaps in consultation with me, if he so desires. Apart from that, we shall have to leave the matter to be decided by the various bodies concerned.
Australian Drought Pictures
– Has the Minister for Information seen the Illustrated London News of the 27th January last? I have here a copy of the paper, in which are published photographs which resemble in some respect those which have been taken of concentration camps in Germany. Spread across the top of the page is the heading, “ Australia’s Dust Bowl Problem “. Underneath, there are pictures of dying sheep, and of sand drifting across fences ; of homesteads and farm’s destroyed by sand drifts ; of mallee trees with 9 feet of their roots exposed through erosion, dead sheep lying in the corners of paddocks, and of men trying to save their homes from being engulfed by sand. Can the Minister say whether these photographs were supplied by the Department of Information? What action has he taken to correct the impression that the whole of Australia is an arid waste with sheep dying everywhere? Finally, does he regard such propaganda aslikely to encourage British migrants to come to Australia?
– I am so fully occupied with watching the Australian press that I have little time left to study the columns of the Illustrated London News. If the honorable member will make his copy available to me I shall have the matter investigated, and shall answer his question as well as I can. I should say off hand that my department did not supply the pictures which he mentioned, because it is fully engaged in supplying to people inside and outside Australia pictures and information about this country’s war effort. I assume that the pictures were taken from a commercial film which was made during the height of last year’s drought, and was shown throughout Australia. It seems to me that copies must have eventually found their way to London.
Transfer of State Officials
– I ask the Acting Prime Minister whether it is a fact, as reported in the press, that Victorian Government officials have expressed fears that in certain contingencies the Commonwealth is likely to legislate to acquire compulsorily some thousands of State public servants for its new social benefits plan to operate from July? If so, does the Government propose the compulsory acquisition of public servants, employed by governments in other States, and has there been any objection by such State public servants to their being forced to transfer to the Commonwealth Public Service ?
– Recently there was a conference of Commonwealth and State Public Service Commissioners, over which the Minister for Post-war Reconstruction presided. One of the objectives of the conference was the making of arrangements by which some State servants could be transferred to the Commonwealth to carry out certain administrative duties associated with the employment of returned servicemen, and the social services legislation which will come into operation shortly. It was not proposed that any compulsion should be used in connexion with the transfer of State public servants to the Commonwealth. I shall have a detailed statement prepared for the information of the honorable member, but I assure him that, should legislationbe introduced to provide for the transfer of State public servants to the Commonwealth, no compulsion will be used, and that State officials will have the right to elect to be transferred.
– Has the
Minister representing the Minister for Health and Minister for Social Services yet had an opportunity to peruse carefully the reports presented to the National Health and Medical Research Council on the subject of population, particularly those portions which deal with recommendations for the improvement of maternity services ? If so, in view of the urgency of the problem in the minds of many women, is he in a position to make an announcement as to the Government’s intentions, and the action likely tobe taken in connexion with those recommendations ?
– I have not been able to study carefully the latest report, but I shall discuss the matter with my colleague at the first opportunity, and let the honorable member have an answer.
Homes for State Public Servants
– Is the Minister for Post-war Reconstruction in a position to define the spheres of action and responsibility ofCommonwealth and State Governments in connexion with housing? By way of explanation, I inform the Minister that recently I received a letter from the Coff’s Harbour Parents and Citizens Association stating that high school teachers in that district are unable to secure any accommodation at all. The association asks whether, in the circumstances, it is possible to make certain hotel accommodation available to teachers. The position is much the same at Grafton, Taree, Kempsey and elsewhere ; in some towns teachers are forced to sleep in places which can only be described as pens. Can the Minister say whether the Commonwealth Government or State governments are responsible for providing accommodation for public servants ?
– The responsibility for finding accommodation for members of the teaching profession rests with State governments, because under the Constitution the Commonwealth Government has no responsibility whatever for either education or housing. Under the controls which operate at present, State governments have complete authority to proceed with the construction of accommodation required by State instrumentalities without applying to my department for any permit. The Government of New South Wales is free to go ahead and provide the accommodation necessary for housing its employees. Should there be any other aspects of this matter which the right honorable gentleman would like clarified, I should be glad if he would place a question on the notice-paper.
-Can the Minister for Repatriation say whether a booklet which has been prepared by Mr. O’Sullivan, a member of the New South Wales bar, in his capacity as chairman of No. 1 War Pensions Entitlement Appeal Tribunal, has been accepted by the Repatriation Commission as an authoritative text book, and will the cost of publication be borne by the commission ? I suggest that it is a useful booklet.
- Mr. O’Sullivan’s booklet was prepared by him in his own time, and is not regarded as an official publication. During its preparation Mr. O’Sullivan showed to me an outline of what he had written. I disagreed with it, as did the Repatriation Commission also. It is not intended to pay for the booklet as an official publication.
– When the revelations of Japanese brutality to Australian prisoners were made last year by the then Acting Prime Minister, I asked him to investigate the possibility of dropping medical supplies to prisoners of war in camps in Thailand. Can the Acting Prime Minister say whether anything has been done in that regard? If not, will he observe what is going on in enemy-occupied territory such as Holland, and follow the example of the Allied forces there in employing special equipment for this purpose?
– I remember the honorable gentleman asking the question which he has mentioned. As Acting Minister for Defence, I am not familiar with what has been done, but I agree that the matter shouldbe investigated very closely. I shall attend to it as soon as possible.
Motions (by Mr. Chifley) - by leave - agreed to -
That leave of absence of two months be given to the Minister for the Army (Mr. Forde), the Attorney-General and Minister for External Affairs (Dr. Evatt), the honorable member for Ballarat (Mr. Pollard), and the honorable member for Indi (Mr. McEwen) on the ground of urgent public business.
That leave of absence for one month be given to the honorable member for Newcastle (Mr. Watkins) on the ground of ill health.
– I should like to ask the Minister representing the Minister for Supply and Shipping a question relating to the continued disabilities being suffered by people under the building restrictions. A resident in the country area in my electorate had the misfortune to have the roofblown off and one of the walls of his house damaged in a storm in October last. A priority was issued giving the man permission to expend £100 on repairs. This priority was handed to the local saw-mill in December last, but the mill has not yet been granted permission to supply the building materials. I now ask that a permit be issued to the mill to enable it to fulfil this order. The occupants of the house concerned have been obliged to live in one room for the last six months. Will the Minister also amend the regulations with a view to obviating delay in emergencies of this kind?
– I shall have inquiries made immediately into the matter raised by the honorable member.
Surplus and Deteriorated Supplies
– I ask the Minister representing the Minister for Supply and Shipping whether it is a fact that millions of gallons of high octane fuel dispersed throughout remote areas of the Commonwealth for defence purposes hasbecome deficient in octane value and is no longer of value as fuel for modern aircraft engines? Is it also a fact that years of storage has greatly reduced the bulk quantity of this fuel? Will the Minister make an early statement as to what the Government intends to do about stocks of deteriorated aircraft fuel, and as to whetherarrangements can be made either to sell it on the spot through the War Disposals Commission or return it to the consumer market?
– I regard this matter as being governed by what the Air Force and Army authorities might say. The job of the Supply and Shipping Department was to supply the petrol and to distribute it to the points laid down. It may be that the quantity in storage is now in excess of requirements, and, perhaps, some of the fuel has deteriorated. I shall look into the suggestion made by the honorable member.
High Court Decision
– Relative to the recent decision of the High Court that the Government’s order that bonds shall be lodged in connexion with real estate transactions is invalid, has the Treasurer issued any direction to the banks that bonds lodged with them under the Government’s order can now be released?
– The Leader of the Opposition privately asked me about this matter some days ago. The Governor of the Commonwealth Bank has been requested to communicate with the private banks intimating that bonds held under the conditions mentioned should be released. Other aspects of the court’s judgment have not yet been completely studied.
In committee: Consideration resumed from the 1st May (vide page 1250).
Clause 17 - (2.) Subject to the last preceding subsection, the moneys in the Fund shall be applied by the Board -
– I move -
That the following new paragraph be added to sub-clause (2.) : - “(g) for placing and maintaining in the Senate Chamber a bale of Australian wool so that for all time the citizens of this Commonwealth may appreciate that the greatness and wealth of this nation were founded upon and still exist upon the wool shorn from the flocks of Australia.”
I submit this amendment for two reasons. First, the presence of a bale of wool in the Senate chamber will be a constant reminder of the importance of wool in the national economy of Australia, and, secondly, it will form one of the traditions of this country. Australia will never achieve international greatness unless it has traditions on which to build its national spirit, as the countries of the Old World have done. The value of the wool which is produced in Australia represents 40 per cent of our total exports, and with mutton and lamb, over 50 per cent. of our total exports. The honorable member for Forrest (Mr. Lemmon) incorporated in Hansard a graph entitled, “ The value of the Australian wool clip, and the curve of population gainfully employed “. If we examine the graph, we shall discover that employment in the Commonwealth rises and falls in accordance with the fluctuations of the price of wool. The economic health of this community depends upon the price which we receive for our wool in overseas markets. In this respect, wool is like investment activities such as buildings, factories, roads and bridges. The maintenance of a stable level of investment activity is one of the main requirements for keeping men and women in employment and preventing the wasting curse of depression. Hardly less important for the prevention of an economic depression is the maintenance of stability of income in the wool industry.
– I rise to order. I submit that the amendment is not in order, because the Wool Consultative Council, which will be established under clause 14, will be responsible for considering such matters as the placing of a bale of Australian wool in the Senate chamber for publicity purposes.
The CHAIRMAN (Mr. Riordan).The amendment is in order.
– Security in employment of Australian workers depends on the price of wool, and I am astounded that the honorable member for Cook (Mr. Sheehan) should do anything to the deteriment of the wool industry.
– I have not done so.
– My proposal for placing a bale of Australian wool in the Senate chamber is not a laughing matter. Its presence there will make members of this Parliament, and the people of Australia, realize the value of wool in our national economy. During the decade preceding the outbreak of this war, the value of the wool exported was nearly three times as great as the value of mining products exported, principally gold. In addition., the value of wool exported was seven- times as great as the value of all manufactured goods exported from Australia. Wool is of vital importance in enabling Australia to secure the capital goods required for developmental purposes and the manufacturing industries. If it had not Iv >;ii for our wool clips, does any honorable member believe that great companies like the Broken Hill Proprietary Company Limited, in their initial stages of development, would have been able to obtain manufacturing plant and credit overseas? Such transactions would have been utterly impossible. Wool is the strongest factor in our export trade in maintaining our overseas funds. Whenever the price of wool falls, the exchange position is effected. During the depression of ] 929^32, that pressure was so great that, despite the efforts of the Scullin Government, the Commonwealth Bank and various conservative elements in this country, Australia was obliged to export the whole of its gold reserve and, even then, was not able to maintain the exchange rate at parity with sterling, although Great Britain had departed from the gold standard. The wool industry must be protected by the people from being affected detrimentally by the actions of governments, irrespective of their political views. We have had instances of past governments having injured the wool industry. In England in medieval times, “the Great Maltote”- a tax of £2 a balewas imposed. History was repeated in Australia in the days of the great depression, when the Scullin Government imposed a tax on sheepskins exported from this country.
– That is not true.
– History has a habit of repeating itself. Sheepskins could not then be exported from Australia except on the payment of a duty. The idea was to have the scouring and fell.mongering done in the electorates of the honorable member for Cook and some other honorable members.
– What was wrong with th at?
– It caused chaos, and tended to smash the wool industry. My friend who has interjected would revert to the days of Richard I., whom he resembles. Professor Shann, in his work The Boom of 1890 - and Now, said this -
The immediate occasion of thu smash, the rut at the bottom1 of thu hill, was a belated realization that the fall in wool prices had come to stay. To those who careel to think, it was .plain in 1 880 that a continuance of the low prices for wool and other exports would soon stop high spending and make the liquidation of public and private obligations overseas heavy work.
Professor Shann was one of the younger economists in the Commonwealth at the time of the great depression. He failed to reach the heights to which he might have attained and of which ho gave promise, because, like that other great Australian, Professor John Hunter, he died at an early age. He went on to show that, according to Coghlan’s index numbers for imports and exports, the price of wool declined from 16d. per lb. in 1S74 to 6£d. per lib. in 1894, and pointed out clearly that the great smash in IS 93 was due very largely to that decline.
– The honorable member must connect his remarks with the amendment.
– I am stressing the very great importance of the wool industry to Australia, which, I maintain, has to be kept continually before the minds of not only the people, but also the legislators of the Commonwealth. To that end, I propose that a bale of Australian wool shall be placed, in a prominent position in the Senate. The late John MacArthur, in a letter which he wrote towards the end of the eighteenth century, said -
A petty population established at so vast a distance from other civilized parts of the globe could have no prospects of ultimately succeeding unless by raising us an export some raw material which would be produced with little labour, he in considerable demand and he capable of bearing the expense of the long sea voyage.
MacArthur, in his time, saw the great importance of the wool industry to Australia. The language of the ordinance of the staple of 1343 said that wool was “ The sovereign merchandise and jewel of this realm of England “.
I would amend that slightlyby saying, “ The sovereign merchandise and jewel of this Commonwealth of Australia to-day is wool, as it was in Britain in 1343”. At that time, the British people were faced with problems similar to those that now confront us. They had rulers who taxed wool to the limit, and met the position by placing in the House of Lords not one wool sack, but several wool sacks.
– The honorable gentleman is speaking of the time shortly after the battle of Bannockburn.
– I am not so conversant with the history of small clans in Scotland as I am with the history of Great Britain. I am referring to the reign of Edward III. in the 14th century. It is believed that the Woolsack was placed in the House of Lords during the reign of that monarch. Its purpose was to remind the Lords and the people of England of the value of wool. There is equal reason to-day for placing a bale of wool in the Senate. Every worthwhile country in the world has certain traditions. Even the Minister for Postwar Reconstruction knows that there are certain traditions in his great country - Scotland - one of which relates to Robert Bruce watching a spider.
– The first period of the honorable member’s time has expired.
– If no other honorable member wishes to speak, I shall take my second period now. At question time to-day,. I produced some pages from the Illustrated London News depicting Australia under drought conditions. This is the view which I would have people hold of Australia -
Core of my heart, my country!
Land of the rainbow gold,
For flood and fire and famine
She pays us back threefold,
Over the thirsty paddocks,
Watch, after many days,
The filmy veil of greenness
That thickens as we gaze.
An opal-hearted country,
A wilful, lavish land -
All you who have not loved her,
You will not understand -
Though earth holds many splendours,
Wherever I may die,
I know to what brown country
My homing thoughts will fly.
The traditions of every country are enshrined in its capital. Those of Great Britain are centred in London, and are associated with Westminster Abbey, St. Paul’s, the National Gallery, and all the other famous spots. In Paris they are associated with the Tuilleries, Versailles and Malmaison. The traditions of a country are like a mosaic - they are made up of many small pieces. The traditions of Australia are allied largely with the great wool industry. The saga of the industry has already been written in verse and has yet to be sung. Nothing could be more proper than that the traditions of this great capital city of Australia should be built up round the wool industry. This aim would be assisted by placing a bale of wool in the Senate. I go further and say that we must not only build up our capital city by means of traditions, but in addition we should erect in it buildings of architectural beauty. We should get away from the galvanized iron mentality which for too long has existed in Australia. The perambulating High Court should be brought to Canberra, and be established here as a high court in a palace of justice like that of Brussels. Wool is one of the traditions of Australia. All of our traditions should be woven into the Capital City, which should be made a centre of which the people will be proud. In addition to the High Court, we should have here a national theatre and a national university. It should be possible to carry out wool research in the laboratories of a national university. For that institution 1,000 acres of land in the Australian Capital Territory should be reserved. In order to emphasize the importance of wool in tho economy of this country, and build up the traditions of Australia, I urge that a bale of Australian wool be placed in the Senate chamber, so that the people may know the debt they owe to a great primary industry.
– The Government cannot accept the amendment. The honorable member for New England (Mr. Abbott), in the course of his remarks, said that a Labour government had done great damage to the wool industry by imposing an export duty on sheepskins. That remark, like other statements by the honorable member, is completely untrue. No export duty on sheepskins was imposed during the regime of the Government of which my friend the right honorable member for Yarra (Mr. Scullin) was the leader.
– The proposal was introduced.
– It was never .put to the Parliament.
– Not only has no Labour government ever done any damage to the wool industry, but Labour governments more than any others in Australia have recognized the great importance of the industry. This bill itself affords conclusive proof that the Curtin Ministry recognizes the importance of the industry, because this bill will afford the greatest tangible assistance that has ever been rendered to the. growers of wool. At no time have members of the Opposition offered to extend to the industry so much assistance as is now to be given to it by a Labour government.
. -Despite the general attitude of levity towards the amendment, it has some merit. I confess that when I heard of the proposal, in the second-reading speech of the honorable member for New England (Mr. Abbott), my reaction to it was exactly the same as that of other honorable members. I had visions of honorable members offering to bring to this Parliament typical products for which their electorates are famous. I could imagine a future member for Denison coming along with a crate of scallops ! We might end by Parliament looking like an industrial pavilion at a country show. On the other hand, in this chamber we have the Speaker’s Chair, the mace and despatch boxes. We have every piece of symbolism used in the Mother of Parliaments, except the one which would appear to be the most appropriate for Australia to have adopted. I was ruminating in this fashion in the King’s Hall when my eyes alighted on that monstrosity in the south-eastern corner of the hall, a trade exhibit which is entirely out of keeping with the dignity of this building. I refer to the show case with which all honorable members are familiar. I then thought to myself that, if we placed in the hall a decent sack of wool instead of that monstrosity, we should indeed have done something to improve the appearance of this place. I do not agree that, if the amendment be accepted, a sack of wool should be exhibited in the Senate chamber. My housewifely soul rather resents the idea of cluttering up that beautiful chamber, but if the exhibit were placed in the King’s Hall it would serve a useful purpose. Of course, it would need to be suitably draped.
We in Australia lack a sense of tradition. From honorable members opposite I have frequently heard complaint of a lack of Australian national sentiment, and I am entirely in accord with that view. It is a sad fact that too many people in Australia show no appreciation of the history of their own country. For some unknown reason we still look back to the beginnings of the colonization of this country as though, indeed, we deserved the reflection cast upon us so many years ago by an unfortunate governor who referred to our birth stain. The convict settlement days were a stain, not on this country, but on the age which gave them birth. The United States of America also had a convict settlement, but the people of that country have forgotten it. They have developed a fine sense of tradition and history. They emphasize other features of their history, of which they feel proud, and to which they have directed tie attention of other people. Australia, too, has a glorious history in many respects. Side by side with the convict settlements there were brave people who began and built up all the things which have made Australia great to-day, despite all the vicissitudes that have marked our history. No other activity is so closely linked with Australia’s very beginnings as is the wool industry. Apart from the story of the development of the pastoral industry, as the honorable member for New England has told it, wool is linked with the development of the trade union movement. Among the first trade unions to achieve real greatness and to do anything worthwhile for the workers of this country was the Australian Workers Union. It has maintained a very high standard. It has encouraged in its members a pride in craftsmanship, something which, I grieve to say, too many people to-day, in unions and out of them, have long since abandoned.. Among members of the Australian Workers Union there is still some pride in being the “ ringer “ of the shed. There is still some appreciation of the work of a man’s hands, something which is as important, if not more important, than the work of many white collar workers. The Australian Workers Union, more than any other organization in Australia, was responsible for the creation of the Arbitration Court. To-day, it is still true to its high standards. It had a great deal to do with the creation of the Australian Labour party, and what, I may ask, would Australia be to-day without the Labour party? We would not recognize it. There is in the proposal of the honorable member for New England this merit: The bale of wool would be the symbol of something which made our vision great. I deny that our story is marked only by ugliness; it is marked by struggle, if you will, but. marked also by romance and a great, success. Of this history every child born into Australia may well feel proud. If I were a teacher to-day, I would, regard it as my duty to give to the children in my charge some sense of their dignity as Australians. If the suggestion of the honorable member for New England were accepted, a fitting symbol of Australia’s progress would be provided here in this National Parliament. I should teach the children the history of the wool industry, and everything connected with it. I should tell them that it had played so important a part in the development of Australia’s greatness, that the National Parliament had seen fit to place within the precincts of Parliament a. bale of Australian wool, in the same way as, many centuries ago, a bale of wool was placed in the British Parliament, from which we have derived so many of our customs and so many of our liberties. “ That bale of wool “, I would say to the children, “ you can all see for yourselves when you go to Canberra “. Such a thing would not be without importance. I trust, however, that the honorable member for New England will accept the suggestion that the wool sack should replace that hideous and vulgar trade display at present housed in the King’s Hall of this building. I should then be Tory glad indeed to support his amendment.
, - Only about two years ago I asked a question, upon notice, about an exhibit in the King’s Hall. It was then the policy of the Government to have exhibits made up in Melbourne and transported to Canberra by special car. The one to which I drew attention consisted of a very mediocre representation of a lamb in a glass case, surrounded by certain wool products. The Government saw fit to use an Army car - I saw it unloading outside Parliament House one Sunday morning - to carry the exhibit from Melbourne to Canberra, for which purpose the vehicle made a round trip of 1,330 miles. At that time, petrol was scarcer than rain is now, and rubber was scarcer than freedom is among the supporters of the Government. If it were not, for the export of wool from Australia, this Parliament would not exist. As a matter of fact, wool was Australia’s first export, and it is still Australia’s most important one. Therefore, the honorable member for New England is completely justified in putting forward his proposal. It should be supported by honorable (members from all parts of the House.
– Absolute buncombe!
– No doubt, the honorable member is an authority on that. If there is to be any important advance in our secondary industries, and if soldier settlement after this war is to be successful, it behove3 us to recognize the important part which wool plays in our economy.
.- This is an intriguing amendment, which might well be supported by honorable members on this side of the House if it were redrafted. For instance, instead of providing that a bale of wool be placed in the Senate, we might provide a bale of hay for the honorable member who introduced the subject. The honorable member for Darwin (Dame Enid Lyons) advanced very good reasons why there should be some symbolism in the National Parliament, but I do not think that we ought to choose wool. It is debatable what would be the most appropriate Australian symbol. It might be argued that a nugget of gold should be used as the symbol of Eureka, or we might enshrine the painting of a farmer who was pushed off his holding by the pastor alists in days gone by. Others might favour the first ticket issued to a member of the Australian Workers Union. It is really a very wide subject. Anyway, let us not waste any more time in discussing the matter, but let us pass on to other things.
Question put -
That the paragraph proposed to be added (Mr. Abbott’s amendment) be so added.
The committee divided. (The Chairman - Mr. Riordan.)
Majority . . . . 25
Question so resolved in the negative.
Clause agreed to.
Clauses 18 to 23 agreed to.
New clause 23a.
– I move -
That the following new clause be added : - “23a. During the operation of this Act no money shall be spent by the Commonwealth to support, encourage or subsidize the manufacture of synthetic fibres in Australia or any Territory under the control of the Commonwealth.”
A provision of this nature is necessary to protect the wool industry against the competition of materials made from synthetic fibres. Honorable members will realize how great is the danger to the wool industry when I state that whereas in 1939-40 only 94 square yards of piece goods made from synthetic fibres was imported into Australia, the imports in 1942-43 amounted to 1,623,653 square yards, on which a subsidy of up to 2s. 7d. a yard was paid. I cannot see why the graziers of this country should voluntarily contribute approximately £300,000 a year by means of a levy on wool in order to encourage and promote the use of woollen goods when the Government pays a subsidy on synthetic piece goods out of Consolidated Revenue, which includes money collected as taxes from the community, including wool-growers. In other words, the wool-growers not only contribute directly to the protection of the wool industry by means of a levy on their product, but, as taxpayers, also contribute tothe subsidy paid in respect of materials which compete with wool. Scientific research into problems associated with wool has resulted in the removal of those qualities which irritate the skins of some people, and has also made possible the manufacture of the finest woollen materials. In the circumstances, there is no good reason for paying a subsidy on synthetic piece goods, or for constructing in this country, a large factory for the manufacture of materials made from synthetic fibres. In 1942-43 the Government subsidized items chiefly comprising synthetic piece goods to the amount of £6,155, but in 1943-44 this amount had risen to £967,000, whilst for the first half of the year 1944-45 the corresponding subsidy already amounts to £756,000, which works out at £1,500,000 for the full year. Since 1942-43, this subsidy has increased by over 16,000 per cent. in respect of items of which synthetic piece goods comprise the greater part. I again remind the committee that we derive a revenue of £70,000,000 annually from the wool industry. Therefore, wool is deserving of every protection and encouragement we can give. Whilst we are powerless to combat the development of synthetic fibres overseas, surely we shall be only too anxious to protect the wool industry within our own borders.
– All of those problems can be dealt with under this legislation as drafted.
– Once this measure is passed we 3hall not have the opportunity to deal with the matters I have raised. Remembering that we export 90 per cent, of our wool clip, any action on our part which has the effect of subsidizing synthetic fibres will proclaim to the world that although Australia is so great a producer of wool we believe that the natural product is inferior to the artificial. We should render s>uch assistance to the industry as will make it perfectly clear that the opposite “ is the case - that we know that wool is in every way superior to synthetic fibres. For that reason, I appeal to the Government to have regard only to the value of the wool industry to the nation as a whole, and to accept my amendment. By doing so, it will do much to combat the competition of synthetic fibres.
.- I wish merely to point out that all of the matters referred to by the honorable member for Wide Bay (Mr. Corser) can be effectively handled under this measure by either the board itself or the board in consultation with the Wool Consultative Council. Therefore, there is not the slightest need to hold up the passage of the measure, which has the endorsement of not only Government supporters, but also honorable members opposite. Awaiting our urgent consideration are important measures, including the banking bills, and a bill to give effect to the Government’s proposals for the nationalization of airlines-. In these circumstances, it is deplorable that the Government should allow the business to be taken out of its hands, and the valuable time of Parliament wasted by a pernickety Opposition whose object, apparently, is to obstruct the Government in every possible way.
. The honorable member for Batman (Mr. Brennan) has said that important legislation awaits consideration by this chamber. No more important proposals can be submitted for our consideration than this measure, the object of of which is to stabilize and expand our great wool industry. Previously, I pointed out that our annual wool cheque amounts to £70,000,000. Already, considerable time has been devoted by Parliament to consideration of the Commonwealth Bank Bill. The total funds of shareholders in private banks who will be directly affected by the Government’s banking proposals amount to £70,000,000. I mention that fact in order to emphasize the importance of this measure in comparison with those mentioned by the honorable member. This bill aims at arresting the drift now apparent in the wool industry as the result of competition from synthetic fibres. The committee is indebted to the honorable member for Wide Bay for his observations. He is seised of the necessity to ensure that the industry shall receive effective value for the expenditure of this money in combating the disastrous competition of synthetic fibres. Therefore, if the expenditure of ‘ that money is to produce valuable results, it is only logical to have a safeguarding provision for the purpose of preventing the Government from continuing to carry out its present policy of subsidizing the greatest rival of woollen goods. After all, that is the reason for the introduction of this measure.
Let us consider the facts sensibly, and realize the extent to which the wool industry is in competition with synthetic fibres. The recent report on wool by the Textile Advisory Panel points out that the threat to wool by synthetic fibre is threefold - in production, quality, and price. World production of stable synthetic fibre shows an astonishing increase, from 28,000,000 lb. in 1933 to 1,237,000,000 lb. in 194’0. In the same period, the production of continuous filament rayon yarn increased from 664,000,000 lb. to 1,144,000,000 lb. In 1940 world production of synthetic fibre actually exceeded that of wool for the first time, and since then considerable increases have occurred. The threat to wool is in respect of heavy, warm fabrics as well as in lightweight, attractive materials. The average price of scoured raw wool was 76 cents per lb. in 1930, compared with 106 cents per lb. for rayon filament yarn. By 1940, the price of wool had increased to 96 cents per lb., whilst the price of rayon yarn had decreased to 53 cents. Although the threat to our greatest basic primary industry is obvious, the Government hasbeen subsidizing imported synthetic products, such as rayon, by as much as 2s. 7d. a yard. For the financial year 1943-44, price stabilization subsidies for imports amounted to £967,236, whilst for the six months ended the 31st December, 1944, the comparable amount was £548,278. In all, £1,729,529 has been paid by the Commonwealth under this heading, and it is obvious that a considerable proportion of this sum was paid in respect of synthetic fibres imported into this country.
At long last, the Government has realized the seriousness of the position and has been forced to accept its responsibility for placing the wool industry upon a sound basis in order that it may compete effectively with its great competitor, the synthetic fibre industry. Therefore, the Government proposes to pay £375,000 a year to support the wool industry. That amount is a premium of approximately one-half of 1 per cent. towards the maintenance, if not the expansion, of the wool industry, which contributes £70,000,000 a year to the Australian economy. Increased income tax will be necessary to provide the money for subsidizing rayon products, and wool-growers will have to find a portion of this tax. Consequently, they will be in the position of being compelled to contribute to the cost of a product which forms a real challenge to their own industry.
In addition, the Commonwealth Government has drastically reduced the production of double-weft cloth. Its place has been taken largely by single-weft or “ standard “ cloth of poor design and inferior quality. Until recently, no good quality woven woollen blankets were available in Queensland. Their place was taken by a so-called “ wool felt “ blanket, of poor quality, manufactured on a hessian-like base, very similar in appearance to underfelt floor covering. The short-sighted policy shown by these examples has resulted in the partial destruction overnight of the Australian textile industry. Yet the industry is no mere side-line. An annual income of over £70,000,000 is at stake. The capital assets involved in producing this income can well be imagined. Justice and equity, as well as plain common sense, dictate that the amendment of the honorable member for Wide Bay shall be supported by all those who have at heart the economic welfare of Australia’s greatest primary industry.
.- I emphasize the necessity for inserting in this bill a provision to safeguard the wool industry of Australia against summary action by the Government in certain respects. My attitude is strengthened by my recollection of what occurred in connexion with the export of sheepskins in 1930. The Votes and Proceedings of the House of Representatives, for the 17th December, 1930, show that the then Minister for Trade and Customs (Mr. Fenton) moved -
That on and after the eighteenth day of December, One thousand nine hundred and thirty, at nine o’clock in the forenoon, reckoned according to standard time in the Territory for the Seat of Government, duties of customs be imposed according to the following tariff: - Sheepskins with wool,1/2d. per lb.
– Order ! I ask the right honorable gentleman to connect his remarks with the proposed new clause.
– I am pointing out the necessity for having a certain measure of protection of the wool industry, and I suggest that we should have not only the amendment moved by the honorable member for Wide Bay (Mr. Corser), but also an additional amendment which I shall later submit for the purpose of ensuring that adverse action shall not be taken in future without parliamentary approval. The Votes and Proceedings of the House of Representatives, for the 5th March, 1931, disclose that the then Minister for Trade and Customs (Mr. Forde) made a ministerial statement announcing that the Government had decided to cease collecting the export duty on sheepskins and to refund the amounts already collected. The threat of rayon to our wool industry is infinitely greater now than was the threat to the industry created by the action of the Scullin Government in 1930. Last year, £6,000,000 was paid by the synthetic fibre! industry for the purpose of research and publicity. In Great Britain alone, about £500,000 is expended on research into and the advertisement of rayon. When such enormous sums are at the disposal of the manufacturers of synthetic fibres, Ave must ensure that we do not assist them with government funds to compete with wool. I should like the amendment to provide also that the subsidy shall not be paid on the imports of rayon into this country. That appears to me to be absolutely essential for the complete protection of the wool industry. We are really stultifying ourselves by providing a huge sum for research in order to promote the use of wool, and at the same time assisting other products which compete with it. I said in my secondreading speech that the use of rayon in combination with wool would make for the very much wider use of wool. Even so, there is no reason why we should go out of our way to subsidize an industry that is returning 40 per cent, or 50 per cent, on the capital invested in it. I hope that the honorable member for Wide Bay will vary his amendment in the manner I have suggested.
– I support the amendment. The purposes which the Government professes to have in view will be completely defeated without some such provision. The wool industry is to contribute by means of a tax £325,000 or £350,000 for use partly in publicity and partly in research. The manufacture of rayon is not an Australian industry at the present time. It is highly organized overseas, and even before the present war engaged in very wide publicity drives. I can well remember debates in this chamber, in which attention was drawn to the character of some of the advertising that was indulged in by rayon manufacturers in opposition to the use of wool, in countries which were our customers. Very little satisfaction will be derived by the Australian wool industry if the Government puts this bill into operation with one hand, and subsidizes and encourages the ‘manufacture or importation of rayon with the other hand. The figures given by the honorable member for Wide Bay (Mr. Corser) were new to me. They are outstanding, and indicate the length to which a government can go, in time of war, without, parliamentary knowledge, sanction or approval, in the importation of goods in the guise of a war necessity, thus dealing a blow at one of the biggest industries of the country. Unless the committee agrees to the amendment, all that Government supporters have said will not mean a thing. Very few Government supporters have taken part this afternoon in a debate on what I believe to be the most important amendment yet submitted. That is an indication of their lack of concern for Australia’s first industry.
.- Whilst I support the amendment, I have noted that a good deal of the discussion has been irrelevant to the issue. The granting of a subsidy on all goods imported, including rayon materials, is a part of the general scheme of price stabilization. That is well known to everybody, and no one will deny it. Although I am a grower of wool, and advocate a. greatly expanded use of it, I have to admit that the people cannot be forced to use it in conditions that are not suitable for its use. Nor can womenfolk be compelled to wear woollen garments in every detail, when they prefer other kinds. Therefore, whilst supporting the amendment, I realize that a certain quantity of synthetic and rayon materials will always be in demand in this and every other country. We might take measures totally to prohibit the importation of material of that sort, but if we did we should penalize sections of our own community. We might prevent its manufacture in Australia, but thereby we should provide a market for overseas importers and manufacturers. We have to approach the matter sanely and rationally. Whilst doing everything in our power to protect the wool industry and expand the use of wool, we n st not absolutely debar the use of other materials which are entirely suitable for the various purposes for which they are manufactured.
.- I hope that the amendment will be redrafted, because it cannot have my support in its present form. It provides that during the operation of this act, no money shall be expended by the Commonwealth for the purpose specified. Clause 4 provides that an Australian Wool Board shall be ‘ constituted and shall have perpetual succession. Subclause 2 of clause 15 stipulates that the Treasurer shall appropriate a certain amount in each year. Whilst I have the utmost sympathy for what the mover of the amendment has in mind, it seems to me that the insertion of such a provision would commit ns far too much in the future to that line of policy. I support fully those who want the Australian wool industry to be protected, and the use of wool increased. But there must be a balance between the tremendous value of wool to this nation on the one hand, and the great value of industrial organization and1 development on the other hand. There is a place in the world for both wool and synthetic fibres. It would be unfortunate were we to regard the one as almost exclusive of the other. Also, it would be wrong to imagine that by artificial means we can exclude the competition which must come from synthetic fibres. That would be almost as bad as Canute ordering the waves not to advance. The Government’s first duty is to protect the wool industry. But the time must and will come when a balance must be drawn between the one industry and the other. Great though the importance of wool is to our present economy, it would be wrong for us to assume that for all time Australia is to be a pastoral country. I am opposed to that concept. Every civilized nation began as a pastoral community. I realize the tremendous importance of the wool industry, and I concede that there are difficult days ahead, in which it will have to meet the problem of disposing of the post-war surplus of 15,000,000 bales, and of meeting the ever-increasing threat by synthetic fibres.
The utmost importance must be attached to the protection of the industry during that period. Therefore, I fully support what has been said by honorable members on this side of the chamber. But I suggest to the mover of the amendment that he proposes to establish a principle which it would be hard and ‘ uneconomic to apply in later years.
– The Government cannot accept the amendment submitted by the honorable member for Wide Bay (Mr. Corser), who has failed to substantiate his claim that the Govern ment, by its price stabilization policy, has done harm to the wool industry. As a matter of fact, the industry is producing to its maximum capacity to-day. It is producing goods the value of which is two and a half times greater than in normal peace times. When the industry is producing to its utmost capacity no competing textile can do it any harm. The Leader of the Australian Country party (Mr. Fadden) knows that the price stabilization scheme is a part of a general policy to prevent inflation, and that if the Government took steps to-morrow to remove the subsidy its action would result in chaos. Yet the right honorable gentleman persists in supporting an amendment which would have that bad effect on the economy of this country in time of war. The Government has no desire to subsidize in the post-war period the production of textiles which compete with wool. This amendment would prevent the Government from subsidizing synthetic fibres at present ; yet, if it did not do that, the prices of other fabrics would rise, wages .and the cost of living generally would increase, and we should experience the spiral of inflation which honorable members opposite always fear. The amendment has been moved purely for political purposes. The policy of subsidizing the cost of raw materials, so that the prices of the finished articles would not rise above the ceiling existing when the policy was introduced, was, speaking from memory, adopted by the Government in March, 1943, and certainly prior to the last Commonwealth election. If honorable members opposite thought it would have done harm to the wool industry they could have challenged it at the time. With the support of the honorable member for Wimmera (Mr. Wilson) they could have defeated the Government on that issue, but they took no action to that end. They knew perfectly well that the policy was necessary for the stabilization of price levels. For months up to the time of the last elections members of the Opposition could have prevented this policy from being given effect, but they knew that the policy could be justified then, and they know that it can still be justified. Adoption of the amendment of the honorable member for Wide Bay would preclude the continuance of the subsidy in time of war. The Government, as I have said, does not intend to continue to subsidize synthetic fibres in the postwar period, but the subsidy is a necessary war-time measure in order to stabilize price levels.
– The Minister plays many parts. He is now assuming the role of Don Quixote, and he tilts at windmills. No doubt, his good groom, Sancho Panza, is behind him. The Australian Country party has not submitted this amendment for political purposes, but it has the interests of the country and the people at heart. It represents the primary producers of this continent, and has been sent here to see that they at least get a fair deal and that their interests are safeguarded. The Minister talks about spirals of inflation, and predicts many terrible things which would happen if the price stabilization scheme of the Government were abandoned. Synthetic fibres are not being made in Australia at present, other than those manufactured in test tubes in Sydney by Mr. A. R. Penfold, deputy director of the Scientific Liaison Bureau. The fibres are imported from overseas and woven in this country. The Australian Country party, being a great national body, recognizes that there must be a balance between primary and secondary production and that the products of the primary industries must be consumed largely by the industrial populations in the cities. The party has no desire to injure the people living in the industrial areas in the cities, but it asks that the wool-growers shall receive a fair deal. All that the honorable member for Wide Bay (Mr. Corser) seeks by his amendment is that, during the operation of this measure, no unfair advantage shall be given to the manufacturers of synthetic fibres. I was astonished to hear the Minister defend the Government’s action on the ground that it is a part of the Government’s price stabilization plan. Are we to understand that National Security Regulations are as the laws of the Medes and Persians? Have they no flexibility? Is it impossible to secure their amendment in any circumstances? Are we to understand that no remedy is available, even though a grave wrong is being done to a great Australian industry for the benefit of outside interests which seek- to flood this country with their products? Already, the people are complaining that the Government, isolated in the sylvan setting of Canberra, has become completely detached from public affairs. This appears to be another example of this tendency. We are indebted to the honorable member for Wide Bay for having moved this amendment. The Leader of the Australian Country party (Mr. Fadden) pointed out that the Government has already paid £1,729,000 in stabilization subsidies on imports. The representatives of the wool industry ask for no favours, but they do ask that the Government shall treat the industry fairly. We are willing to fight synthetic fibres on the merits of wool. We do not seek legislation such as that which was passed during the reign of Charles II., providing that every one who died should be buried in a woollen shroud. We do not ask that the corpses opposite be wrapped in wool.
– Order !
– I was not, of course, referring to honorable members on the opposite benches, but to those who lie in the cemetery away on the hill yonder. It is possible to fight a delaying action against a competitor. One of the classic delaying actions in history was fought by the silk interests of China which prevented the recognition of cotton as a major fibre for 1,500 years after its introduction in 500 b.o. Even as late as the fourteenth, century Marco Polo reported that cotton was known only in Fokien Province in China. We do not advocate so drastic a campaign as that. All we ask is that the funds collected from the wool-growers by taxation shall not be paid away as subsidies to encourage the production and use of synthetic fibres. I have much pleasure in’ supporting the amendment of the honorable member foi Wide Bay.
.- It would be foolish to suggest that we could prevent the manufacture of synthetic fibres. Indeed, if we are vigorous enough in our propaganda, we can use to our own benefit some of the processes which have been developed by the manufacturers of synthetic fibres. However, we must realize that wool-raising is Australia’s main industry, and will continue as such for many years. It behoves us, therefore, to protect it in every way possible, and it certainly seems to be foolish to subsidize a competing industry to the amount of more than £1,000,000 a year while arranging for the creation of a fund of £650,000 to promote the use of wool. I have here a graph which shows the history of the wool industry from 1930-31 until the outbreak of war. It shows that, during this period, a payable price was received for wool only in 1934 and 1936-37, whilst at other times it varied from 8d. per lb. to 12d. Honorable members will recall that, at the outbreak of war, the then Prime Minister (Mr. Menzies) induced the Government of the United Kingdom to take over Australia’s wool clip at a payable price. Had that not- been done, we should have had great difficulty in maintaining economic stability during the war. The years covered by this graph are those which saw the rise and development of the synthetic fibre industry all over the world. At one time we exported 14 per cent, of our wool clip to Germany, but in 1938-39 our exports to Germany amounted to only 4 per cent, of the clip. Of course, the development of the synthetic fibre industry in Germany and Italy was associated with the preparation for war by those countries, but we cannot expect that the people of Europe, having become used to synthetic materials, will abandon them. Synthetic fibres are being constantly improved, and will be a menace to the export of wool in the future.
The Minister said that the payment of subsidies to the synthetic fibre industry was part and parcel of our price stabilization structure. That is so. He then went on to paint an extravagant picture of the chaotic economic conditions which would arise if the ceiling prices of synthetic materials were abandoned. He said that we would enter immediately upon the spiral that would lead to inflation. I do not believe that anything of the kind would happen. I agree that the price of the synthetic article would rise, but only to the advantage of the home-produced article, namely, wool, and I cannot see how that could hurt us. We know that synthetic fibre can be produced for about half the cost of wool, and new processes are expected to make it even cheaper, thus constituting it an even more dangerous competitor of wool. Therefore, it cannot but be to our advantage to withdraw the subsidy to an industry which has become such a formidable rival. In his reply, the Minister said that we should have taken action in 1942-43 to prevent the payment of subsidies on synthetic products. In that year the subsidy paid in respect of. materials made from synthetic fibres was only about £6,000. At first it was not known that the subsidy was being paid, but when that fact became known the matter was- raised in this chamber. In the light of the information as -to the menace of synthetic materials which has been made available during the debate, I ask the Minister to give further consideration to the amendment.
– The right honorable member for Cowper (Sir Earle Page) suggested that the amendment should go further and include a prohibition- of the importation of goods made of synthetic fibres. Although I am in sympathy with his proposal it would be impossible to give effect to it on this bill, because such an amendment would probably be ruled out of order.
– I rise to order, and ask whether the amendment of the honorable member for Wide Bay is relevant to the bill.
– Having studied the amendment moved by the honorable member for Wide Bay, and having listened to the debate on it for about 50 minutes, I have concluded that the amendment is not relevant to the bill. I therefore uphold the point of order taken by the honorable member for Wannon.
– I do not suggest, Mr. Chairman, that you could possibly be wrong if you gave mature consideration to the point of order, but I point out that the reason for this legislation–
– What is the honorable member’s point of order?
– My point is that the bill is based on the report of the Secondary Industries Commission dealing with wool, the basis of which is the danger to the wool industry caused by the increasing use of materials made from synthetic fibres. The menace is real.
– The Chair has given a ruling, and will not permit that ruling to be disputed. If the honorable member disagrees with the ruling, he must do so in accordance with the Standing Orders.
– I move -
That the ruling he dissented from.
– I rise to order. Before the question is put, can we have from the Chair the reasons for the ruling that has been given?
– I gave my ruling on a point of order raised by the honorable member for Wannon as to whether the amendment was relevant to the bill. I intimated that, having studied the amendment and listened to the discussion, I was of opinion that the amendment was not relevant to the bill, and, therefore, the point of order must be upheld.
– I rise to order. Is it not open to me to attempt to show the hopelessposition we are reaching?
– Although the Standing Orders provide that the Chair may permit a motion of dissent to be debated the practice has been not to allow debate.
Question put -
That the ruling be dissented from.
The committee divided. (The Chairman - Mr. Riordan.) Ayes . . . . . . 17
Majority . . . . 21
Question so resolved in the negative.
Title agreed to.
Bill reported without amendment.
Motion (by Mr. Dedman) proposed -
That the report be adopted.
– I move -
That the bill be now recommitted to a committee of the whole House for the consideration of a proposed new clause.
I wish to provide that during the operation of this legislation no money shall be expended by the Commonwealth to support, encourage, or subsidize the manufacture of synthetic fibres in Australia or in any territory under the control of the Commonwealth.
Question put -
That the bill be now recommitted to a committee of the whole House for the consideration of a proposed new clause.
The House divided. (Mr. Speaker - Hon. J. S. Rosevear.)
Majority . . 20
Question so resolved in the negative.
Bill - by leave - read a third time.
In Committee of Ways and Means:
Motion (by Mr. Dedman) proposed -
That, in lieu of the tax imposed by the Wool Tax Act 1936 on the wool specified in this Resolution, a tax be imposed on all wool -
grown and shorn in Australia; and
received or produced by a wool-broker or dealer, or exported, on or after the first day of June, One thousand nine hundred and forty-five, at the following rates: -
– The proposed rates of tax set out in the motion were arrived at, no doubt, after an investigation, to which the Prime Minister referred in the following words: -
My Government has been very closely considering the question of wool research and publicity and is convinced that this is a matter of great urgency if wool is to withstand the threat of alternative materials.
– Order! The honorable member may discuss only the question now before the Chair, namely, that the motion proposed by the Minister for the imposition of certain rates of tax be agreed to.
– I desire to move -
That the following words be added to the motion - “ During the operation of this tax, no money shall be spent by the Commonwealth to support, encourage or subsidize the manufacture of synthetic fibres in Australia or any Territory under the control of the Commonwealth.”
– The Chair is not able to accept the proposed amendment. The motion proposes certain rates of tax, and discussion or amendment can relate only to the proposed rates.
– Then I move - “That the rate 2s.0d. be reduced by “1s.0d.”.
– The honorable member for Wide Bay (Mr. Corser) has moved that the proposed rate of tax of 2s. on each bale of wool be reduced to1s., not because he objects to the amount, but as an instruction to the Government to accept an amendment that he submitted on the Wool Use Promotion Bill earlier this afternoon. The honorable member read an extract from the preface to the report to the Secondary Industries Commission, pointing out that the Prime Minister (Mr. Curtin) had said that the Government -was convinced that this assistance was a matter of great urgency if wool was to withstand the threat of alternative materials. The Prime Minister referred not to some other government, but to this Government, depleted in numbers, worsted in battle, and defeated in tactics. The amendment which the honorable member for Wide Bay submitted, merely seeks to give effect to the Prime Minister’s grave warning, because this legislation has been introduced to combat the threat which synthetic fibres are offering to the wool industry. Now, honorable members opposite are endeavouring to repudiate the words of the Prime Minister. The honorable member for Wide Bay proposed that during the operation of this act no money shall be expended by the Commonwealth to support, encourage or subsidize the manufacture of synthetic fibres in Australia or in any territory under the control of the Commonwealth.
– The honorable member can discuss only the matter of the proposed tax.
– I agree that it would be quite improper were I to do other than discuss the matter of taxation. That is what I am endeavouring to do. The Minister has proposed that the wool tax, at present 6d. a bale, shall be raised to 2s. a bale. He did not come out of the sky like an angel, and make the bare proposal without giving reasons for the increase. In excellent speeches, he gave every reason. Similarly, I am giving reasons for the proposal of the honorable member for Wide Bay for the reduction of the tax from 2s. to ls., as an instruction to the Government to incorporate in the bill of which we have just disposed the amendment that he moved to it. I take it that I am perfectly in order in doing that.
– The honorable member may not revive the debate on another bill.
– I am not endeavouring to do that; I am merely trying to be helpful by suggesting that the Government might care to make use of its vast majority to secure the incorpora tion in the Wool Tax Bill the proposal rejected on an earlier bill. I cannot understand why the Government will not agree to do that. Has it some secret agreement with the synthetic fibre manufacturers of the Old World?
– Order ! I have told the honorable member that he can deal only with the proposed rates of tax.
– The honorable member for Wide Bay proposes to reduce the tax from 2s. to ls. a bale. Every other honorable member is asking himself why the honorable member for Wide Bay seeks to have that reduction made, and I am endeavouring to provide the answer. The honorable member for Wide Bay chivalrously desires to give practical effect to the wish expressed so ably by the Prime Minister in the preface to the report of the Secondary Industries Commission.
– Would the honorable member like me to accept the amendment?
– I should be delighted if the Minister would do so. But I have found him to be most unreceptive in regard to amendments ; he will not accept any. I have the greatest pleasure in supporting the endeavours of the honorable member for Wide Bay to give a square deal to the wool-growers of Australia, and to prevent the making of a special arrangement with the synthetic fibre manufacturers of the Old World. I ask the Government to have the amendment made in the Senate.
– The matter before the ‘Chair is the imposition of a new tax. The Minister’s motion begins -
That in lieu of the tax imposed by the Wool Tax Act 1936 on the wool specified in this resolution, a tax be imposed on wool.
That assumes that the Wool Tax Act 1936 ‘has been repealed. It has not been, and cannot be repealed until the Wool Use Promotion Bill has been passed by the Senate and has received the assent of the Governor-General. Judged by strict procedure, the Government is asking the committee to do what is illegal. It has no right to presume what the Senate will do in regard to the Wool Publicity and Research Act of 1936.
Therefore, we ought to wait until the Senate has dealt with the hill that has just been passed by this chamber, before being asked to substitute another tax for that which exists to-day. According to ray study of the records, the timehonoured procedure in the House of Commons is that there shall be no imposition of any tax unless a committee of the House of Commons has had the right to discuss grievances. Whenever such a proposal is brought into the House of Commons, any member who has a grievance in regard to the matters affected by the imposition of the tax has a perfect right to move for the redress of that grievance. The honorable member for Wide Bay (Mr. Corser) has shown conclusively to any fairminded man that he has a grievance in regard to the manner in which this money might be expended. Every committee of the Parliament must take into consideration, not what the Government has done - it could not in this matter, because the Government has not done anything - but what the Government might do in certain circumstances with the money it seeks authority to raise. Therefore, the honorable member for Wide Bay is perfectly within his rights in attempting to impose restrictions on the executive in the expenditure of that money. I support his proposal. The honorable member has followed a time honoured practice in this Parliament, in having moved for the reduction of the amount proposed, in order to achieve a certain objective. The present Government came into office as the result of a motion for the reduction of a vote on the Estimates. The method which transferred Government supporters from this to the other side of the chamber surely is legitimate when the honorable member for Wide Bay seeks to do something in the interests of the wool-growers, whose cause he has espoused so well to-day.
– I have taken the only course that was open to me to impress on the Government the importance of this matter, and to give to it an opportunity to face up to its obligations to the woolgrowers. The resolution submitted by the Minister imposes a tax. My amend ment would make it possible to take from some sections of our importing and manufacturing community a privilege that they have and a subsidy that they receive. So long as that subsidy is continued, it will be unfair to require the wool-growers to pay the full amount of the tax. The Minister considers that the tax is not too great. He has said that our woollen factories are working to full capacity. Assuming that they are, by doing Army work they are losing the home market to the subsidized synthetic fibre trade which the Government subsidizes.
– The honorable member may deal only with the proposed tax.
– I claim that the tax is too great under existing circumstances. The graziers would be prepared to pay it if the Government were not subsidizing the manufacturers of synthetic wool. The Minister says that it is necessary to provide a subsidy to enable a cheap artificial commodity to be produced in competition with wool.
– If the honorable member does not confine his remarks to the proposed tax I shall have to ask him to resume his seat.
– Those who are asked to pay a levy of 2s. on every bale of wool do not receive any subsidy. The price of their product is fixed.
– That is not so. The wool manufacturing industry receives a subsidy.
– The Minister uses a subsidy to manufacture in an effort to contradict my statement. The Government is keeping down the selling prices of the wool-growers’ competitors by means of a subsidy. If the Minister is determined that no safeguard shall be provided for Australia’s interests, when the Government is throwing away money in all directions–
– Again I call upon the honorable member to confine his remarks to the question before the committee.
– My protest seems to be hopeless, and therefore I shall not continue it.
– I support the amendment as a protest against the action of the committee in rejecting the previous amendment by the honorable member for “Wide Bay (Mr. Corser).
– The honorable membermay not refer to another debate, but must confine his remarks to the proposed tax.
– The question is whether a florin or a modest “ deaner “ shall be extracted from the wool -grower. It does not seem to me to be right to place an impost on the wool-grower while we subsidize his competitor to almost the same amount. Figures submitted by the Leader of the Australian Country party show that the manufacturers of synthetic wool have received in subsidies an amount equivalent to the 2s. a bale levied on the wool-growers.
– If the honorable member does not confine his remarks to the proposed tax I shall ask him to resume his seat.
– The levy proposed is 2s. for each bale,1s. for each fadge or butt, and 4d. for each bag of wool. If we impose a tax of that character on the wool-grower, and at the same time subsidize the manufacturer of synthetic materials, we must, if we are to be consistent, refuse to accept the levy while the subsidy is paid to the competitors of the wool-growers.
-Would the honorable member like me to accept the amendment?
– If the Minister did so it would at least indicate to those who are to pay the wool levy how little regard he has shown for the industry throughout the discussion on this measure. For that reason alone it is worth while reviewing the proposed tax. A producer who raises only a few pet lambs will be charged. 4d. a bag on his wool, whilst the manufacturer of synthetic wool–
– The honorable member must discuss the proposal before the committee.
Mr.Wilson. - I rise to order. Can we discuss the amendment of the honorable member forWide Bay, or are we confined to the discussion of the tax resolution before us? The amendment relates to synthetic fibres. May we not discuss it?
– I submit that when a money bill is before the committee, and an honorable member desires to raise a matter of general moment, the practice is to move that the amountproposed to be raised be reduced by a certain sum, in order that he may discuss that matter. A sum of money is proposed to be provided for a purpose which has the approval of members of the Opposition. We have endeavoured to draw attention to the inequality of taxing the wool- grower and at the fame time subsidizing his competitor. Certainly, discussion mustbe relevant to the question before the Chair, but the proposed tax may be debated at large.
– The question is that the amount proposed to be reduced be so reduced.
– That is not the amendment which was moved by the honorable member for Wide Bay (Mr. Corser). He moved that the rate of 2s. be reduced to1s. in order to enable him to discuss a certain proposal. That is the amendment before the Chair. If you confine him to the question as you have just stated it, there was no point in his having moved the amendment at all. There is only one thing to be done now. The committee should have read out to it by the Clerk the amendment which was put into your hands by the honorable member for Wide Bay. I doubt whether you could read it correctly.
– I name the honorable member for Barker.
Motion (by Mr. Dedman) put -
That the honorable member for Barker be suspended from the service of the committee.
The committee divided. (The Chairman - Mr. Riordan.)
Majority . . 16
Question so resolved in the affirmative.
In the House:
The CHAIRMAN (Mr. Riordan).I have to report, Mr. Speaker, that the honorable member for Barker has been suspended from the service of the committee.
Question put -
That the honorable member for Barkerbe suspended from the service of the House.
The House divided. (Mr. Speaker - Hon. J. S. Rosevear.)
Majority . . . . 16
– The Chair is not cognizant of what took place in committee.
– The House is now being called upon to vote on something which took place in committee. Therefore, it is proper that it should be informed of what took place.
– The House is not concerned with what happened in committee.
Question so resolved in the affirmative.
The honorable member for Barker thereupon withdrew from the chamber.
In committee of Ways and Means (Consideration resumed) :
Sitting suspended from 6.6 to8 p.m.
– Prior to the suspension of the sitting I was pointing out what we are endeavouring to achieve by the amendment of the honorable member for Wide Bay. That amendment reads -
That the rate “2s. Od.” be reduced by ls. Od.”.
The honorable member desired to move his amendment as an instruction to the Government that -
During the operation of the tax no money shall be spent by the Government to support, encourage or subsidize the manufacture of synthetic fibres in Australia or any Territory under the control of the Commonwealth.
The forms of the committee provide that when the committee is dealing with a taxation resolution an honorable member may move an amendment, but may not attach any condition thereto. An honorable member may move that an amount be reduced, but he may not attach any conditions.
– I take it, Mr. Chairman, that he could give reasons for moving that an amount be reduced.
– He may onlyshow whether, in his opinion, an amount is necessary, or is too much, or too little.
– Would I be within my rights in giving reasons?
– The Chair has given a ruling. I repeat that the Standing Orders provide that when a taxation motion is before the committee, honorable members may discuss only whether an amount is too much, or too little, or is necessary.
– I rise to order. Are we to understand that when a taxation motion is before the committee it is not competent for an honorable member to say. for example, “I oppose this tax altogether, on the ground that there is already a sufficient incidence of taxation throughout the community, and that the economic circumstances of the country cannot bear it”? In this instance, is it not competent for an honorable member to argue that no tax should be imposed on wool-growers for the purpose of assisting the wool industry when at the same time wool’s chief competitor is being subsidized bv the Government? Surely those would be sound reasons for expressing coin ions for or against the bill?
– The ‘Chair has given its ruling, and honorable members ba.ve their remedy if they do not agree with it.
– The taxation pro- .posal which we are discussing is that a levy of 2s. a bale shall be imposed on all wool produced within the Commonwealth. I have no valid objection to the amount of the levy, and I believe that in imposing a tax of this kind the Government is influenced by the wishes of the woolgrowers themselves. The reason for the amendment is that some honorable members believe that in this legislation, which is designed for the express purpose of protecting the wool industry, another matter which vitally affects that industry must be considered. It would appear to be more or less a waste of public money to impose a tax of 2s. a bale on wool, resulting in a fund of approximately £300,000 being provided, when, according to the figures already given, about £200,000 a year is being paid in subsidies to people who are in direct competition with this great Australian industry. I understand that about £1,750,000 was paid last year as a subsidy on imported synthetic materials. Honorable members were amazed to learn that a subsidy of up to 2s. 7d. a yard was paid in respect of that imported material at a time when Australian manufacturers of woollen goods were not permitted to manufacture cloth of a high standard.
– Order ! I ask the honorable member to confine his remarks to the question before the Chair.
– I was about to do so, Mr. Chairman. The Government’s proposal to impose a levy of 2s. a bale on wool coincides with its decision not to allow manufacturers of woollen goods to make first-class material.
– That is untrue.
– It is true.
– I ask the honorable member to get back to the question before the Chair.
– The amendment is that the tax shall be reduced by ls. a bale. That is the only way that we can protest against the action of the Government in refusing to deal adequately with a serious menace to the wool industry.
The Prime Minister (Mr. Curtin) said that this bill had been introduced for the express purpose of creating a fighting fund for the protection of the wool ‘industry and to enable wool-growers to maintain a reasonable standard of living. Wool-growers would not complain of a levy of 2s., or even 3s., a bale, provided that they had an assurance that the money would be used for the purposes for which it was collected. There is grave doubt in the minds of members of the Australian Country party as to whether this tax will be effective if at the same time a substantial subsidy is paid on competitive goods entering this country. The importation of goods to be manufactured into military cloth might have been necessary–
– Order ! I again ask the honorable member to discuss the amendment before the Chair. It has nothing to do with articles other than wool.
– In order that there may be no doubt regarding what I am discussing, I shall repeat the amendment. It reads -
That the tax be reduced by1s. a bale as an instruction to the Government that during the operation of the tax–
– Order ! The latter part of the amendment is out of order.
– I respectfully submit that when you interrupted me, Mr. Chairman, the last word I had mentioned was “ tax “. I understand you to say that this is a taxing measure. If I am wrong, I stand corrected.
– It is a taxation resolution.
– That being so, surely I am at liberty to mention the word “ tax “. I had just reached that word when you interrupted me. In its wisdom, the Government has decided that the wool-growingindustry is worth fostering. The Government admits that it is a national asset because it has carried Australia for many years.
– I suggest that “ affirms “ is a better word than “ admits “.
– If I get rather tangled between the words “ affirm “ and “ admits “ I should go to the Minister for Post-war Reconstruction for advice.
– Order! I ask the honorable member to deal with the question before the Chair.
– As I understand the situation, the question before the Chair relates to the imposition of a tax on wool-growers for the express purpose of promoting not only the manufacture, but also the production of wool. The production of wool covers a number of matters of which some honorable members are not aware.
– Order ! The honorable member must deal with the question before the Chair, which is a taxation resolution. I have already informed him that he may only discuss whether the amount is too much, or too little, or is necessary.
– In complying with your ruling, Mr. Chairman, I say, frankly, that a tax of 2s. a hale is not too much. I say also, that a tax of1s. a bale would be too, much, unless the Government is prepared to give to the wool industry that measure of protection against the competition of synthetic fibres for which the wool-growers of this country ask. It would appear that the Government is not willing to give that protection.
– Order! I ask the honorable member to confine his remarks to the amendment before the Chair.
– I take it, Mr. Chairman, that I am at liberty to debate whether the tax is necessary, or otherwise.
– That is so.
– The honorable member may give reasons for his opinion.
– A tax is necessary first, for the purpose of publicity, and also to bring home to wool-growers the great menace which continually faces them in the form of articles made from synthetic fibres which come here from other countries, and have taken the place of wool to a considerable degree. Secondly, while it may be necessary during war-time to require manufacturers to make only such materials as are required by the defence authorities, I regard as uneconomic and unsound a policy which provides only for the manufacture of inferior articles. In my opinion, it would be much more sound economically to turn out articles of high quality in these days of coupon rationing.
– Order ! The honorable member is getting away from the amendment.
– I submit that I am showing how necessary it is to promote the greatest industry in this country, and I interpret your ruling, Mr. Chairman, as meaning that I am permitted to do so. More important even than a tax of 2s. a bale is the necessity to manufacture articles equal to the best that the world can produce. We can do so. The Minister at the table knows that in the Returned Soldiers Woollen Mills at Geelong woollen articles which compare favorably with anything made elsewhere in the world are being produced. There is no reason why that should not be so, seeing that Australia produces the best wool in the world.
– Order ! The honorable member must confine his remarks to the amendment before the Chair.
– It is absolutely essential to safeguard an industry which has accomplished so much for Australia. The unfortunate fact is that Australian cloth has received a very bad name because-
– Order ! The honorable member must confine his remarks to the amendment before the Chair.
– Owing to the bad name that Australian cloth has received, through no fault of the manufacturers
– Order ! The honorable member must obey the Chair, or I shall have to ask him to resume his
– That set of conditions
– Order ! The honorable member will resume his seat. I call on the honorable member for Griffith (Mr. Conelan).
– I rise to order. I ask you, Mr. Chairman, to state the amendment that the committee is discussing in order to clarify the position. I understand that the amendment before us is that of the honorable member for Wide
Bay (Mr. Corser). If a part of that amendment be out of order, honorable members would like the position to be clarified.
– Before you give your ruling–
– Order ! I ask the right honorable gentleman to resume his seat.
– Surely a member of the committee has a right to address the Chair on a point of order. I propose to exercise that right. Speaking to the point of order raised by the honorable member for Wimmera (Mr. Wilson), I want to say, Mr. Chairman, that you have, on an earlier occasion, indicated that if there is a motion that a tax be reduced by1s. it is not competent for an honorable member to attach some instruction to that motion. In other words, it is not competent for an honorable member in this case to move that the tax be reduced by1s. a bale as an instruction to the Government to do certain things. I should like, in the first place, for the guidance of honorable members and for the protection of their rights, to know on what standing order such a ruling as that is based, because I have a lively recollection in a long parliamentary experience of many times having motions before the Chair in committee that a vote be reduced by a certain amount as an instruction to the Government to do this, that, or the other thing. Indeed, I can very well remember a few years ago that on the approval of such an amendment a government went out of office. There may be some standing order of which I am not aware which provides that there is a distinction between reducing a tax and reducing a vote, but, at the moment, I confess that I am unaware of it.
The second thing I want to say is that either the amendment moved by the honorable member for Wide Bay (Mr. Corser) is in order or out of order. I am not aware that it has yet been ruled out of order. If it has been ruled out of order, then there is no amendment before the Chair at all. It is not for the Chair to alter the language of an amendment moved by an honorable member. Either that amendment is moved and is in order, or it is out of order and is consequently rejected by the Chair. It is not competent to the Chair to say, for example, “I shall accept the first seven words of an amendment, but I shall reject the rest”. If the honorable member for Wide Bay chooses to accept the suggestion of the Chair, and alters his amendment, then his altered amendment will be before the Chair, but the position is this: That without rejecting his amendment you have put a gloss upon it by telling honorable members that they must discuss it as if it were not an amendment moved by the honorable member for Wide Bay, but some other motion. This is not a matter for merely adhering to some previous decision which you have made, Mr. Chairman; it concerns the rights of all honorable members in. committee and that is why I have addressed myself to it.
– In reply to the point of order raised by the honorable member for Wimmera (Mr. Wilson) and the statements just made by the Leader of the Opposition (Mr. Menzies), the Chair has relied upon the practices of this House. If honorable members study the Votes and Proceedings they will find that the Chair has never accepted an amendment containing any instruction to the Government. It is true that motions have been allowed by the Chair that a vote be reduced by £1, or by some other amount, but honorable members will not find any instance where the Chair has allowed an amendment to which any instruction has been attached. The ‘Chair has allowed the amendment moved by the honorable member for Wide Bay that the rate of tax be reduced from 2s. to1s. a bale. That is the question now before the Chair.
– Accepting your ruling that the motion now before the Chair is that the rate of tax be reduced by a certain amount, is it not competent, Mr. Chairman, for an honorable member who moves such an amendment to indicate the purpose for which he moves it? Has that not been the practice of the House ?
– He can indicate the reasons why he moves an amendment, but he cannot attach any instruction, or condition, to the amendment.
– I should like to know, Mr. Chairman, if the reason why you ruled me out of order was because the amendment contained an instruction?
– I ruled the honorable member out of order because he was dealing with something which had nothing whatever to do with the amendment before the Chair, although the honorable member for Wide Bay (Mr. Corser) referred to the same matters when moving the amendment.
– I rise to order. I understand, Mr. Chairman, that you have ruled that the amendment before the Chair cannot be accepted, although you have not rejected it. You have stated that an honorable member moving an amendment cannot attach to the amendment his reasons for it. You have also stated that an honorable member in addressing himself to this amendment, must confine his remarks to whether the tax is too much, too little, or necessary. I respectfully draw your attention to a debate which took place in this chamber on the 1st October, 1941, and which most of my colleagues remember and the country regrets. The motion was moved by the present Prime Minister (Mr. Curtin) when Leader of the Opposition. I take the following from Hansard, Volume 168, page 617:-
– Then I move-
That the first item be reduced ‘by £1.
I do so for the following reason: -
That, while agreeing that the expenditure requisite for a maximum prosecution of the war should be provided by Parliament, the committee is opposed to the unjust methods prescribedby the budget, declares that they are contrary to true equality of sacrifice, and directs that the plan of the budget should be recast to ensure a more equitable distribution of the national burden.
Apart from the fact that the country has now come to realize the wisdom of that budget, that debate centred on the reasons set out. Therefore, I ask you, Mr. Chairman, how you reconcile your ruling with the ruling which allowed that debate to continue, and ultimately involve the government of the day in defeat?
– I have before me the Votes and Proceedings dealing with the debate on the occasion to which the
Leader of the Australian Country party (Mr. Fadden) refers, in which the following appears: -
General debate resumed on the question, That the first item in the Estimates, under Division No. 1 - The Senate - namely -
Salaries and allowances . . £8,470 be agreed to, and on the amendment moved thereto by Mr. Curtin, viz. - That the first item be reduced by £1.
-But the mover of that motion gave reasons for doing so, whereas you have prevented honorable members from dealing with the reasons for the amendment moved by the honorable member forWide Bay (Mr. Corser).
– Do I understand that the mover of an amendment of this kind is entitled to give the reasons why he moves it?
– Yes, provided his reasons are relevant.
– And the Chair, having accepted such reasons, do you preclude any other honorable member from giving like reasons for supporting the amendment?
– Provided the reasons are relevant to the question before the Chair, an honorable member may deal with them.
.- I desire to address myself to the resolution, and to analyse what I believe to be the reasons underlying it. The committee should be extremely vigilant in determining whether this imposition is necessary, because this tax is to be imposed not on the general body of taxpayers but on only a section of taxpayers, namely, the woolgrowers. Although it has been suggested that the growers have consented to this imposition, it has also been made clear that although the organizations concerned speak for the overwhelming majority of growers they do not speak for all the wool-growers of Australia. Therefore, the committee should be vigilant, and should analyse both the reasons for the imposition, and the necessity for it. I understand that the primary object is to raise money to be expended upon research in an endeavour to improve wool as a fibre, and as a material for the manufacture of wearing apparel of all kinds. The necessity for such research is borne in upon the committee when we realize the tremendous inroads made into the use of wool in recent years by the use by many people of synthetic materials. In order to combat this competition wool must be improved from the point of view of its wearing qualities. We get some idea of the fierceness of that competition when we learn that importations of synthetic fibres in recent months have increased to an alarming degree. To realize the strength of this competition we have only to know that the Government has been subsidizing very substantially the importation of synthetic fibres. Wool is now up against a commodity which not only possesses certain virtues in itself, but is also enjoying the advantage of a direct government subsidy. Therefore, the necessity for expenditure upon research to help the industry to meet this competition is evident. Revenue is also required for publicity purposes. Is the board to be limited to publicity which will merely advertise the wearing qualities of wool, or will it be entitled to engage in publicity directed against a government which is subsidizing wool’s greatest competitor? The board should be empowered to engage in publicity not merely to attract customers, but also to appeal to the best patriotic sentiments of the people of Australia and point out to them the historic background of the industry. In respect of competition from imported synthetic fibres, the board will be able to appeal to Australians to support their own industry. But, by the same token, should a government be so recreant to its duty to this great industry as to fail to give it sufficient support, and, indeed, encourage its rival, the money to be voted under this measure might well be expended in revealing to the public of Australia just how foolish and unpatriotic is such action on the part of that government. I find it difficult to be convinced that it is necessary for the Government to impose a special levy upon the growers themselves seeing that the industry is of such value to Australia as a whole, enabling us to maintain a favorable trade balance and strengthen our exchange position. Surely those advantages are national advantages. If the people of Australia as a whole are to continue to enjoy those benefits, the wool-growers may reasonably suggest that the public should carry a portion of the hurden. 1S0 the Australian taxpayers may be asked why they should not be legitimately required, at this point, to make some contribution to the fund. If we do that, we shall be faced with the difficulty that to-day, the Australian taxpayer is the most heavily taxed in the world, and I am reluctant to suggest that an additional burden should be imposed upon him, even for this very worthy purpose. But surely that does not become necessary, because the Commonwealth Government is expending approximately £2,000,000 per annum to subsidize the importation of synthetic -fibres. If the Government has funds with which to subsidize the importation of synthetic fibres, honorable members should support the proposition that the Government, instead of levying a special impost upon the wool-growers, should make other use of those funds which, in our opinion, are now being unwisely spent to encourage the competitors of Australian wool, and which are having damaging repercussions on the Australian . industry. We may seriously question whether any real necessity exists for imposing this additional load upon the wool-growers of Australia when, at the same time, the Commonwealth Government, out of general revenue, is providing £1,750,000 a year to subsidize imported synthetic fibres.
.- The honorable member for Fawkner (Mr. Holt) is supposed to have some knowledge of textiles, but his speech was based upon unsound premises. He declared that this Government is subsidizing the importation of synthetic fibres. He knows that that statement is entirely untrue.
– Why is it untrue?
– I shall explain the position. Before the outbreak of this war, the quantity of rayon which was imported into this country was enormous.
– Order ! I ask the honorable member to connect his remarks with the motion.
– The honorable member for Fawkner made a very poor case indeed. I claim to know as much about the textile industry as any honorable member in this chamber. Before the outbreak of this war, the production of double weft and double warp materials in Australia was only 15 per cent, of the total.
– That was prior to the introduction of clothes rationing.
– That is so. The Tariff Board inquired into the position, and it was agreed to allow textile manufacturers to make 16J per cent, of the better class material. Since then, textile manufacturers have been permitted to utilize any of their surplus labour for making better class materials.
– Order ! The honorable member is not addressing his remarks to the motion, which provides for the raising of a certain sum of money.
– I am endeavouring to explain why that money should be raised.
– Order ! The honorable member is not permitted to make a second-reading speech on this motion.
– The amendment submitted by the honorable member for Wide Bay (Mr. Corser) is designed to reduce the proposed levy from 2s. to ls. a bale, although the woolgrowers themselves agreed to the imposition of the levy. Honorable members opposite claim that they represent the interests of wool producers, but to-night, they are doing a great disservice to them. If the amendment were accepted, only one half of the amount which it is proposed to expend on wool publicity and research for the benefit of the wool industry, will be available. The textile industry is now making satisfactory progress and is exporting high class materials. Some time ago, I directed attention to the fact that these Australian materials were being sold in New Zealand as English cloths. If Australian textile manufacturers are to compete successfully with overseas manufacturers, they will not sponsor synthetic fibres. Any honorable member who puts up that “Aunt ‘Sally” is doing a disservice to our textile manufacturers. At present, Australians are using as much woollen material as they can, and honorable members opposite would be the first to complain loudly if the Commonwealth did not send overseas all the wool available for export. Their concerted effort this evening has notbeen worthwhile. If they desire to assist Australian woolgrowers and textile manufacturers, they will support the motion.
.- The honorable member for Griffith (Mr. Conelan) has so broadened the scope of this discussion that I am encouraged to contribute my views upon this tax. I propose to address my remarks, not to the amendment, but to the resolution moved by the Minister for Post-war Reconstruction (Mr. Dedman), because this legislation has been introduced as a part of the general system to provide money for the purpose of assisting the Australian wool industry to expand the use of wool. The fund will be financed in two ways, first, bya special tax of 2s. a bale levied on the wool-growers of the Commonwealth, and secondly, by a contribution by the Commonwealth Government from Consolidated Revenue on a £1 for £1 basis. Australian wool-producers voluntarily agreed to this arrangement, and the proceeds will be devoted to wool publicity and research. Therefore, it is imperative that before this levy of 2s. a bale is imposed upon wool-growers, they should be certain in their minds that the Parliament will protect them regarding the expenditure of this money. This tax is specifically designed to subsidize wool publicity and research and it would be wrong, while that was being done, for Government revenue to be used in such a way as to defeat the efforts of the woolgrowers. If the wool-growers believe that their contributions will not be protected, they will feel a natural diffidence about paying this levy. A few days ago, the honorable member for Wimmera (Mr. Wilson) declared that some woolgrowers, whom he knew, felt diffident about increasing the levy from 6d. to 2s. a bale.
– That is so.
– Then the Parliament should resolve that doubt, and make certain that the money, which will bo raised in this way, shall be used to the satisfaction of the wool-growers. But another safeguard is necessary. Government revenue should not be employed indirectly to the detriment of the wool industry. That is the crux of the problem. I cannot understand why the Government should attempt to limit the scope of this discussion, because this matter should be resolved in the interests of the wool-growers themselves, so that they will be satisfied that this substantial increase of tax is justified. Whether or not this amendment is accepted, the Government should make a declaration that will satisfy the wool-growers throughout. Australia that they will not be asked to provide money to assist themselves whilst at the same time, Government revenues are being employed to destroy their efforts. The Minister for Postwar Reconstruction should have placed all these facts before the committee.. I cannot understand the efforts that are being made to prevent a discussion of this matter. If the money is to be used wisely, we shall give the scheme our blessing. If it is to be used unwisely, or Government revenues are tobe used to defeat the objects of this bill, we can only warn the wool-prod ucers that they have been sold a gold brick. Whether or not the amendment is ruled out of order., the time has come for the Government to reveal its intentions. Does the Government propose to assist the competitors of wool, or to support the wool industry which has played such an important role in Australia’s national economy? The quality of our wool more than anything else, except perhaps the bravery of our troops, has made Australia’s name famous throughout the world.
. - I desire to refute some of the statements that have been made by honorable members opposite. Their principal contention is that the tax should be reduced from 2s. to1s. a bale, because they claim that the Government is already subsidizing the importation of synthetic fibres. That contention is incorrect, and honorable members opposite know it. Their remarks are deliberately misleading. I am a practical wool-grower, and I am of the opinion that honorable members opposite are attempting to make political capital out of this proposal. They have suggested, not only in this chamber, but also in many other places, that the Government is proposing to collect money from the wool-growers by means of this proposed tax in order to promote the interests of the synthetic fibre textile industry. That is a most unjustifiable proposition. If there are any practical wool-growers on the opposite side of the chamber, I ask them how their womenfolk would regard a proposal that they should wear only woollen stockings. There would be a terrible hullabaloo if such a request were made. Some rayon must bc imported, but the quantity now coming into this country is only a fraction of what came in a few years ago when an anti-Labour government was in office. The purpose of the proposed tax of 2s. a bale is solely to promote the interests of the wool-growing industry. The money will not be used, in any sense whatever, to support a rival industry. Honorable members opposite know very well that the purpose of the Government is to encourage the production of high quality woollen fabrics for the manufacture of clothing, and it is completely untrue to say that an attempt is being made by this means to encourage the marketing of textiles manufactured from synthetic fibres. I regret that such statements have been made in many country districts, foi- there is not the slightest foundation for them. The money that will be obtained from this levy will be used solely for the purpose of improving the production and increasing the use of wool and to suggest anything different is so entirely untrue as to justify us in brandling such statements as pure political propaganda. Honorable gentlemen opposite are more interested in the welfare of speculators in wool than of wool-growers. I regret that I have no figures available at the moment to indicate the manner in which importations of synthetic fibre textiles have declined in the last few years, but the graph referred to by the honorable member for Deakin (Mr. Hutchinson) shows that this is a fact. No honorable member on this side of the chamber has the slightest desire to do other than help our great wool industry. The woolgrowers realize this, for they have agreed to accept a voluntary impost of 2s. a bale on wool in order to enable the Government to proceed with its plans for the expansion of the wool industry. I regret that the time of the committee is being wasted by honorable gentlemen opposite who have asserted that the Government desires to subsidize a rival textile industry.
– The honorable member for Wannon (Mr. McLeod) has quite a wrong idea of the purpose of the amendment. We have not suggested that the proposed levy of 23. a bale is intended to assist a rival texile industry. What we do rightly claim is that wool-growers pay taxation and that general taxation is drawn upon to pay a subsidy to synthetic industry. We realize that the purpose of the bill that was passed this afternoon is to provide for the scientific investigation of the problems of the wool-growers with the object of increasing the use of wool. The amendment has been moved because this was the only means within the forms of the committee by which we could make a protest at this stage against government action which is having the effect of stimulating the synthetic fibre textile industry. The honorable member for Griffith (Mr. Conelan) said that the importation of synthetic fibre textiles was greater years ago than it is to-day, but I point out that whereas government subsidies paid to the synthetic fibre and other industries in 1942-43 totalled only £6,000 the total of such subsidies last year was about £1,500,000. This amount was paid last year in subsidies to the synthetic fibre textile industries, and it is an unfortunate fact that the woolgrowers, through their contributions in general taxation, were obliged to contribute towards that amount.
– I ask the honorable member to confine his remarks to the motion.
– The wool-growers are deeply interested in this subject, and you, Mr. Chairman, as the representative of one of the great woolgrowing districts of Queensland, although you are tied to the Chair for the time being, must also be interested in it. Because of existing economic and war conditions our woollen textile manufacturers are prevented to-day from manufacturing anything but single-weft cloth of inferior quality. But synthetic textiles manufactured in black labour countries are being admitted to Australia, and the trade is being substantially subsidized by the Government. It is high time that steps were taken to permit our woollen textile manufacturers to resume the production of the high-grade fabrics for which they were noted in pre-war days. This amendment has been moved not because we consider that the proceeds of the proposed levy will be applied to the assistance of a rival industry, but because only by adopting this procedure could we give expression to our strongly held view that the Government should do a great deal more than it is doing to assist the wool industry. “We have been given no guarantee that the Government will not continue to subsidize synthetic fibres’ to the disadvantage of the wool industry, and we have, therefore, adopted this method of expressing our views. The future of the wool industry must be safeguarded in the interests of Australia, and the Government must understand that the people will not endorse any action which is likely to have the effect of preventing the expansion of all our wool producing and manufacturing activities. The Government should give us an undertaking that it will not continue to subsidize textile industries which are rivals to the woollen textile industry of this country. I realize that the Government will not accept any proposal from this side of the committee, however good it might be, but that will not hinder us from doing our utmost to protect the interests of the wool industry. Wool-growing is of cardinal importance in the development of the great hinterland of Australia. The expansion of this industry will, undoubtedly, assist us in the days to come, to develop our railway systems, extend our air services, and generally to increase the importance of the secondary industries of this country, particularly in relation to textile manufacturing. We, therefore, ask the Government to do the fair thing for the wool-growers, and we protest against such misrepresentation as that of which the honorable member for Wannon has been guilty. The honorable gentleman had the audacity to say that we had stated that part of the proceeds of this levy of 2s. a bale on wool would be used to subsidize rival industries. We have made no such statement. Whether, this amendment be defeated or not, we appeal to the Government to give an undertaking that it will not encourage the synthetic fibre textile industry to the disadvantage of the wool industry. The honorable member for Wannon did not know what he was talking about. Even at this eleventh hour, the Minister should admit that the amendment has an element of fairness, and that he is prepared to give consideration to it in the interests of the wool-growing industry.
.- The honorable member for Wide Bay (Mr. Corser) has made some remarkable statements. The most striking feature, to me, is that after the passage of the bill providing for research to assist the wool industry, he should move an amendment which, if accepted, would deprive the industry of not less than £350,000. Proof of this i3 furnished by the provision in sub-clause 2 of clause 15, that the Treasurer shall pay into the Research Account a sum equal to the amount received by the Commissioner of Taxation. Consequently, if the amount received by way of tax on the growers were reduced by one-half, automatically the payment into the fund by the Treasurer would be reduced equally. I fail to understand the logic of honorable members who support such a proposal. Under the economic organization of this country, ceiling prices were fixed, and they applied to textiles as well as to superphosphate, petrol, oils and other commodities which rural producers use and consume. A subsidy of a little more than £1,000,000 has been paid in respect of textiles, but the primary producers have benefited by more than £4,000,000 because of the subsidy that has been paid on certain commodities that they use. The honorable member for Wide Bay said that the subsidy in respect of textiles amounted to £7,000,000. That is not the amount of the subsidy, but the total value of the imports of textiles in the year that he mentioned. The subsidy of a little more than £1,000,000 in respect of textiles embraces woollen products and cannot, therefore, be said to be a subsidy only to competitors of wool. It is interesting to note that whereas before the war, in the year 1937-38, the imports of rayon yarns totalled 8,720,283 lb., they have now been reduced to 5,000,000 lb. ; and whereas the yardage of rayon fabrics imported in the same period totalled 76,303,309 square yards, less than one-half, of that quantity, is now being imported. On the other hand, the use of wool in Australia has been increased to the maximum capacity of the plant available, including the additional plants established during the war period. Those figures contrast the record of the Government which was supported by honorable members opposite who now claim to be advocates of the wool industry, with the record of the present Government, which effected a reduction of the use of synthetics and increased the production of every woollen article that is used in the Commonwealth.
Question resolved in the affirmative.
Standing Orders suspended; resolution adopted.
That Mr. Dedman and Mr. Scully do prepare and bring in a bill to carry out the foregoing resolution.
Bill presented by Mr. Dedman, and passed through all stages without amendment or debate.
Debate resumed from the 19th April (vide page 926) on motion by Mr. Chifley -
That the bill be now read a second- time.
– This is not a lengthy bill, and its scope is limited. Therefore, I do not desire to occupy the time of the House unduly long. But there are certain provisions which should be discussed at this stage. As honorable members will recall, the bill contains various proposals which involve, in effect, a reduction of taxation. By the courtesy of the Treasurer (Mr. Chifley), I have been provided with an estimate of the amount involved in each of them. It is this -
A glance at those figures will show that easily the largest, and probably the most contentious, is in relation to the proposal to grant a special deduction to all taxpayers resident within particular zones marked out on the map which has been distributed to honorable members. As I propose to make some references to this map, because I intend to address some remarks to this novel zoning system, I have it in front of me. As honorable members will recall, it in effect divides Australia into three zones - A, B and an unnamed zone which is the rest of Australia, including the whole of Victoria, a good deal of New South Wales, a part of South Australia and Queensland, and the whole of Tasmania.
– Apparently, a zone could be extended to include certain Labour constituencies.
– I intend to deal with that aspect. The proposals in the bill, in reality, are proposals for the reduction of taxation, and to that extent they represent a series of steps in a desirable direction - which, I may say, must be followed steadily when this war finishes.
On the subject of the reduction of income taxation - for I shall discuss the bill in that sense - there are probably two extreme schools of thought. One is that which says that very high rates of tax - and I refer particularly to income tax - are an admirable weapon for the redistribution of income and for the elimination of differences in wealth, and that consequently those high rates of tax should be maintained in times of peace for general social purposes. That is one school of thought which I venture to describe as extreme. At the other end of the scale is another school which probably travels too far in the other direction. That school considers that high rates of income tax encourage unemployment and reduce the capacity of industry and individuals to employ, and that therefore low rates of tax are in all circumstances the wiser policy. Our experience during the war has shown that that is not a view that can be accepted without reservation. The truth - and I am now referring to the present position and also the position in years to come - probably lies midway between those two views.
Of all methods of taxation, I am bound to say that income taxation is the fairest, because it is imposed on a steeply graduated scale, and is applied on the principle of placing the burden where it is most capable of being carried. Of course ic also represents, if properly and wisely used, a flexible means of reducing gross inequalities in the social and economic structure. At the same time it is clear that if taxation rates remain for years to come at the level at which they now stand in Australia, when the war is over and we have, as we are bound to have in those circumstances, a great drive for re-employment and the development of industry so that its capacity to employ may be increased, the incidence of the present tax rates standing at the present level will undoubtedly hinder reemployment by sharply eliminating or reducing the ordinary human incentive to enterprise. Therefore, as a broad principle we should all aim at a progressive reduction of taxation as soon as the opportunity presents itself, and the sooner the better.
In the business world and in the industrial world it will still remain true, whatever some of the theorists may say, that men will always be willing to accept substantial risks for substantial rewards, and that men will be always willing to work extra hard for extra pay. That is a basic truth of humanity which runs from employer to employee, from the entrepreneur to the men engaged in the undertaking on wages; but if, in time of peace, the position is that the bulk of the extra pay of the wage-earner who has been prepared to work extra hard for extra pay, or the bulk of the extra earnings of the man who has entered on a business undertaking, and taken risks in so doing, are to be absorbed by taxation, I believe that there will be either wholesale evasion of taxation or a general attitude developing in Australia that the game is not worth the candle, that extra hard work does not get much effective remuneration, or that the acceptance of business risks does not bring much reward. That can be nothing but bad for a country, the prompt and extensive development of which after this war will be of first importance in post-war reconstruction.
– That is fairly widespread to-day.
– It is. I have not discussed this matter in relation to the position to-day, because most of us have been prepared to accept what would otherwise be a damaging thing in the interests of prosecuting the war and getting on to victory. Summed up, it means that active re-employment by expanding industry after the war will require some progressive reduction of the income tax rates. I believe that it is just as true in the case of the wage and salary earners to-day paying wartime taxes as it is true of investors, employers and those engaged generally in business control.
The major item in the bill is that of £1,000,000 taken up by the proposed zone allowances - a flat rate deduction from income of £40 in zone A and of £20 in zone B, with no deduction of the rates in the rest of Australia. However interesting this proposal is as a novelty, it seems to me to be fundamentally unsound as a taxing method. It talks in terms of deduction, but its net result is that it imposes three different rates1 of tax in Australia on the one amount of income. I point out to the Treasurer that this method will give rise to intolerable anomalies along the borders of the zones. We have only to take the map and look at the western extremity of the line which marks out zone A. I am interested to notice that where the straight line turns a little to the north the name on the map is “ Opthalmia “. This is one of the few times I have known a government cartographer to make a really good jest. Tate that line, with all its twists and turns, and the position we find is. that on one side of it a man has a deduction of £40 and on the other side another man has a deduction of £20 from his income. These men may be living within a mile or two of one another. They will unquestionably on both sides of the line have substantially identical living conditions. Their circumstances for all substantial purposes will be identical, yet we may go anywhere along the line marking zone A or zone B and find the most intolerable anomalies as the result of the adoption of this scheme.
The second objection I offer to it is that it will open the door, for the first time so far as I know, to the activities of pressure groups in Australia, organized upon a geographical basis. We have been accustomed to pressure groups organized in terms of occupations, or their views on the Douglas Credit theories or “What have you? “ For the first time, however, we shall he encouraging people to organize themselves on a geographical , basis into pressure groups. For example, some request may come up, as it has before from., say, the coal-miners where a group will ask for special taxation treatment. My friend the honorable member for Hunter (Mr. James) has more than once eloquently advocated that in this House, and the answer has always been that it is extremely difficult to make flesh of one and fowl of another. If this principle be adopted and is sound, and fits neatly within the terms of the Commonwealth Constitution, and within the terms of policy, there is nothing at all to prevent the Government from saying: “We shall draw a line around the northern coal-fields area, and we shall say that in that zone a special taxation law is to apply “.
I shall say something in a moment about the constitutional aspect of this scheme, because that matter ought not to be ignored in this House, but, before I talk about that as a problem in law, let me say something about it as a problem which involves the spirit of the Constitu- tion. Section 51 (ii) of the Constitution sets out in quite specific terms the limitation on the taxation power of the Commonwealth. It gives to the Commonwealth Parliament power to make laws with respect to taxation, but so as not to discriminate between States or parts of States. Section 99, in language which is not identical, and in some respects has a different meaning but contains a similar principle, provides -
The Commonwealth shall not, by any law or regulation of trade, commerce, or revenue, give preference to one State or any part thereof over another State or any part thereof.
The whole principle of these two provisions, and of others in the Constitution not unlike them, was that Commonwealth fiscal laws were intended to bear evenly upon the citizens of Australia wherever their residence might be. The whole principle was that if we adopted an income tax we might adopt all sorts of fluctuating rates, but in the net result the taxpayer was to be subject to the same impost whether he lived in the electoral division of Capricornia or Fremantle. That was the whole basic principle and a very sound principle too.
My third objection to the zoning principle as a matter of policy is this: it may appear on the face of it attractive as a simple measure of decentralization. Indeed the Treasurer in his remarks on the second reading of the bill indicated that this scheme was designed to offer some inducement to people to establish themselves in the more remote parts of Australia. If this is really designed to be a measure to encourage decentralization, all I can say is that it. is nothing well calculated to assist that end as would other more concrete and more carefully directed schemes. If we desire to encourage decentralization in Australia we should have a. look at those elements which bear heavily upon the establishment of industry and populations in remote places. We find, that they will include such very important factors as the provision and cost of transport, the cost of communications and the availability of light and power. All those things have a direct bearing on the decentralization of industry. If we desire to deal with the problem in a practical way we should consider such matters as the subsidizing of freights, the subsidizing of the provision of electric power in remote places, and the provision of increased rural amenities generally, for then we shall ‘he touching the realities of the problem. However, to say that we are really taking steps in the direction of decentralization by making this entirely artificial distinction in income tax seems to be utterly unreal.
The fourth objection is that which deals, not with the spirit of the Constitution, but with the letter of it. I do not profess to know, nor can any one else, whether a provision of this kind is, or is not, unconstitutional. All one can do is to read the provisions of the Constitution, and try to form some idea of what they mean - and then to hope for the best. Personally, I have the greatest difficulty in understanding how this proposal does not discriminate between parts of States. Let me illustrate what I mean by directing the attention of honorable members to this map. Honorable members will see that the whole of South Australia is either in zone B, or in the third zone. None of it is in zone A, because that zone cuts across tEe Northern Territory. Thus, South Australia is divided into two areas, in one of which there is to be a deduction of £20, while in the other there is to be no deduction at all. This proposed legislation relates to taxation, and it unquestionably discriminates between one part of ‘South Australia and another part, and the discrimination is based on locality, and nothing else. Ingenious attempts have been made in the course ofl argument before the High Court to establish that there may be circumstances other than locality which can afford a criterion, but they cannot apply in this case. Here, a line is drawn right across South Australia, and it is proposed that if a person lives on one side of that line he may deduct £20 from his income for taxation purposes, while if he lives on the other side, no such deduction will be permitted. Had the High Court never given any decision on this point the position as I have stated it would seem to be unarguable. If ever there was a law which discriminates between parts of States it would appear to be this proposed law. However, it baa been sug- gested - and this is supported by some judgments of the Court - that the view of the Crown would be that section 51 (ii) of the Constitution, relating to the taxing power, prohibits discrimination between States or parts of States “ as such “, but is silent if the lines are drawn with reference to Australia as a whole. I commend this to. the attention of the House as a notable refinement; but as the Treasurer is unquestionably relying on it - for if he is not, then he is certainly on very broken ground - the contention is worth looking into. It has been argued by responsible authorities, and supported by judgments of the High Court, that there is no discrimination between States or parts of States unless the law is dealing with them as States or parts of States. That means that if the draftsman of the bill had said: “In Western Australia, north of a line identical with the line on this map, there shall be a deduction of £40, . while south of that line, and north of the line marking zone B, there shall be a deduction of £20, and south of that zone there shall be no deduction at all”; and if similar provisions were made to apply in the cases of Victoria, New South Wales, Queensland, South Australia and Tasmania, the law would be invalid, because there would be discrimination on the face of the law between States considered as States; and between parts of States considered, as parts of States. I do not want honorable members to think that this is a refinement invented by me; it is not. It is a refinement which has been justified by several, pronouncements in the High Court. However, if the legal draftsman simply takes a map of Australia, and draws upon it identical lines, and makes similar provisions in regard to the various zones without naming States, then the law will be valid. That is a distinction which I find it very difficult to accept, and I believe that it must also trouble the honorable member for Warringah (Mr. Spender). The provision in the Constitution represents a restriction on Commonwealth power. It contemplates Commonwealth law - that is, a law which operates in relation to the Commonwealth. Thus, when the legal draftsman draws lines on a map, we expect him to draw on a map of the Commonwealth. For those honorable members who desire to pursue this distinction, and particularly for the Treasurer, who will be delighted to find ways of reinforcing his opinion, there are four important High Court cases which touch the point. They are Barger’s case, 6 C.L.U., at page 41; Cameron’s case, 32 C.L.R., at page 68; James v. The Commonwealth, 41 C.L.R., at page 442; and Elliott’s case, 54 C.L.R., at page 657. I do not propose to go through these cases, because it is nothing to the point for me to produce some allegedly erudite argument. The real point emerges in Elliott’s case, which involves the Transport Workers Act. It was said that, because certain ports were licensed under the Transport Workers Act in certain States, while other ports were not licensed in other States, preference was given to one State over another, which constituted a breach of section 99 of the Constitution. It is interesting to observe that the principal statement which would uphold the validity of the Treasurer’s scheme was made by Chief Justice Latham, who waa formerly in politics on my side; while the principal judgment criticizing that view, and maintaining the abjection to which I have referred, was delivered by Mr. Justice Evatt, as he then was. Since, in his absence from this chamber on very important business abroad, I like to he able to speak ofl him in agreeable terms, I am bound to say that, on this point, I find myself on the side of Mr. Justice Evatt, and I hope also - on this point - to be on the side of Mr. Attorney-General Evatt. Sir John Latham, at pages 673-4 said, basing his view on some earlier judgments -
The Constitution in section 51 (ii) does not, however, prohibit “ discrimination between localities in the widest sense “. It prohibits discrimination between localities only in a particular and limited sense - “between States or parts of States “. Thus Knox C.J-, having defined discrimination between localities in the widest sense, proceeded to apply the definition to the particular kind of discrimination which was forbidden by the section under consideration. He continued: “I respectfully agree with this definition, and add that when the localities selected to furnish the discrimen are States or parts of States the discrimination is expressly forbidden by section 51 (ii) of the Constitution “. The point of this observation is to be found, in my opinion, in the rejection of the contention that any form of discrimination between Australian localities (which, except in the territories, are in fact all States or parts of States) is prohibited by the Constitution in section 51 (ii). The Chief Justice was expressing his adherence to the view of Isaacs J. that the prohibition to the Federal Parliament was against differentiating between States and parts of States “ because they were particular States or parts of States “. After referring to section 99, Isaacs J. continues: “The treatment that ie forbidden, discrimination or preference, is in relation to the localities considered as parts of States, and not as mere Australian localities, or parts of the Commonwealth considered as a single country.” (Barger’s case.)
That is the view which represents the crystalization of a substantial body of judicial opinion in the High CourtOn the other hand, Mr. Justice Evatt, who dissented from the majority view - the case being based on section 99, and not on section 51 (ii) - expressed very clearly the opposite view. He said, at page 686 -
A fundamental proposition of law established by Barger’s case was that the preference forbidden by section 99 of the Constitution includes any preference given to persons associated with any locality within the Commonwealth so far as it comprises the aggregation of the geographical areas of the six States, such preference necessarily resulting in a preference either to a State or to some part thereof.
The dissenting opinion of Isaacs J. was that section 99 forbade preferences “ in relation to the localities considered as parts of States, and not as mere Australian localities, or parts of the Commonwealth considered as a single country “.
It may be observed that in such opinion the phrase “ considered as “ is ambiguous. In one sense it may refer to the motive of the Commonwealth legislation or regulation. In another sense it may refer to some stated relation between the favoured localities and the States to which they belong. But section 99 says nothing about the motive- animating the Commonwealth law; and it forbids preferences not merely to a State, but to a part of it. Further, it would seem impossible to assert that a law preferring Sydney to Melbourne does not give preference to part of one State oyer part of another. However,. “ considered “, Sydney and Melbourne are parts of States and section 99 prohibits a commercial law which gives preference to a part of one State over any part of another State. The “ considered as “ theory, which I analyse later, is extremely difficult to understand or apply.
I agree with that statement. Again, at page 690, he said -
Accordingly, there was a very solid foundation for the conclusion reached in Burger’s case by the majority of the court - that section 99 forbids all preferences which arise solely as a legal consequence of association with or reference to any locality in “ Australia “, i.e., “ one or more of the States of Australia The opposing view of Isaacs J. - that the only preference forbidden by section 99 is preference to a State or a part of a State “considered as “ such - involves the proposition that section 99 is not infringed if (say) a Commonwealth enactment exempts from taxation “ all persons carrying on business or resident at Brisbane”.
That is as nearly as possible the case with which we are dealing. Finally, Mr. Justice Evatt said -
On Isaacs J.’s view, presumably, such an enactment would not give a preference to a part of Queensland “ considered as “ a part of Queensland. But it is indisputable that such an enactment would give a preference to Brisbane, and, as Brisbane is part of the State of Queensland, the enactment would give a preference to a part of a State over the five remaining States of the Commonwealth. Similar examples may be multiplied indefinitely, e.g., preferences might be given to persons associated with an electoral division, a municipal or shire area, and so forth ; in all such cases a careful analysis of the enactment would reveal an infringement of section 99. In truth, the extension of the prohibition in section 99 to “part of” a State, whether it is a large part or only a small part, makes it impossible to apply the view, advanced by Isaacs J. in Barger’s case, but rejected by the majority.
I have made thatbrief reference to the last of these decisions. Any one who reads all those decisions will agree that this is not a simple problem.
– I guessed that.
– I would be the last to suggest that it is a simple problem. If I were to argue it before the Treasurer as I would before the learned justices of the High Court, the argument might take several days. The essence of the thing is that we, as a Parliament, are asked to believe that an income tax law which imposes a lower tax on a given income of a Queensland taxpayer than on a Tasmanian taxpayer is not a taxation law which discriminates between States. Shorn of all legal refinements, that is the position which we, as servants of the Constitution, have to face. If the lawyers can refine that out of existence they are as ingenious as the Minister at the table evidently thinks they are.
The amount involved in this bill - approximately £2,000,000, and on the item that I have been discussing, £1,000,000 - is not a very great sum in these days in comparison with our total income tax of nearly £200,000,000 a year. It is not a large item, but it provokes some consideration as to the methods of reduction which should he pursued if we propose to have, as I hope we shall have, steadily increasing reductions as the years pass. I suggest that there are four possible ways to make those reductions; I shall put them briefly.
I suggest, first, a deduction, not from income tax, but from sales tax. I do not necessarily mean a reduction of the rate, because the amount of money involved may not be sufficient to justify that course. Itmeans that we should have in mind the putting of additional items into the exempted list for purposes of sales tax. One of the most urgent material problems which will face us in the post-war period will be that of rehousing the people. Honorable members will realize that a wise use of exemptions from sales tax would tend, by degrees, to reduce the cost of building. Anything that reduces the cost of the capital establishment of homes after the war - indeed from now on - will tend to reduce the burden of both interest and rentals.
– Those reductions would apply over the life of the house.
– That is so, and capital cost is of cardinal importance for that reason. If we were dealing with this measure at a time when re-housing was actively under way, I should feel disposed to insist - insofar as an Opposition member can insist - that such a scheme should be considered. I put it to the Treasurer - and I think that he will agree with me that the Government should have that possibility prominently in mind as rebuilding commences. As the Leader of the Australian Country party (Mr. Fadden) has pointed out by interjection, the capital cost of buildings exercises a permanent influence over interest and rental.
The second possible method would be the making of a percentage reduction of all income tax rates. For instance, the income tax rate on all incomes could he reduced by 5 per cent. That is intrinsically fair, because the rates themselves are steeply graded’ - they are worked out so as to impose the greatest burden on the person best able to bear it - and a percentage reduction would preserve the relative relations of the tax rates in the various income giro ups.
The third method of bringing about. a reduction of the tax burden would, be to extend the concession granted in. respect of children and other dependants, with the conversion at the same time to deductions instead of concessional rebates. The proposal has great merit at this time, because our high income tax rates, which bear heavily on all, bear most heavily on what I may call the family taxpayer. If our interest in forwarding the welfare of families as such is real, we should do well to give recognition in a practical form to those taxpayers who undertake family responsibilities. I do not know how much money would be involved, but I dare say that, with the amount involved in this zoning provision, some considerable relief might be given to family taxpayers by an extension of concessions and a conversion to a deduction basis.
My fourth suggestion is that the deduction system should be extended much more widely in relation to payments for education, including university education. I should not limit the deduction to the age of eighteen years, but would reconcile it with the realities of the ages of those who are university students. Most of that field is outside the deduction area to-day. Nothing is more important to any country than a high level of education, and general and technical training for employment in both primary and secondary industries. That should not be regarded solely as the responsibility of governments. Particularly in a country like Australia, there is great virtue in encouraging the natural ambition of independently minded people to provide their children with the best possible training for life. If they lay out money for this purpose, not in some idle fashion, but because they are really giving some proper training for life to their children, I believe that their performance in that respect should be recognized and encouraged. Accordingly, I. suggest that we should increase greatly tha concessions allowed to taxpayers in relation, to educational expenditure.
As to the first proposal - that relating to sales tax - I shall say no more, because it has certain angles which I have not mentioned. As to the second proposal, namely, an all-round percentage reduction of income tax rates, it may be that the relief would be too limited to matter very much. I do not know, because I have not worked it out. I believe> however, that we might do great good by starting off the reduction of the tax burden by selecting, the third and fourth proposals. If relief is to be given, we should begin with those with family responsibilities, or who have incurred additional expenditure for the education of their children. I do not desire to say more about the bill at this stage. There are other proposals in it which, although of a minor character, are important. In relation to some of them, amendments will be suggested in committee. On the matter to which I have drawn particular attention, I have thought it proper to put the House in possession of. my views in some degree of fullness, because I believe that if we at this stage adopt a system of taxation based on geographical lines we shall make the most retrograde step that any national parliament could make..
Mr. BURKE (Perth) i.9.48]. - The Leader of the Opposition (Mr. Menzies) devoted more time to a dissertation on the constitutional aspects of this measure than to the merits of the various proposals contained in it. His remarks would be of interest to the legal mind, but I think that the ordinary layman would take the same view of the Constitution, namely, that it does not allow discrimination between States or parts of ‘States. However, we can be certain that before introducing these proposals the Treasurer (Mr. Chifley) had legal advice. There is, therefore, a body of legal opinion which does not agree with the interpretation given by the Leader of the Opposition in his lengthy dissertation. Whether or not the Constitution is being complied with in this bill, the object of the Treasurer is worthy of commendation. The right honorable gentleman ridiculed the lines of demarcation set out in the measure. Listening to him, one would be led to believe that this provision was something new in the economic life of this country. Whilst its application in the field of taxation may be new, the principle itself has in fact been applied in this country for many years. Higher living allowances are provided in some States than in others, and. within certain boundaries within the one State. Obviously, this principle can only be applied on the basis of geographical boundaries. It is now sought to apply in the field of taxation this principle which has been observed for many years in awards and determinations of our industrial courts and tribunals. As is pointed out in a memorandum circulated to honorable members, it is an endeavour to make fair allowance for the actual conditions under which people are obliged to live in certain areas, particularly the outback areas and the far north. I need hardly remind honorable members that we require to increase our population in those areas. Whether the validity of this provision is tested or not, it is evidence of the Government’s determination to grapple with a very real problem by alleviating the hardships which people living in such areas are forced to bear. We know, for instance, some of the disadvantages inevitable in tropical climates and in areas where isolation increases the cost of the necessaries of life. As I have already said, special living allowances are now prescribed under industrial awards in respect of residents in such areas. However, in many cases the payment of such allowances lifts recipients into a higher income range, and much of the allowance is consequently absorbed in tax. Bearing in mind the objective of the provision, I earnestly hope that should the validity of the provision be tested, the court will uphold it, and that the principle will be permanently embodied in our taxation law. I agree that its application may create anomalies, and that certain tax- payers deserving of this benefit may be excluded from receiving it. Such anomalies are inevitable. I emphasize, however, that once the principle is established whereby regard shall be paid to special living conditions in certain areas, the nation will be enabled to recompense residents of such areas for the disabilities they suffer, and give to them fairer treatment in comparison with persons living in areas where no such disabilities apply.
The Leader of the Opposition cited instances in which a reduction of tax should be made as soon as possible. I do not propose to follow him into the realm of economic theory, or the principles of taxation. I agree with him in respect of some of the instances he cited. The bank balances reveal a tremendous increase of deposits in recent years. This is due to a large degree, perhaps, to the deferment of maintenance expenditure. It is also true, however, that although rates of tax are higher, the great majority of business undertakings are making bigger profits than ever before; and there can be no doubt that increases of tax imposed on companies are generally passed on to the community. I do not agree that in such cases it is desirable or necessary to reduce the present rate of tax. The position is different with respect to lower ranges of income. Although the “ 0 “ series index reveals only a comparatively small increase of the cost of living, the fact remains that taxpayers, on the lower ranges of income are finding it harder to-day to make ends meet than they did in normal times. Therefore, the first reduction of tax should be in respect of those incomes. It is noteworthy that the Treasurer has now lifted the statutory exemption level from £104 to £156.
Dealing with the sales tax, the Leader of the Opposition emphasized the adverse effect of such tax in respect of our future home-building programmes. The Government has already afforded, substantial relief in this respect. Personally, I dislike the principle of sales tax. I have no doubt that, insofar as it affects the home-builder, sales tax will be gradually removed as conditions permit. The Leader of the Opposition also compared the rebate system with the system of concessional deductions. The old system of allowing deductions actually conferred little advantage on taxpayers on the lower incomes. However, as the level of income rises, the rebate diminishes until a standard rate, more or less, is applied to higher incomes. Whilst it is true that the rebate system would be of greater advantage than the deduction system in respect of higher incomes, it is of little advantage to persons on lower incomes. The latter, of course, are most in need of relief, and the Government has endeavoured to lighten their tax burden by providing a higher exemption to taxpayers with dependants, and increasing payments in respect of child endowment. The Government has also granted much needed relief in respect of the education of children, and university education. Honorable members opposite had the opportunity for very many years to provide similar reforms. I do not like making comparisons of this kind, but in view of the remarks of the Leader of the Opposition on this point, one must draw attention to the fact that honorable members opposite were in office for very many years and failed to assist parents on the lower incomes to educate their children in this way. However, the real advantage of such a provision is usually exaggerated, because, in any case, persons on lower incomes can rarely afford the cost of university education. The University of Western Australia is the only free university in- Australia. However, a student attending that university, finds the ordinary cost of books, &c, beyond the means of his parents when the latter receive only a low income. It is true that considerable benefit is conferred by the bursary system, and under the system whereby the Government now provides monetary assistance to students while they are attending a university. This, of course, is only fair, because no one will seriously contend that university education should be available only to the children of wealthy parents. To-day, a young man or woman can qualify for this assistance, once it is demonstrated that he or she is of sufficiently high intellectual attainments, to profit from university education. The value of expenditure in this regard, would be no less in peace-time than in war-time. Therefore, the prin ciple which we must apply should not be rebates of incomes so much as financial assistance to children throughout the period of their primary and secondary education and their university career.
– Why not both?
– Because one gives very little to some people.
– The most effective way is to provide financial assistance for the purpose o£ ensuring that children shall have all the necessary facilities required in their school life and university career. If that is done on an adequate scale, the need for the deduction will be avoided, and the benefit will be more equitably distributed among all sections of the community.
In this bill, the Government has sought to grapple with a problem that has vexed us for a long time, namely, the taxation of living-away-from-home .allowances. These allowances are granted by industrial tribunals as compensation for the additional cost of living, including rent and food, incurred by persons residing in distant areas. The bill seeks to place them on an equal footing financially with the residents of metropolitan areas. These allowances are a recognition of the additional costs’ incurred by living in outback areas, and the Government is to be commended for granting this measure of relief. The Leader of the Opposition suggested that the amount of the concession, namely, £2,000,000, is inconsiderable. Although the concession to individuals under this heading, namely, £600,000, may not be large, it is a recognition, in fact, that, their living-away-from-home allowances should not be fully taxed.
I have already dealt at some length with the deduction allowable in respect of certain zones. The only argument which may be levelled at this provision is that it may, on being referred to the High Court, be declared ultra vires.
The deduction on a sliding scale for the spouse of a taxpayer is desirable. I do not like, as a principle of taxation, the method whereby an allowance ceases to operate beyond a certain figure, so that if a person’s income exceeds that figure by £1, the concession is not permissible. We should apply a more gradual scale throughout the field of taxation. The bill makes special provision for dental expenses, and that concession will be welcomed by people who incur these expenses not only for themselves, but also on behalf of their wives and children. Concessions will also be granted in respect of. the attendants of blind persons, and to deaf persons requiring artificial hearing aids. Generally, the bill gives some indication that the Government is endeavouring to grapple with the problem of financing the war as far as possible from taxation receipts, whilst endeavouring to ensure that persons on the lower ranges of income shall not be unduly penalized by the present high rates of tax. That is a worthy objective, and I commend the Government for it. The Treasurer should not forget to carry on this gradual process as war needs relax, and we return gradually to peacetime conditions. Before any relief is given to the higher income groups, those persons on fixed incomes in. the lower groups must be given relief. As a principle of taxation, it is not desirable that low wage-earners should be taxed, because they experience great difficulty in providing a reasonable standard of living for their wives and families. It is a fundamental fallacy to take even small amounts from people on the lower incomes, when their earnings are completely absorbed in providing the necessaries of life and amenities which, in peace-time, would be available to them. Many desirable innovations, including refrigerators and washing machines, are still beyond their grasp. A person in receipt of a small income finds it practically impossible to provide for the essential needs of his wife and family. From the economic standpoint, the country does not benefit if even a small amount of tax is taken from him, because the wageearner has not sufficient income to enable him to attain a reasonable standard of living and provide for his dependants the amenities which should be their right in this community. The Government has met that difficulty in the most desirable way by child endowment. That payment should be increased from time to time.
Generally, I commend the bill because it indicates the Government’s genuine desire to relieve the lower income groups of the burden of taxation, and .recognizes that people who receive allowances to compensate them for the higher cost of living should not be taxed on those allowances.
” [10.17). - If only for three reasons, this bill will be worthy of note by future generations of Australians. The first reason is that the bill extends the principle of concessional rebates, as contrasted with the principle of allowable deductions. The second is that, for the first time, liability for quantum of tax depends”, to a certain defined extent, on a territorial basis. And the third is that substantial concessions are made to some taxpayers, whilst others are excluded. As from the income year 1941-42, the “ rebate of tax “ system was substituted for concessional deductions in Australian income tax law. From an administrative point of view, this change was not remarkable. However, it is most important to the individual taxpayer, for it changed the very basis upon which his liability for tax was calculated. In simple terms, for a man with a taxable income of £500 a year, a deduction of £100 means that he pays tax on £400 a year at a rate of tax applicable to £400. If he receives a rebate of £100, he pays tax on £500, at the rate of £500, from which is deducted the tax on £100 at the same rate as £500. Under the existing law, a taxpayer is exempt from tax if his total income does not exceed £104 per annum. If he has a dependent wife and child, and his total income from personal exertion does not exceed £175, he is still exempt. The reason is that he is entitled to deduct rebates of tax based on £100 for his wife and £75 for his child, and these rebates equal the amount of tax payable on an income from personal exertion of £175. It follows that the effective and contrasting allowance for the dependent wife and child is £71, i.e., £175-£104, if we are to assume that there is coordination between the exemption amount and the rebate system. Yet if we take two comparable cases, in the larger income tax field, so far as marital status is concerned, we find the rebate allowance for wife and one child is calculated upon £175.
As I have stated in this House on more than one occasion, a system which presents such differing results should be abandoned, and we should revert to the older and more equitable method of allowing a deduction before determining Ohe taxable income. Under this bill, the allowance for the first child is based, in one sense, on only £19, which is the difference between the £175 allowable for a wife and child and the proposed exemption of £156 for a married man without any children.
If, in this sixth year of total war, the Treasurer considers that our economic structure will permit of taxation concessions amounting to £2,000,000, the concessions should be granted to those who most deserve them, such as a married man with a wife and family of three or more dependent children. My views on this subject have been expressed previously in this House at great length, and, consequently, there is no need for me to labour this point, except to say that my opinion differs fundamentally from that of the Government.
Apart from the parsimony and even downright meanness that characterizes the rebate system: - and I do not use that expression in a carping sense - there is a further specific iniquity in the limitation of the rebate to certain maximum amounts. It will be conceded that the maintenance of dependants lessens the taxable capacity of the breadwinner. If so, then the fair and honest method is to measure that diminution in the straightforward way of permitting a deduction, not a rebate, in an equitably calculated manner, before determining the taxable income. The graduation of the tax ought to take care of the matter of increasing tax capacities.
Another disadvantage of the rebate system is that it adds a burden to an already over-complicated taxation system in this country. The Income Tax Assessment Act 1915 occupied a mere 23 pages in the statutes of that year. The latest consolidation of the assessment acts, up to 1943, occupies no fewer than 143 pages. There were only 65 sections in the original act. The number has now grown to 266 sections, including such sections as 160 to 160ae; and 221a to 221y. The average taxpayer has no possible hope of determining his taxable liability from a perusal of the present taxation statutes and tables. Such a top-heavy structure will be made more unwieldy than ever by this bill, which will only make confusion worse confounded, except to the expert. In an endeavour to achieve simplicity, I suggest that instead of attempting to provide for all possible contingencies in ‘ the dry and technical jargon of an act, the sections should be stripped of their exceptions and provisos and the hardship sections should be liberalized to provide, in general, for a tribunal to dispense justice equitably in those unfortunate cases not adequately covered by the specific simplified sections.
The second matter which calls for some comment is the question of the constitutional validity of the zoning system proposed in clause 11 of this bill. The Constitution of the Commonwealth of Australia is the highest law of this country and is as binding on the highest citizen as on the lowliest. The rule or law is the keystone on which the British system of jurisprudence has been built, and consequently, if there be any reasonable doubt as to the constitutionality of these provisions, no honorable member should be a party to including them in the statute law of the nation. The proposed new section 79a would divide Australia into three zones, and for reasons that can be successively ascribed to the Government Meteorologist, the Minister for Transport and the Prices Commissioner - or the weather, isolation, and the high cost of living - it purports to grant allowable deductions of varying amounts to taxpayers according to the zones in which they reside.
Two sections of the Constitution are worthy of note in connexion with this clause and they have been touched on by the Leader of the Opposition. The first is section 51 (ii), which many of my friends opposite will remember” from the referendum campaign. It gives this Parliament power to make laws with respect to-
Taxation; but so as not to discriminate between States or parts of States.
Section 99 appears, also to be relevant. It reads -
The Commonwealth shall not, by any law or regulation of trade, commerce, or revenue, give preference to one State or any part thereof over another State or any part thereof.
In a case some years ago in which I was interested professionally, the High Court held that income tax regulations which purported to fix differing amounts as the fair average value of livestock in different States discriminated between States and parts of States and territories and were therefore invalid. That was. the Cameron case. The law was held by the High Court to be ultra vires the Constitution. In dealing with this particular section some ten years ago, the present Attorney-General said that to prove infringement of section 99, it was not sufficient to show discrimination based on mere locality. It must also be shown that, as a consequence of the discrimination, tangible benefits, advantages, facilities or immunities are given to persons. The legal doubt with regard to the constitutionality of this provision is enough to call for an explanation from the Minister. If a legal opinion has been obtained, it should be tabled and made available to honorable members; if one has not been obtained, the SolicitorGeneral should be requested to have an opinion prepared and read to honorable members before the committee stage is reached.
– We do not say that it is a borderline case.
– If the Minister for Information (Mr. Calwell) is the legal adviser to the Government, he should assure the House that the proposal is not ultra vires the Constitution. I should like to know how the AttorneyGeneral or his department reconciles the constitutionality of this measure with his decision in connexion with the Elliott case referred to by the Leader of the Opposition (Mr. Menzies). I cannot understand why the confusing and complicated income tax laws of this country should be further confounded by the introduction of. a novel and farreaching principle, in the provision of zoning. I have been a student of the taxation Jaws of as many countries as I have been able to study, and I have yet to learn that such a principle has been embodied in the Income Tax Act of any country the different parts of which have varying conditions. Doubtless, it waa with a view to providing a safeguard against possible abuse that the founders of the Constitution were far-sighted enough to provide against such discrimination. The argument advanced by the Treasurer in justification for this upsetting of the fundamental principles on which the taxation laws of this country have been based, is that there is need for decentralization. The party that I have the honour to lead stands foursquare and unreservedly for decentralization, but not for such a pretence as a zoning system embodying varying deductions. Australia is to be divided into three zones. I am very pleased to note that the Government is reverting to the sensible, though old-fashioned, practice of making an allowable deduction. There is to be an allowable deduction to resident taxpayers of £40 in zone A, and £20 in zone B. No taxpayer should be deceived into believing that he will be allowed to deduct the amount from the quantum, of tax he will pay because he lives in those areas under the conditions to which the Treasurer has referred in his explanatory notes. The deduction will be calculated according to the rate of tax applicable to that £40 or £20. At the present rate of tax, having regard to the general average conditions prevailing in those areas, the allowance will be from £7 to £10. The Treasurer has upset the fundamental principle of, taxation in this country by the introduction of this novel and cumbersome method, which will be difficult to administer, for the purpose of encouraging people to take up residence in remote areas in order that they may take part in’ the post-war development plans of “ the nation. His explanatory note states -
As the diminution in the value of. such allowances through the payment of income tax may tend to dissuade persons from accepting employment in the remote areas, post-war development plains may be seriously affected. On the other hand, the allowance of an income tax concession to all taxpayers residing in such areas would tend to encourage settlement in those areas, and at the same time provide a form of compensation for the disabilities they are obliged to endure.
Does the Government consider that an allowance aggregating £1,000,000 is sufficient to achieve effective decentralization, and that an individual deduction of from £7 to £10 will keep the existing residents contented, or induce others to leave the capital cities and go to remote areas? The Government has an opportunity to give effect to a . practical and sensible policy of development in the remote areas. It could expend £1,000,000 with great advantage in providing reasonable living amenities to those who reside in them. The first objective should be to keep contented those who have remained there for many years, including the war period. There are various aspects which should receive the consideration of this Government or any other Government that succeeds it. Facilities of all kinds should be provided, including electricity services and labour-saving devices. It is ridiculous in the extreme to pretend that allowances totalling £1,000,000 represent a sincere desire to encourage post-war development. The Government should come forward with what to me is an indispensable policy for encouragement and development in those parts, along the lines I have mentioned. Nobody will be deceived by the ineffective proposals contained in the bill.
There is one other matter which calls for comment. I refer to the principle embodied in clause 5. The Treasurer proposes to spread the profits derived from the sales of live-stock by pastoralists whose holdings are resumed by Government action. It is proposed that these profits shall be spread, at the tax-payers’ option, over a period of five years. About nine months ago, the Leader of the Opposition and I were members of a deputation which ‘Senator Gibson led to the Treasurer. We placed before that honorable gentleman the case of persons whose flocks had been destroyed by bushfires in Victoria, and who were covered by insurance. I was informed - as was the fact - that relief could not be afforded by any administrative act of the Commissioner of Taxation ; consequently, the insurance moneys were included in the assessable incomes of the graziers concerned. They attracted a very high rate of income tax, and thus lessened the monetary capacity of many of the pri mary producers affected to re-stock their holdings adequately. The Treasurer could not see his way to amend the act at that time. He has now introduced a provision which purports to overcome difficulties very similar in principle. The Income Tax Act 1922-34, incorporated a method for the calculation of a grazier’s norma] herd when sales were made on a “ walk-in walk-out “ basis, which had the effect of terminating that particular business. A statement was obtained from the tax-payer, showing the number of stock sold during the preceding ten years, or for as many as were available. The average annual sales were thus obtained. The Taxation Department then calculated the portion of the profit that was attributable to this average, on the basis of the actual profit made. This portion was deemed to be assessable income, and the balance was considered to be of a capital nature, being derived from the sale of a capital asset, and thus not income. Even though the concession was withdrawn in 1936, I submit that in the present circumstances it would be worthwhile to study the principle contained in the earlier act in comparison with the flat-rate method proposed to be adopted. Of course, the Treasurer will say that the withdrawal of the concession was based on the finding of the Royal Commission on Taxation which was appointed to survey the position and recommend a re-orientation of the whole of the taxation laws of the country, but much water has run under the bridge since then. It may be that under the conditions now prevailing, where a person is forced to sell because of government action, the older principle might be more equitable, as it would enable the primary producer concerned to re-establish himself more readily and with less need to borrow from financial institutions.
Another point in connexion with this clause is that the purported relief may quite easily result in more onerous conditions of payment for the taxpayer concerned. Take as an example a profit of £10,000 made in the circumstances to which the clause applies. If the profit be spread over the five years as proposed an amount of £2,000 a year will be included as taxable- income, neglecting the averaging provisions. The rate of tax on each such amount of £2,000 will depend upon the aggregate of the taxpayer’s other income. If in the third year he has £5,000 of taxable income, exclusive of the sum carried forward, he will pay on the £2,000 at the rate applicable to £7,000. Thus an apparent benefit or advantage may turn out to be a serious detriment, and no taxpayer will haveany means of knowing - at the time when he will be forced to make his choice - what his future income will be. Therefore I submit that the proposal introduced by the Treasurer will have much less real value than he sets out to make those concerned believe. The advantage in the bill is more apparent than real.
The proposed new sub-section 3 of section 36 of the principal act, which appears in clause 5 of the bill, reads as follows : -
Where, in consequence of the acquisition or resumption of land under the provisions of any Act or State Act or Ordinance of a Territory of the Commonwealth which contains provisions for the compulsory acquisition or resumption of land, a taxpayer, in any year of income, disposes., by sale or otherwise, of any live stock, the taxpayer may elect that his assessable income of that year shall be reduced
I desire the Treasurer to state whether adequate provision has been made for applying the proposed new sub-section, if necessary, to land held under Crown lease, occupation licence or perpetual lease. Many pastoralists in Queensland hold such a tenure. I am sure the Treasurer does not intend to discriminate between States and parts of States, and would agree to have this matter adjusted if any weakness in the law were discovered.
A welcome feature of the bill is the extension of the rebate for medical and dental expenses to include optical expenses and other similar disbursements. About seven months ago, I pointed out in this House a defect in the Income Tax Assessment Act, which excludes expenses incurred for diathermy treatment and massage, even when such treatment is ordered by a medical practitioner. Such a concession seems to be long overdue and provision should be made for it in this bill. I also draw attention to an anomaly which may assume serious proportions in the immediate post-war period. Many professional men have temporarily relinquished their practices for service in the armed forces and on philanthropic bodies such as the Australian Red Cross Society and the Australian ComfortsFund. Take the case of a person who returned to civilian life in, say, February, 1944, and earned £500 by the end of the following June. On that £500 he is tentatively assessed for 1944-45 at £136 odd. After the 30th June, 1945, it is found thathis income for 1944-45 was £2,000. His tentative assessment of £136 odd is then altered to £951. He is required to pay the difference, namely, £815, and at the same time is required to pay provisional tax of £951, together with one-third of 25 per cent. of £136, or about £11, making in all the sum of £1,777. This does not leave him very much out of his £2,000. That person is forced to pay £1,777 out of an income of £2,000 after serving in the fighting forces for three or four years. Even the most hard-hearted person must recognize that that is an anomaly which ought to be corrected. It has been suggested to me that the matter might be adjusted by providing that those returning to civilian life should become subjected to pay-as-you-earn taxation as if the “year of forgiveness” were the first complete accounting year ofcivil life after war service has been completed. I commend this suggestion to the Treasurer, who will, I am sure, give it his earnest consideration. The criticism which I have directed to certain points i? not intended to embarrass the Treasurer or the Commissioner for Taxation. My sole purpose is to remove anomalies.
Debate (on motion by Mr. Francis) adjourned.
– I move -
That the House do now adjourn.
I am submitting this motion at this hour because the Leaders of the Opposition parties have been kind enough to agree that the Income Tax Assessment Bill will be available for consideration by the Senate next week; in other words, it must be passed by the House this week.
Question resolved in the affirmative.
House adjourned at 10.53 p.m.
The following answers to questions were circulated: -
Mr.Chifley. - On the 1st March, 1945, the honorable member for Bendigo (Mr. Rankin) asked a question regarding the methods adopted by rationing inspectorsin obtaining evidence against two Bendigo butchers to substantiate charges of selling meat without coupons. The honorable member stated that the inspectors informed the butchers that some of their relatives were returning from New Guinea and that they did not have sufficient coupons to buy supplies.
I desire to inform the honorable member that an investigation has been made into the allegations but that as no depositions were taken at the hearing of the charges, there is no official record of the court proceedings. The inquiries made reveal that, as the result of complaints received by the Rationing Commission that Bendigo butchers were selling meat without coupons, two inspectors were sent to Bendigo. They visited several shops on the same day, but all the butchers visited, except the two charged, refused to sell any meat without coupons. The woman inspector admits having presented a ration book in a name other than her own, but denies having stated that the meat was required for the benefit of her brother who was home on leave from New Guinea or that she held out any inducement to the traders to break the law. During the court proceedings, counsel for the defendants strongly criticized the procedure adopted by the inspectors, but, although invited so to do, the magistrate made no comment thereon and,by imposing a fine of £20 in each case, showed that he accepted the inspectors’ evidence as trustworthy. In view of this, there is no alternative but to accept the view that they did not induce or persuade the butchers in question to break the law.
While Commonwealth money is at times made available to obtain evidence against persons contravening the Prices and Rationing Regulations, clear instructions have been issued prohibiting the use of any unjust method to secure evidence by such means as tempting or persuading a trader to break the law. As stated previously, no such method was adopted in the case of the two Bendigo butchers referred to.
Alleged Traffic in Liquor.
– The answers to the honorable member’s questions are - 1 and 2. I have no knowledge of the matter referred to by the honorable member but will have inquiries made and furnish him with a reply when the inquiries have been completed
Prices Control: Groceries.
n asked the Minister representing the Minister for the Interior, upon notice -
– The Minister for the Interior has supplied the following answers : - 1 and 2. To supply the information desired by the honorable member, a considerable amount of work and overtime would be involved. In view of the pressure of work and depleted staff, it is not proposed to authorize this work being carried out.
South- West PacificCampaign Casualties: Area of Japanese Occupation.
n asked the Minister representing the Acting Minister for the Army, upon notice -
– The Acting Minister for the Army has supplied the following answers : -
Papua: east coast as far south as, exclusive Milne Bay, August, 1942; inland to vicinity Wau, January, 1943; andover Owen Stanley Range to Eoribaiwa (32 miles from Port Moresby), September, 1942; Nauru and Ocean Islands, August, 1942.
The British possessions regained from the Japanese by Australian Forces in each half-yearly period subsequent to 30th June, 1942, are as set out below -
The following British possessions occupied by the Japanese remain to bp reconquered: Wewak area New Guinea. Gazelle Peninsula in New Britain, New Ireland, New Hanover Island, approximately two-thirds of Bougainville Island plus Buka Shortland and Choiseul Islands in the Solomons (these areas are clearly delineated in Appendix “ D “ tothe report of the Acting Minister for the Army tabledby the Prime Minister on 24th April. 1945). Nauru Island. Ocean Island. Malaya. Singapore. Hong Kong, southern half of Burma, Andaman Island. NicobarIsland. North Borneo, Sarawak, Brunei, and Christmas IslandIndian Ocean).
n asked the Minister representing the Acting Minister for the Army. upon notice -
– The Acting Minister for the Army has supplied the following answers : -
Housing : Permits.
Mr.bryson asked the Minister for Post-war Reconstruction, upon notice- -
How many permits for the constructionof houses were issued by the Department of War Organization of Industry in each capital city in each of the years 1942, 1943 and 1944?
n. - In reply to the aforestated question, I desire to advise the honorable member as follows : -
Wheat Industry: Licensing System; Production in Victoria; Superphosphate.
asked the Minister for Commerce and Agriculture, upon notice -
y. - The answer to the honorable member’s questions are as follows : -
The Commonwealth has asked, in view of Australia’s greatly increased obligations, that sufficent phosphate rock and shipping be mode available to enable Australia to provide 1,150,000 tons of superphosphate for primary industry during 1946-47. The combined food board and the shipping authorities will endeavour to meet Australia’s request. Not only has there been a decline in the amount of phosphate available during the war, but the quality is not up to the standard of that produced from Australia’s own deposits at Nauru and Ocean Islands, which arc still in Japanese hands. The quantity of 800,000 tons provided this year will permit the States to increase their allocations to wheat-growers. The actual amount to be granted to the different primary industries is left to the determination of the States. 7.I have no hesitation in saying that Mr. Martin would agree at a meeting of the Agricultural Council that the shortage of superphosphate has caused the decline in wheat sowing.
Cite as: Australia, House of Representatives, Debates, 2 May 1945, viewed 22 October 2017, <http://historichansard.net/hofreps/1945/19450502_reps_17_181/>.