House of Representatives
27 March 1947

18th Parliament · 1st Session

Mr. Speaker (Hon. J. S. Rosevear) took the chair at 10.30 a.m., and read prayer’s.-

page 1224




– I . have been interested -to note that, following the pressure’ tactics of the waterside workers - which have been completely successful - the waterside clerks have been threatening a one-day stoppage within the next fortnight.- I ask the Prime Minister whether, when this stoppage occurs, members of the Waterside “Workers Federation, who report for work, and who are not ableto work because of the stoppage, will b& paid attendance money.? If so, is thesame principle to be applied in. this case, as in that of seamen who are paid war risk money while their ships remain inport?


– The honorable member can hardly expect me to’ make an assumption on- an assumption. I havenot considered the possibility of such difficulties arising as have been envisaged by the honorable member, but I shall look into the matter.

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Importation of Maohinery - Requirements of Clarence County Council


-. - I have here an advertisement which appeared in the Sydney Morning Herald about diesel engines for electrical generating sets. The advertisement states -

Duo to arrive in July, 75 50-cycle alternating generating sets.

Can the Prime Minister say whether it is a fact that machines of this kind are manufactured in Australia? Would not the granting of permits for the importation, of such machines be contrary to the policy of the Government to conserve dollar exchange?


– I have no knowledge of the matter mentioned by the honorable member. It may be that, although machines of this kind are manufactured in Australia, they are not manufactured in sufficient numbers to fill immediate demands. In, several instances, it has been found necessary to import articles in order to meet the needs of the community, although similar articles were being made in Australia. I shall inquire into the matter.


– I have received a very urgent letter from the Clarence County Council, which supplies electricity to the whole of the district situated 300 miles south of the Queensland border, that it has been able to procure only 10 per cent, of its requirements of structural steel, electric wires and equipment necessary to connect thousands of potential rural consumers of electricity, nearly all of whom are producing food, or are capable of producing food in large quantities. The council desires that this matter be raised in the highest quarters with a view to ascertaining whether it is possible to expedite supplies of its requirements so that food production in the area of its franchise may be stimulated.

Minister for Defence · CORIO, VICTORIA · ALP

– The Department of Supply and Shipping does not deal with the allocation of raw materials, such as structural steel and copper wire, for the purposes indicated by the right honorable gentleman. Such distribution is controlled by the Minister for Works and Housing. I shall discuss the matter with both of my colleagues to see whether anything can be done along the lines suggested by the right honorable gentleman.

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– In the Commonwealth Gazette, No. 51, dated the 13th March, 1947, at page865, there appears a notification of vacancies, and the notice continues -

Applications are invited from permanent officers of the Commonwealth Public Service for promotion or transfer to the positions named in the appended schedule.

Among the vacancies advertised are positions in the Investigation Branch of the Attorney-General’s Department in the several States, and at Canberra. In respect of some of the positions in the States the duties are set down as “ Participation in the collection of information, combined with the collation, analysis and reporting of information obtained “. I have received from a resident of one of the States in which vacancies exist, a letter pointing out that applications are limited to permanent officers of the Commonwealth Public Service, that there is a shortage of trained security officers in that service, and that probably the appointees to these positions will be untrained clerks from such government instrumentalities as the Prices Branch or the Department of Labour and National Service. Will the Attorney-General widen the scope of applications in order that trained security officers in the police forces of the States may be eligible to apply for these positions ?

Attorney-General · BARTON, NEW SOUTH WALES · ALP

– I realize the importance of having the best personnel available for the positions advertised, and I have already discussed that aspect of the matter with the permanent head of my department, who has taken it up with the Public Service Board. I shall inform the honorable member and the House of the result of their investigations. For important positions of that kind it is desirable that the scope of applications should be as wide as possible.

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– In view of the fact that Sir Stafford Cripps, President of the Board of Trade in the United Kingdom, recently made available to British manufacturers German industrial secrets found by 3,000 teams of British scientists working under the British Intelligence Objectives Sub-Committee, and that an exhibition of their discoveries was held in London, and later in British provincial cities, I now ask the Minister in charge of the Council for Scientific and Industrial Research whether any of these findings have been made available to Australian manufacturers through the Council for Scientific and Industrial Research ? If not, will the Minister investigate the possibility of making such information available to Australian industries?


– This matter does not come under the ‘Council for Scientific and Industrial Research, but is dealt with by the Secondary Industries Division of my department. We have had a technical mission in Japan, and Australian scientists have been working in collaboration with British scientists in the German sphere, with the result that many valuable secrets have been obtained and passed on to industries in Australia through the Secondary Industries Division. I dealt with this subject at some length in a statement which I made on the motion for the adjournment of the Bouse about a week ago. If the honorable member will read that statement I think he will find full details of the matters covered by his question. Australian industry generally is most appreciative of the work done by the Secondary Industries Division of my department in making available valuable information obtained from Germany.

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– As the Department of Home Security has gone out of existence and as questions are arising in many minds of many people as to what is being done in relation to civil defence, I ask the Minister for Defence whether any organization now exists to continue the war-time study of civil defence problems, and, if so, what those organizations are, and what steps are being taken by the

Government to keep their knowledge up to date ?


– I agree that the question of preparations for civil defence is very important. The matter is engaging the attention of the Defence Committee. The right honorable gentleman will realize that, in considering what measures should be taken for civil defence, a very close investigation must be made of the possibilities that arise out of the use of new weapons.

Mr Menzies:

– They are liable to make the problem of civil defence more acute.


– Yes, and very much more complicated. Civil defence measures will have to .be much more elaborate in future than they have been in the past. When the sittings of the Parliament are resumed after Easter I hope to be able to make a statement not only upon this matter but also upon other aspects of defence policy.

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Purchase of Vessels - Black Marketing and Pillaging


– Is it a fact that the British Government is endeavouring to purchase from the United States of America 160 ships which it is now chartering at a cost of 2,000,000 dollars a month ? If so, is the Australian Government taking any steps to endeavour to purchase some of these ships in order to assist in the bringing of migrants to Australia?

Minister for Immigration · MELBOURNE, VICTORIA · ALP

– The British Government is attempting to purchase from the United States of America a number of ships - the number may be 160, I am not sure - which it operates at present under the lend-lease arrangement with the United States of America. There is, however, an American law which forbids the sale of American ships to foreign nations, and very strong objection is raised by certain sections of the American people to the sale of anything but the slowest ships. The problem is not likely to be solved in. the near future. We know of the circumstances in which the British Government is trying to purchase the ships it needs, and we, too, are making overtures in the matter. The Australian Ambassador to the United States of

America, Mr. Makin, has been in touch with the State Department at Washington with a. view to ascertaining in what way we can overcome the difficulty presented by the American statutory law forbidding the sale of ships to foreign countries. We have made a proposition to the American Government stating that we will consider taking people from the displaced persons camps in the American zones in Austria and Germany, if the American Government will either allow us to charter or buy the requisite ships to bring an equivalent number of people from Great Britain to Australia. We may have to bargain along those lines. The American law, however, seems to present an insuperable difficulty to the sale of the ships we need.


– Some time ago, as the result of information that I received from several sources, I stated that a black market in shipping space appeared to exist on mainland wharfs, and that, in the main, pillaging of cargoes was carefully organized by groups outside the wharfs. An inquiry into these allegations was instituted. Can the Minister representing the Minister for Supply and Shipping say whether the inquiry has been concluded, and, if so, when will the findings be made known ?


– I was not aware that this inquiry had been instituted, but I shall ask the Minister for .Supply and Shipping to inform me as soon as possible whether it has been completed and, if so, when the report w.ill be made available t.o the honorable member.

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– It was recently reported in an Adelaide newspaper that members of the Commonwealth Parliament enjoy a priority in making trunk line calls to the disadvantage of business men in that State who wish to make urgent business calls. In view of the fact that on one occasion I waited five and a half hours to contact the Prime Minister by telephone, can the Minister representing the PostmasterGeneral inform the House what prioritics exist, and who enjoy .them ?


– I can say very definitely that members of Parliament other than Ministers have no priority. ] was very much aware of the fact before I became a Minister. I believe that members of Parliament suffer a great deal of inconvenience because they are not given a priority to enable them to transact public business; and they felt that inconvenience very keenly during the war years. At no time has any member of Parliament, other than a Minister, enjoyed any priority of any sort in making trunk line calls. In addition to Ministers, a priority is given to certain leading public servants in order to enable them to transact public business; but the number of priorities is now much fewer than was the case during the war. The priority list is constantly under review, and is gradually being reduced. At the same time, the Postal Department has been able to make a number of new channels available between capital cities, and it is hoped that before many more months pass it will be possible for any citizen in Australia to make an interstate call within a period of a few minutes.

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Victorian Supplies


– Will the Minister for Commerce and Agriculture inform the House as to how the Government’s scheme of meat sales on a weight and grade basis is working in Melbourne? Is he aware that yesterday 164 out of 201 suburban butcher shops in Melbourne were closed, this being a larger number than was closed in the preceding week? In view of this fact does the Minister still believe that his statement that Melbourne meat supplies are returning to normal is supported by the evidence ?

Minister for Commerce and Agriculture · BALLAARAT, VICTORIA · ALP

– The position is that the Commonwealth Government’s weight and grade system is working quite satisfactorily.

Mr McDonald:

– To whom?


– The facilities arcbeing availed of; but still more important, the institution of that system has been a factor in encouraging all those responsible for the Melbourne holdup - and I shall not particularize - to return to normal marketing practice. On Tuesday, the yardings on the Melbourne market were 21.000 sheep and over 1,000 bullocks, whereas the yardings for the previous week were only some hundreds.

Mr Archie Cameron:

– That would not give Melbourne people a bite of meat a piece.


– The fact remains that Melbourne people are now getting more than a bite of meat. The indications are that the yardings next week will show a substantial increase over the figures for this week, and that as I prophesied, and now repeat, Melbourne meat supplies will return to normal wit l].in a reasonable time. However, yardings to-day might not have been of reasonable proportions had the Government not taken the action it took. As to whether I am aware that 164 butchers’ shops were closed in Melbourne yesterday, I have no information on that point, except that I have read a report in the Melbourne press of result of a survey made by a representative of a Melbourne newspaper. I am unable to accept the result of such a survey. “Whether the particular press representative who made it was able, in the time at his disposal, to traverse the whole of Melbourne and “ check up “ onevery butcher shop in that city, I do not know; but it is exceedingly unlikely that he was able to do so.

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– Will the Minister for Post-war Reconstruction indicate the directions in which wool research is proceeding, what progress has been made, whether the activities have the approval of the representatives of the growers on the Wool Consultative Council and what the anticipated cost is for the current year?


– The wool research programme for the current year involves the expenditure of about £450,000. The programme was examined first by an inter-departmental committee at the beginning of the financial year, later by the Wool Consultative Committee, which was set up under the Wool Use Promotion Act, on which there are two representatives of the growers, who are in full agreement with the programme submitted, and then by a Cabinet sub-committee, of which I am chairman and the Treasurer and the Minister for Commerce and

Agriculture are members. The programme includes biological research and investigations of manufacturing techniques in the textile industry. I assure the honorable member that the growers’ represenatives and the growers generally appreciate the work that is being done. If there are any further details that the honorable member would like to have I shall be glad to make them available.

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Vocational Training: Carpentering


– I ask the Minister for Post-war Reconstruction whether many ex-servicemen have been notified by the Department of Post-war Reconstruction that it will be two years before they will be given the opportunity to undergo a course of training in carpentering. Does the Minister consider that denotes successful handling of the vocational training scheme? Will he try to devise means of avoiding that long delay ?


– It is true that many applicants for training as carpenters have been advised that they will have to wait a considerable period for their training to commence. That is because of insufficiency of accommodation and teaching staff for the training of excessively large numbers of men at the one time. If all were trained at the one time there Would be insufficient timber for them all simultaneously to take positions after having been trained. The whole purpose of the scheme is to ensure an even flow of trainees that the trade will be able to absorb when they complete their training. In the meantime, other employment is available for these men, and they are advised to accept such employment.

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Broadcasts to Immigrants


– Will the Minister for Information place upon the table of the library each script of the new broadcasts to immigrants entitled, “ Australia and your Future “ immediately such broadcasts are made?


– I shall be only too happy to do as- the honorable member desires, and if any honorable member is sufficiently interested in immigration to desire a copy of these broadcasts to be sent to his private address, I shall arrange for that to he done.

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Interpretation of Standing Orders

Mr SPEAKER (Hon J S Rosevear:

– I have examined the question of procedure recently raised by the honorable member for Reid (Mr. Lang) as to whether a member, at the conclusion of his speech, may move, “ That the question be now put “.

In my opinion the terms of Standing Order 262 leave little doubt that he can do so. That standing order reads -

After any question has been proposed a motion may be made by any member rising in his place, and without notice, and whether any other member is addressing the Chair or not, “ That the question be now put “, and the motion shall be put forthwith and decided without amendment or debate.

To me the intention of these words is clear. It will be noted that the standing order provides that the motion may be made by any member “ rising in his place “. The honorable member for Reid held the view that the words “ rising in his place” indicated that some member other than the member addressing the House must make the motion, “ That the question be now put”; but I stress the fact that the Standing Order states that any member may make the motion. In my opinion, those words mean that every member has the right. A ruling to the contrary could easily be evaded ‘by the member who was addressing the House resuming his seat and promptly rising in his place to make the motion.

May’s Parliamentary Practice states that the “ Closure may be moved as the conclusion of a speech “. If there were any doubt in my mind as to the correct interpretation of Standing Order 262 or of the extract from May’s Parliamentary Practice I should be guided by the practice of this House, and I shall quote three examples to illustrate that practice. On the 5th November, 1913, .Speaker Elliott Johnson ruled -

There is no discretion left to the Speaker who must put the question forthwith, and any member, without being called, is empowered to’ move it.

On the 28th August, 1929, Mr. Anstey moved a motion of privilege. The then Prime Minister, Mr. Bruce, said, in concluding his speech -

I refuse to be associated with so contemptible a motion and I therefore move at once - “ That the question be now put.”.

On the 26th June, 1930, Mr. Bayley moved a motion of privilege. At the close of his speech, the then Prime Minister,. Mr. Scullin, said -

As I do not intend to allow Government time .to be occupied by motions of this sort, and as I have answered the points made by the previous speakers, I move - “ That the question be now put.”.

As the present procedure of permitting any member to move, “ That the question be now put “ has been followed in thi3 House since the inception of the Commonwealth Parliament. I see no good reason for altering the practice. The honorable member for Reid expressed the fear that, if a member who was addressing the House was permitted to conclude his speech by moving, “ That the question be now put “, another honorable member might be precluded from replying to what might have been a vicious and violent attack upon him. I point out, however, that there is ample safeguard in Standing Orders 258 and 260, which would permit a member who has been attacked or misrepresented, to make a personal explanation immediately after the question had been put, or at any subsequent sitting of the House.

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– I ask the Minister representing the Minister for Trade and Customs whether it is a fact that about twelve months ago, the Tariff Board recommended to the Government that the duty on timber suitable for home building, and held in bond, should be substantially reduced? If that is correct, and in view of the acute shortage of timber for the construction of homes throughout Australia, will the honorable gentleman explain why the Tariff Board’s recommendation has not .been implemented ?


– I shall ask the Minister for Trade and Customs to supply the information.

Mr.RY AN. - Is there any truth in the report that considerable quantities of valuable imported timber have been dumped at sea and/or burned ? If so, will the Minister representing the Minister for Trade and Customs state who was responsible for this remarkable action, and what were the reasons for taking it? Was it due to the excessive duty charged upon the timber? Does not the Government consider that it should seriously consider reducing the high duty rate in order to permit the absorption of much-needed timber into a starved home-building market ?


– I do not know of any episode such as the honorable member mentioned. I shall be glad to refer his question to the Minister for Trade and Customs and ascertain the facta for him.

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Unrest Among Employees


– Widespread unrest exists among employees of the PostmasterGeneral’s Department owing to the delay in determining their claims for an increase of wages. Will the Prime Minister take the necessary action to expedite a determination of these claims, which are at present being considered by the Public Service Board?


– Apparently, the honorable member is referring to the representations which the Public Service unions made to thePublic Service Commissioner regarding anaward covering all their members. As I mentioned to the House previously, extensive consultations have taken place with the respective unions on this subject. I understand that the Public Service Arbitrator has dealt with the claims, and has approved an award covering the lower paid members of the Public Service, including post office employees. I had hoped to be in a position to lay the determination on the table of the House to-day; and I shall do so at the first opportunity.

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Resignation of Mr. Paul Hasluck


– I ask the Minister for External Affairs whether it is a fact, as announced from the United States of America, that Mr. Paul Hasluck, who has represented Australia at the Headquarters of the United Nations and on the Security Council, has resigned? Is his resignation the result of any disagreement with the Australian Government? Will the right honorable gentleman give to the House the reasons for the resignation?


– It is a fact that Mr. Hasluck, who is a temporary Commonwealth officer, has resigned. If the honorable member will place his question on the notice-paper. I shall see whether I can supply a full answer.

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– It is clear that the profit on Australian butter sold to Great Britain since the 1st July, 1946, is being returned to the dairying industry. Will the Treasurer explain what has become of the profit of £5,700,000, which the Australian Government made on sales of butter to Great Britain before the 1st July last? How and when will the profit be returned to the industry?


– I shall be very glad to learn that profits were made as the honorable member suggested. I am not aware of any profits, but I shall make a close investigation in order to ascertain whether there is any truth inthe suggestion.

Mr Bernard Corser:

– The Government received more than it paid for the butter.


– I know the story very well. If the honorable member will give notice of the question, I shall obtain a full reply for him.

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– Does the Government intend to maintain the Lake Boga flying boat base as a repair centre for flying-boat types of fighting and civil aircraft? I understand that this is the only flying boat repair centre in a wide area.


– The Lake Boga establishment is not a peace-time requirement. There are other repair centres at

Bowen and Rathmines. The Government has already handed over the hospital and & number of other buildings at the Lake Boga station to the Commonwealth Disposals Commission. The remainder of the buildings are now being used for the storage of equipment, but when this material has been disposed of, the buildings will be handed over to the Disposals Commission, because they will be no longer required by the Department of Air.

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– Can the AttorneyGeneral inform me of the position regarding what has been commonly known as the Rosetta Kelly case relating to the smuggling of goods into Australia? Is there any truth in the allegation which has wide currency, that the forms of the court are being used to delay the hearing of the case until after the New South Wales State elections, because of the possibilities of what may be revealed by disclosures in the court?


– The suggestion that the forms of the court are being used for any such improper purpose is untrue. I am surprised that the honorable member should make such a suggestion. He has already asked a question on this matter and has been given a full and completely correct answer. The case is before the court, which has fixed a time for the hearing, which, I understand, will take place next week or, at any rate, within a few days. I submit that the honorable member’s attempted interference with the procedure of the court in this matter by indirect suggestion constitutes a most improper attack on the court.

Mr Harrison:

– Why is the Minister hedging?


– I am not hedging. I have given the honorable member a complete answer. The desire of the Commonwealth authorities has been to have this case brought on more quickly, and it has been brought on.

Mr Harrison:

– The Government has allowed the principal witness to go overseas.


– I hope that the honorable member will listen to the complete answer. The Commonwealth legal authorities are most anxious to have this case carried on to completion, and it will be carried on to completion. As I have already said, I understand that the hearing will commence within a few days. 1 hope that there will be no more attempts by the honorable gentleman to interfere with the course of justice in the court.

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– Has the Prime Minister observed in to-day’s press the statement that the British House of Commons has referred to a committee on privileges the allegation that an outside body had brought pressure to bear on Mr. W. J. Brown, M.P., a member of the House of Commons? Will the right honorable gentleman, during the ensuing short recess, endeavour to obtain from the High Commissioner in London factual information in regard to the matter, and then consider whether or not action should be taken against the Labour party in South Australia for having threatened Labour members in this House of what would happen to them if they did not adopt a certain attitude towards the International Monetary Agreements Bill, embodying ratification of what is commonly known as the Bretton Woods Agreement ?

AgreemCHIFLEY.- The honorable member appears to be confusing certain issues in Australia with others that have arisen overseas for which the Commonwealth Government has no responsibility. His question also sounded rather silly to me. Nevertheless, as he is usually lucid and sane, I shall make some inquiry in regard to the matter he has raised.

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Representation of Australia


– I ask the Minister for External Affairs whether the signing of the Dutch-Indonesian pact will result in recognition of the Indonesian Republican Government by the Australian Government. If it will, does the Commonwealth Government intend that Australia shall be represented in Indonesia? If it does, what form will the representation take?


– I cannot say precisely, at the moment, what form the representation of Australia in Indonesia will take.

Such representation has been delayed by the dispute in Indonesia which has recently been settled. The Government hopes to make an arrangement which will be satisfactory to both the Dutch Government, and the Government of Indonesia which has come into existence as the result of the agreement at which these two parties arrived. As soon as the arrangement has been made, I shall inform the House of it.

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Motion (by Mr. Chifley) agreed to -

That leave be given to bring in a bill for an act to amend the Income Tax Assessment Act 1936-46.

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Motion (by Mr. Chifley) agreed to -

That leave be given to bring in a bill for an act to amend the Gift Duty Assessment Act 1941-42.

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Motion (by Mr. Chifley) agreed to -

That leave be given to bring in a bill for an act to amend the Estate Duty Assessment Act 1914-42.

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Motion (by Mr. Dedman) agreed to -

That leave be given to ‘bring in a bill for an act to approve the Constitution of the United Nations Educational, Scientific and Cultural Organization.

Bill presented, and read a first time.

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Motion (by Mr. Chambers) agreed to-

That leave be given to bring in a Bill for an Act to establish, from the profits and other assets of Can.teens conducted within the Defence Force during the time of war which commenced on the third day of September, One thousand nine hundred and thirty-nine and from other sources, Trust Funds to be administered in the interests of servicemen, exservicemen and their dependants and for other purposes.

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Debate resumed from the 26th March (vide page 1219), on motion by Mr. Dedman -

That the following paper be printed: -

United Nations Conference on Trade and Employment -Report of the First Session of Preparatory Committee.


.- Last night we heard speeches by the Prime Minister (Mr. Chifley), the Leader of the Opposition (Mr. Menzies), the Leader of the Australian Country party (Mr. Fadden) and the honorable member for Balaclava (Mr. White) on the subject of imperial preference. I direct my remarks particularly to the speech of the honorable member for Balaclava, who, as a former Minister for Trade and Customs, showed that he attaches great importance to the maintenance of imperial preference. The statements he made concerning the need for its continuance referred to the present economic situation of Great Britain and the United States of America. The honorable member made an attack on the economic policy of the United States of America, in the course of which he quoted a couplet - apparently of his own compositionto the effect that all trade deals with the United States of America result ultimately in more money finding its way into American banks. However, I point out that in the first year of peace the United States of America has not shown any evidence of acquisitiveness. On the contrary, from the very day that hostilities ceased in the Pacific until to-day the United States of America has made gifts of goods to war-ravaged countries valued at nearly $5,000,000,000, not to mention the very generous loans which it has made to Great Britain,. France, Greece and Poland ; loans which, in many cases, bear no interest for four or five years. In view of that it cannot be suggested that in the first year of peace, at least, the economic leadership assumed by the United States of America has been characterized by greed or irresponsibility.

The Government is consistently accused of desiring to abolish imperial preference. We are always having quoted to us a statement by Dr. Coombs that imperial preference is doomed. When Dr. Coombs made that statement he was not expressing his own desire or that of the Commonwealth Government, he simply gave expression to what will probably be the inevitable policy of the British Government. The United Kingdom Government has received from the United States of America a loan of $3,750,000,000, and is expecting a further loan of $2,500,000,000. These loans to the United Kingdom are, of course, simply credits to enable it to obtain certain goods from the United States of America until its own industries can earn sufficient dividends to replace the capital losses on the smashed industries of Great Britain. Is it to be expected that Great Britain is going to advocate discriminatory tariffs against the United States of America in favour of her own dominions? When Great Britain has sought these loans in order to acquire goods from the United States of America, it would be absurd to place tariff barriers in the way of the importation of those very goods. The mere fact that Great Britain has borrowed from the United States of America indicates that it wants goods from that country. The erection of tariff barriers against their entry would defeat the very purpose for which the loans were raised.

The fact is that Great Britain must act in regard to trade in a manner entirely different from what was its normal policy before the war. The honorable member for Balaclava drew a false comparison between the situation in 1936 and to-day. Great Britain now owes in sterling balances £3,500,000,000. Its sterling debt to India £1,218,000,000, and to Australia £230,000,000. The honorable member for Balaclava said that our prosperity during the war was due to British purchases of our goods, which had resulted in the accumulation of sterling balances in London. If we send goods to Great Britain, and do not get goods in return, but merely credits, how can that add to our prosperity? The fact is that there was no prosperity in Australia during the war. There were fewer consumer goods than normally, with the result that they had to be rationed. We did not get goods from Great Britain in return for our exports of primary produce and raw materials to that country. We could have done what Canada did - and we are always having Canadian policy held up to us as an example to follow. We could have used our sterling credits in London to eliminate British investments in Australia. At the present time, there is not one pennyworth of British investments in Canada. Great Britain paid for Canadian goods during the war by handing over British industries in Canada, and afterwards Canada made gifts to Great Britain. However, Canada established Canadian national industries out of the sterling balances it had accumulated in London. Except for such Canadian industries as are owned in the United States of America, Canada has industrial autonomy, largely as a result of this transaction. The last thing which Great Britain wishes is that Australia should use its sterling balance to take over British investments in Australia. These now amount to £489,000,000 sterling, carrying interest amounting to about £19,800,000 sterling, or approximately £A.25,000,000. I obtained these figures in October of last year in reply to a question which I asked of the Prime Minister, and I assume that they are still reasonably accurate. These investments give Great Britain constant claims on Australian goods in the form of interest, and Great Britain certainly desires that they be left intact, rather than that they be eliminated in settlement of our sterling balance, as was done in the case of Canada’s London balance. I am sure that Great Britain desires that its investments in Australia should remain here as a permanent source of earning. Except for British investments in South America, its investments in Australia are virtually the only significant foreign holdings it has. British investments in South America amount to £S87,000,000, of which £395,000,000 bears no interest. The rest returns interest amounting to £26,000,000 sterling a year, so Great Britain has claims on South American production to that extent. In the case of India and Australia, however, Britain has received goods and services for which it has so far not paid. It would take years of even the most extensive export trading to wipe off the accumulated sterling balances of £3,500,000,000. I am reminded of a saying of the late Lord Keynes -

If you owe a banker a thousand pounds you ure at his mercy. If you owe him a million pounds he is at your mercy.

That is the position so far as India, the United States of America and Australia ure concerned. We have a major interest in the restoration of British industry. So far as India is concerned, at any rate, the restoration of British industry is essential if India’s sterling balance in London is ever to be liquidated.

When we discuss international trade we must be realistic, and ask ourselves bow dominant will Britain be in post-war trade. When war broke out, Britain had 21,000,000 tons of shipping. This was reduced by war losses to 15,000,000 tons. When the war broke out the United States of America had 14,000,000 tons of shipping, but this was increased by war-time building to 56,000,000 tons. Therefore, in the provision of shipping services, the United States of America is dominant now, whereas it was second to Britain before the war. However, Britain is making a great effort to earn overseas credits by the restoration of its shipping services. At the end of 1946, 3,500,000 tons of shipping were being built all over the world, and more than half of this was British. However, while this restoration of British capital is taking place, Britain is forced to live on credit, and in particular on credit issued by the United States of America. This means, in effect, that Britain is forced to live on goods transferred by the United States of America, or, in a lesser degree, Britain can transfer dollar holdings obtained as a result of a loan from the United States of America to other countries which require credits in order to purchase in the United States of America.

The honorable member for Balaclava made a very strong point of the dominance of Britain in Australia’s trade. He said that Britain was our most important customer before the war. That, of course, is perfectly true, but we must recognize that a country which is a debtor to another, as we were a debtor to Great Britain which had £489,000,000 invested in Australia, must send goods to the creditor country in order to pay interest charges on the debt. Therefore, we are at least assured of a market in Great Britain to the value of £A.25,000,000 every year, because that represents the interest on British investments in Australia. It is clear that themere magnitude of our exports to Great Britain is not necessarily a sign of Australian prosperity. If a country’s exports are doing no more than pay interest on its indebtedness, it is merely losing goods for which it receives nogoods in return. Of course, it has had the capital assets for which the money was originally borrowed, and those assets have been used in the development of thecountry. At the same time, the theory that the value of a country’s exports isnecessarily indicative of its wealth, and of prosperity in the country itself, needs some critical examination. Whether we like it or not, the position to-day is that Great Britain is largely dependent on the economic policy of the United States of America. The honorable member for Balaclava made the assertion that the United States of America, in putting forward proposals of free trade, had a sinister purpose. Free trade is the economic theory of the dominant industrial power. In the nineteenth century Great Britain was the dominant industrial power and no country could withstand its competition. British statesmen then believed in free trade, whereas other powers such as Germany which were endeavouring to build up their industries believed in tariffs, and, -in- particular, tariffs against the dominant power, which at that time was Great Britain. To-day, the United States of America is the dominant industrial power. Statements issued periodically by Mr. Cordell Hull and, later, by Mr. Sumner Wells and other American statesmen, show a variation of American thought during the war years, until it has now reached the stage that the United States of America desires post-war free trade.

Dame Enid Lyons:

Mr. Cordell Hull advocated free trade for many years before the war.


– That is true. It is also true that the movement towards American industrial domination began before the war broke out. It was accelerated during the war period. Referring to this American advocacy of free trade, the honorable member for Balaclava suggested that it would be accompanied by a refusal to lower American tariff barriers. What I fear in the post-war world is not that the United .States of America will not accept goods in return; not that that country will put up tariff barriers after it has exported goods and will not want to accept imports; but that its policy of reconstructing the world by way of loan will mean that any exports to the United States of America will simply be payments of interest. That is the danger.

Mr Spender:

– And cause another world depression.


– Yes. The fact that there has been a recognition of this danger in the United States of America is shown by the gifts that that country has made to reconstruct other countries - gifts totalling nearly $5,000,000,000- and also by provisions that interest shall not be immediately payable on loans. I say frankly that I do not believe that the problems of sterling balances in London, or of the British debt to the United States of America, will ever be cleared up. I do not believe that Great Britain will be able to pay to the United States of America $6,000,000,000. I do not believe that Britain will be able to pay to all the holders of sterling credits in London £3,500,000,000. At least, insofar as Britain endeavours to honour those obligations, that country will be forced into a policy of accommodating its creditors, particularly the United States of America. Therefore, to imagine that Great Britain will be a champion of imperial preference at a time when it needs a vast volume of goods from the United States of America, which is the only power which can provide them - hence Britain’s policy of borrowing there - seems to be entirely unreal. It is of no use to approach the problems associated with imperial preference on the 1936 standard, or by stating the benefits which have been derived from the Ottawa Agreement. Nor is it of any use approaching the problem from the patriotic point of view, and saying that we ought to buy from Britain and Britain ought to buy from us because we are British dominions. The only proper approach to the problem to-day is from the point of view of Britain’s economic dependence on the United States of America, which is a fact whether we like it or not, and the grave upsetting of British trade which is indicated by foreign holdings of sterling balances in London. I shall say frankly what 1 believe ought to be our policy towards at least some of these sterling balances. In a previous speech I mentioned that purchases by American troops in Australia amounted to £113,000,000 sterling. In other words, Australia obtained dollars equivalent to £113,000,000 sterling from the American occupation forces. That was transferred during the war to Great Britain, thus enabling Britain to make purchases in the United States of America and Canadian dollar areas. 1 have no doubt that those purchases by Great Britain included war materials and food. Insofar as Great Britain purchased in the dollar area to defend itself it purchased in that area to defend Australia; and therefore I believe that we ought to look at the sterling balances in London and ask to what degree they are war debts, and whether we should adopt a generous attitude and wipe them off as war debts. That, however, is a matter for an all-over settlement. We cannot have unilateral wiping off of war debts ; at least, it would be unwise .for a country to wipe off debts owed to it when it owed debts to other countries. But there is a case within the Empire bloc for a wiping out of such debts. I believe that it ought to be the aim of Australian and other dominion statesmen to look at that problem with a generous mind.

Some Opposition members have suggested that Australia will be gravely and adversely affected by the decline of Great Britain’s purchasing power. I agree with them. At the same time, we have to look at the possibility of new sources of trade. The Minister for External Affairs (Dr. Evatt) pointed out how the value of Australia’s exports to India, which before the war amounted to about £3,000,000 per annum, had risen to £1S,000,000. I have never been satisfied with that statement, because I have not ascertained to what degree India is paying for our goods with goods, and to what degree that country is paying for our goods simply by transferring its big sterling balances in London to Australia. In the latter event, India’s purchases from us would be merely adding to Great Britain’s debt to this, country, as it would be a transference of sterling balances, and would not he real trade; it would merely be the deferment of a debt, or an increased stake in future British production. India developed industrially during the war and has now reached a state of economic independence. Whereas before the war many of India’s exports were to pay interest on investments, to-day those capital assets are held by Indian nationals. Goods exported by India are no longer payments of interest, but a claim on foreign goods. And so, whatever the present position of Indian, payments by some transference of sterling balances in London, there is a possibility of a real exchange of goods in the future. For centuries there has been a sub-standard of living in Asia. Millions lived on the verge of starvation, so that the slightest decline of cereal crops brought them to a state of actual famine and starvation. That was the position of India, but to-day the ability of the Indian people to purchase from other countries is a factor of the greatest importance to Australia. Australia, Argentina, the United States of America, Canada and New Zealand were developed in, the nineteenth century by Europe’s great demand for food associated with Europe’s industrialization. The industrialization of Asia - I refer particularly to India - could have an enormous effect upon all primary producing countries, in particular upon the primary production of Australia and New Zealand. India took from us last year 56,000,000 bushels of wheat; it would have been glad to have obtained eight times that quantity. It would take from us far more than the 12,000 tons of rice we shall have available for export. At present Burma will not export rice to India because the Burmese farmer does not want to be paid in credits; he wants goods in exchange for his products. India not being in a position at the moment to supply them, there has been a hitch in Indian-Burmese trade. If anything like a reasonable standard of living is developed in India, now that it owns its own industries, Indian demands for food will have a great effect upon our export trade. The situation that exists to-day is too fluid for any of us to be dogmatic on these matters. I believe that the United States of America will be forced to abandon its desire to unload its surplus goods on other nations and not to take their goods in exchange. Last year the United States of America exported goods to the value of $14,000,000,000 and imported goods from other countries valued at less than $7,000,000,000. As no country is capable of paying the balance in gold, or in any other way, the United States of America, as a vast producer which must unload its goods on the world’s markets, will be forced to allow an inflow of goods if it desires to retain, such a large volume of world trade. America has become such a vastproducer and exporter that it can no longer expect the balance of trade to be made good by payments in bullion. That is why I believe the high tariff policy which it formerly pursued, and which does not coincide with its interests as a dominant industrial power, will have to be abandoned.


– The defeatism of Government speakers on this matter is due to a fundamental error in their conception of what Empire preference means. They appear to accept as true the statements circulated throughout the world during the 1930’s and since the war, that Empire trade preference will result in the erection of barriers against world trade and increased prices for our exportable products. In order to demonstrate how inaccurate is that conception, I point out that the British consumer, since the growth of Australian imports, has enjoyed lower prices for canned fruits than prevailed prior to the Ottawa Agreement. Under that agreement, Australian canned fruits were given substantial preference in Great Britain in 1932 because the extraordinary expansion of the Australian fruit and canned fruit industries had enabled them to double their production and export surpluses and at the same time almost to halve their costs and bring a measure of prosperity not only to the people in the Australian irrigation areas but also, by making available cheaper food, to the people of Great Britain. The following table shows the decline in average declared value per cwt. of imports on canned fruits preserved in syrup in the years 1930 and 1938 :-

Under empire preference the fruit industry in Australia has been developed and extended, and because of the manner in which it has been organized, cheaper food has been supplied to the British people and better conditions have been enjoyed by those engaged in it. I am very disappointed at the defeatist attitude of the Prime Minister (Mr. Chifley), and of the Minister for Post-war Reconstruction (Mr. Dedman) who is to represent Australia in these negotiations. “We should present a solid front to the world to-day. If the British Army at Dunkirk had meekly laid down its arms and said “ Everything seems to be lost “ as the French Army did, the world would not now be under the control of the democracies but trampled under Hitler’s heel. I remember how in 1930 the pessimists said that nothing could be done to save Empire trade. One has only to look through the newspapers published at that time to see the general note of pessimism. But what happened? Great Britain, India, Australia, South Africa and New Zealand, against the advice of many leading economists, made a stand for Empire preference, and by August, 1932, were responsible for bringing about the greatest triumph in economic unity the Empire has ever achieved. We should reorient our ideas in regard to international trade. The first duty of members of this Parliament, and of our representatives at the International Conference on Trade and Employment, is to secure the integrity of Australian industries and preserve the possibilities of their expansion, and especially to ensure that we will be able to develop new industries. We must accelerate the expansion of our industries in order to provide employment for much larger numbers of people. Our aim should be to increase the population of this country to 20,000,000 within a very short time. We must develop and expand industries in Empire countries, and particularly in Great Britain itself. The first step towards making the world prosperous is to make Australia prosperous. When the Empire has been made prosperous we shall have established a solid core of prosperity for the whole world. Before we start saving the world by grandiose schemes, let us first make sure that we save ourselves. Events of the last 100 years, especially the last 30 years, have proved that if the British peoples fail there is very little prospect of the salvation of the world. What have prominent industrialists in Great Britain to say on this subject? In an article appearing in the issue of the Financial Times of the 19th February, 1947, Mr. W. A. Wells, of the Empire Industries Association, in outlining the views of British industrialists on the subject of preference and tariffs, said -

Mr. Amery has pointed out that a 75 per cent, increase in our total exports means, in present circumstances, 100 per cent, in our exports of manufactures.

The Americans are determined to treble their exports. How is it that they, with their very high wage standard, are able to produce competitive goods at all ? The answer is that they start with the initial advantage of a home market of 130,000,000, protected not only by tariffs but by its very magnitude, their financial strength and their possessionof raw materials.

Great Britain, on the other hand, maintained predominance in the export market during the first quarter of this century without any of these advantages. How, again, was this possible? . . . Throughout that time we -were given a protected market by reason of the Imperial Preference granted us by the dominions, which together with colonial advantages, put us very nearly on the same basis as tire Americans.

It was not quite enough, as events subsequently showed, but when in 1932 we adopted a moderate system of tariffs and extended the preferential basis very considerably, we reached a position in which half our manufactured exports found a home in Empire markets.

Compare our moderate tariff with the American tariff of over 100 per cent. Yet we are told that our tariff will hamper world trade. Mr. Wells continues -

It is this, plus our reputation for quality, which enables us to sell the other half of our manufactured exports in foreign markets at competitive prices.

The United States of America does not export ordinary foodstuffs, or primary products. Regardless of tariffs the great bulk of its exports consist of high-quality goods, such as cloths and specialized machinery. Mr. Wells further stated -

Now the I.T.C. proposals are that preference shall be eliminated, but tariffs merely reduced. If these proposals are put into effect the one thing which holds out to us some hope of achieving our colossal export target vanishes. We are left to compete not only with low cost producing countries but with the United States of America, still retaining its favorable home market basis and able to unload its surplus not only in its customary markets, but in those which we have by toil and enterprise built up in the Empire. Looked at in this light the result of the I.T.C. conference does indeed become literally vital.

That is not an academic statement of the problem, but the viewpoint of practical business men on the spot in Great Britain. Let us apply that test to the statements made on behalf of the Government, and also the report of the International Conference on Trade and Employment at Geneva. What are the fundamental facts of our position? Australia’s development depends first on increased production, and, as the Leader of the Opposition (Mr. Menzies) pointed out last night, not on a static production ; but as the right honorable gentleman also pointed out, it is now proposed that we shall subsidize our primary industries only should we fail to increase production. Our prosperity depends not only on an increase of primary production but also an increased production of manufactures for which we possess the raw materials in abundance and for which we shall have a ready sale in other countries. For example, we should be making hides into leather and boots and wheat into breakfast foods for export. All of these things are many times more valuable exports than the raw products ; and by selling such manufactures we shall increase our overseas credits thus enabling us to pay for imports essential to our well-being. Likewise, we should be exporting soap and plastics rather than tallow and timber. In order to develop new manufactures we shall need to import large quantities of specialized equipment, and we can buy that equip- ment from Great Britain. It is significant that from 1917 to 1927 we imported annually manufactured metals and machinery from Great Britain valued at not less than £25,000,000. That was done in order to build up new industries in this country. The result was that in 1927 more people were employed in factories in Australia than at any time in our history prior to the outbreak of World War LT. That was the result of adopting the policy I have indicated, and of which substantial preference to British goods was a feature. How can Britain maintain its industries ? Great Britain, is a highly industrialized country. It i-a unable to undertake agriculture to any large degree. Consequently, it is obliged to look to other countries for its supplier of food and raw materials. However, it can undoubtedly obtain a tremendous market for specialized equipment in not only Australia, but also China and other countries whose only hope of raising the standards of living of their peoples depends upon economic development. Only by thus making the peoples of those countries contented shall we be able to maintain world peace. Therefore, Great Britain must live as a manufacturing country. It must retain its reputation for thu quality and finish of its manufactures in order to secure high prices for its exports. There is no need to increase duties under the Empire preference scheme. No honorable member on this side of the chamber has suggested that we should increase the existing Empire preferences which, as the Leader of the Opposition (Mr. Menzies) said last night, and I, myself, pointed out a fortnight ago, are akin to the preferences inherent in trade between the various States in America and the Soviet Republics. Empire preferences represent small subsidies which serve to benefit world trade as a whole. If we abandon them we shall probably be obliged to impose higher duties all round. It is obvious that the United Kingdom cannot hope to sell any large proportion of its manufactured goods in the United States of America except, as I have already indicated, certain goods which have a reputation for quality and finish. However, there is a good market in the United States of America for such goods. I recall that when, as Treasurer, I attended a conference of about 30 bankers in New York in 1925, I casually asked those men where they had their clothes made, and each of them informed me that he was wearing a suit made of highquality English cloth. In- America a large section of the people is prepared to pay high prices for English cloth because of its good quality and finish. There is a tremendous number of rich people in the United States of America. Indeed, they can buy more of such goods from Great Britain than our entire population. Therefore, I believe that the United States of America would be well advised to reduce its tariffs without insisting that we abandon our existing preferences, particularly with respect to wool which American factories require in large quantities. On the facts I have given it is clear that we can make advantageous arrangements with other countries without destroying Empire preferences which have been built up as the result of 70 years of trial and hard work. The United States of America is short of supplies of fine wool, but it imposes on our wool a duty of 33 cents, which is equivalent to ls. Id. per lb. That is sheer stupidity when America itself is unable to grow sufficient wool to enable its own clothing industries to work to full capacity. What happens to that duty? It has not been put into full operation for many years, because factories in that country do not really need so high a protection. In winter in America the price of butter rises to 4s. or 5s. per lb., because the cost of production increases in ratio to the increase of production difficulties. If America imported butter from Australia and New Zealand in the winter months, it would reap immense advantages. A commission of inquiry held in 1940, at the instigation of the late President Roosevelt, into nutritional standards in America reported that, notwithstanding that American workers received the highest wages in the world, 50 per cent, of the population was on a subnormal diet because of seasonal shortages of essential foods. The quantity of lamb that we could sell to America to offset the seasonal meat shortage is negligible compared with the tremendous consumption of that country, but it would be of great benefit to both countries. We could supply America with apples and pears in the two or three months of each year when it has none left in its cold stores. They would be the apples and pears that we produce above our own requirements and those of Great Britain and other Empire countries. Thereby considerable benefit would be conferred on the American people and on Australia.

It is not necessary to destroy Empire preferences to improve the state of the world. What America wants from us is a reduction of the duties that protect our secondary industries. Those industries are infants that have to be nursed till they are strong enough to stand on their own feet. If those duties were reduced, America would be able to dump goods here and destroy the industries concerned. Only by reducing those duties could we help America, but why should we give it that advantage? From 1920-21 to 1938-39 the balance of trade between America and Australia was by far in America’s favour. In one year it exported to Australia £29,000,000 worth of goods more than it took from us, the figures being - Exports to Australia, £32,000,000-odd and imports from Australia £3,000,000-odd. In nearly twenty years its balance of trade averaged not less than £16,000,000 a year in its favour. So there is no reason why we should give anything away in order to improve America’s export trade. It is only common sense that America should welcome our goods, because they would help its economy in a thousand ways. I agree with the previous speaker that the conference is being held too soon. The world is too unsettled for it. The conquered countries do not have their own governments; they are under the military rule of their conquerors. They do not know - and neither do we - what industrial development they will be allowed. Not only are they in an unsettled state, but the whole of continental Europe and Great Britain itself are unbalanced. Yet soon we shall send delegates to a conference that proposes to cripple one industry in Australia and foster another, and retard or developcertain industries in Great Britain. How can the conference arrive at decisions. binding the world in trade matters when the peace treaties with Germany and Japan have not even been formulated, let alone signed? The position is utterly ridiculous. Talk about defeatism! If the defeatism that this conference signifies had existed in Great Britain in the days of Dunkirk and the Battle of Britain not we but Germany would have won the war. It is a case of the blind leading the blind. Officials do not know, Ministers do not know, indeed the world does not know what the future holds. The nations should restore their economies on what they do know. I know from my own surgical experience that one cannot without killing the patient operate to repair damage all over the body at the same time. The repair has to be made by degrees. That applies to the world. If we try to perform one operation to remove all the world’s ills simultaneously we shall kill it, not cure it. This is a bad time in which to try a cure-all operation. Even if it were a good time, the instrument to bo used is the bluntest ever used in any operation. The proposed charter of the International Trade and Employment Organization of the United Nations is full of loop-holes, through which an unscrupulous nation could escape its obligations. If, acting in good faith and accepting the good faith of the other signatories to the proposed trade agreement, the British Empire scrapped trade preferences, it could easily be left in the lurch. The republican party in the American Congress has insisted on an escape clause. Under Article 14 of the charter the British Empire is to have breathing space before preferences are eliminated. They give us time! They give this proud Empire, which has saved the liberty and prosperity of the world through the centuries, the right to delay for a period what is tantamount to cutting off the head of one’s first-born son. Article 25 provides -

  1. Except as otherwise provided in this Charter, no prohibition or restriction, other than duties, taxes or other charges, whether made effective through quotas, import licences or other measures, shall be imposed or maintained by any Member on the importation of any product of any other Member or on the exportation or sale for export of any product destined for any other Member.

One great Australian industry is the meat industry. It was of inestimable value to the United Nations during the war. It has been maintained for the last seventeen or eighteen years by means not only of a preferential duty in Great Britain but also by a quota system that ensures that, despite competition from Argentina, we shall sell our exportable surplus to the United Kingdom. Argentina, with its lower costs of production and vast herds and flocks, could otherwise utterly destroy our meat trade with the United Kingdom, and accordingly do tremendous damage to our internal economy. Those concessions from Great Britain resulted from reciprocal preferences between Empire countries. Argentina could sell to starving Europe and we could send our meat to our kith and kin, who know and welcome our brands. Similarly, with butter, we have a preference of 15s. a cwt. on the United Kingdom market. That means that, although Denmark is close to Great Britain and can deliver a continuous supply of butter to it, we are able to under-sell Danish butter in any grocer’s shop by 2d. or 3d. per lb. But the preferential duty itself is not enough. In order to ensure Australian butter of a market in the United Kingdom the British Government also limits to 150,000 tons a year the quantity of butter that may be imported from Denmark, while we are able to supply Britain’s needs. If the proposed charter is to deny us the privilege we now enjoy in that respect we shall be strangled to death. It is futile to tell us that we are merely to undergo a minor operation on a toe if we are to be choked with a cord around our throat. I should like to know if one of the functions of the conference will be to alter the terms of this charter as well as to deal with the question of tariff barriers.

Mr Dedman:

– Yes.


– In that case the Government had better heed some of the advice that honorable members on this side of the chamber have offered. If we are to participate in this scheme, we must ensure, not only that we shall be able to play our part, but also that the other nations will be willing to play theirs. The escape provisions apply not only to America but to all countries.

The possibility of improving our trade with India and the Netherlands East Indies must be borne in mind when considering the proposals. Is it necessary to re-write the tariff policies of all nations to enable us to increase our trade with our neighbours? Figures supplied by the Commonwealth Statistician show that in every year between 1920-21 and 1938-39, inclusive, the Netherlands East Indies sold more goods to Australia than it bought from us. During that period the favorable trade balance of the Netherlands East Indies has varied from £6,362,000 down to £868,000 when a world depression occurred after World War I., and has averaged more than £3,000,000. Is there any reason therefore, why we should make trade concessions to the Netherlands East Indies? Another relatively near neighbour which could be a better customer is India, and I hope that our relations with that country will become closer in the near future. Much was done in this regard by the Eastern Group Supply Council during the war. The operations of that council facilitated the freer exchange of Indian and Australian products urgently required during the war. However, between 1921-22 and 193S-39, with the exception of two years, we have had an adverse balance of trade with India which in some years has been as much as £5,000,000. Nobody will suggest that the condition of this country is such that we should be forced, into an agreement such as this, and called upon to make heavy sacrifices, as if we were the “ bad boy “ of the world. An examination of Australia’s trade with all nations between 1920 and 193S indicates that we have been an ideal trading nation. In that period we have exported £2,552,000,000 worth of goods, and imported goods valued at £2,210,000,000, leaving a balance of exports over imports of more than £342,000,000. Interestpayments overseas amounting to £30,000,000 a year probably meant that an additional £600,000,000 worth of goods were purchased during that period. I am satisfied that those goods included £300,000,000 or £400,000,000 worth of machinery which enabled new industries to be established and paved the way for Australia’s great industrial effort during the .war. Surely that balance of trade is something for which Australia should be given credit by the proposed International Trade and Employment Organization. Certainly we have not done anything to stifle trade with other countries. But what do we find when we examine the goods that we sell overseas under a preferential tariff? Australian and New Zealand butter is sold on the British market at 2d. per lb. less than Danish butter. Similar conditions apply to the sale of Australian canned fruit. That is what one would expect because of the fundamental similarity between our system of Empire preference and the great internal free trade system of the United States of America and Soviet Russia. As the Leader of the Australian Country party (Mr. Fadden) said last night, there is a danger that our entire system of organized marketing will be destroyed because it can only be maintained under certain conditions which apparently are to be removed under the agreement. The result will be of, course, that we shall be unable to help the people of Great Britain in the way they should be helped. Under the British preferential tariff system, there has been little interference with world trade according to figures that I quoted when I spoke last on this matter recently. Not only has inter-Empire trade grown under that system, but also the world trade of each individual member of the Empire has grown because of the increased prosperity that has resulted. Even the consumption of goods not subject to preference has increased amongst Empire countries. Therefore, it is hypocrisy to say that the abandonment of Empire preference is fundamental to the agreement. I hope that the Government will stand firm and insist that tariff reductions in this country shall be effected only as the result of inquiries by the Tariff Board.

I find, too, that certain articles of the charter do not seem to be in line with the articles of the International Agreement. There are two whole chapters - chapters 6 and 7 - dealing with that agreement, and when one examines them closely, one finds that although it is provided that no member nation shall impose restrictions upon the trade of another member, powers are being conferred upon the international committee for that very purpose, namely, to make certain that no nation shall produce more than a certain quantity of a particular product. These things are incongruous. I am in favour of international trade agreements. When I was Minister for Commerce I did everything in my power to secure the adoption of the International Wheat Agreement.


– Order ! The right honorable member’s time has expired.


.- I do not propose to deal at length with this document, because, having scanned its contents I realize that more than a cursory examination would be required before one could understand fully what it entails and what hope for future benefit it offers. I wish to refer, however, to certain matters that have been raised in the course of this debate. The right honorable member for Cowper (Sir Earle Page) apparently does not realize that sound and fury do not improve the health of any’ individual, nor do they increase the logic of the arguments of a member of Parliament. The motion now under discussion is for the printing of a paper. I assume that at a later stage a decision will be made by the Government or by the Parliament, as to whether Australia should become a signatory to the agreement. The question of trade and tariffs has been a live one throughout tha ages. The Leader of the Opposition (Mr. Menzies) last night went back to the seventeenth century. He cited as an instance what was then known as the “ most-favoured-nation clause In 1338, the Hundred Years War between England and France began, and although the principal cause was stated to have been the demand of an English king for the throne of France, another reason was the demand that English merchants should have an “ open door “ into Flanders. For the first time in history, a war then had its origin in trade barriers. Ever since, international disagreements have been accentuated by economic causes, and prominent among them were tariffs and prohibitions upon. the importation of goods. We must consider the reasons for tariffs, and what they mean to the various countries which seek to derive benefits from them.

In a new and developing country like Australia, industries are established and maintained by the existence of tariffs. If, however, fiscal policy leads to a competitive tariff race, we may lose some, if not all, of the benefits arising from tariff policy. Whatever the result may be on this country and on other nations, the need to get together for the purpose of discussing tariffs and trade barriers generally is most urgent. Whether, in the transitional period from war to peace, we should adopt hard and fast articles of agreement, or whether we should discuss means of co-operation and remove fears, is a matter which is debatable. For my part, I believe that frank discussions at this juncture among the nations regarding the future of trade and tariffs will be most valuable. This is a technical, complicated and in some respects, contradictory instrument, which cannot be intelligently discussed after only a limited study. As the Leader of the Opposition rightly said, conditions are laid down and escape clauses are provided which appear on the one hand to offer some benefit, but on the other hand, limit their value. That is an inevitable consequence in matters of this kind at the present stage of the world’s development. That fact is demonstrated in the escape clause to which the leader of the Australian Country party referred last night. The explanation of the presence of the escape clause is that the Senate of the United States of America gave to the Executive a bargaining power in regard to tariffs. Probably, the Parliament of the Commonwealth would not give to the Executive such a power, and would insist upon its being consulted before an agreement was signed. Because the Senate gave to the American Executive such a free hand, and a wide margin in which to operate, it insisted upon the inclusion of i.n escape clause in treaties. However, the American Executive’s power to negotiate on tariff matters is of some value, and if the choice lay between a refusal to negotiate and a limitation of the power of the Executive, we all would choose the second course. As the negotiations proceed, they will demonstrate to American industries that unduly high tariffs do not help the nations, and the escape clause, allied to the bargaining power given to the American Executive, will be infinitely better than a limited power.

During this debate, the Ottawa Agreement, the Empire preferences that it gave and the advantages that it was said to confer upon the British Empire have been extensively discussed. Throughout the years, conflicting views have been expressed as to whether all the benefits that have been claimed for the Ottawa Agreement, have materialized. Figures can be produced, and exports can be cited to indicate that following the adoption of the Ottawa Agreement in 1932, trade among the countries constituting the British Empire expanded considerably. But what we must remember very definitely before we dogmatically assert that that expansion was indicative of the beneficial results of the Ottawa Agreement is that in 1932, the world had passed through the most serious financial and economic depression in history, and was beginning to experience a greater volume of trade. For that reason, at least some of the improvement in Empire trade might have been consequential upon the general improvement of world trade. To another condition, we must also attach some importance. A fairly large proportion of the trade of the United Kingdom is with the other parts of the British Empire, but that country has had, and must retain if it is to maintain its prewar standards, a large volume of trade with foreign countries. Therefore, we should know how much trade Great Britain has lost with other countries as the result of the Ottawa Agreement. The honorable member for Balaclava (Mr. White) suggested that trade between the United Kingdom and the dominions should be developed to maximum capacity. The whole purport of his remarks indicated that the countries constituting the British Empire can isolate themselves virtually from the rest of the world, provided they trade on terms favorable to one another within the British Commonwealth of Nations. To place emphasis on that aspect is dangerous. When tariff barriers are raised against one country, or two countries reach an agreement on trade, the “ most favoured nation “ clause is invoked against them.

Mr Holt:

– Is not that what occurs within the United ‘States of America and within Soviet Russia at present?


– No, that is a complete fallacy. We deceive ourselves if we believe, as the Leader of the Opposition and the right honorable member for Cowper suggested, that the situation is no different between the separate and several countries which constitute the British Empire, and the 48 States of the American Union or the so-called autonomous states of Soviet Russia.

Mr Dedman:

– Yes, that view is completely false.


– I was most surprised to hear the Leader of the Opposition state that there is no difference, in effect, between the components of the British Empire, the 48 States of the American Union and the autonomous States of Soviet Russia.

Mr Holt:

– The Leader of the Opposition said that there was no difference in principle.


– There is such a complete difference in principle that I see no reason to argue the point. The difference is so marked and so clear that the Leader of the Opposition departed from strict logic when he made that statement. It is true that the dominions have great interests in common with the United Kingdom and that we spring from a common stock, but that is equally true of the United States of America. The interests that the United States of America and the United Kingdom have in common are also most marked. We are separate self-governing dominions within the British Commonwealth of Nations bound at the present time by little more than a common loyalty and the kinship that we have with the people of the United Kingdom. Apart from that, in every essential respect, the dominions and the colonies are moving to the point of being complete masters of their own destinies, free to withdraw from the Empire but content to remain members of it because of common interests and for purposes of self-protection. I shall not pursue that subject further. It is fallacious to argue that there is any resemblance between the British Empire and the two other nations which I have mentioned.

Mr Harrison:

– The honorable member will admit that the several States of the United States of America have their own State laws, which give them a certain sovereignty.


– Yes, and so have the several States of the Commonwealth of Australia. Nevertheless, the conditions that apply between those States do not apply between Australia and the United Kingdom. Surely that is not the contention of the honorable member. The States have a measure of sovereignty, they have overriding control in some matters, and they certainly have many things in common, but their relationship is not similar to the relationship between the Dominions and the United Kingdom. The trend of this debate indicates to me that the right honorable member for Cowper and the honorable member /or Balaclava consider that Australia ought to trade solely within the British Empire and, in fact, could do so. I direct their attention to what the then Minister for Trade and Customs, the late Sir Henry Gullett, said in 1932, when introducing the United Kingdom and Australia Trade Agreement Bill in this House -

It is not suggested that it would he possible or wise to attempt to make the British Empire self-contained. There are commodities such as wool and wheat and coal, and many classes of manufactured goods, of which the Empire as a whole baa an output far in excess of its requirements, while in other commodities, as for example oil, its supplies cannot meet its consumption. Moreover, it has never been held by those who believe in preferential trade that we should aim at excluding foreign trade from our markets. International trading, like inter-community trading, is essential to the progress of the world’s civilization.

The Minister pointed out later in his speech that, in his opinion, the agreements entered into would confer substantial benefits upon certain classes of Australian producers, but that little had been done to help wool and wheat-growers because only small proportions of their products went to the United Kingdom market.

Mr Turnbull:

– That was years ago. What is the position to-day?


– That was when the Ottawa Agreement was brought into operation. The then Minister for Trade and Customs pointed out that although the arrangements made at that stage, which have since operated with some variations, were of mutual advantage to Australia and the United Kingdom, they should not be interpreted as representing an attempt by the government of the day to keep Australian trade solely within the confines of the Empire. Other views have been expressed on this subject, and I refer to a letter written by Mr. O. Seppelt, then president of the Associated Chambers of Manufactures of Australia, regarding the Ottawa Agreement. He stated -

Speaking now for the manufacturers of Australia, generally, wc can frankly say that hod any indication been given that Messrs. Bruce and Gullett were going to Ottawa with practically an unlimited fiscal charter, this organization at the outset would have pressed for a clear definition of the powers of the delegation, and would have protested in unmistakeable terms at any suggestion that the Commonwealth Parliament was to be bound to accept automatically the outcome of their deliberations.

He expressed the fear that, in the enactment of laws to give effect to decisions made at the Ottawa conference, Australian industry might be obstructed or even destroyed. Professor Shann, who was an adviser to the Australian delegation at Ottawa, later made the following statement in an address at the University of Western Australia : -

The more Britain complicates her task of liberal financial leadership by jeopardizing her world-trade and her world investments, the more must Australia seek for herself fresh market openings, especially where, as in the East, she has geographic and economic advantages - the more must she watch the process of armament or disarmament abroad.

These quotations show that differences of opinion regarding the benefits of the Ottawa Agreement and the preferential tariffs which resulted therefrom were not confined, as the right honorable member for Darling Downs (Mr. Fadden) suggested, to members of the Labour opposition of that time. The full effects and benefits of the Ottawa Agreement cannot be ascertained by a survey of the results of mutual trading since 1932.

I come now to a consideration of whether some international trading organization ought to be brought into being and whether the effects of such an organization would necessarily be helpful to us. The draft charter is a most complicated document which reflects the fears and doubts of the postwar period. There is urgent need to-day for the bringing together of nations on problems of this nature. There should be long and frank discussions before the principles to be adopted are expressed in definite terms. The United States of America has accepted the financial and economic leadership of the world, not voluntarily, but because that position has been forced upon it. We, therefore, look to America to see what policy that nation has pursued. It is a common practice “now to criticize or condemn the policy of the United States of America. In fact, as the honorable member for Fremantle (Mr. Beazley) pointed out, the United States of America has been extraordinarily generous since the war ended. Even prior to the war, when trade was not flowing freely between the nations and when, for a long time, depression conditions existed, the United States of America played a liberal part in its dealings with other nations. It made generous loans after World War I. and made very generous contributions for food relief in various countries that had been devastated by war. Even during the ten years immediately preceding World War II., the United States of America had a passive, or adverse, balance of imports averaging 100,000,000 dollars annually. This fact was pointed out in a recent issue of the London Economist, which I quoted on another occasion in this House. For six of those years it had a fairly heavy adverse balance; in other words, imports greatly exceeded exports. However, the reverse was the case during the other four years. The average excess of the value of imports over the value of exports for that period was 100,000,000 dollars annually. It is idle to refer to figures of trade between any nation and the United States of America as a means of indicating the trade relations between the two countries. If that were done, Great Britain’s position would appear to be bad in many instances, but good in others. The simple fact that the United Kingdom has the ability to buy goods from one country and pay for them by means of exports to another country is vital to its continued existence, welfare and development. The United States of America did not play a difficult part in the decade preceding World War II., but it made large loans to other nations, and the issue of the London Economist to which I have referred points out that, within that period, American capital was returned to the United States of America at the rate of 137,000,000 dollars a year. The reason was that there was disaster throughout the world, and privately owned capital was scurrying to the comparative safety and the means for making profits which were afforded by the United States of America. In those ten years also, those same high profits, or the escape from high taxes or confiscation, encouraged the export to the United States of America of 113,000,000 dollars annually of refugee money, seeking a haven in that country. Since the war ended, the United States of America has sought, in measures which I believe will sacrifice its large bargaining power, to prevent such things happening again. In addition, it has brought forward this scheme for an international trade organization. Many of the provisions of the charter appear to be good, whilst others seem to impede the proper functioning of the instrument. I endorse the principle that the nations should get together to consider the mutual advantage of building up tariffs one against another, of trade preferences which give rise to mostfavourednation treatment and cancel out some of the benefits originally gained, and the transfer of industry to take advantage of the benefits conferred by such preferences. But generally, in the interests of humanity throughout the world, I believe that some such organization as this is necessary in these post-war years. Nevertheless, I express a doubt as to what this organization involves and as to whether the nations are prepared at the present stage to give to it the power that it will need to enable it to carry out the purposes intended. We ought to accord our support to the principle, study the document that has been presented more closely than has been possible heretofore, and watch developments. If we can have an organization that will devote itself to the purposes I have suggested, it will do good. But we need not, and should not, hurry into becoming a member of this organization until we have seen how world conditions are, and what prospect there is of the development and improvement of this new organization that is sought to be established.

Sitting suspended from 1Z-US to 2.15 p.m.


.- The subject we are discussing is the proposed charter of a United Nations trade and employment organization. This represents the third leg of the tripod designed to support the superstructure of international trade. The other two legs are the Internationa] Monetary Fund and the International Bank for Reconstruction and Development. I have read the proposed charter at some length and I have had difficulty in understanding it. I agree entirely with the statements of former speakers that it is extremely difficult to understand. It is, in fact, a very remarkable document. In the past I have had a great deal to do with international documents, but I have never known one which was so difficult to understand. In its present form the charter is full of contradictions, conditions and qualifications, and is expressed in language so turgid and ambiguous that no ordinary person could hope to understand it. However, two points emerge from the document; the first is that there is to be an end to the system of imperial preference, and secondly, that there are to be no more bilateral’ trade treaties. That means that it is no longer permissible for governments to make exclusive trade agreements, but instead the nations are to indulge in what I term “promiscuous” trade.

I propose to deal in very general fashion with this proposition. I think it would be a waste of time to go into detail; first, because the matter has not yet been finalized, and secondly because I hope considerable modifications will be made in the proposals. Honorable members have discussed at great length the question of tariff preference, but I consider that at the present moment any such discussion in vacuo is premature and out of place. “When I say m vacuo I mean discussing the future of a preferential tariff and the international economic factors connected with it on a basis of mere conjecture. Preference is a matter to which all Australians attach the greatest importance. For fifteen years Empire preference has directed our trade into profitable economic channels and in consequence we have enjoyed prosperity and security. Two questions emerge now which I think we should ask ourselves. The first question is : Do we believe preference is still essential to our economy; is preference still desirable? Secondly: Is it practicable in the world’s economy to-day? With regard to the first one, I do not thinkthere is one honorable member who does not consider that preference is still a vital thing to Australia. I listened with interest - and some disappointment - to the speech of the honorable member for Fremantle (Mr. Beazley). From the standpoint of imperial preference, I thought his speech a somewhat gloomy one, and when he had concluded I was left in doubt as to whether he believed that preference was really necessary for us. In this debate so far, no speaker from either side of the House has failed to affirm his faith in preference, and that belief is something more than a mere economic theory. As the Leader of the Opposition (Mr. Menzies) pointed out yesterday, participation in the proposed discussions may involve our concurrence in the abolition of the whole system of preference and the abandonment of the present economic organization of the British Empire. The strength of the Empire is derived, not from ties of blood and kindred political organizations alone, but, to a considerable degree, from imperial economic relations. Therefore, I feel that if the system of Empire preference is to be abolished it is a very bad omen for the Empire as it exists to-day. Preference began 40 years ago with Mr. Joseph Chamberlain, and came into force because of the conditions brought about by the industrialization of the world. Turill walls were erected by various countries many years ago which canalised trade between the industrialized countries of the world. At that time Mr.

Chamberlain said : “ We must keep business within the firm and that is the principle which has actuated imperial relations ever since. The next significant event was in 1929, when, for the first time in recent history, there came into force the doctrine of national selfsufficiency. Most of the great nations of the world, Germany, Italy and the United States of America, zealously adopted this doctrine. There were profound reactions upon not only the economic, but also the strategical, organization of the world. The United States of America introduced the excessively high Hawley-Smoot tariff, which practically excluded the entry of any imports. In this atmosphere of national self-sufficiency the Ottawa Agreement of 1932 came into existence, when Mr. Neville Chamberlain slipped this keystone into the arch which had been erected by his kinsman, Mr. Joseph Chamberlain, some twenty years before. The position which now confronts Australia is whether the mutually beneficial provisions of that agreement should continue to operate in the post-war era. Can that system of tariff discrimination be reconciled with a comprehensive economic structure designed to secure world stability?

The arguments used in support of the proposals for increasing international trade are that trade barriers tend to reduce the total volume of trade, that high tariff barriers greatly restrict imports, and that independent currency systems have the same effect as discriminatory tariffs because they interfere with the normal exchange of goods. I believe that those arguments are based on an elemental fallacy. A reduction of international trade depends primarily, not on a reduction of export trade, but of total trade, both internal and external. The intervention of a government to insulate national energies may be essential to the expansion of internal trade. As an example of that I cite the record of the United States of America, which from being purely an agricultural country, has developed into the greatest industrial country in the world, merely by insulating its nascent industries from the competition of highly industrialized countries which, in many instances, were working on lower price ranges. By means of a tariff wall, the United States of America made itself a great industrial country, and now contributes a tremendous amount to the volume of international trade. Germany became an industrial country towards the end of last century. I mean that it became industrialized on a large scale because, of course, Germany always had its industries. However, it was only towards the closing years of last century that Germany made its influence felt on world trade. How did this happen? By the same process as was invoked in the United States of America, namely, the raising of tariff barriers, and the development of industries behind them. Having thus developed its industries, Germany became an important market for goods from abroad, as well as a contributor to the general pool of the world’s goods. Russia has developed its industries in the same way. Australia also imposed protective tariffs behind which its industries were developed, and we have become an importer of goods from abroad in exchange for the goods which we export. Thus, protective measures have resulted, not only in strengthening the industries of the countries which resorted to them, but they have also assisted materially in the expansion of world trade as a whole.

That is true also of bilateral trade agreements. These are mutual in their beneficial effect, increasing the trade and prosperity of both the signatories. If we are to do away with such agreements, as seems almost certain under the proposed charter, the situation must become worse for the countries directly affected, and also for world trade generally.

The world economic depression was not caused by world tariffs in general. It was caused by the high American tariff only, and the inability of other countries to maintain balances for payment, and this resulted in the withering of world trade. But the restrictions in general were not the cause of the depression; they were actually the effect of it. The depression arose out of the restrictions imposed by the United States of America, and some other countries. This undermined world confidence, with the result that no country was prepared to embark on large-scale expansion of trade overseas, so that the depression spread rapidly over the whole world.

Into this situation, in 1932, came the Ottawa Agreement. I should like here to review them and their effects. In the first place, as I think everybody agrees, so far as Australian and Empire trade is concerned, Britain holds the key position. Free trade was adopted by Great Britain during last century after that country had become pre-eminent as an industrial power, which it remained for the greater part of the century. However, when Britain met the competition of nations which became industrialized in the latter part of the century, that competition destroyed the trade pre-eminence of Britain. In 1S70, British manufactures constituted two-thirds of the world’s export trade. By 1913 this proportion had been reduced to one-third, and in 1931 to one-fifth. In 1913, Britain’s adverse visible balance was £345,000,000, and its net credit £194,000,000. In 1931, the adverse balance was £100,000,000 and, as we know, that adverse balance has increased enormously since the outbreak of the recent war. It has, therefore, become necessary for Britain to reconsider the policy which resulted in the Ottawa Agreements. Those agreements, working through moderate tariffs, produced a condition of great prosperity for Empire countries, compared with many other countries. The figures relating to the Ottawa Agreements are significant, and therefore I quote them -

Of those increases, £65,000,000 worth came from British Empire countries, thus illustrating the expansionist effects of tariffs and agreements. Britain’s economic position to-day is most serious. The nation’s income from overseas investments has been reduced from £203,000,000 to £97,000,000 per annum as the result of sales of foreign investments amounting to £1,118,000,000. Other losses amounting to £150,000,000 per annum have been incurred in connexion with revenue from shipping insurance, &c. In addition, as the result of the war, British dominions and other nations have credits in the British Isles amounting to £3,000,000,000. Consequently, the British Government has to make up that considerable loss of income from abroad. In December, 1946, Sir Stafford Cripps set out the position clearly when he said that, in order to make up losses on imports from abroad, Britain had to increase the volume of its pre-war export trade by 175 per cent. Before the war a considerable proportion of Britain’s revenue from exports came from coal and shipping services. Since then, the revenue from coal has disappeared, and the amount received from shipping services has been very considerably reduced. To-day, Britain is living on loan, and must increase its revenue from abroad. Figures in connexion with the loan to Britain by the United States of America are significant. They show that 50 per cent, of Britain’s imports come from the United States of America, whereas only 14 per cent, of Britain’s exports go to that country. The difference has to be made up in some way. The rest of Britain’s exports are piling up in the form of unusable currencies, or by paying a portion of sterling credits, or by buying from other sources.

Britain’s competitive position in the world to-day is far below what it was before the war. The cost of production is high; there is a high standard of living ; high wages are the rule, and taxes, particularly in respect of overhead expenses, are heavy. Taken together, these things represent a veiled excise on exports.

I have dealt with Britain’s position in the world to-day because of the key position which the Old Country holds in relation to Australia and the rest of the Empire. Britain is still Australia’s best market, and therefore our prosperity is still bound up with the prosperity of the Motherland. In considering imperial preference we must give thought to Britain’s reactions to demands made upon it. That brings me to the second question which I asked earlier, namely, to what degree is a continuance of Empire preference practicable to-day? I submit that we must fight hard to maintain that preference, not only because of what it means to Australia, but also because of Britain’s position. We must take Britain’s economic position into account. Recently, the honorable member for Reid (Mr. Lang) referred to the White Australia policy. We all agree that it is a good policy, but it is one thing to say that, and quite a different thing to enforce it. Australia could not insist on the White Australia policy if the rest of the world said otherwise. Our position in regard to imperial preference is somewhat analagous. All honorable members believe in Empire preference, but how can we enforce it if the rest of the Empire, particularly Britain, is against it?

I did not rise to make a pessimistic speech. I believe that it is possible to marry the system of preference to a wide expansion of world trade. The two things are not incompatible. If the British Empire prospers, surely the trade of the world generally will prosper, because of the position in the world of Britain and its dominions. I believe that the maintenance of preference will not prevent the success of the international trade organization, if we hold to our belief that trade, both internal and external, matters more than tariffs. If we press those views on the representatives of other nations at the conference, I believe that they will agree that there is a great deal of right, in addition to common sense, in them.

So far, we have not had any clear expression of opinion from Ministers, or, indeed, from Government “ backbenchers “ on this subject. They could, at least, say that the maintenance of Empire preference is of great importance to Australia and the Empire as a whole, and need not interfere with any new basis of international trade. I should like to hear a definite statement that the Government is determined to do everything possible to ensure that Empire preference shall be continued. In particular, I. desire to know what instructions, if any,, the Government has issued to its delegates. I hope that those instructions were clear and unequivocal.


.-Honorable members will admit that even before this report was tabled I had shown a keen interest in what I thought was going on behind the back of the Parliament. I regret, Mr. Speaker, that I was not successful in catching your eye earlier and that I am rather late in entering the debate. The report which has been tabled proves that this Parliament is being humbugged by the Government. When forced to table the document, the Minister for Post-war Reconstruction (Mr. Dedman) tried to make the Parliament believe that the report was innocuous, but on examination it proves to be a most damning indictment of the Government, and a clear revelation of the way in which Australia is being sold out. Commitments have already been made, and more commitments are about to be made. This Parliament has been totally ignored by the Minister and treated with contempt by these doctrinaire bureaucrats. Dr. Coombs was a member of the Preparatory Committee which drafted what is known as the charter of the International Trade and Employment Organization. Not only was he chairman of that committee, but he also voted for the resolution. He was also chairman of the Commercial Policy Committee and he agreed with the procedure for the wholesale reduction of our tariff and the abolition of Empire preference. What this Parliament should know is, who authorized him to do these things; who told him he should do these things in the name of Australia? In his reply the Minister might state whether he instructed Dr. Coombs to do them and whether the Cabinet was consulted at any stage prior to the return of Dr. Coombs to Australia, or whether only certain selected members of the Cabinet were consulted in the matter. Why is it that the Minister for Trade and Customs (Senator Courtice) said recently that he, a Cabinet Minister, was totally ignorant of the contents of the document now before the House? Dr. Coombs was chairman of the very committee that made these most devastating recommendations. It was his committee that drafted the clause providing for the multi-lateral trade treaties, which was responsible for the vital clause of the draft agreement contained in articles 24, 25 and 26. He was also chairman of the committee that proposed the interim tariff agreement. For whom was he acting ? Judging by results, he certainly was not acting for Australia. We should know these things, and I again ask, who gave him the instructions? The Preparatory Committee would not wait for the conference to assemble before setting to work on the lowering of tariffs and the abolition of preferences. When he tabled this report which we are now debating, the Minister for Post-war Reconstruction evaded all reference to immediate obligations. In not one sentence of his speech can I find a reference to them. Nor did he mention the allimportant annexure 10 setting out the procedure for an interim tariff agreement which was already in motion. Only later did the honorable gentleman, in reply to a question by me, admit that certain demands had already been served on Australia by other countries.

Mr Dedman:

– They were publicized in the press before the honorable member asked his question.


– The Minister will, I hope, answer these things. The honorable gentleman has not yet disclosed the new rates of duties that those countries are asking this Government to fix on imports. He should inform the Parliament just what they are. Dr. Coombs has pledged himself to take a list of commitments to Geneva. The Minister says that the list is not yet completed. Yet the Minister for Trade and Customs is so oblivious to everything that is happening in his department that he knows nothing at all about the matter. Has the Govern ment completely capitulated to Dr. Coombs? Has Dr. Coombs been given plenary powers? If the Minister believes that the protection of Australian industries will be. undermined at Geneva - and he has given us to understand he does - why does he refuse to lay upon the table of this House the demands made on Australia by other countries? If these documents were tabled every industry in Australia would know exactly where it stood. Instead, the Minister is placing responsibility for the survival of the- industries of Australia on the industries themselves. The Parliament and the Australian industries are completely in the dark. But there is more to it than the mere tabling of a list of concessions. The move made by Dr. Coombs to commit a country like Australia to a draft charter, before it was submitted to or accepted by the full conference, was a clever one. On page 49 of the report dealing with these negotiations, will be found the undertaking by members of the Preparatory Committee to adopt the principles of the draft charter forthwith. The draft charter is not supposed to be something that can be altered. Fine care was taken to commit each country to adopt it when it came before the full conference. Dunnar the current negotiations for an interim tariff agreement, the following so-called “ self-explanatory rules “ in article 24 are to be followed : - (I.) (») Prior international commitments shall not be permitted to stand in the way of negotiations with respect to tariff preferences, it being understood that action resulting from such negotiations shall not require the modification of existing international obligations, except by agreement between the contracting parties or, failing that, by termination of such obligations in accordance with their terms.

  1. All negotiated reductions in mostfavourednation import tariffs shall operate automatically to reduce or eliminate margins of preference.

Who authorized Dr. Coombs to commit Australia to those two clauses? Those clauses are there to be adopted. Surely, a representative of the Parliament and the people has a right to ask who authorized Dr. Coombs to commit Australia to them?

Mr Dedman:

– The answer is that Australia is not committed.


– If the Minister for Postwar Reconstruction reads this document he will find what I have said to be true; and 1 have a perfect right to put my views before the Parliament and the country and to ask the Minister to answer those questions if he can. There can be no dispute about the existence of those clauses. I do not know, and I am not aware that any other honorable member knows, what authority Dr. Coombs had to put them there. So, we ask whether the Government was consulted about them. If it was, why did not the Minister direct the attention of the Parliament to these commitments when he tabled the paper? If the Government knew of their existence why did not the Minister, when tabling the paper, advise the Parliament that Australia was so committed through Dr. Coombs on the authority of the Government ?

We shall not have to wait until next September for the abolition of preferences and the withdrawal of protection. That is taking place now. The Minister says that the new tariff will be submitted to this Parliament in due course. Those are his own words. My comment on that is. “ Yes, perhaps ; but after Geneva, not before Geneva “. Dr. Coombs and his satellites will draft the new tariff. It will be submitted to the representatives of the other nations. Then, what will happen? The Minister, some time later, will come to this Parliament and tell us, in the glib old phrase, that we have international commitments. It will be the same old story as we heard with respect to Bretton Woods. Or, we shall be told that we cannot afford to stay out. That is now the cry. One could almost hear the Prime Minister (Mr. Chifley) voicing it in his speech last evening: “We cannot stay out. Must we not go in?” I can hear the same things being said after the damage is done. And that will be only one of the reasons that will be given to us - “ We cannot stay out ; we have international commitments “. Those international commitments will wreck our Australian industries, and will rob us of our economic sovereignty. Just as the “Financial Agreement robbed the Australian States of their sovereign rights, the International Trade Agreement, in its turn, will rob the Commonwealth of Australia of its rights. No longer shall we have th6 right to determine how we can best protect our own industries and our national economy. No longer shall we have the right to enter into reciprocal arrangements with Great Britain or the other dominions for the sale of our products, or in respect of any other matter. I wonder how many honorable members have carefully read article 30, or, if they have read it, how many have studied it. That article provides for the elimination of export subsidies. Section 2 reads - . . Member shall grant, directly or indirectly, any subsidy on the exportation of any product or establish or maintain any other system, which results in the sale of such product for export at a price lower than the comparable price charged for the like product to buyers in the domestic market. . . .

How is the Government going to explain that proviso to the dairy-farmers of Australia? Did Dr. Coombs have any authority to sacrifice the Australian butter industry? How is the Government going to honour the sugar agreement? Will the Minister for Trade and Customs explain to his constituents in Queensland how he is going to protect them in the future? The Government asked the electors of Australia at the recent referendum to give it full power to control themarketing of primary products; and on the hustings its spokesmen glibly claimed that that matter was of the highest importance. Now it is handing over all its powers to an international body. If the Government fixes a price for butter lower than the export price, it will violate the charter. If it fixes a price for sugar lower than the black-labour market price of sugar from Fiji or Cuba, it will repudiate an international commitment. If the other countries are not satisfied with the tariff concessions that we are prepared to give, they will have the right to haul us before the International Trade Organization. It will be supreme. This Parliament will be only the rubber stamp.

Under the Ottawa Agreement, the Australian Tariff Board had the final say. Under this charter, the Australian Tariff Board will be defunct. The International Trade Organization will not be interested in protecting our industries. Its job is to hand over the world’s trade to the big nations. Under the Ottawa Agreement, the Tariff Board conducted an inquiry, took evidence, and then made its recommendations in the light of the protection required to safeguard the Australian industry against unfair competition. Under the Charter, the International Trade Organization will he supreme. The Minister says there are safeguards. But against international pressure, those safeguards are worthless. There are 100,000 words in this document. Every clause of the Charter should be examined minutely by this- Parliament. Yet the Government treats the subject as one that can wait until after Geneva. It appears to have a simple, blind faith in Dr. Coombs. Mow is the time when this Parliament -should give proper consideration to the agreement. After the Geneva Conference will be too late. This Parliament should decide what concessions are to be offered -at Geneva. Is not this Parliament entitled to know? It represents the Australian people and is entitled to know. This Parliament should determine the matter of imperial preference. If the Government wants to water imperial preference let it stand up before the Parliament and the people and give its reasons.

There are many other vital principles bound up in this elephantine document. Such matters as quantitative restrictions, abolition of quotas, and the co-ordination of the International Trade Organization with Bretton “Woods, as well as the rules governing State-trading enterprises such as aviation and telecommunications, about which the Commonwealth Government ought to be particularly concerned, should all be considered in detail. It is futile for the Minister to plead that we are bound by Article 7 of the Mutual Aid Agreement and the Atlantic Charter to sign any deal put before us. The Minister would have us believe that we were blackmailed into this deal at the time of Pearl Harbour. He says that only for the Mutual Aid Agreement the Japanese would have been here. He then suggests that had we refused to accept Article 7 there would have been no lend-lease. That is indeed putting a low assessment upon the intelligence of the American Government and the intelligence and straightforwardness of the American people. It is, in fact, a sordid interpretation of the appeal made by the Curtin Government to President Roosevelt. But the American

Government of to-day is not the same as the American Government that was in office when the last meeting of this committee was held, when this document was drafted. The present Congress has very different ideas on tariffs from those of the previous Congress. Already President Truman has been compelled to instruct the American delegation to seek an escape .clause in. the agreement. The American Congress is demanding the right to abrogate any low tariff that might jeopardize American industry. But, apparently, this Government believes that what is good enough for the American Congress is repudiation if sought by this Parliament. No Australian industry, primary or secondary, will be safe while the Government is prepared to jump through the hoops every time the international ring-master cracks the whip! This is just another phase in the detailed plan to strip us of our economic defences and hand us over to the international money cartel. If the Government yields, then it will have lost the peace, just as surely as the war was won. It is for this Parliament, irrespective of party, to make a stand. If it does not it will only be humbugged. In the interests of Australia, it must not be humbugged.

New England

– I agree with the Leader of the Opposition (Mr. Menzies) that this is one of the most important documents ever placed before the Commonwealth Parliament. It is lamentable that the Government has produced it on the eve of the Easter recess and thereby curtailed debate. Last’ night we heard two of the most interesting and most analytical speeches that have been delivered in this House for some time. I refer to those of the Leader of the Opposition and the Leader of the Australian Country party (Mr. Fadden). The anti-climax came with the speech of the Prime Minister (Mr. Chifley), who said that Australia would not be committed and that nothing decisive would be done. He then went on at great length to demonstrate that we are bound inevitably to sacrifice our imperial preference. That, as the honorable member for Reid (Mr. Lang) has pointed out, will mean selling this country “ down the river “. Whilst it may be true that anything that is done by our delegation at Geneva will be subject to ratification by this Parliament, the fact remains that the economic advisers of the Government attending the conference will commit us by default. We shall be forced to agree to what is done there, whereas had we protested at an early stage, Australia might have been saved from the position in which it will be placed through the weakness of this Government.

I was astounded to hear a Labour Prime Minister enunciate in this House the doctrine of freetrade. What a reversal of the form of past stalwarts of the Labour movement who built up Australian industries behind a protective tariff barrier ! I have never been enamoured of this allegedly infallible doctrine of freetrade as a solution of all the world’s economic problems and I have never believed that any country that has not reached a high stage of industrial development can afford the luxury of freetrade. Will any honorable member argue that the United States of America would ever have become the great industrial nation that it is to-day had it not won its freedom in 1776 in the War of American Independence? Without that freedom, the United States of America would have been in very much the same position as Canada and Australia are in to-day. It would never have developed industrially, if it had stuck to its old mother’s apron strings. I remember, during the first World War, reading a book entitled the National Si/stem of Political Economy by Friedrich Leist upon whose arguments the protective systems of almost all nations have been founded. Last night the Prime Minister spoke of this country entering a new economic era. Maybe that is so, and maybe the world has problems to solve that it has not had to face in the past; but there are certain economic laws just as there are certain physical laws, that are immutable in any economic era, and must be obeyed. One of these is that no country which is undeveloped industrially has a hope of building up its industries unless it takes protective measures - measures determined by itself and not by some external authority- and preserves its own sovereign right to safeguard its economy and fiscal future. But we know, and the people of Australia are beginning to learn, that this Government is not guided by practical considerations of life, but by the opinions of economists such as Dr. Coombs and Mr. Melville, who are the invisible rulers of this country. What has been the rise of Dr. Coombs in the public life of this country? No rocket missile ever rose so speedily as Dr. Coombs has done, and nobody has had more influence on the economic programme of this Government than this economist. This Government is sacrificing the fiscal policy of the nation simply because it has heeded the advice of economists who have said so often that if our trade is to be developed and Australia is to progress, there must be a lowering of tariff barriers. Let there be universal free-trade, they say, and we shall enjoy the golden age of which the Prime Minister spoke so much during the last election campaign, but, about which he has been most silent ever since. As a classical example of what this type of treaty can do I remind honorable, members of the results of the Methuen Treaty made between Great Britain and Portugal in the seventeenth century. Under that treaty, port wine was allowed to enter England free of duty provided that British cotton goods were allowed to enter Portugal free of duty. The result was, that the British people absorbed a quantity of wine which was a little heavier than the French product, and in Portugal fourteen cotton factories closed down and never re-opened. If Australia becomes a signatory to this agreement, Australian factories will be closed and people will be thrown out of work. The internal economy of this country will be at the mercy of an international body sitting at Geneva or in some other city. We should never have had anything to do with this proposal. It is the Government’s fault that even” the present stage of negotiations has been reached. The Government has committed this country to the degree that technical officers are being sent to Geneva to confer with the representatives of other countries. What the honorable member for Reid has said is quite true; Australia will be definitely committed, and this Parliament will be presented with a fait accompli. We shall be asked to swallow the medicine whether we like it or not.

One provision in the charter states that no nation may place an embargo upon imports to protect its international funds, except with the consent of . this international body. Ohe of the most distinguished members of this House is the right honorable member for Yarra (Mr. Scullin). When he was Prime Minister in 1929-31, he was obliged to take drastic action for the purpose of conserving our overseas funds. Repeatedly, the newspapers published lengthy schedules of prohibited imports, and the right honorable gentleman had a strenuous fight to preserve Australia’s external solvency. What kind of a position would the right honorable gentleman have been in if the proposed agreement had been in operation, and he had been compelled to send a cable to the international authority, saying, “ I must prohibit certain imports, because our overseas funds are rapidly disappearing “. While he was awaiting the reply to the cable, the whole of Australia’s overseas funds would have been dissipated as rapidly as a pot of dripping would melt at the equator. Why should the people of a sovereign country be at the mercy of an international organization?

Mr Dedman:

– What became of the dripping?


– At least, it did not go to Great Britain. The policy of this Government appears to be not to allow any Australian food to be sent to the United Kingdom.

The Government has warned us that we shall be compelled to curtail our purchases in the dollar area unless we sign this agreement. Our refusal to become a party to this agreement might impose a little hardship on some of us, particularly if we are compelled to reduce our purchases in the dollar area. But the best way in which to make the United States of America see reason is not to purchase its goods until America is prepared to accord to Australian imports the treatment that we extend to American imports. The London Economist pointed out recently that while Great Britain was importing about 27,000,000 dollars worth of films from the United States of America, the United Kingdom had the greatest difficulty in securing the admission of 6,000,000 dollars worth of British films into America. Is that an instance of reciprocity? Would it not be a salutary lesson to the United States of America if we said : “ We are sorry, but we are a poor people. Our poverty has been caused by our efforts in saving humanity. We propose to preserve the British Empire and Empire preferences, and we shall not be able to do business with you until you are prepared to deal with us on a reciprocal basis. We shall allow your goods on to our markets if you will allow our goods on to your markets “. If that were done, the world would be much better off than it will be as the result of laying down this rigid code. I warn the Government that the agreement is capable of wrecking our economy. Its provisions were shaped not by practical men of trade and commerce, who are the graduates of the university of experience, but by theorists who gained- their experience from libraries, and who do not know the practical difficulties which arise almost hourly in the world of commerce.

The honorable member for Reid referred to the escape clause which the United States of America will insist upon including in any agreement to which it is a party. The policy of America appears to be “ Heads I win, tails you lose “ This statement is borne out by a recent declaration of Mr. Winthrop Brown, who is chief of the commercial policy division of the American State Department -

In future we plan to include in every trade agreement a clause which will permit us to withdraw or modify any concession if, as the result of unforseen circumstances, it results in such an increased volume of imports as to cause or threaten serious injury to domestic (i.e. American) producers.

Early this month, the President of the United States of America, President Truman, issued an executive order covering the future pattern of trade agreements. According to an article in the Economist -

Government officials in Washington maintain that this Bipartisan Agreement secures the Cordell Hull tariff policy from any major reversal, and Republican party spokesmen are eloquent on the concessions made to the Minority party in Congress.

On the 8th March last, the Economist stated -

Overseas observers, however, will be rather more suspicious. The United States now reserves to itself the right to withdraw all concessions wherever imports “ threaten “ domestic producers, and the Tariff Commission is empowered to exercise a constant patrol against imports … If all nations take this pattern at the Geneva conference next mouth (and the United States has less justification than any other nation) the world trade climate is likely to continue bleak and unpromising.

The United States of America would probably not detrimentally affect its economy in any way if it were to preach and adopt the doctrines of Adam Smith, and have freedom of trade with other countries. However, the United States of America desires to make its position even more secure than that. “Whilst preaching the reduction of tariffs and the abolition of Empire preferences, it desires to include in international trade agreements an escape clause. The result will be that if any section of American producers is adversely affected by imports, the United States of America will have the right to abandon the reduced tariffs. The whole position is hopeless, and no good purpose will be served by Australia’s presence at the forthcoming conference. I sincerely hope that, as the result of Australia being represented at this conference, and the secretive action of the Government in not, baking the Parliament into its confidence, we shall not find ourselves in the position of being compelled to sign on the dotted line. I hope that we shall not be told that 22 other nations have signed the agreement and if we do not we shall be outcasts in world trade and commerce. That, will be a desperate position.

In his speech last night, the Prime Minister spoke of the woes of Great Britain, and emphasized the lack of food and raw materials. I ask : Was this great Empire so devoid of food and raw materials that we could not have made an imperial loan to Great Britain in the same way as the United States of America has done? Is it conceivable that the children would have demanded from the Mother Country such onerous terms as the United States of America has demanded? Great Britain will be hamstrung by the loan. Although the actual interest rate is low, the conditions attaching to the loan are the harshest that have ever been inflicted on one sovereign country by another. Last night, the Prime Minister warned that we must be prepared to abandon imperial preferences, because Great Britain would desire us to do so. That is a poor argument. It reveals a defeatist attitude. Bather should Australia have endeavoured to rally the whole of the Empire to the support of Great Britain. Australia should have said: “We shall stand firm with the United Kingdom. We shall retain Empire preferences. We shall purchase British goods “. Had we done so, other parts of the Empire would have responded to the call as they have rallied for hundreds of years. Instead, Australia has caved in weakly. I forecast that this Government will not occupy the treasury bench much longer.


.- The speeches which have been made to date have fully justified the action of the Government in initiating this debate. Honorable members generally have agreed that some points of this very complicated and elephantine document require elucidation. Whilst the Leader of the Opposition (Mr. Menzies), the Leader of the Australian Country party (Mr. Fadden) and other speakers on this side of the House made a real contribution by examining in a detailed manner certain sections of the charter, the disappointing feature of the debate to me has been the speech of the Minister for Post-war Reconstruction (Mr. Dedman), and the most doleful and uninspiring speech of the Prime Minister (Mr. Chifley). We were entitled to hear something more from the Government. No other Ministers have contributed to the debate, although some “ back-benchers “ have made what, from their .point of view, were useful contributions. We on this .:id e of the House, and Australians generally, are disturbed about the present situation. We disapprove of the manner in which the negotiations have been conducted. Not one practical man represented Australia at the conference. As the honorable member for New England (Mr. Abbott) and the honorable member for Reid (Mr. Lang) have said, the leader of the delegation was Dr. Coombs, who, although he may have great academic’ qualifications; has no practical knowledge at all of the trade matters that were discussed. This state of affairs is in marked contrast with the conditions under which discussions were held at Ottawa in 1932. Australia was represented on that occasion .by one of the best qualified delegations’ ever to leave our shores. It was composed of Ministers of the Crown, officials of various departments, and advisory representatives of all industries that were likely to be affected by the agreement. The Ottawa Agreement was the product of the experience of practical men. The original discussions relating to the present plan took place in a totally different atmosphere. What reason have we for confidence about the outcome of the discussions that will take place at Geneva? The officials who represented Australia at the conference in America will again do so at the Geneva conference. I admit that advisers representing various industries will be present at Geneva, but, as far as I know, they have not yet left Australia. It is extraordinary that, during the respite between the discussions in America and those which will take place in Geneva, the Government did not seize the opportunity to bring together these practical advisers and the government officials so as to consider the general principles for which the Government stands and for which the delegation will be asked to fight at the conference. As far as I know, the government representatives are already at Geneva whereas the practical men, whose advice should be of considerable value, have not yet left Australia. I have read in the newspapers that, although there was a conference of Empire representatives in Great Britain, they were unable to agree on the general principles that should be submitted on behalf of the Empire at Geneva. This is a tragic situation. The” difficulties confronting the Empire are more likely to be surmounted if we present a united front than if representatives of -the member nations attend separately as fragments of a rapidly liquidating empire. Those terms do not express my own belief as to the future of the Empire, but I have no doubt that they express the view that will be taken by other countries.

We are- justified in entertaining doubts regarding the Government’s policy at this conference because we have not been told anything other than that it proposes to fight for Empire preference. We do not know what other principles it intends to espouse. The past record of the Labour party gives us cause for alarm in this respect. I was a member of this House when the United Kingdom and Australia Trade Agreement Bill, which ratified the Ottawa Agreement, was introduced in 1932, and I have a vivid recollection of the attitude then adopted towards the agreement by the Labour party, which was then in opposition. The Opposition had little good to say about the Ottawa Agreement. Although I have the greatest respect for the right honorable member for Yarra (Mr. Scullin), his attitude as the Leader of the Opposition on that occasion gives cause for concern regarding the attitude of the government cn this occasion. In debating the United Kingdom and Australia Trade Agreement Bill 1932j the right honorable gentleman engaged in a long discourse, as the importance of the measure deserved, in which he made a number of significant comments, which are reported in Hansard, volume 136, at page 184-7. He stated -

A most objectionable feature of this agreement is article 12, which prevents the Australian Parliament from imposing new duties or increasing existing duties on United Kingdom goods without the recommendation of the la riff Board.

That shewed that the Labour party, even at that stage”, in its history, was prepared to set up -boards and other authorities to act merely as rubber stamps. It was not prepared to accept their recommendations. The implication of the right honorable member’s speech was that, under the Ottawa Agreement, first, the secondary industries of Australia would be badly damaged, and secondly, the primary industries would not secure the advantage which was expected to result from the agreement. That is my interpretation. I hope that I have not done the right honorable gentleman a wrong. The Opposition of that day held such strong views about the Ottawa Agreement that the right honorable gentleman, with the full support of his followers, moved the following amendment to the bill : -

That the bill be withdrawn and negotiations opened for a new agreement embodying concessions to Australian producers and preferences to Great Britain ion specified items without endangering our protective policy or depriving Parliament qf its power to give effect to the will of the people on general tariff policy.

That represented the policy of the Labour party on that occasion.

Mr Scullin:

– A good policy, too.


– I do not question its merits. The fact is that that was the Labour party’s policy. In consonance with that policy> the Labour party of the day strongly resisted the Ottawa Agreement. We all know that during a very difficult period in the history of this country that agreement gave a definite fillip to both primary and secondary industries in this country. That is shown by the rapid expansion which they made ‘after it had. come into operation. The net value of the Australian production of all recorded industries in 1931-32 was £252,000,000, and the value of our exports was £105,000,000, whereas in 1933-39, seven years later, the total value of our production was £388,000,000 and the total value of our exports was £135,000,000. That was a very substantial increase of production. Whilst I do not attribute the whole of the expansion to the Ottawa Agreement, I do suggest that no provision in that agreement caused harm to be done to those industries of the welfare of which the Labour party was so fearful at the time.

I come now to the present proposals. I have said that all of us were completely disappointed with the statement of the Minister for Post-war Reconstruction; because, although it was fairly lengthy, it was almost as ambiguous as is this document itself. The honorable gentleman said that the Government will stand by its traditional policy of a vast, progressive, industrial development of Australia. That has been the purpose of Labour party policy. Whether or not it has been effective, I do not know. The honorable gentleman went on to say -

But at the same time it will be prepared to consider modifications of tariff when these can bc conceded without endangering this general objective and when they are part of an exchange of concessions generally advantageous to Australia.

The last portion of that sentence is most ambiguous. I do not know what is meant by “generally advantageous to Australia “, or who is to be the judge of the effect; but I take it that the Minister suggested that under the agreements certain of this country’s industries may be considerably jeopardized, whilst others may derive some advantage. I have no doubt that something of that kind may have to happen. But why should we start off on that assumption? Indeed, the statement of the Minister that tho Government calmly contemplates such a thing will not give great encouragement to industry generally in this country. Whilst I seldom agree with the honorable member for Reid, I believe that he was right when he submitted certain questions which, he said, the Minister or the Government should answer. Most of his questions were pertinent. I am sure that the Parliament, and I believe the industries of this country, will anxiously await the Minister’s reply to this debate.

I am not competent to make an analytical survey of the charter itself. I agree with the description of the Leader of the Opposition, when he termed it one of the most complex documents he had ever had the misfortune to have to assimilate. I frankly admit that, although I have read most of it, I have not yet begun to assimilate a great deal of what I have read. It is most extraordinary that, after all the discussions and negotiations at the conference of the United Nations on trade and employment, and after all the provisions for doing certain things had been drawn up, the conference should be unable to state the title of the charter. Having discussed certain features of trade and commerce in the future, I assume for certain purposes, the Government is not yet able to tell us what is the purpose of those provisions or, indeed, of the charter as a whole. We learn from article 1 that the general purposes of the organization are to be considered and drafted at a later stage. That is most extraordinary. How on earth these people can discuss and decide on certain principles when they do not know the objectives at which they are aiming, is beyond my comprehension. Probably, they will find out later. According to some of the comments of the Leader of the Opposition, this might be termed a charter to organize the British Empire. There is a real fear in our minds that under the final conditions that are to be included in the charter, it may be very difficult for the Empire to succeed as we know that it could if it were given a reasonable opportunity. I hope that the Minister, in his reply, will answer some of the points that have been raised by some honorable members. One of the most important points, of course, relates to preference, which I admit has been subscribed to with great vigour vocally by different Ministers. Unfortunately, we who sit on this side of the House, and I believe the people of this country generally, are beginning to be very tired of the lip service that is given by this Government to many principles. What is required by the Parliament and the country is more action. We want to know whether the Government intends to embark on the struggle for the retention of preferences with a defeatist outlook.

We are entitled to assume that the Prime Minister has enunciated the policy of the Government. If we start off on the basis which that right honorable gentleman laid down, we are hound to meet defeat. I say that, recognizing that with whatever strength we may support our objectives we may finally be overborne by the majority of the members of the conference. I hope that the Government will instruct its representatives to infuse such vigour into their advocacy of the retention of preferences as the Minister for External Affairs (Dr. Evatt) displayed in his opposition to the inclusion of the veto in the United Nations charter. If they display so much persistency they will be more likely to achieve the results that we desire than will be achieved if they adopt a defeatist attitude. Further, the provision in relation to mostfavourednation treatment is one of the most important in the charter. I entirely support the contention of the Leader of th( Opposition that that provision alone will prevent freedom of trade between members of the Internationa] Trade and Em- ployment Organization. It is perfectly obvious that a member, under the terms of the proposed charter, can decline to extend any concession but can elect to avail itself of the concessions made by other members. That fact will, of course, be realized by all signatories to the charter, and the consequence is that instead of world trade being increased it will probably be diminished. I ask the Government not only to give serious consideration to many of the proposed provisions, but also to make an announcement so that Parliament and the country may know its attitude towards them. Up to the present time we have not had any definite statement from the Prime Minister, the Minister in charge of this bill, or any other member of the Government. 1 think that when the Australian delegation goes to Geneva to discuss these most important matters the country should know precisely the Australian Government’s policy and the instructions given to ite representatives. Until we get a clear and concise statement of Government policy T am sure that neither this House nor the people generally will be satisfied that the Government is doing the best thing for this country.

Minister for Defence, Minister for Post-war Reconstruction and Minister in charge of the Council for Scientific and Industrial Research · Corio · ALP

in reply - First of all let me clear away some of the dead wood from this discussion. The honorable member for Reid (Mr. Long) based his statements in this House on a tissue of inaccuracies. It has been pointed out to him time and again that no commitments whatever have been entered into, but notwithstanding this the whole of his criticism was based on the assumption that Australia has already been committed to some agreement.

Mr Brennan:

– How did this agreement originate?


– This is not an agreement; it is a preliminary draft of the charter for a United Nations trade and employment organization which was discussed and agreed upon by representatives of seventeen countries at the end of last year. The draft proposals have now been referred to the respective governments and a further meeting of the committee is to take place in Geneva shortly. However, even at that further meeting no government will be committed to anything, and final acceptance of the charter will rest with this Parliament. Whatever attitude the Government adopts towards trade concessions, preference or reduction of tariffs will require to be determined ultimately by this Parliament.

The general tone of the speeches of members of the Opposition has been one of intense . pessimism and, indeed, of defeatism. Let me turn from the lugubrious ululations of members of the Opposition to the somewhat brighter picture presented by the London press in dealing with this subject. The Manchester Guardian, the traditional guardian of liberalism, spelt with a small “ 1 “, says -

There is plenty of scope for give and take. Success will depend mainly on the Americans. There have been signs that the Republican leaders will support the policy of lowering tariffs.

The London Herald of the 12th March describes the agreement for co-operation in economic advancement as “ the greatest of the positive tasks for peace “. That is practically the same phrase that I used in tabling this document. Thearticle goes on -

Britain and the Dominions agree on the need for expanding world trade. But they cannot sacrifice unilaterally the advantage of their preferences.

May I interpolate that the whole of the argument of the Leader of the Opposition (Mr. Menzies) was that these agreements should be on a unilateral basis. The Daily Standard of the 13th March saysBritain and the Dominions can therefore go to Geneva with free hands. Their policy should bo that put forth by Mr. Dedman, namely : “ The Australian Government is not prepared to give away any preference at all unless it can get something that will be more advantageous. “

The Economist of the loth March remarks -

The British seem to envisage a considerable whittling down of preferences on the reasoning that the required expansion of British trade oan bc secured only if the United States and other “ hard “ currency countries open their doors much wider to sterling area goods.


– By whom is that article written ?


– These are observations taken from the London press. The Sunday Times of the 16th March says -

The Dominions may be counted on to sell Empire preferences dearly. The United Kingdom should be no less hard-fisted. Apart from specific trade concessions we must add full compensation for two intangible assets, goodwill and security. Preference is a principle as well as a practical system. It quotes Mr. Chifley’s remarks about the pressure on Britain to exchange preference for larger opportunities in countries from which she must buy to live. But these opportunities must be large and assured.

The Financial Times observes -

Really worthwhile tariff concessions would be a signal contribution.

I ask honorable members to note the very much more optimistic tone of the observations of the British press in contrast with the remarks made by members of the Opposition.

I turn now to some remarks made by Sir Stafford Cripps in the House of Commons only two days ago. Honorable members opposite have endeavoured to convey the impression that this Government is trying to “ put Great Britain on the slippery slide “. The Prime Minister (Mr. Chifley) has explained that Great Britain, because of the position in which it finds itself, may be forced to make concessions on Empire preference. I have made a precis of the remarks of Sir Stafford Cripps and since that includes nearly all the points that I want to make I propose to read it. The precis is as follows : -

Sir Stafford Cripps commenced by making reference to the balance of payments problem of the United Kingdom and the necessity for expansion of United Kingdom exports. He said there were two problems, the hard currency and a general problem. The general problem could be solved by a general rise in the volume of exports; the hard currency problem by canalising exports into hard currency markets. Most importantly this involves mutually satisfactory arrangements with the United States of America. Approach to those problems involves appreciation of two particular matters. First that many parts of the British Commonwealth other than the United Kingdom have now become to a greater or lesser extent manufacturing countries themselves and naturally they desire to give protection to their infant industries. As a result of the changes which have taken place, we all, within the Commonwealth and Empire, need and must have wider markets than even that with which the Commonwealth and Empire can provide us. The family grouping; is still of importance to us, not as an exclusive isolationist group, hut rather as a factor within the wider conception of trade.

The second matter to appreciate is that we cannot get the advantage of freer trade into these markets, particularly the hard currency markets, unless we are prepared to make some contribution to the general freeing of world markets. We cannot expect others to make a unilateral grant to us. In order to regain and contain pre-war standards we must have this very large increase of exports at least To per cent, over pre-war. There can be no doubt that if we were to proceed on a restricted view, that is to say, a view that world trade is likely to remain substantially static as it was pre-war, our hopes of attaining that necessary increase would he, to say the most optimistic thing one could say, a very slender thing indeed.

Our pre-war share of the total world trade in manufactured goods -was 20 per cent. To reach 175 per cent, of our pre-war export trade with a static world trade would mean that

Ave should have to secure 35 per cent, of the world trade in manufactured goods. It is an obviously ridiculous impossibility. Only if there is an expanding international trade generally can we possibly hope to attain our export target.

It therefore becomes a cardinal point in our policy for our external trade that we should try to reach a measure of agreement with all the principal trading countries of the world generally, particularly the other countries of the British Commonwealth and Empire, whereby we can be assured of general expansionist policy throughout world trade.

To think An terms of static or pre-war conditions of world trade means we have to think in terms of a very bitter struggle in world markets with each country trying to carve out a larger share of the whole, which is not sufficient to satisfy all. Our approach to the question of post-war trade is based on the principles I have outlined and upon the Atlantic Charter and Article 7 of the Mutual Aid Agreement.

Referring to the tariff negotiations at Geneva. Sir Stafford Cripps said that he felt sure that all countries including the United States, realize that at the present stage no finality can be sought, much less can it be found, in the matter of tariff negotiations.

We have prided ourselves to include imperial preference iii the bargaining process although that is only of course one aspect of the negotiations. We shall be ready after consultation with the Commonwealth countries concerned which is now proceeding in London, to consider reductions of margins of preference, both those which we grant and those which we enjoy, in return for concessions which we regard as of comparable value made by other negotiating countries. We are under no one-sided obligation to eliminate or reduce imperial preference. Out obligation is to consider reduction of preferences in return for reductions of tariffs within the scope of our negotiations’. We, together with Common- wealth countries, remain the judges as to whether the counting concessions offered us are sufficient to induce us to modify preference margins in return just as of course other countries will judge whether the advantages they get are sufficient to justify the concessions that they will be making.

His Majesty’s Government are fully aware of the importance of imperial preference both in practice and in sentiment and they fully appreciate the value attached to the system by other Commonwealth countries.

Cripps went on that the United Kingdom Government does not see any prospect of the absolute elimination of imperial preference as a result of the Geneva talks though it might happen that the preferential margin on a particular commodity might be eliminated. He went oil that the United Kingdom Government would certainly not agree unilaterally to the elimination of a preference without the agreements of other British Commonwealth governments concerned.

The question of whether we removed a particular preference is a matter for bargaining between us and the dominions, just as the question of preference in our tariffs will be a question of bargaining between the dominions and America.

We shall certainly not give away the interests of other Commonwealth countries in reducing preferences enjoyed by them on United Kingdom markets and we are equally sure that we can count on them to meet us in the same way and not give away preferences which we value in their markets. Whatever is given up will have to be part of a mutually satisfactory bargain.

We, *f course, recognize very well in this relation that some industries, including agriculture particularly, perhaps have been developed in Empire countries on the basis of markets assured by preferential arrangement. We do not want suddenly to modify these preferences to the extent that is going to cause real disruption and distress in the overseas countries concerned. In the long term we can, I think, avoid any such results by the successful implementation of the terms of the proposed trade charter. In short term, the consultations that are now going on between representatives of the Commonwealth countries should make all parties, including ourselves, fully aware of the dangers of sudden action of that kind, and should, therefore, enable us to avoid them

The result of these negotiations will have to be judged, not in themselves alone, but in rela-tion to the general framework which is arrived i’t for the international trade organization. We hope by that to secure undertakings by member countries, or countries which become members, that they will each in their own way take steps to ensure maintenance of effective demands within their own countries which if we can get reduction of trade barriers would benefit, not merely themselves, but every other country in the world as well.

After reviewing a number of matters dealt with in the draft charter, Cripps said all these points and a great many others, together with results of tariff negotiations, will have’ to he looked at as a whole, and a reasonable balance will have to be struck between our wishes and ties ires and the desires and ambitions of various other trading1 nations- with whom we are negotiating.

Thus, it is not true, as has been insinuated by some members of the Opposition, that this Government is bringing pressure to bear on the Government of the United Kingdom to sell out on imperial preference. I propose now to summarize the objectives of the trade charter, and to make it clear once more that whatever is done at Geneva will be subject to ratification by this Parliament. In1 the meantime, this Government is. keeping very closely iia touch with the negotiations that have been going on in London, and will also, be in close touch, with those conducted, in Geneva from April onwards. Communications are constantly passing between the leader of the Australian delegation, Dr. Coombs, a-nd the Government. Only this morning, a subcommittee of Cabinet- consisting of the- Prime Minister (Mi:. Chifley).’, the Minister for Commerce and Agriculture (Mr. Pollard), the Minister for Trade and Customs (Senator Courtice), the Minister for Works and. Housing. (Mr.. Lemmon), and, myself, sat for one and . a. half hours dealing, with certain, communications which, we had received from the leader of the. delegation.. I propose to quote from, the first paragraph of the reply which w,e seat to Du.. Coombs> because it shows that the statements of the honorable, member for Reid were based upon, a. wrong assumption., He referred to Article 24 of the charter as if it were a hard andi fast provision, something like the law of the Medes, and Persians. That is; not so-.. Article: 24 is under revision now, and communications are passing between the- Government and the leader of the delegation as, I have no doubt, they are passing, between the- leaders of other delegations and. their- respective governments-. The first paragraph of our reply to Dr. Coombs is as- follows : -

With reference to Article- 24 (1) f&) of the draft charter,, the view of the Cabinet sub-committee is that Australia should enter the tariff negotiations without, advance com:mitments of any kind, and should retain free.dom t’o consider every item on its merits- as individual cases arise.

The general objective of the draft charter is to establish an international trade organization which will, first of all, commit its members to a national and international policy of full employment and industrial development. These two matters have been given great emphasis in the charter because of the good work of the Australian delegation which attended the conference- at which the draft was made.. But for that work, those matters would not occupy their present prominent position, in the charter. The second objective of the charter is to check any danger of a new vicious spiral of trade restrictions;, such as those which destroyed European aud world trade in the period’ between the. two world- wars. A good deal, has been said by Opposition members regarding the beneficial effects of the Ottawa Agreement. They pointed out that inter-Empire trade had increased considerably as a result. Tha.t is true. But. it is- also true that world, trade generally wa$ increasing a-t the. same time,. as< the result of the emergence of the- nations from a world-wide depression. No. Opposition member pointed, out that at no- time since the signing of the Ottawa. Agreement or. since the Hawley.Smoot tariff was introduced the United States, of America - and the Ottawa. Agreement was, in fact, an answer to that tariff schedule - has world trade- reached anything like the level that it had then reached. It seems evident, therefore,, that the Ottawa Agreement and the Hawley-Smoot tariff were restrictions of world trade. If the nations can agree to a world charter which will enable them to. engage in trade with one another and provide for the elimination of some of the restrictions which those measures imposed’ on world trade, it should be possible t’o restore the volume of world trade. If we cannot do that, I fear that no country will be able to give effect to a policy of full employment and industrial development.

I am, glad that the House has had an opportunity to discuss this, matter. It has Been, of. course, only a preliminary discussion,, because whatever may be the result of further negotiations at Geneva or elsewhere, the resolutions will have to come before this. Parliament for ratification.

Question resolved in the affirmative.

page 1262


Bill presented by Mr. Chifley, and read a first time.

Second Reading

Prime Minister and Treasurer · Macquarie · ALP

by leave - I move -

That the bill be now read a second time.

Many important amendments of the Income Tax Assessment Act are proposed by this bill, including the provisions necessary to give effect to the agreement made last year between the Governments of the United Kingdom and Australia for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income. That agreement was made on the 29th October, 1946, but, as I indicated in a statement to the House in November last, it will not come into operation until such time as it has received the endorsement of the Commonwealth Parliament and the House of Commons. The necessary endorsement by Australia is proposed in this bill. For some time it has been recognized, in both the United Kingdom and Australia, that the weight of taxation on income which is subjected to tax by the two countries has presented a serious obstacle to the investment of United Kingdom capital in Australia, and an impediment to the establishment and development of Australian industry. The agreement has been negotiated to overcome these disabilities.

Double taxation has arisen by the levying of tax, first, by the country in which the income has its origin and, secondly, by the other country in which the recipient of the income is resident. _ The agreement applies to all income which is taxed by both the United Kingdom and Australia, and its application to taxpayers in the two countries will have the effect of removing the taxation barriers that have adversely affected commercial and industrial relations between the United Kingdom and Australia. The removal of these barriers provides an incentive to British industrialists either to extend their businesses to Australia or to expand businesses already established in this country. The relief from double taxation should result in an increased flow of capital to Australia and- lead to a consequential development and expansion of Australian secondary industries,, thereby increasing the field of employment and the national income. The agreement will replace provisions in the taxation laws of the United Kingdom and the Commonwealth which, since 1921, haveafforded some measure of relief from double taxation. These provisions have proved to be complicated, cumbersome and productive of long delays before finality is reached in determining thedegree of relief to which the taxpayer is entitled. The agreement will also provide a more satisfactory method of relief from double taxation in respect of all classes of income. From a revenue viewpoint, Australia may gain a slight advantage owing to the fact that the Commonwealth will no longer be required to provide a tax rebate in respect of trading profits derived from Australian sources by a resident of the United Kingdom. These, broadly, are the advantages to Australia arising from the agreement, the articles of which are explained in detail in a memorandum which is being circulated.

After making a careful survey of the nation’s financial position, the Government proposes substantial reductions of the rates of social services contribution and income tax. It will be generally agreed that in any reduction of this nature the weight of taxation should be lifted as far as possible from taxpayers with domestic responsibilities. With this object in view, the amounts upon which rebates for dependants are calculated will be increased as follows : -

Spouse; female relative or housekeeper of a widow or widower; mother- From fi 00 to £150.

First child under sixteen; student child; invalid child - From £75 to £100.

Other children under sixteen - From £30 to


The maximum rebate for each dependentchild other than the first will be raised from £8 to £15, but the maximum rebate of £45 for spouse, first child, &c, is not being altered. The rebate for dependent children receiving full-time education will be expanded to include children between sixteen and nineteen years; at present it applies to children between sixteen and eighteen years.

Additional rebates will be provided in respect of a dependent father, or invalid brother or sister. The rebate for housekeeper will also be extended to cover further cases in which the housekeeper has the care of children under the age of sixteen years who are maintained by the taxpayer. The cost of diathermy treatment will be treated as medical expenses for rebate purposes.

Special deductions will be allowed to primary producers in respect of capital expenditure incurred in combating soil erosion and the conservation of water. Expenses incurred in the protection of the banks of waterways, the planting of wind-breaks, terracing, the prevention of gullying and the expenses of a like nature will be deductible from the assessable income of the primary producer. It will not include the cost of fencing, because appropriate allowances have already been provided, by way of depreciation, for fencing on land used for primary production. The deductions in respect of water conservation will include expenditure on the construction of dams, earth tanks, bores, wells, underground tanks, levee banks, irrigation channels and expenses of a similar nature. The concessions will commence to apply in respect of expenditure made during the year ending the 30th June, 1947. A further concession which will benefit primary producers mainly is being provided by the extension of the period in which losses may be recouped. At present the deduction of accumulated losses is limited to those losses incurred during the four years preceding the year of income. In future, the deduction will be allowed in respect of losses incurred during the seven years preceding the year of income. This expansion of the deduction for losses will assist particularly the primary producers of the northern parts of Australia. The concession will apply to assessments based on income for the year ending the 30th June, 1947.

Provision is also being made for the continuance of the exemption from income tax in respect of income derived up to the 30th June, 1947, by a resident of the Northern Territory from primary production, mining or fisheries in the Territory. The exemption was first granted in 1923, and extended from time to time, the last occasion being in 193S. Its purpose is to assist in the development of the Territory and to encourage reinvestment of profits in the Territory’s primary industries. The exemption will be continued for a further five years terminating on the 30th June, 1952. Existing taxation laws allow a special deduction of £40 to individuals resident in Zone A of Australia - north-western and extreme north-eastern Queensland, northern Northern Territory and northern Western Australia. Reports which have been received in regard to those areas indicate that the disabilities under which residents of those areas labour warrant some increase in this concession. It is proposed that the deduction for the zone be increased from £40 to £120.

The effects of taxation on the mining industry have also been examined by the Government. The law already provides certain concessions to the industry, owing to its nature and, with the object of fostering production, it is proposed that these concessions be extended. The deduction at present allowed in respect of capital expended on plant and development of a mining property will be enlarged so as to give mining concerns an effective allowance, from mining profits, of the full capital expenditure over the life of the mine. The cost of exploration and prospecting on mining tenures will also be made deductible from income from mining operations, but this concession will not extend to expenditure on exploration or prospecting for gold and petroleum, or in locating coal deposits. Gold-mining profits are already exempt from income tax, and provision has already been made in the income tax law in regard to expenditure incurred in the search for petroleum in Australia and New Guinea. The location of coal deposits is not regarded as justifying any special taxation allowance in respect of the cost incurred. At present, concessions are granted in respect of calls paid to mining companies or syndicates carrying on mining operations in Australia for gold, silver, base metals, rare minerals or oil. These concessions an: being extended to include calls on shares owned by the taxpayer in a company or syndicate engaged in prospecting for these metals or minerals. At present, an exemption from income tax is allowed in respect of income derived by a bona fide prospector from the sale of his rights to mine for gold in Australia and New Guinea. This exemption will be extended to profits derived by bona fide prospectors from the sale of rights to mine for such other metals and minerals as may be prescribed. Safeguarding provisions will be inserted in the law to prevent exploitation of this concession where relationship exists between prospector and purchaser. The amendments will apply in assessments based on income derived during the year ending the 30th June, 1947.

The bill also corrects a technical defect in the act relating to the assessment of Australian residents on dividends received from ex-Australian companies. Since 1941, these dividends have been included in the assessable income of the Australian resident shareholder who has been entitled to a deduction of the ex-Australian tax paid on the dividend. A decision delivered last week by the High Court is to the effect that dividends from ex-Australian companies which are subject to ex-Australian tax are exempt from Commonwealth tax. While remedying the defect disclosed by the court’s decision, it is proposed to modify the basis of assessment. Instead of allowing to the Australian resident a deduction of the exAustralian tax from his assessable income, the taxpayer will be entitled to offset the ex-Australian tax against the Commonwealth tax on the dividend. As from the 1st July, 1946, the Australian resident will be required to pay to the Commonwealth only the excess, if any, of the Commonwealth tax over the . exAustralian tax on the dividend. Taxation on this basis will place the Australian resident shareholder in an exAustralian company in the same relative position as an Australian resident shareholder in an Australian company.

In the light of experience, it has been found necessary to amend the special provisions of the act relating to the registration of tax agents. Annual review of registration by the Tax Agents Boards is considered to be vital to the effective operation of the scheme of registration. Accordingly, it is proposed that tax agents shall renew registration annually.

A fee will not, however, be charged on renewal of registration. It is also proposed that the tribunals to which appeals may be taken on the cancellation of a tax agent’s registration shall be extended to include the Supreme Courts of the States.

The bill also contains a number of machinery provisions as well as some other amendments designed to correct defects that have been revealed in the application of the act. These are fully explained in the memorandum which is being circulated, and may best be considered at the committee stage. I regret that, owing to printing difficulties, it has not been practicable to obtain black type copies of the memorandum for circulation to honorable members this afternoon. These will be obtained as early as possible and will be forwarded to all honorable members.

Debate (on motion by Mr. Menzies) adjourned.

page 1264


Bill presented by Mr. Chifley, and read a first time.

Second Beading.

Prime Minister and Treasurer · Macquarie · ALP

by leave - I move -

That the bill be now read a second time.

When the gift duty legislation was enacted five years ago its main purpose was to provide some deterrent against a person making gifts of his property to members of his family in order to reduce his taxation liabilities, and, in cases where such gifts were made, to obtain from the donor a payment to revenue in the form of a duty on the gift to offset, to some degree, the resulting loss of income tax and estate duty revenue. Experience of the operation of the legislation has, however, shown that some amendments are desirable, and the bill before honorable members contains the amendments which have been decided upon. Under the present law, gift duty is imposed on all gifts made by a donor where the value of the gifts, together with the value of all other gifts made by the donor within the period of eighteen months prior to and subsequent to the date of the gift, exceeds £500. In other words, exemption from gift duty applies if the total value of all gifts made by the donor within the three-year period mentioned does not exceed £500. It has been found that the present exemption of £500 results in duty being imposed in a great number of small cases which do not come within the category of those to which it was intended the law should apply. The present law imposes gift duty upon the transfer of the family residence from the name of the husband to that of the wife, the purchase of a family residence by a wife out of the housekeeping allowance made to her by her husband, the settlement of a son on the land by a primary producer involving gifts to the son of property and assets which are very often not more than £1,000 or £1,500 in value, and to other like gifts. The real purpose of the gift duty legislation is not concerned with cases such as these. It would, however, be difficult to include a specific exemption in the act to deal with them, but most, if not all, of them can be taken outside the act by an increase of the present exemption. The Government has, therefore, decided to increase the exemption from £500 to £2,000. This decision will be implemented by an amendment of the Gift Duty Act, but the increase in the exemption also involves the amendment of section 19 of the act which at present provides for the lodgment of a return by any person making a gift, the value of which, together with the value of all other gifts made within the preceding eighteen months, exceeds £250. Section 19 is, therefore, being amended to increase this amount from £250 to £1,500. The reason for specifying the amount of £1,500 when the exemption is £2,000 is to provide for difference of opinion between -the Taxation Department and the donor as to the value of the gift.

A section in the act which has caused considerable difficulty in administration and been the subject of considerable criticism on the part of donors, is section 16. This section as it stands makes liable to gift duty all dispositions of property between relatives in which the full consideration for the disposition is not paid in cash at the time the disposition is made. It has been found, however, that, in practice, the section operates in a most inequitable manner. For example, in those cases where the disposer takes a mortgage for the outstanding balance or otherwise secures the debt in some way which brings it within the provisions of section 16, the transaction is subject to duty. Where, however, the outstanding debt is not secured at all the transaction is not subject to gift duty. Transfer of land in consideration- of an annuity charged upon the land would be subject to duty, but if the annuity were not charged on the land, the transfer would not be subject to duty. If the same transfer were made and the transferor retained a life interest in the property instead of taking an annuity charged on the land the transfer would not be subject to duty.

In view of these anomalies it was evident that the section needed a thorough overhaul. The section was designed to prevent a parent giving his son property worth, say, £10,000 in the form of a sale for a small deposit of, say, £500, and then forgiving the debt for the outstanding balance by periodical gifts small enough to avoid gift duty. With the proposed exemption of £2,000 and without section 16, it would take nearly fourteen years to forgive a balance of £9,500 without becoming liable to gift duty. It would be rare to find a case in which such a scheme would be entered upon and still more rare for the parent, who usually makes such gifts late in life, to live for a sufficient length of time after making the gift to successfully complete it. In view of all the circumstances the Government decided that, instead of amending the section to remove the anomalies which exist, it would be preferable to repeal the section entirely.

Gifts made by a donor within three years of his death are subject to estate duty. In order to avoid a double impost of gift duty and estate duty in respect of such gifts, section 15 of the act provides for the allowance of a rebate of the gift duty or the estate duty on the gift whichever amount is the less. It has been found that it would make for smoother administration if this provision were transferred to the Estate Duty Assessment Act and this transfer is being effected. The section is, accordingly, being excised from this act and a comparable provision is being inserted in the Estate Duty Assessment Act.

Debate Con motion by Mr. Menzies) adjourned.

page 1266


Bill presented by Mr. Chifley, and read a first time.

Second Reading

Prime Minister and Treasurer · Macquarie · ALP

by leave - I move -

That the bill be now read a second time.

The bill contains some necessary amendments to the Estate Duty Assessment Act, but none of them is of a contentious character. The first amendment made by clause 3 of the bill relates to gifts made by a deceased person within three years prior to his death and is one which I am sure will be warmly welcomed by solicitors and trustee companies. Under the present law all gifts no matter how small in amount must be included in the estate duty return as part of the dutiable estate of the deceased. It has been represented that it is inequitable to charge duty on small gifts which really form part of the normal expenditure of the deceased. Furthermore, the tracing and identification of these small gifts in the accounts of the deceased imposes additional work on executors and solicitors out of all proportion to the revenue involved. The Government has, accordingly, decided to exempt from duty all gifts made by a deceased person up to £50 in value or, if more than one gift is made to the same person, where the aggregate value of the gifts does not exceed £50.

Another amendment of clause 3 corrects an anomaly which arises from the wording of the present law. Section 8 (4) (c) of the act provides for the inclusion in the dutiable estate of a deceased person of property comprised in a settlement made by the deceased under which he had an interest of any kind for his life whether or not that interest had been surrendered by him at any time before his decease. If, therefore, a person had at any time during his lifetime created a settlement in which he retained a life interest, the property comprised in that settlement forms part of his estate for purposes of estate duty even though he may have surrendered that interest many years prior to hi? death and thereafter had no interest whatever in the settled property. It is proposed to amend this provision to ensure that such property shall not be included in the estate of the deceased if the life interest has been surrendered by him more than three years before his death. This amendment will bring the provision into line with the provisions of the act relating to gifts made by a deceased person during his lifetime.

The next amendment made by clause 3 provides for the allowance of a rebate of estate duty in respect of property included in the estate which has also been subject to gift duty.

Provision for the allowance of a rebate to avoid double duty in such cases is at present contained in the Gift Duty Assessment Act but the provision is being transferred to the Estate Duty Assessment Act in order to make for smoother administration of both acts.

Under section nine of the act a special deduction of £5,000 is allowed in the case of a deceased member of the Defence Force who, during the War, or within three years of its termination, dies on active service or as a result of injuries received or disease contracted on active service. The section, however, applies only to members of the forces at the time of death and excludes from its operation the estates of persons who have died from war injuries after being discharged from the forces. Clause 4 of the bill removes this anomaly and ensures that the special deduction shall apply to discharged members of the forces as well as to members of the forces.

The amendment made by clause 5 relates to the deduction allowable in respect of State and Commonwealth income tax and land tax which become due and payable after death and within one year after payment of duty. The intention of the law was to permit the deduction for income tax and land tax assessed subsequent to the date of death on income derived and land owned by the deceased during his lifetime. In many cases, however, owing to the complicated nature of the estate a considerable time elapses before the estate duty can .be finally assessed. In the intervening period between the date of death and completion of the assessment and the payment of the duty, income tax and land tax may be assessed on income derived and land owned by the executors of the estate subsequent to the date of death of the deceased. The unintended effect of the present law is that many large estates are, by reason of the unavoidable delay in completing the estate duty assessment, receiving the benefit of very substantial deductions in respect of income tax and land tax assessed on income derived and land owned by the executors subsequent to the death of the deceased-. The amendment made by clause 5 will ensure that proper effect shall be given to the original intention of the law.

Debate (on motion by Mr. Holt) adjourned.

page 1267


In Committee of Ways and Means:

Prime Minister and Treasurer · Macquarie · ALP

– I move -

  1. That a tax he imposed upon incomes at the following rates: -

Division A. - Rate of Tax in Respect of a Taxable Income Derived from Personal Exertion.

  1. If the taxable income does not exceed £1,000 the rate of tax for every £1 of taxable income up to and including £250 shall be nil and the rate of tax for every £1 of taxable income in excess of £250 shall be 25.032 pence increasing uniformly by .032 of one penny for every £1 by which the taxable income exceeds £251.

    1. If the taxable income exceeds £1,000 but does not exceed £2,500 the rate of tax tor every £1 of taxable income up to and including £1,000 shall be 30.75 pence and the rate of tax for every £1 of taxable income in excess of £1,000 shall be 73.018 pence increasing uniformly by .018 of one penny for every £1 by which the taxable income exceeds £1,001.
  2. If the taxable income exceeds £2,500 but does not exceed £5,000 the rate of tax for every £1 of taxable income up to and including £2,500 shall bc 74.7 pence and the rate of tax. for every £1 of taxable income in excess of £2,500 shall be 127.007 pence increasing uniformly by .007 of one penny for every £1 by which the taxable income exceeds’ £2,501.
  3. If the taxable income exceeds £5,000 the rate of tax for every £1 of taxable income up to and including £5,000 shall be 10!). G pence and the rate of tax for every £1 of taxable income in excess of £5,000 shall be 1C2 pence.

Division B. - Rate of Tax in Respect of a Taxable Income Derived from Property.

  1. If the taxable income does not exceed £500 the rate of tax for every £1 of taxable income up to and including £250 shall be nil and the rate of tax for every £1 of taxable income in excess of £250 shall be 35.052 pence increasing uniformly by .052 of one penny for every £1 by which the taxable income exceeds £251.

    1. If the taxable income exceeds £500 but does not exceed £1,000 the rate of tax for every £1 of taxable income up to and including £500 shall be 24 pence and the rate of tax for every £1 of taxable income in excess of £500 shall be 61.032 pence increasing uniformly by .032 of one penny for every £1 by which the taxable income exceeds £501.
  2. If the taxable income exceeds £1,000 but does not exceed £2,250 the rate of tax for every £1 of taxable income up to and including £1,000 shall be 50.5 pence and the rate of tax for every £1 of taxable income in excess of £1,000 shall be 93.018 pence increasing uniformly by .018 of one penny for every £1 by which the taxable income exceeds £1,001.
  3. If the taxable income exceeds £2,500 but does not exceed £5,000 the rate of tax for every £1 of taxable income up to and including £2,500 shall be !)2.2 pence and the rate of tax for every £1 of taxable income in excess of £2,500 shall be 147.003 pence increasing uniformly by 003 of one penny for every £1 by which the taxable income exceeds £2,501.
  4. If the taxable income exceeds £5,000 the rate of tax for every £1 of taxable income up to and including £5,000 shall be 123.35 pence and the rate of tax for every £1 of taxable income in excess of £5,000 shall be 102 pence.

Division O. - Rates of Tax in Respect of a Taxable Income Derived Partly from Personal Exertion and Partly from Property.

  1. For every £1 of taxable income derived from personal exertion, the rate of tax shall be ascertained by dividing the total amount of the tax that would be payable under Division A, if the total taxable income of the taxpayer were derived exclusively from personal exertion, by the amount of the total taxable income.

    1. For every £1 of taxable income derived from property, the rate of tax shall be ascertained by dividing the total amount of the tax that would be payable under Division B, if the total taxable income of the taxpayer were derived exclusively from property, by the amount of the total taxable income.

Division D. - Rates of Tax by Reference to an Average Income.

  1. For every £1 of taxable income derived from personal exertion by a taxpayer to whose income Division 16 of Part III. of the Income

Tax Assessment Act 1936-1947 applies, the rate of tax shall be ascertained by dividing the tax that would be payable under Division A upon a taxable income from personal exertion equal to his average income by that average income.

  1. For every £1 of taxable income derived from property by such a taxpayer, the rate of tax shall be ascertained by dividing the tax that would be payable under Division B upon a taxable income from property equal to his average income by that average income.

Division E. - Rates of Tax by Reference to a Notional Income.

  1. For every £1 of the actual taxable income from personal exertion of a taxpayer deriving a notional income, as specified by subsection (1.) of section eighty-six of the Income Tax Assessment Act 1936-1947, the rate of tax shall be ascertained by dividing the tax that would be payable under Division A upon a taxable income from personal exertion equal to his notional income by that notional income.
  2. For every £1 of the actual taxable income from property of such a taxpayer, the rate of tax shall be ascertained by dividing the tax that would be payable under Division B upon a taxable income from property equal to his notional income by that notional income.

Division F. - Rates of Tax Payable by a Trustee.

For every £1 of the taxable income in respect of which a trustee is liable, in pursuance of either section ninety-eight or section ninetynine of the Income Tax Assessment Act 1936- 1947, to be assessed and to pay tax, the rate of tax shall be the rate that would be payable under Division A, B,C, D or E, as the case requires, if one individual were liable to be assessed and to pay tax on that taxable income.

DivisionG. - Rates of Tax Payable by a Company, other than a Company in the Capacity of Trustee.

  1. For every £1 of the taxable income the rate of tax shall be -

    1. in the case of a company which is not a life assurance company - Seventy -two pence;
    2. in the case of a company which is a mutual life assurance company - Sixty pence; or
    3. in the case of a life assurance company, other than a mutual life assurance company -
    1. in respect of the mutual income of the company as defined in sub-section (1a.) of section one hundred and sixty c of the Income Tax Assessment Act 1936-1947 - Sixty pence; and
    2. in respect of the remainder of the taxable income of the company - Seventy-two pence.
  2. For every £1 of that portion of the taxable income which has not been distributed as dividends, on which the company is liable, in pursuance of Part IIIa. of the Income Tax Assessment Act 1930-1947, to pay further tax, the rate of further tax shall be Twenty-four pence.
  3. For every £1 of interest in respect of which a company is liable, in pursuance of subsection (1.) of section one hundred and twentyfive of the Income Tax Assessment Act 1936- 1947, to pay income tax, the rate of tax shall be Seventy-two pence.

DivisionH. - Tax Payable where Amount would otherwise include Odd Pence.

Where, apart from this Division, the income tax which a person would be liable to pay under the preceding Divisions, before deducting any rebate to which he is entitled in his assessment, leaves an amount of pence remaining when expressed in pounds and shillings -

  1. if the remaining pence do not exceed six - the income tax payable by that person shall be the amount so expressed in pounds and shillings; or
  2. ) if the remaining pence exceed six - the income tax payable by that person shall be the amount so expressed in pounds and shillings plus One shilling.

    1. That, in addition to any income tax payable under the preceding provisions of this Resolution, there be payable upon the taxable income in excess of Five thousand pounds derived by a company a super-tax at the rate of Twelve pence for every pound of that excess:

Provided that this paragraph shall not apply-

  1. to the assessment of a company as a trustee;
  2. to the income of a company to which section fourteen of the War-time (Company) Tax Assessment Act 1940-1946 provides that that Act shall not apply; or
  3. to the mutual income, as defined in sub-section (1a.)’ of section one hundred and sixty c of the Income Tax Assessment Act 1936-1947, of a life assurance company.

    1. That tax in accordance with the preceding provisions of this Resolution be levied and paid for the financial year commencing on the first day of July, One thousand nine hundred and forty-seven, upon the taxable income derived during the year of income as defined by section six of the Income Tax Assessment Act 1930-1947.
    2. That, until the commencement of the Act for the levying and payment of income tax for the financial year beginning on the first clay of July, One thousand nine hundred and forty-eight, the foregoing provisions of this Resolution also apply for all financial years subsequent to that commencing on the first day of July, One thousand nine hundred and forty-seven.
    3. That provisional tax be imposed, and be payable in accordance with the provisions of the Income Tax Assessment Act 1930-1947, in respect of the income of the year of income ending on the thirtieth day of June, One thousand nine hundred and forty-eight.
    4. That, in this Resolution the expression “ Income Tax Assessment Act 1930-1947 “ mean the Income Tax Assessment Act 1936- 1940, as proposed to he amended by the Income Tax Assessment Bill 1947.

In my second-reading speech on the Income Tax Assessment Bill, I indicated that the Government proposes that the income tax and social services contribution shall be substantially reduced as from the 1st July next. This resolution sets out the reduced rates to be declared for the financial year 1947-48, that is the rates that will be applied to taxable incomes derived by persons during the year ending the 30bh June, 1948. Under the “ pay-as-you-earn “ plan, the reduced rates will be reflected in the tax instalments to be deducted from salaries or wages payable on and from the 1st July, 1947. A corresponding reduction will also be made in the- provisional tax payable in respect of income other than salary or wages of -the year ending the 30th June, 1948.

The revenue involved in the reduction of the income tax rates and the increase of the amounts upon which rebates are allowed for dependants is estimated to be £24,500,000 per annum. “When the proposed reduction of the rates of social services contribution contained in another measure is taken into account, the estimated annual revenue involved in the reductions will amount to approximately £33,000,000. The new rates of income tax, as distinct from social services contribution, will commence when the income reaches £251 instead of £201 as formerly, but the incomes at which persons with dependants become liable to income tax will be raised by considerably more than £50. The income tax rate applicable to each £1 of income will average approximately one-tenth of a penny on an income of £251, and will increase progressively until a rate of 13s. 6d. in the £1 is payable on that part of the income in excess of £5,000. This represents a decrease of ls. in the £1 in the maximum rate. Thus, when social services contribution is added, the ceiling rate will be 15s. in the £1 in lieu of the present maximum of 16s. in the £1.

Property rates of tax are slightly higher than the personal exertion rates, in the lower ranges of income, and the excess gradually increases until, on a property income of £1,000, the combined’ rates of income tax and social services contribution exceed the combined rates on personal exertion income by approximately 25 per cent. Thereafter, the difference in the rates gradually diminishes, until the rate on that part of the income over £5,000 is the same for both personal exertion income and property income.

As I mentioned earlier, the new rates, combined with the proposed increase of the amounts upon which rebates for dependants are calculated, will have the effect of raising the limits of income which may be derived by persons with dependants before incurring any liability for income tax, as distinct from social services contribution. Compared with existing limits, the amounts which will be free of income tax under the new scale will be as follows : -

Tables showing the amount of income tax and social services contribution that will be payable by various classes of taxpayers in different income groups, and comparing these amounts with amounts payable under the existing scale and under the war-time scale, have been circulated to honorable members with thefinancial statement made to the House on Tuesday last.

An examination of the tables will indicate that, although all taxpayers will benefit from the reductions, the combined effect of the reduced rates and the increased concessions for dependants will be that the greatest benefit will be provided for persons with dependants. These taxpayers are being granted reductions ranging from 100 per cent, on the lowest incomes to approximately 10 per cent, on high incomes.

It may also be noted that the total tax and contribution payable by the majority of taxpayers will be less than one-half of the war-time tax on a corresponding income. For example, a taxpayer with a dependent wife and two children will have received reductions amounting to more than 50 per cent, of his war-time tax if his income does not exceed £800.

It is proposed also by the resolution that the company rate of taxation operative for the current financial year shall be applicable also for the next financial year, i.e., in the assessments based on incomes derived by companies during the year ending the 30th June, 1947.

Progress reported.

page 1270


In Committee of Ways and Means:

Prime Minister and Treasurer · Macquarie · ALP

– I move -

  1. That, in lieu of the basic rate of contribution and the concessional rate of contribution set out in paragraphs (1.) and (2.) of the First Schedule to the Social Services Contribution Act 1945-1946, the following rates apply:- (1.) The basic rate of contribution for every £1 of the contributable income shall be Threepence, increasing uniformly by one-tenth of one penny for every £1 by which the contributable income exceeds £100, but the rate shall not in any case exceed One shilling and sixpence. (2.) The concessional rate of contribution for every £1 of the contributable income shall be the rate which bears the same proportion to the basic rate as the amount by which the contributable income exceeds the rebatable amount bears to -

    1. the contributable income; or
    2. Two hundred and fifty pounds, whichever is the lesser amount, but if the rate so ascertained exceeds the basic rate, the concessional rate of contribution shall be the same as the basic rate.
  2. That the amendments made by the Act passed to give effect to this resolution be expressed not to apply to assessments for a financial year prior to that commencing on the first day of July, One thousand nine hundred and forty-seven.

In addition to reducing the rates of income tax payable for the financial year 1947-1948, it is proposed to reduce, in the lower income ranges, the rates of social services contribution. The cost of these proposals will be approximately £8,500,000, bringing the total value of the reductions of income tax and social services contribution to £33,000,000.

At present, the basic rate of social services contribution, which applies in the case of a person who has no dependants, and who would not be entitled to any income tax concessions for life assurance, medical expenses, &c, commences at 3d. in the £1 and increases by one-eighth of one penny for each additional £1 of income until the maximum rate of 18d. is reached at an income of £220. The proposed basic rate of social services contribution will also commence at 3d., but will increase by only one-tenth of one penny for each £1 of income. The effect will be that the maximum rate of 18d. in the £1 will not be reached until the income amounts to £250. In the case of a contributor maintaining one or more dependants, the rate and amount of contribution are determined after taking into consideration the number of dependants and the expenditure incurred by the contributor in medical expenses, life assurance premiums, friendly society dues and those other expenses in respect of which concessions are provided. The proposed increases of the amounts on which the concessions for dependants are to be based are also taken into consideration in determining the minimum income that may be received without incurring a liability to social services contribution. The effect of these modifications will be, broadly, to raise the limits of income which may be derived by persons with dependants before incurring liability to social services contribution and tocause the rate to be graded so that the maximum rate of 18d. in the £1 is reached at approximately the same income level as liability to income tax - as distinct from social services contribution - commences.

The points at which liability to social services contribution commences, and the points at which the maximum rate of 18d. in the £1 is reached will be altered as follows : -

I would particularly direct the attention of honorable members to the fact that neither social services contribution nor income tax will be payable by a taxpayer with a dependent wife if his income is £200 or under. A taxpayer with a dependent wife and two children will also be free from both levies if his income is £317 or less. The reduced rates of social services contribution will apply from the 1st July, 1947.

Progress reported.

page 1271


In Committee of Ways and Means:

Prime Minister and Treasurer · Macquarie · ALP

– I move -

  1. That, notwithstanding anything contained in section four of the Gift Duty Act 1941, the gift duty payable in respect of any gift (not being a gift to which the next succeeding paragraph of this resolution applies) made after the commencement of the Act passed to give effect to this resolution shall not exceed one-half of the amount by which the value of that gift exceeds Two thousand pounds.
  2. That where, apart from this paragraph, the rate of gift duty in respect of any gift made after the commencement of the Act passed to give effect to this resolution is to be ascertained by reference to the value of that gift combined with the value of any other gift or gifts, the gift duty in respect of that gift shall not exceed an amount which bears the same proportion to one-half of the amount by which the value of all those gifts exceeds Two thousand pounds as the value of that gift bears to the total value of such of those gifts as are made after the commencement of the Act passed to give effect to this resolution.
  3. That the following rates be substituted for the rates of gift duty specified in paragraphs (o) and (6) of the Schedule to the Gift Duty Act 1941:-

    1. where the value of all gifts does not exceed Two thousand pounds - nil.
    1. where the value of all gifts exceeds Two thousand pounds but does not exceed Ten thousand pounds - Three pounds per centum of the value of the gift.
  4. That, subject to the next succeeding paragraph, the amendments made by the Act passed to give effect to this resolution shall not in any way affect gift duty in respect of any gift made before the commencement of that Act.
  5. That, in ascertaining the rate of gift duty in respect of a gift made before the commencement of the Act passed to give effect to this resolution, the value of any gift or gifts made after that commencement be not taken into account unless the “value of all gifts “, as defined in the Schedule to the Gift Duty Act 1941, exceeds Two thousand pounds.
  6. That the Act passed to give effect to this resolution be expressed to come into operation on the day on which it receives the Royal Assent.

The resolution gives effect to the Government’s decision to increase the minimum amount subject to duty from £500 to £2,000. The resolution also provides for the tapering off of the duty to prevent an anomaly occurring in cases where the gift is a few pounds in excess of the minimum amount subject to duty. The rate of duty on gifts up to £10,000 is 3 per cent, so that, whilst gifts up to a total value of £2,000 in a period of three years would not be subject to duty, gifts up to a total value of £2,001 would, but for this provision for tapering off, attract duty amounting to £60. This anomaly is prevented by providing that the duty on the gift is not to exceed one half of the excess of the value of the gift over £2,000. By this means, the full rate of 3 per cent, imposed on gifts up to £10,000 does not commence to apply until the value of the gift exceeds £2,127.

Progress reported.

page 1271


Tariff Requests

Prime Minister and Treasurer · Macquarie · ALP

by leave - In January, the Government announced that, as the international trade negotiations developed, all items in tariff requests made by other countries directly to Australia would be published as they became available. Items in Australia’s requests for reductions of the tariffs of other countries would also be made known. The public would also be kept informed of Australian commodities enjoying preference in other markets which are likely to be effected by the negotiations. In accordance with that undertaking a statement was made to the press on the 20th January, listing the commodities in the various categories, and inviting persons interested to make representations to the Government. In addition, a further small list of commodities on which Australia had been asked to negotiate was published on the 7th February. Since then, additional requests for Australian tariff reductions have been received and we ourselves have formulated additional requests to other countries.

In addition, it has now been decided to release a list of those commodities in respect of which Australia is expected to benefit from the tariff reductions which may be obtained by other countries. These benefits will accrue to Australia because the negotiations are based on the most-favoured-nation principle.

There are, therefore, four schedules as follows : -

Schedule1. - Items in the Australian tariff on which other countries are asking Australia to negotiate.

Schedule 2. - Items in respect of which Australia proposes to seek tariff concessions from other countries.

Schedule 3. - Items on which Australia receives preference in British markets which may be affected by the negotiations.

Schedule 4. - Items in respect of which Australia is expected to benefit through the tariff reductions which may be obtained by other countries.

As Parliament is now sitting, I table a supplementary list bringing the position up to date - together with the original lists which were released in January and February. I lay on the table the following paper: -

International Trade Negotiations - Tariff Requests and Preferences - Ministerial Statement, 27th March, 1946, together with the following schedules : -

Schedule 1. Items in the Australian tariff on which other countries are asking Australia to negotiate.

Schedule 2. Items in respect of which Australia proposes to seek tariff concessions from other countries.

Schedule 3. Items on which Australia receives preference in British markets which may be affected by the negotiations.

Schedule 4. Items in respect of which Australia is expected to benefit through the tariff reductions which may be obtained by other countries. and move -

That the paper be printed.

Through the press, the Government is inviting all persons wishing to make representations upon any of these commodities to address their remarks and supporting data to the appropriate Commonwealth department.

Debate (on motion by Mr. Menzies) adjourned.

page 1272


Bill presented by Mr. Chambers, and read a first time.

Second Reading

Minister for the Army · Adelaide · ALP

by leave - I move -

That the bill be now read a second time.

The object of this bill is to establish trusts made up mainly of moneys derived during the World War II. from the surplus profits and assets of the Navy, Army, and Air Force canteens, and the surplus mess regimental and amenities funds, and other moneys which for various reasons may properly be regarded as the property of members of the forces. Honorable members will recall that at the conclusion of World War I., the Australian Imperial Force Canteens Fund Trust was established by act of Parliament for the disposal of the profits and other assets of the Australian Imperial Force canteens.

The total amount received by the trustees of the Australian Imperial Force Canteens Funds Trust was £761,746, made up from profits from canteens, Australian Imperial Force regimental funds, interest on investments, and miscellaneous receipts. Benefits were paid to seriously disabled ex-servicemen and to the immediate dependants of deceased ex-servicemen. The bulk of the money was paid out in about twelve months.

Another fund established for the benefit of ex-servicemen and dependants of World War I. was the Sir Samuel McCaughey Bequest for the technical education of children of deceased and seriously incapacitated sailors and soldiers who served abroad. This bequest, from which a total sum of £703,552 already has been expended, is administered by the same trustees as the Australian Imperial Force Canteen Fund, and has been in operation for twenty-five years, has provided assistance for approximately 20,000 children and its activities will go on for several years to come. That, briefly, is how funds were distributed after World War I.

The bill now before the House deals with canteens profits, surplus mess regimental amenities and other benefit funds of the three services which accumulated during World War II. During the war, an undertaking was given by the Government that canteens profits would ultimately be distributed for the benefit of the members of the forces and their dependants. This bill is brought forward in pursuance of that undertaking, and the opportunity is being taken at the same time to make provision for the disposal of other moneys which, it is considered, should be similarly distributed. Under this bill, provision is being made for four funds, namely the Services Canteens Trust Fund of approximately £4,500,000, the Royal Australian Navy Relief Trust Fund of approximately £60,000, the Australian Military Forces Relief Trust Fund of approximately £60,000, and the Royal Australian Air Force Welfare Trust Fund of approximately £60,000. The bulk of these moneys has been derived from the activities of the various canteens services and represents in the main the accumulations of profits earned during the war years. That such large sums have been allowed to accumulate is explained by the fact that canteen activities within the services have been most extensive and spread over a wide area. The volume of business done has been very substantial and even the small margin of profit which prudent administration regarded as essential has resulted in the substantial balances which are now available for appropriate distribution through the funds proposed in this bill.

I take this opportunity of paying a tribute, on behalf of the Government, to the able businessmen who have given their time in an honorary capacity to the conduct of canteen activities. Although tho profits of the canteens service have been, in the main, derived from trading with members of the Australian Military Forces, the operations were not confined to these members, and some portion of the profits was derived from trading with Navy, Royal Australian Air Force and personnel of other forces. Moreover, other moneys available for the benefit of members and ex-members of the various branches of the services were derived from other sources, in some cases by direct public subscription. A great deal of consideration has, therefore, been given by the Government to the question of whether a principal fund should be established for all services, or whether an equitable method of allocation between separate service funds should be sought, so thai each fund could act independently. In the interests of economy in administration and also to ensure uniformity in the distribution of benefits on an equal basis to all members of the war-time forces - navy, army or air - it appeared desirable that a central and combined fund should be established to cover all services. At the same time, it was appreciated that, as the moneys now available had accrued in the main as a direct result of the war-time forces, it would be only equitable that the members of those forces and their dependants should be the beneficiaries. Consequently, the Services Canteens Trust Fund, which is -the central fund established by this Bill, will be administered for the benefit of Navy, Army and Air Force personnel, whether male or female, who served during the recent war, and their dependants.

Provision is made in the bill for the establishment of three other trusts, to be administered for the benefit of members and ex-members of the forces, other than those who served during the prescribed war period. Thus, the principle, which is already in existence, of separate funds for each service, will be retained for the benefit of such personnel. Servicemen, ex-servicemen and dependants will be eligible for benefits from only one fund. The bill provides for trustees of the Services Canteens Trust Fund and the service funds to be appointed by the Governor-General in Council. It is proposed that the trustees of the Services Canteens Trust Fund shall consist of a chairman, representatives of the Naval, Military and Air Boards, a business man, an ex-servicewoman and four representatives who have served in the ranks of the Navy, Army and Air Force and who are nominees of ex-servicemen’s organizations. The moneys which will be paid into the Services Canteens Trust Fund are principally the profits derived from canteens.

It is proposed that as from a date to be fixed, and which is referred to as “ the prescribed date “, the profits and other assets of the canteens services shall be transferred to the Services Canteens Trust Fund, except such as are required to meet existing liabilities, or for the continuing operation of the canteens services, for the purposes of the interim forces. Australia has undertaken to operate canteens for the whole of the British Commonwealth Occupation Forces in Japan. It is a matter of considerable importance that these canteens shall continue to be operated in a manner which will permit the supply of goods at reasonable prices to British Commonwealth Occupation Forces personnel. The scheme which has been adopted is that after the first transfer of assets of canteens services to the Services Canteens Trust Fund, the operations, finances and commitments of the canteens services will be reviewed from time to time and the remaining assets transferred ‘progressively. Other moneys which will be paid into the Services Canteens Trust Fund will be the proceeds of the sale of amenities, payments from funds such as the Commander-in-Chief’s Amenities Fund, the Army Canteens Amenities Fund, the Royal Australian Navy Central Canteens Fund, all of which are made up of distributions of canteens profits or of levies on the profits of canteens trading. The regimental funds of disbanded war-time units will also be paid into the Services Canteens Trust Fund as was done after World War I., and so will such of the mess funds of disbanded war-time units, as are not required for the payment of mess debts and other commitments relating to messes. A further contribution to the Services Canteens Trust Fund will come from the existing Royal Australian Navy Relief Fund and Royal Australian Air Force Welfare Fund.

The number of people who will be eligible to apply for benefits from the principal fund will, of course, be very considerable. The total number of enlistments for the three services during World War II. was as follows: -

It will be seen that the eligible personnel, apart from dependants, will be over 1,000,000, compared with a total enlistment of 425,377 for World War I. The bill provides for a sum of £2,500,000 out of the total of approximately £4,500,000 to be set aside by the trustees and used by them in the provision of educational assistance including professional and trade training for children of - (a) Deceased servicemen; (b) incapacitated servicemen; (c) servicemen who are in needy circumstances ; (d) and other children of servicemen who are, in the opinion of the trustees, particularly deserving of assistance. The amount of £2,500,000 is a minimum amount, and if it appears to the trustees to be desirable, they may allocate further sums for the provision of educational assistance to children.

The balance of the Services Canteens Trust Fund, after the setting aside of the amounts for the education of children, is to be applied by the trustees for the benefit of eligible servicemen and their dependants and to the dependants of deceased eligible servicemen in necessitous or deserving circumstances. The trustees will also have power to provide relief or benefits to eligible servicemen and their dependants in such other cases as they think fit. Honorable members will appreciate that the moneys available to the Services Canteens Trust Fund amount to a very considerable sum, and if judiciously administered, they will be of inestimable value to the personnel who served during the war, and to their dependants. The education scheme will include provision for children yet unborn and the expectation of the useful life of this fund is 30 years. A straight out per capita grant to all eligible servicemen was considered, but not favoured because, as may be seen from a review of the figures, an insignificant grant to every eligible serviceman would completely use up the available money without any lasting benefit.

The remaining three trusts established under this bill may be considered together. Each one will begin with an initial amount of £60,000, and their principal purpose will be, as I have already indicated, to provide a means of meeting cases of distress or need outside the ambit of the main fund. These separate service funds will be available for members of the forces who served prior to the war or who joined the forces subsequent to the prescribed date. These funds will be continuing and, it is expected, will be supplemented in future years by direct contributions from other sources which may become available.

In the case of the Navy and Air Force funds, the initial £60,000 will be transferred from existing Navy and Air Force Trust funds to the new funds established under this legislation. In the case of the Army, the £60,000 will be transferred direct from canteens profits and will so place the Army fund in a similar position to the comparable of Navy and Air Force funds. The bill is designed to distribute canteen profits and other funds in providing comfort and assistance for exservicemen and their dependants. No provision from public funds, however benevolent it may be, can afford adequate compensation to those who are bereaved or who are suffering from serious wounds or sickness as a result of the hazards and privations of war. Further, it is recog nized that in all statutes border-line cases arise just outside the scope of the act. The bill also gives a wide discretion to the trustees to expend the moneys entrusted to their care on any other cause which will contribute to the general or collective benefits of ex-servicemen and their dependants.

The Government trusts that the plan placed before the House in this bill will commend itself to all who served in the fighting forces during the war. The sole objective has been to ensure that this large accumulation of funds derived from the operation of canteens, messes and regimental funds in all the services during the war shall not be quickly dissipated, but shall be utilized in the best manner possible in the interests of exservicemen and their dependants.

Debate (on motion by Mr. Holt) adjourned.

page 1275


Second Reading

Minister for Defence, Minister for Post-war Reconstruction and Minister in charge of the Council for Scientific and Industrial Research · Corio · ALP

by leave - I move -

That the bill be now read a second time.

The subject-matter of the bill is Australia’s adherence to the United Nations Educational, Scientific and Cultural Organization. Unesco, as the organization is known, is the product of the general conviction that scholars, - scientists and educationists can, through a strong international body, make a major positive contribution to international understanding and progress. At the same time, Unesco is an attempt to meet certain immediate needs of a world recovering from war. Honorable members may recall the Standing Conference of Allied Ministers of Education, of the British Government and the governments in exile, which was convened in November, 1942, and met in London until the end of the European war. That conference planned the reconstruction of educational facilities in occupied Europe, particularly in relation to the accommodation, equipment and staffing of schools, technical colleges and universities, and the reestablishment of libraries and laboratories. From that urgent practical task grew the conviction that a permanent international organization for education was indispensable. Steps were taken during the later war years to plan such an organization. The United States of America and other nations joined the conference for this planning. In 1944, general agreement was secured thatan international organization should be established to participate in the reconstruction of educational and cultural facilities in Europe.

When, in June, 1945, the San Francisco conference adopted the United Nations Charter it was agreed that the United Nations should promote, among other objectives, international cultural and educational co-operation. This provided a stimulus for completion of the London conference’s existing work on plans for an international education and cultural organization. The next step was a joint invitation by the British and French Governments to all the United Nations to be represented at a further conference in London in November, 1945, to establish an appropriate international body. At this conference, the representatives of 44 governments considered the constitution of the proposed organization, which was broadened to enable it to provide for world collaboration in science as well as education and culture. A Preparatory Commission of Unesco was set up at that time, and it proceeded to prepare a draft programme and drafts for the detailed organization of Unesco. At sessions of the Preparatory Commission, Professor R. C. Mills, Director of the Commonwealth Office of Education, presented the view of the Government that a limited, practicable programme for the organization - one which attempted to combine immediate tasks with long-range projects - was preferable to a programme which attempted to extend Unesco’s as yet limited resources over too wide a field of endeavour. This approach has in general been adopted.

The constitution of Unesco came into force on the 4th November, 1946, following signing and acceptance by twenty of the States represented at the Preparatory Commission. Australia was one of the first members of the organization to deposit an instrument of acceptance on the 11th June, 1946. In the words of the constitution, the organization has set itself as its main objective -

  1. . to contribute to peace and security by promoting collaboration among the nations through education, science and culture in order to further universal respect for justice, for the rule of law and for human rights and fundamental freedoms affirmed … by the Charter of the United Nations.

To this end, Unesco will assist in promoting on an international scale the free flow of ideas, attempt to assist members to give fresh impulse to popular education and the spread of culture and also to contribute to the maintenance, increase and diffusion of knowledge. At the same time, the organization is prohibited from interfering in matters within the domestic jurisdiction of member states.

The principal organs of Unesco are a general conference, an executive board, and a secretariat. The general conference meets annually in ordinary session, each member being entitled to representation by five delegates. The responsibility of the general conference is to determine the programmes and policies of the organization. It is empowered to summon international conferences on education and the humanities, the sciences and the dissemination of knowledge, and to prepare conventions. The venue of the conference changes annually, and tentative suggestions have been made that Australia may be the scene of the third or fourth conference. The implementation of the programme of the organization is in the hands of the executive board. The board prepares the agenda and programme of work for acceptance by the conference, and recommends the admission of new members. It consists of eighteen members and meets twice annually in regular session. Members of the board, who are elected by the general conference from among the delegations appointed by member states, exercise their powers on behalf of the conference as a whole, and not as representatives of their respective governments. The seat of the organization is Paris. Honorable members will know that Australian policy favours the location of organizations of this character at the head-quarters of the United Nations. In this case, however, tribute was paid to France for that country’s pioneer work in the field of international intellectual co-operation, and to Paris as a traditional seat of learning.

Member states accept a number of obligations on which, the organization is based. As a member, Australia will be expected to fulfil the following obligations: - (1) To contribute to the expenses of the organization; (2) to respect the international character of the responsibilities of the staff; (3) to report periodically on laws, regulations and statutes relating to educational, scientific and cultural life and institutions; (4) to report to the organization on the action taken upon recommendations and conventions; (5) to make such arrangements as suit Australian conditions for the purpose of associating the principal bodies interested in educational, scientific and cultural matters with the work of the organization, by the establishment of a national commission or of national cooperating bodies. In respect of this last obligation, the Government strongly supports the underlying principle of associating such bodies with Unesco activities. Unesco cannot depend solely on the support of governments, but must attract the interest and support of the voluntary organizations upon which it must rely for the widest possible dissemination of information. A number of our more important educational bodies have already expressed interest in the work of Unesco. Arrangements are now being worked out whereby interested bodies will be invited to be associated with the work of Unesco.

The first general conference of Unesco met in Paris from the 19th November to the 10th December last year. Australia was represented by a delegation led by Professor Mills, Director of the Commonwealth Office of Education, and Dr. E. R. Walker, of the Australian Legation, Paris, who has been elected to the executive board of the organization and to its standing committee. In reviewing the programme of activities submitted by the Preparatory Commission, the general conference determined that, under existing conditions, projects relating to the dissemination of knowledge through education and mass communication should have the highest priority. It was decided that Unesco should develop a programme of fundamental education for a world-wide attack on illiteracy, since it was pointed out that well over half of the world’s population is illiterate. Unesco’s officers will evolve methods of combating illiteracy, develop educational techniques, and determine how best use can be made of films and radio in this project. It is of immense importance for Australia, no less than for the rest of the world, that European educational services should be promptly put on their feet and as much of the arrears of the war years made up as is now possible. But it is of even more importance for Australia that the living standards - beginning with the educational standards - of Asia and the politicallyawakening islands to our north should be speedily raised. Some of their civilizations are older than our own, but large proportions of the Asiatic and island populations remain illiterate.

The genera] conference approved proposals in other fields. In mass communication technical committees will be set up to examine the urgent needs of wardevastated countries in film, radio and press. In the field of libraries and museums steps will be taken to stimulate the development of free circulating and reference libraries and of popular museums for adults and children. In the national and social sciences steps will be taken to study the nutrition problems in India, South America, and China. Field science co-operation station* “-ill Vin =”t up in Asia and Latin America so that scientific knowledge on cut rem problems may be readily disseminated. Studies and experiments in the teaching of international relations will be made. Many other projects are included, some relating to the increase of knowledge, others to its preservation, and others to its dissemination. Just how much will be done this year, and on which projects greatest emphasis will be placed, will depend on the judgment of the Director-General, Dr. Julius Huxley, and on hia advisers on the executive board.

The outstanding impressions left with the Australian delegation at the recent Unesco conference were two. First, the conference showed throughout its meetings a spirit of genuine international cooperation. Secondly, the approach of the organization to its work of contributing to peace and security is a positive and practical one. “ Peace “ means much more than the absence of hostilities. It means a condition in which free men and women can live a secure and satisfactory life. To such a peace I believe Unesco can make a significant contribution; and I believe, too, that it has set about its work in a business-like, practical way. Only last week, the Prime Minister urged on the House the necessity of backing to the full the work of those international institutions which can do something to remove or even mitigate the political, social and economic causes of wars and depressions. I am convinced that Unesco is such an organization. I urge a wide interest in its efforts, and commend the bill to the House.

Mr Holt:

– Can the Minister give an estimate of the charge on the Australian budget?


– £42,000 a year.

Debate (on motion by Mr. Holt) adjourned.

page 1278


In committee: Consideration resumed from the 26th March (vide page 1197).

Clause 18 (Settlement of cases).

Barker · ALP

– The Minister for Immigration (Mr. Calwell) intimated on two or three occasions yesterday that in 1939 I had played a certain part in the passage of legislation relating to aliens. His first statement was, that I was Deputy Prime Minister of the Government which had passed that legislation. That statement is incorrect. His second statement was, that I was a Minister in the Menzies Government which had passed the legislation. That, too, is incorrect. His next statement was that I had supported the legislation. The honorable gentleman can read the debate that took place on the bill that was then before the House. I have the report of it here, and it shows that I did not say one word on the second reading of that bill.

Mr Calwell:

– That does not prove that the honorable gentleman was opposed, to it.


– In committee, five amendments were moved, two by the Minister in charge of the bill and the other three by me, and only one of those three was carried, a division being taken upon it, in which the Government supported me. If the Minister will peruse Hansard at pages 2021 and 2099 of that year, which contains the vital matter, he will find each of those amendments set out, and will learn that I was attempting to tighten up that law as a war-time measure. If the English language then used means anything, that was the purpose of my amendment. It is perfectly true that I had some responsibility, as a member of the Lyons Government, for the setting up of an interdepartmental committee in 193S which held an inquiry in respect of the. registration of aliens, particularly with a view to tightening up the conditions and of ensuring that certain undesirables did not get into this country, and that we had proper control of those aliens who did get in, after their entry. The bill to which the Minister referred was introduced on the 3rd May, 1939, as is shown on page 55 of Hansard of that year. The ministry of the day was the Menzies Ministry, in which the Australian Country party was not represented, and the bill was passed on the voices. I remind the honorable gentleman that the Opposition at that time was composed of members of the Labour party. Apparently, it did not have very much fault to find with the bill, although it did not support me in my efforts to tighten up the law. I had no worries whatsoever about the part that I played in the matter. I went through the debate in Hansard last night, and the Minister conveniently reported progress when he saw that I was about to make a reply.

Mr Calwell:

– Not at all.


– Everybody had spoken before I was ready to reply. Then the Minister reported progress. Every statement that he made is proved by the Hansard record to be incorrect. However, I do not mind thar. The Minister ought to be a little more careful in the statements that he makes. Those olive trees which he planted are doing well, but they are not yet quite big enough for the purpose for which I want to use them.

Minister for Information and Minister for Immigration · Melbourne · ALP

– The honorable gentleman has discovered another “mare’s nest “. He set out to prove that he had moved amendments, although the question as to whether or not he had moved amendments had never been in dispute. I chided the honorable gentleman with having voted for the legislation as it finally appeared on the statute-book.

Mr Archie Cameron:

– There was only one division.


– Nothing that he has said disproves the claim that I have made. He was talking about clauses in this bill which are identical with sections of the act of 1939, for every one of which he voted ; and the amendments that he moved, if they were adopted, are a part of the legislation that is on the statute-book. All that I set out to prove was that the things which he was attacking in this bill are the very things to which he either gave his consent by remaining silent, or which he did not oppose when the legislation was before the Parliament in 1939. The claim that I made last night in regard to bis inconsistency, is true. He may have amended the legislation of 1939. He may have tightened up a lot of things. He may have done a lot of good work. But what he did is included in the legislation on which this bill is based. It is of no use for him to talk now about what great work he did at that time.

The CHAIRMAN (Mr Clark:

– The Minister must return to the clause. He has been allowed a fairly wide latitude to reply to the honorable member for Barker.


– All that I am bound to do is to keep within the Standing Orders. I am certainly observing the Standing Orders when I am replying to an honorable member who made certain remarks in regard to previous legislation.


– The Chair does not want to discuss that matter with the Minister. I ask him to refer to the clause.


– I am referring to it. I have not Cone anything but refer to it. Clause IS deals with the manner in which cases may be settled. All that has transpired to date relates to that matter. Since certain honorable members last night objected to the clause, and claimed that it contains dangerous features, I have had a look at relevant provisions in other acts, and have found that in the Post and Telegraph Act, the Income Tax Assessment Act, the Customs Act, Part XV., the Excise Act, Part XIII., and the regulations under the Electoral Act and the Referendum Act, similar provisions have been enacted. Because I do not want to weary the committee by reading them, I shall with the consent of the committee incorporate them in Hansard -

page 1279


Section 150. - Where any person admits to the Postmaster-General that he has committed a breach of this Act other than an indictable offence the Postmaster-General may with the consent in writing of such person determine the matter and may order such person to pay such pecuniary penalty as he may think proper and upon payment of such penalty such person shall not be liable to be further proceeded against in respect of the same matter.

page 1279


Section 226. - (1.) Notwithstanding anything contained in the last three preceding sections, any taxpayer who fails to duly furnish as and when required by this Act or the regulations, or by the Commissioner, any return or any information in relation to any matter affecting either his liability to tax or the amount of the tax, shall be liable to pay as additional tax an amount equal to the tax assessable to him or the amount of one pound’ whichever is the greater. (2.) Any taxpayer who omits from his return any assessable income, or includes in Msreturn as a deduction for expenditure incurred by him an amount in execess of the’ expenditure actually incurred by him, shall be liable to pay as additional tax an amount equal to double the difference between the tax properly payable by him and the tax that would be payable if it were assessed upon the basis of the return furnished by him, or the amount of One pound, whichever is the greater. (3.) The Commissioner may in any case, for reasons which he thinks sufficient, and either before or after making any assessment, remit the additional tax or any part thereof. (4.) If in any case in which a taxpayer is liable to pay additional tax under this section a taxation prosecution is instituted in respect of the same subject matter, the additional tax shall not be payable unless and until the prosecution is withdrawn.

page 1279


Section 265. - If any dispute shall arise between any officer and any person with reference to any contravention of this Act, the

Minister may in manner prescribed with the written consent of such person inquire into and determine the dispute and shall have power by order a notification of which shall be published in the Gazette to impose enforce mitigate or remit any penalty or forfeiture which he shall determine shall have been incurred.

Section 2!iG. - Every such order shall be final and without appeal and shall not be liable to bc quashed on any account and a copy thereof shall be delivered to such person and may be enforced in the same manner as the order of a court of summary jurisdiction.

page 1280


Sections loo and 150 of this Act are similar in every way to Sections 205 and 200 of the Customs Act, Part XV.

page 1280



Regulations 21. - (1.) Subject to such directions as are issued by the Chief Electoral Officer, the Commonwealth Electoral Officer shall, upon the receipt of a report from the Divisional Returning Officer in respect of an alleged contravention of section 42 of the Act, consider all the facts and, if satisfied that the person concerned has contravened any of the provisions of the section, may make an order imposing upon that person a penalty not exceeding Ten shillings for a first offence and not exceeding Two pounds for any subsequent offence, and notify the Divisional Returning Officer thereof and the time allowed for payment.

Regulations 7S. - (1.) Subject to such directions as are issued by the Chief Electoral Officer, the Commonwealth Electoral Officer shall, upon the receipt from a Divisional Returning Officer, of the documents mentioned in the last preceding regulation, consider all the facts, and if satisfied that the elector concerned has failed to vote at the election without a valid and sufficient reason for that failure, he may make an order imposing upon that elector a penalty not less than Ten shillings nor more than Two pounds, and notify the Divisional Returning Officer thereof and of the time allowed for payment.

The clause under discussion does not place upon aliens the great hardship that some honorable members have suggested. As a matter of fact, it was framed in the interests of aliens who offend, so that their offences could be disposed of more expeditiously and with less expense to them. If we were to prescribe that every infringement of an act must be tried before the courts, we should be overloading the courts increasing litigation and creating added expense for the individuals concerned.


– I think the Minister (Mr. Calwell) has missed a point which should particularly appeal to him, because I credit him with a real desire to assist immigration, and to facilitate the assimilation of aliens into the community. It is utterly misleading to compare this clause with, similar provisions in other legislation. I do not accept this practice as good, in connexion with any legislation. In this case, however, we are dealing not with Australian citizens who have grown up in this country and are acquainted with the administration of our laws, but with people who have no acquaintance whatever with our system of justice. I do not approve of this proposal, because there is a distinct danger of very serious miscarriages of justice if this power falls into the hands of unscrupulous officials. I do not say that will happen, but in these unsettled days, we should be more than usually careful in matters of this kind. When we bring aliens here, we should give to them the best possible picture of Australian life, and absorb them into our community as quickly as possible. One thing which has marked out the British system of justice from all other systems is that offenders are tried in open court, and it is because of that tradition that we have confidence in the administration of our laws. Aliens do not understand our system of justice, and if this clause is accepted, the first taste of it that they will receive will be behind closed doors. [ know that when the penalty provision referred to was introduced in other acts it was designed to assist offenders as well as the administration. But, as I pointed out, we are dealing with aliens and not with Australian citizens in this case. I oppose the clause.


.- If any honorable member is opposed to anything in this bill an obligation rests on him to rise and say so, because, according to the procedure of this chamber, he is liable years afterwards to have Hansard quoted “to him, and be told that it does not lie in his mouth to criticize some other provision because he apparently approved of this particular one.

This bill does offer inducement and encouragement to inferior officers, and by that term, I mean officers in receipt of small salaries, to do unscrupulous things. If one of these unscrupulous officers - possibly stationed in some remote part of the country - happened to find Out something detrimental to an alien, it would be possible for him to exploit him. It would be open to this officer to send for the alien and say : “ Here is the law ; I know this about you. You are liable to be fined £50 or go to gaol for three months for this offence, but if I report to the permanent head of my department and tell him that you are liable to be fined £50 or he can deal with your case, you may not have to pay the £50 or go to gaol, but may have only the same penalty imposed on you as is exacted for, say, a breach of the Electoral Act, namely, 5s., and nobody will know anything about it. This is a secret department “. Hence there is always a temptation to an unscrupulous officer, particularly in isolated parts, to take advantage of an alien’s ignorance of our law. It might be different if the officers who are going to administer these provisions were members of a police force, or well-trained civil servants. The proper course is to omit this clause, and amend the penalty clause, so that instead of fixing a statutory penalty of £50, or three months imprisonment, police magistrates may be empowered to assess the punishment as they do for other offences. The offence should be tried in open court and the. penalty determined by a magistrate ; the matter should not be left to the discretion of the permanent head of a government department as to whether an offender is to be so tried. That is an entirely wrong principle, and should not be countenanced by the Parliament.

This matter has been fully debated, and a number of honorable members of legal training and high professional standing expressed abhorrence of the clause. It was then that progress was reported; but after the majority of honorable members had left the chamber the bill was reintroduced. I protest against the haste that the Minister is showing to dispose of this bill. No urgent need exists for the committee to deal with the measure now, because the Senate has adjourned, and no particular advantage can accrue by this chamber proceeding with the measure today. I ask that further consideration of the matter be deferred and that the Minister consult his officers to ascertain whether some method which will achieve the same effect, but without these undesirable features, can be introduced.


– I have previously opposed this clause for several reasons, and that fact has been recorded. Members of this Parliament should enact the country’s legislation, but they should not attempt to administer it. Can the Minister (Mr. Calwell) tell honorable members of any other measure that deals with aliens in this way? The honorable member for Darwin (Dame Enid Lyons) pointed out that all the statutes which the Minister mentioned in support of his contention relate to the treatment of Australians, and it is obviously unsound to attempt to apply the same principle to aliens, because their ignorance of our law may expose them to the gravest injustice. It has been said that this clause was intended to help the aliens. I believe that that suggestion has some weight, but the law should state clearly what they are required to do. They should be accorded justice, but provision should also be made for the upholding of the law.

Minister for Information and Minister for Immigration · Melbourne · ALP

– I promise to consider the representations of the honorable member for Darwin (Dame Enid Lyons) between now and the time the bill goes to the Senate. Progress was reported last night not for any ulterior motive, but merely so that the time-table which had been agreed to with the leaders of the Opposition parties could be complied with.


.- I am not in the least interested in the passage at arms between the Minister for Immigration (Mr. Calwell) and the honorable member for Barker (Mr. Archie Cameron), nor am I greatly interested in a consideration of the question as to how aliens who have their first taste of the administration of the law in Australia shall be affected by the consideration raised by the honorable member for Darwin (Dame Enid Lyons). What I am concerned with is the departure from the usual rule of law, which is that we shall preserve our own measures for administering justice in this country, and not be affected by how an alien would be impressed. Therefore, I join with the honorable member for Reid (Mr. Lang) in the request that something should be done to retain our own standards. There is, in a later clause, a penalty prescribed for breaches in this act, as it will become. I hope that the Minister will have regard to my request that we shall not depart from the usual standard of administering justice in this country, and I do not think that a departmental officer should be “ roped in “, in the manner suggested. I am certainly not concerned with how the administration of our law may impress aliens who come to this country.

Clause agreed to.

Clauses 19 to 21 agreed to.

Mr Lang:

– I rise to order. I wanted to speak on clause 20. I did not hear that clause put from the Chair.


– Clause 20 was put and passed by the committee.

Title agreed to.

Bill reported without amendment; report adopted.

Third Reading


– I ask for leave to move the third reading of the bill forthwith.

Mr Lang:

– I object. Standing Order 182 is as follows: -

When the report is finally adopted, a future day shall be fixed for the motion for the third reading.

The report has just been adopted. The standing order is quite clear, and is to the effect that the third reading must be taken on another day.

Mr Calwell:

– We will come back to-morrow.

Mr Lang:

– I do not care how long we take.


– The point taken by the honorable member for Reid seems to be fatal unless the Standing Orders are suspended. If that is not done, a future day will have to be fixed for the third reading.

Leave not granted.

Ordered -

That the third reading be made an order of the day for the next sitting.

page 1282


Motion (by Mr. Chifley) agreed to -

That the House, at its rising, adjourn to

Wednesday, the 16th April, at 3 p.m.

page 1282


Motion (by Mr. Chifley) agreed to -

That leave of absence be given to every member of the House of Representatives from the determination of this sitting of the House to the date of its next meeting.

page 1282


The following papers were pre sented : -

Arbitration (Public Service) Act - Determination by the Arbitrator, &c. - 1947 - No. 14 - Commonwealth Public Service Clerical Association and others; and Amalgamated Postal Workers’ Union.

Australian National Airlines Act - First Annual Report, including Financial Accounts, by the Australian National Airlines Commission, up to 30th June, 1946.

Lands Acquisition Act - Land acquired for -

Defence purposes -

Elizabeth Bay, Sydney.

Postal purposes -

Ascot Vale, Victoria.

Mount Gambier, South Australia.

House adjourned at 5.55 p.m.

page 1282


The following answers to questions were circulated: -

Customs Seizure of Luggage

Mr Hutchinson:

n asked the Minister for Immigration, upon notice -

  1. In the case of Mr. Joseph Goldberg, who was charged in Sydney last December with having imported prohibited goods, did the Crown object to the adjournment which Goldberg sought because he was proposing to go abroad ?
  2. Was the Crown’s objection overruled by the. magistrate?
  3. Was Goldberg subsequently given a passport, and is he, in fact, still abroad ?
  4. When is he expected to return, and what have been the expenses to date of a witness brought specially from America to give evidence in the case?
  5. Why was a passport issued to Goldberg by one Commonwealth department after another Commonwealth department had objected to any adjournment of his case?
Mr Calwell:

– The answers to the honorable member’s questions are as follows : - 1, 2 and 4.I would invite the honorable member’s attention to the answer given by the Attorney-General on 27th February, 1947 to the honorable member for Wentworth in reply to a question regarding this matter. Mr. Goldberg is expected to reach Sydney by the end of next week. The case is sub judice and will come before the court shortly. 3 and 5. Mr. Goldberg is the holder of a passport issued to him in January, 1946.


Mr Francis:

s asked the Minister for Immigration, upon notice -

  1. Has he seen the immigration figures which the New South Wales president of the Returned Servicemen’s League states have been supplied by the Commonwealth Statistician, showing that in addition to European refugees, 239 Chinese and 63 Indians became permanent residents of Australia last year?
  2. Has he also seen the complaint by the State president of the league that ex-service personnel looking for homes, offices and businesses, have to compete, not only with Europeans, but also with Asiatics?
  3. What comment, if any, has he to offer on this complaint, and is he in a position to assist ex-service personnel in the circumstances mentioned?
Mr Calwell:

– The answers to the honorable” member’s questions are as follows : - 1, 2 and 3. Yes, I have seen the figures supplied by the Commonwealth Statistician to the Returned Servicemen’s League. I may mention also that I have ascertained that it is the practice of the Statistician to show as permanent new arrivals domiciled residents of the Commonwealth who have been absent from the country for at least twelve months and also students and government officials who intend remaining here for at least that time. Such persons would, therefore, be included in tile figures of Chinese and Indians furnished by the Statistician. However, domiciled residents are not new arrivals but old residents returning. Students are of course eligible to remain here until they have completed the educational course for which they were admitted and government officials may remain so long as they continue in the employ of their government. I have previously informed the House that before landing permits are issued to aliens to enter the Commonwealth, the person in Australia sponsoring them has to certify that on their arrival he will provide suitable accommodation for them. The whole intention and understanding is- that the accommodation to be provided will be in the home of the applicant, and not such as will deprive Australians of accommodation. This is a principle which my department has faithfully endeavoured to have observed, and within its jurisdiction it has spared no effort to see that it is carried out. It should be remembered that the allocation of houses, as well as the steps necessary to ensure that suitable accommodation is not left untenanted for periods when it could bc made available, particularly to ex-servicemen and their families, arc State f mictions. However, where it is proved that there is any intention on the part of the individual sponsors to violate their undertaking in the matter of accommodation for aliens nominated by them, action will be taken to withhold the issuing of visas to their nominees, and I will ensure that applications for landing permits on behalf of other relatives are rejected. No cases have been brought to my notice or to the notice of my department in which ex-servicemen have had to compete with Asiatics for homes, offices and businesses. Having regard to the limited numbers of arrivals of Chinese and Indians as shown in the return of the Commonwealth Statistician and to the fact that practically all of these would either be domiciled residents returning to their own homes, students for whom accommodation is required to he provided either in educational establishments or by relatives, and Chinese or Indian government officials, it is apparent that such competition, if any, would be negligible.

Mr McBride:

e asked the Minister for Immigration, upon notice -

  1. What information does the Government possess of British efforts to secure immigrants from Europe for Great Britain?
  2. Do these efforts suggest that there will be little official encouragement in Britain for emigration to Australia or elsewhere?
  3. How many persons are at present registered (o) in Great Britain and (6) elsewhere as prospective migrants to Australia?
Mr Calwell:

– The answers to the honorable member’s questions are as follows : -

  1. From time to time press reports are published that the United Kingdom Government proposes to introduce foreign workers, but the Commonwealth Government has received no official advices in this connexion. The question of the introduction of. such workers is a matter entirely for determination by the United Kingdom’ Government.
  2. The British Prime Minister assured the Right Honorable J. B. Chifley in a cablegram dated the 11th January relating to British migration to Australia that the United Kingdom Government fully adhered to their intention to carry out the arrangements set out in the free and assisted passage agreements which were made in March, 1946, between the two Governments. The attitude of the British Government is exemplified by the fact that they have agreed to the opening of these two schemes as from Monday next, the 31st March. 1947.
  3. The total number of persons who have registered at Australia House up to the 28th February, 1947, for emigration to Australia is 185,676 including dependants. Many th 011sands of people in Europe are also anxious to settle in Australia as soon as shipping and other conditions permit.

Waterfront Employment: Use of Armed Forces

Mr Archie Cameron:

n asked the Prime Minister, upon notice -

  1. On how many days in each separate port u 0 -e troops of any armed service employed on the waterfront in Australia during the period 8th December, 1941, to the end of the wart
  2. How many man-hours were worked by the armed services so employed?
  3. How much did the Commonwealth receive for such employment?
Mr Chifley:

– The answers to the honorable member’s questions are as follows : -

The honorable member will appreciate that the details of a reply to Nos. 1 and 2 of his question would not be readily available. Even wilh the most diligent inquiries and a great deal of work the information would be most difficult to ascertain. So far as the Army is concerned with regard to 3. accounts have been submitted to all authorities, companies and persons on whose behalf Army labour has been supplied, and the total amounts received to 31st August, 1945, the end of hostilities, have been £2,779,079 and to the present time have been £4,319,120. These figures represent receipts from all sources and include payments for work performed on the waterfront. Actual receipts for work on the waterfront are not readily available.


Mr Bernard Corser:

r asked the Prime Minister, upon notice -

  1. Has he seen the report in a Sydney evening newspaper that the Australian Council of Employers’ Federations had condemned the Government for failing to stamp out the black marketin labour brought about by an almost open contempt of wage-pegging by many employers and unions?
  2. If so, what action does he intend taking to remedy the position?
Mr Chifley:

– The answers to the honorable member’s questions are as follows : - 1 and 2. I have not seen the statement referred to but, assuming that the views of the Australian Council of Employers Federations have been correctly stated in the honorable member’s question, the statement is tantamount to an admission on the part of the employers federations of their inability to prevent employers from breaking the law. The regulations, however, are not being treated with almost open contemptby employers and employees. There may be individual cases of breaches of the regulations, but on the whole the regulations have achieved their object.

Pensions: Invalid and Old-age; War Widows; War.

Mrs Blackburn:

n asked the Minister representing the Minister for Social Services, upon notice: - 1, Will he give consideration to the payment of the invalid pension to patients in mental hospitals who suffer certain hardships through their lack of means and their inability to buy much needed comforts for themselves?

  1. Is it a fact that patients who come out of the mental hospitals on trial leave may be granted a pension but must surrender it if forced to return to the mental hospital, or is there an arrangement whereby 39 days must elapse after the return to the hospital before the pension must cease?
  2. If a pensioner is temporarily confined to a mental hospital, is he required to pay a contribution for maintenance while in the institution or does the government hospital allowance apply in such a case?
Mr Holloway:
Minister for Labour and National Service · MELBOURNE, VICTORIA · ALP

– The Minister for Social Services has supplied the following information : -

  1. Consideration is being given to this matter in connexion with the preparation of a bill for the consolidation of Commonwealth legislation relating to social services.
  2. A person who has been discharged from a mental hospital on trial leave may be granted an invalid pension if he possesses the necessary qualifications. If he returns to the mental hospital, payment of the pension is suspended in accordance with section 45 of the Invalid and Old-age Pensions Act. This section provides that, if an invalid or old-age pensioner becomes an inmate of a mental hospital, his pension shall bc deemed to be suspended, but when he is discharged from the hospital payment of his ‘pension shall be resumed and he shall be entitled to payment, in respect of the period during which the pension was suspended, of a sum representing not more than four weeks’ instalments of the pension. There is no arrangement whereby 39 days must elapse after the pensioner returns to the mental hospital before the pension must cease.
  3. The question of whether the pensioner or his relatives should be required to contribute towards the cost of his maintenance in the mental hospital is one for the State authority controlling the institution. The provisions of the Hospital Benefits Act do not apply to inmates of mental hospitals.
Mr Barnard:
Minister for Repatriation · BASS, TASMANIA · ALP

d. - On the 18th March, the honorable member for Darwin (Dame Enid Lyons) asked the following question : -

Will the Minister give consideration to a proposal that, in the event of the death of an ex-serviceman who has been unable to obtain life insurance for the protection of his dependants because of the effects of his war service, and where his disability is nonassessable, he shall be deemed to have been a pensioner at maximum rates ‘and his dependants shall be treated accordingly?

I have given further consideration to the question asked by the honorable member.If an ex-serviceman’s death is attributable to war service, his dependants are eligible to receive war pensions evpn though the member was not in receipt of a war pension at the time of his death. If an ex-serviceman is in receipt of a special rate war pension on account of being permanently and totally incapacitated and dies from some cause not connected with his war service, the Australian Soldiers Repatriation Act provides for payment of pensions to his dependants at the rates that would be applicable if the death was due to war service. I do not consider that there is anything to justify an extension of those provisions.

Mr Chifley:

– On the 12th March the honorable member for Bourke (Mrs. Blackburn) asked a question concerning the pensions granted to war widows. I previously advised the honorable member that the Government proposes to introduce a measure to increase the rate of war pensions of war widows. At present a war widow receives a pension of £2 10s. a week ; if she has children under the age of sixteen years, the first such child receives a pension of 17s. 6d. a week and each other child 12s. 6d. a week. In addition a widow receives 7s. 6d. per week endowment for each of her children under sixteen after the first child. Therefore the total amount of pension and endowment received by a widow with three children is £5 7s. 6d. per week. The pensions of widows and children are paid regardless of their circumstances and earnings do not affect the rates. An exsoldier who is, as the result of war service, totally and permanently incapacitated, this is, incapacitated for life to such an extent as to be precluded from earning other than a negligible percentage of a living wage, is granted a pension of £4 16s. a week; his incapacity, however, prevents him from supplementing his pension by working, therefore he is in a different position to a war widow.

Commonwealth Serum Laboratories.

Mr Dedman:

n. - On the 13th March, the honorable member for Bourke (Mrs. Blackburn) asked a. question relating to the publishing of reports of the activities of the Commonwealth .Serum Laboratories. The Minister for Health has supplied the following answer : -

The Commonwealth Serum Laboratories published two booklets in respect of biological products for human and biological use in ona and for veterinary products in another. These booklets are handbooks of instructions and retail price lists. In addition there is pub lished in the Medical Journal of Australia and other journals particulars concerning recent biological products made available from the Commonwealth Serum Laboratories. As with other business enterprises, the ordinary trade practice is followed of not publishing production figures or details as to costing. However, these are available at all times to the Government. “War Gratuity.

Mr Chifley:

– On the 5th March the honorable member for Balaclava (Mr. White) asked a question regarding war gratuity. Further to my reply on that day I desire to inform the honorable member as follows : -

The conditions under which payment of war gratuity may be made before the normal due date in 1951 have been prescribed by legislation and insofar as the ex-serviceman himself is concerned, in the following circumstances only may an early payment bc approved -

the gratuity is less than £10;

the member is blinded or totally and permanently incapacitated;

the member is of the age to qualify for the old-age pension or equivalent service pension and the gratuity is required for the provision of medical attention and personal amenities for which the member could not otherwise pay; (ti) the gratuity is required to alleviate severe distress or hardship due to the sickness of the member or any of his dependants; or

the gratuity is required to assist the member in the acquisition of a home.

As I intimated previously to the honorable member the conditions in the War Gratuity Act regarding early payment of War Gratuity were based on the recommendations of the All-party Parliamentary Committee on war gratuity and these have been subject to review from time to time. Special consideration has been given to those cases of ex-servicemen permanently leaving Australia, however the view has been that it would be undesirable to place an ex-member overseas in a more favorable position than the ex-member in Australia and consequently no provision has been made for early payment in such cases. I might mention however, that arrangements have been made in certain overseas countries whereby gratuities of ex-members residing in those countries may be utilized for the purposes outlined in (e) above. In regard to the entitlement to> war gratuity at the overseas rate in respect of service in England, the War Gratuity Act provides that subject to certain conditions, a member is entitled to the overseas rate of gratuity in respect of periods of “ serviceabroad “. “ Service abroad “ is defined as service in an overseas area as- a member of a body, contingent or detachment of the defence force. The Allparty Parliamentary Committee gave very careful consideration to the question of service to count for overseas gratuity and as a result, it was decided that the principle of the rule which had been approved by Parliament for taxation purposes would be the most equitable to apply, subject to certain necessary modifications, Members serving overseas who did not qualify for the full taxation concessions are not eligible for gratuity at the overseas rate in respect of such service outside Australia. The service of certain members on temporary duty or attached to liaison offices in England and other overseas countries did not come within the accepted definition of “ service abroad “ and consequently they are ineligible for the overseas rate of gratuity in respect of such service.


Mr Holloway:

y. - On the 13th March, the right honorable member for Cowper (Sir Earle Page) asked a question relating to penicillin. The Minister for Health has supplied the following information : -

With regard to the availability of supplies of penicillin from the Commonwealth Serum “Laboratories, the recent quotas made available to the various States are being maintained. Because of difficulties in obtaining supplies of suitable glass bottles a regular increase in the present quota to the States cannot be -made. The extra orders above the quotas cannot be supplied, and will be met as production allows. With reference to the price of penicillin made by the Commonwealth Serum Laboratories, the price to hospitals and wholesalers is 3s. Gd. per hundred thousand units; Cs. per two hundred thousand units; and 14s. net per five hundred thousand units. These prices are competitive with the price of penicillin sold by private manufacturers and it is incorrect to state that they are nearly twice the price of the latter. The Commonwealth Government has never at any stage discouraged the private manufacture of penicillin. With reference to the last portion of the question, the price of penicillin has progressively been reduced, and the Government’s policy of free medicine is under consideration at the present “time.

Royal Australian Air Force: Operational Aircraft

Mr Falkinder:

r asked the Minister for Air, upon notice -

  1. What is the number of operational aircraft at present held by the Royal Australian Air Force?
  2. What is the number of each type of operational aircraft held by the service?
  3. Where are these aircraft at present?
Mr Drakeford:

– The details sought by the honorable member cannot be made available for security reasons, though assurance is given that adequate numbers (unit equipment and reserves) of operational aircraft of types used by the Royal Australian Air Force during the 1939-45 war (as well as new types being locally produced) are being held for all purposes of the post-war air force.

Government Property : Unlawful Occupation

Mr Adermann:

n asked the AttorneyGeneral, upon notice -

  1. What are the facts in relation to the case of a returned soldier, his wife and child, who are alleged to have been ejected by Communist “ squatters “ from Commonwealth property at the former military camp at Ekibin Brisbane, on Saturday, the 22nd March?
  2. What action (if any) is contemplated by the Minister?
Dr Evatt:

– Inquiries are being made and a reply will be furnished as soon as possible.

Case of Charles Cousens.

Air. Spender asked the Minister for the Army, upon notice -

Will he make a full statement to the House indicating the reasons for the cancellation of the commission of Major Cousens?

Was such cancellation based wholly or in part upon evidence additional to that which was placed before the magistrate upon the preliminary police court proceedings against that officer ?

If the answer to paragraph 2 is in the affirmative, will he state the general nature of such additional evidence?

Mr Chambers:

s. - The answers to the honorable member’s questions are as follows: -

  1. A full statement has been made to the House on this matter.
  2. No.
  3. See answer to No. 2.

Dr. “W. E. H. Stanner.

Mr White:

asked the Minister for External Territories, upon notice -

  1. Did Dr. William Stanner conduct an inquiry into anthropological and other matters in Papua recently on behalf of the Institute of Public Relations?
  2. Is the survey completed, and has a report been submitted to the Minister?
  3. If so, will he make a copy of the report available during the Easter recess?
Mr Ward:
Minister for External Territories · EAST SYDNEY, NEW SOUTH WALES · ALP

d. - The answers to the honorable member’s questions are as follows : -

  1. On the application of the Commonwealth President of the Australian Institute of International Affairs, a permit was issued to Dr. W. E. H. Stanner to enable him to visit the Territory of Papua-New Guinea. 2 and 3. The Australian Institute of International Affairs is not a governmental organization, and I have no knowledge of the inquiries made by Dr. Stanner or of any report prepared by him.


Mr Harrison:

n asked the Prime Minister, upon notice -

  1. Has his attention been drawn to a report of the National Bank of Australia, dated the 11th March, 1947, stating, in relation to New South Wales, that “ the serious lag in the motor-car body building industry, due to current steel shortages and to labour disputes, is emphasized by a recent statement that there are 4,000 British car chassis awaiting completion ?
  2. If so, are the facts as stated, and will he ascertain whether the recorded loss of 505,500 tons of coal in the first ten weeks of this year contributed to the steel shortage?
  3. Will coal and steel shortages continue so long as Communist trade union leaders use the strike weapon to enforce their industrial claims?
  4. Will he address a strong statement to the members of Communist-controlled trade unions, warning them of the serious consequences to Australian secondary industry of continued stoppages, and urging them to support industrial arbitration as the means of settling industrial disputes?
Mr Chifley:

– The answers to the honorable member’s questions are as follows : -

  1. I have not seen the report referred to by the honorable the Deputy Leader of the Opposition. I have ascertained from my colleague, the Minister for Works and Housing, however, that the steel supplies for motor body building were previously received from overseas and from local production. The overseas supplies have been stopped by the supplying countries for practical purposes. The local production of steel, portion of which is used for motor body building and for production of housing items, does not exceed 50 per cent, of Australia’s requirements, but the motor body building industry has, to date, been allocated 50 per cent, of the actual production. Those intimately concerned with this problem are inclined to the view that the restricting influence on the production of motor bodies has, to date, been the shortage of man-power rather than shortage of steel, but, unfortunately, with the greater demand for housing items in the future and inability of the company concerned to obtain supplies from over seas, despite Government assistance on the highest level possible, in the future steel shortage may be a restricting influence.
  2. There is no doubt that industrial disputes affecting coal and steel industries would contribute in varying degrees to shortages of those commodities.
  3. See answer to No. 2.
  4. All trade unions are already well aware of the serious effect which disputes have on Australian secondary industries. On a number of occasions I have made public statements deploring the incidence of direct action by organizations. As I said in reply to the honorable member on Tuesday, however, the question of what action the Government should take in these matters is one of policy to which I do not propose to reply further.

Hospital Benefits : Registration of Private Hospitals.

Mr Holloway:

y. - On the 20th March, the honorable member for Lang (Mr. Mulcahy) asked a question concerning private hospitals which have not been registered under the Hospital Benefits Act. He inquired if an endeavour would be made to bring those hospitals under the provisions of the Act or if action would be taken to ensure that people accommodated in those hospitals may secure the benefits provided by the act. I promised to discuss the matter with the responsible Minister. The Minister for Health has now supplied the following information : -

At 1st March, 1947, there were in the Commonwealth 805 private hospitals eligible for approval for the purposes of hospital benefits. At that date 604 were approved and 201 not approved. Of the unapproved private hospitals 157 were in New South Wales, nine in Victoria, eleven in Queensland, 23 in South Australia and one in Tasmania. The large number of unapproved private hospitals in New South Wales was to a great extent due to the attitude of the Private Hospitals Association in that State. . The executive of that body had advised members not to bring their hospitals into the scheme. Recently, the Minister discussed with the executive its objections to the Commonwealth procedure under which proprietors of approved private hospitals are required to deduct the hospital benefits from the accounts of the patients and submit monthly claims to the department for the amounts so deducted. He was successful in clearing the various points which had prompted the decision of the Association not to co-operate. The executive has since recommended all members of the association to make immediate application for their hospitals to be approved, and already proprietors of thirty New South Wales private hospitals have submitted applications to the department. Apart from the association’s action in this matter the department has communicated with all private hospitals concerned and has arranged for specially selected officers to interview proprietors of those hospitals in the metropolitan area. In the other States also the department has taken similar steps in an endeavour to procure applications from proprietors of eligible private hospitals which are not approved.

Mr Holloway:

– On the 21st March, the honorable member for Corangamite (Mr. McDonald) inquired if all country hospitals are entitled to financial assistance under the Hospital Benefits Act and if so are all inmates of both country and metropolitan hospitals entitled to bed subsidy payable under that legislation. The Minister for Health has supplied the following information: -

By agreements under the Hospital Benefits Act 1945, made between the Commonwealth and each State Government the Commonwealth provides financial assistance to the States to enable qualified persons occupying beds in public wards in public hospitals to procure free treatment without the application of a means test and to allow hospital benefits of 6s. per day to qualified persons occupying beds in non-public wards in public hospitals. Public hospitals in country areas participate in the scheme in the same manner as metropolitan public hospitals. Hospital benefits are available to qualified persons in public hospitals irrespective of whether such hospitals are situated in the country or the metropolis.

Under the Hospital Benefits (Private Hospitals) Regulations qualified patients occupying beds in approved private hospitals receive hospital benefits of 6s. per day. These benefits are deducted from the accounts rendered by the proprietors of the approved private hospitals. Not all private hospitals are cooperating under the scheme as some proprietors have refrained from making application for their hospitals to be approved. The department is endeavouring to procure applications from all eligible private hospitals. The hospital benefits for private hospitals are available to qualified patients in approved private hospitals whether those hospitals are situated in country or metropolitan areas. Of 201 unapproved private hospitals at 1st March, 74 were in country areas.

Civil Aviation : Trans- Australia Airlines; Australian National Airways Commission

Mr Rankin:

n asked the Minister for Civil Aviation, upon notice -

What were (o) the gross profit, (6) the net profit, or (c) the loss, as shown in the profit and loss account of the Australian National Airlines Commission for the period 12th February to 30th June, 1946.

Mr Drakeford:

– The answers to the honorable member’s question is as follows : -

The Australian National Airlines Commission had not commenced flying operations during the period the 12th February to the 30th June, 1940, and accordingly was not in receipt of any revenue for that period. The sum of £5,528 7s. fid. was transferred to the profit and loss account at 30th June, 1946, as is shown in the financial accounts of the Commission presented by me to Parliament on 27th March, 1947.

Mr White:

;White asked the Minister for Civil Aviation, upon notice -

  1. Is it a fact that the Australian National Airways Commission has made an allocation of £100.000 for inaugural publicity for TransAustralia Airlines?
  2. What capital expenditure and what established expenditure for Trans-Australia Airlines has been authorized?
  3. Will he inform the House whether operations up to date have been conducted profitably or at a loss?
Mr Drakeford:

– The answers to the honorable member’s questions are as follows : -

  1. No.
  2. and 3. The capital expended by TransAustralia Airlines during the period the 12th February to the 30th June, 1940, was £34.6,527 8s. 10d., which included the sum of £5,528 7s. Gd. transferred to profit and loss account. No revenue was received by the Australian National Airlines Commission during that period as flying operations had not commenced. These figures are shown in the first annual report and financial accounts of the commission presented by me to Parliament on 27th March, 1947. The results of operations during 1946-47 will be presented to the House in the commission’s second report to be submitted as soon as possible after the close of the financial year.

Motor Vehicles.

Mr Chifley:

y. - On the 14th March, the honorable member for Hunter (Mr. James) asked a question concerning releases of motor vehicles to ex-servicemen. I now inform the honorable member as follows : -

The Departments of Repatriation and Postwar Reconstruction rank as first ‘priority together with other Commonwealth departments in purchasing for their own purposes motor vehicles declared to the commission for disposal. Motor vehicles arc not purchased by these departments for resale to exservicemen, because cars and , vehicles up to 1 ton loading capacity are subject to control of the Department of Land Transport, which allocates the vehicles to users according to the urgency of need. Preference within priority groups is, however, given .to ex-servicemen. In addition, all vehicles irrespective of capacity must be reconditioned and placed in first-class roadworthy condition prior to sale.’ the procedure adopted by the Commonwealth Disposals Commission provides for each vehicle to be appraised before sale to the distributing company which has undertaken to effect or arrange for repairs necessary. The price of each vehicle is that determined’ by the Prices Commissioner. Officers of the Finance Inspection Branch” of the Commonwealth Disposals Commission arc making continuous checks of distributors and dealers’ books to ensure that conditions are carried out, thereby doing everything possible to protect ex-servicemen and others who purchase motor vehicles. Should any purchaser be asked .to pay over the pegged pr,ce, his remedy is to report the matter to the Prices Commissioner.

Conciliation Commissioners

Mr Francis:

s asked the Prime Minister, upon notice -

  1. Is it a fact that, although the amending Commonwealth Conciliation and Arbitration Bill has not yet been passed by this Parliament, .the names of many Labour supporters, including a former Minister to “Russia, are n l ready being publicly discussed as possible appointees as conciliation commissioners?
  2. If so, will public confidence in the working of the arbitration system be shaken by such suggestions of political patronage, especially in view of recent clashes of opinions in the Labour movement on industrial matters ?
  3. Will he make an announcement that political views will not be considered when appointments arc being made?
Mr Chifley:

– The answers to the honorable members questions are as follows : - 1, 2 and 3. It is a fact that many names have been publicly canvassed. In making appointments regard will be had to each candidate’s qualifications and fitness for the discharge of the high and important office of conciliation commissioner.

Film Censorship

Mr Francis:

s asked the Minister representing the Minister for Trade and Customs, upon notice -

  1. Is the Commonwealth Film Censor responsible to the Minister for Trade and Customs ?
  2. Is it a fact that there is no obligation on the part of the Film Censor to report to .the Minister on films banned by him?
  3. If so, is it proposed that the Film Censor should submit a report on such matters to the Minister, for ultimate conveyance to Parliament?
Mr Pollard:

– The Minister for Trade and Customs has supplied the following answers : -

  1. Yes.

    1. Yes. A report dealing generally with film censorship activities is voluntarily submitted, to the Minister annually, but such reports do not disclose the title of any film banned or otherwise unfavorably dealt with.
  2. No. The regulations provide for an appeal censor to whom an appeal shall lie from any decision of the Censorship Board in any matter arising under the regulations. The regulations provide also that the decision of the Appeal Censor shall be final with the proviso that the Minister may at any stage of the proceedings under these regulations direct that the matter be submitted to him for determination in which case such action shall be taken as the Minister directs.

Prices Control: Meals

Mr Spender:

r asked the Minister representing the Minister for Trade and Customs, upon notice -

  1. Are the austerity prices for meals still in force, and if not, when were they relaxed?

    1. If they are still in force, have any hotels and restaurants been given permission to levy also a “ service charge “ on meals served, and, if so, what are the names of such hotels and restaurants ?
    2. What action, if any, has been taken by the Prices Commissioner on complaints that prices greatly in excess of austerity prices have been charged in certain establishments for ‘many months past?
Mr Pollard:

d. - The Minister for Trade and Customs has supplied the following information: -

  1. Yes.
  2. No.
  3. Complaints are investigated, and where necessary appropriate action is taken in the courts.


Mr Fadden:

n asked the Minister representing the Minister for Trade and Customs, upon notice -

Will he make a statement indicating the present position in relation to clothing, tea, sugar and butter as compared with that in November last, when Cabinet considered the results of an examination of the rationing of those commodities ?

Mr Pollard:

– The Minister for Trade and Customs has supplied the following answer: - .

Clothing. - The provision of clothing is dependent on piece goods, the position of which is as follows:-

Cotton. - The outlook for future supplies is worsened by the decision of the

United Kingdom to withdraw specific allocations to Australia and other countries and to sell to hard currency countries, and also through a reduction in the United Kingdom output due to various causes, including floods and coal shortage. There is a serious world shortage of both cotton piece goods and cotton yarn, and a buying group has been despatched from Australia to Japan to endeavour to obtain supplies there in order to meet the Australian coupon demand.

Rayon. - There is no improvement in the position.

Worsted and woollen. - Production has not greatly increased and additional employees are urgently required in the spinning and weaving mills.

Tea- Until the end of 1940, the British Ministry of Food purchased the entire exportable surplus from Ceylon and India, and Australia, was given an allocation by the Combined Food Board. This year both India and Ceylon have commenced selling tea in the open market and prices have increased substantially. Supplies to the present time are normal, but the future position is indefinite.

Sugar. - The preliminary estimate for the new crop commencing July next is 537,000 tons compared with the crop of 670,000 tons in 1944, 666,000 tons in 1945 and 552,000 tons in 1946.

Butter. - Compared with the same six months in 1945, butter production for July to December, 1946, was lower by 3,000 tons, while, owing to reduction in service demands, exports to United Kingdom increased by 6,000 tons.

The right honorable member may be assured that rationing of tea and clothing will be removed as soon as supplies are sufficient to reasonably meet demands, and, in the case of other commodities, as soon as Australia is able to meet its obligations to United Kingdom in addition to providing for an unrestricted local demand.

Council fob Scientific and Industrial Research : Mr. A. W. Rudkin.

Mr Abbott:

t asked the Minister in charge of the Council for Scientific and Industrial Research, upon notice- -

  1. Is Arthur William Rudkin, a Bachelor of Science, employed in a scientific research post in the Forest Products Division of the Council for Scientific and Industrial Research at Fisherman’s Bend, Melbourne?
  2. Was Rudkin a leading member of the Communist party in Western Australia for many years and editor of the Workers’ Star?
  3. Was this the same Arthur William Rudkin who was convicted in Perth under National Security Regulations on the10th June, 1940, and sentenced to four months’ imprisonment ?
  4. Is it a fact that this man was senior air raids precautions warden at Victoria Park,

Western Australia, and is alleged to have given air raids precautions security information to the Communist party for forwarding to a Communist organization overseas?

  1. Is it a fact that Rudkin’s wife is in Melbourne with him, and is also a known Communist?
Mr Dedman:

– The answers to the honorable member’s questions are as follows : -

  1. Yes, but the Forest Products Laboratory is located at Yarra Bank-road, South Melbourne, and not at Fisherman’s Bend.
  2. Yes.
  3. Yes.
  4. Mr. Rudkin was senior air raids precautions warden at Victoria Park, Western Australia.
  5. Mr. Rudkin’s wife is living with him; her political beliefs are not known.

Australian Prisoners of War.

Mr Chifley:

y. - On the 6th March, 1947, the honorable member for Martin (Mr. Daly) asked a question regarding the recognition of outstanding services of members of the Australian forces whilst prisoners of war in the hands of the Japanese.

An announcement was made in the Commonwealth Gazette, as well as in the press, on 6th March, 1947, of the grant of awards in respect of services of an outstanding nature rendered by members of the Australian MilitaryForces whilst, prisoners of war in camps in SouthEastern Asia and Eastern Asia from February, 1942, until their liberation in August, 1945. This list contained the names of 79 members who received decorations and thirteen were awarded mentions in despatches for gallantry and personnel of the Royal Australian Navy who were prisoners of war in the hands of the Japanese eleven were granted decorations and thirteen were awarded mentions in despatches for gallantry and outstanding devotion to duty in the action of H.M.A.S. Perth and during their subsequent captivity . Supplementary recommendations for awards to personnel of the Royal Australian Air Force, in recognition of distinguished service whilst prisoners of war, are now awaiting His Majesty’s approval.

Department of Information

Mr Hamilton:

n asked the Minister for Information, upon notice-

  1. How many (a) permanent, and (b) temporary officers of the Department of Information receive £500 a year and. more?
  2. What are (a) their names, and (b) their official designations?
Mr Calwell:

– The answers to the honorable member’s questions are as follows : - 1. (a) Nine permanent officers; (b) 121 temporary officers.

  1. Permanent officers -

    1. Name, (b) Designation.

Adamson, W. M.. Senior Clerk and


Armstrong, R. E., Private Secretary to the Minister.

Bonney, E. G., Director-General.

Foley, L. M., Librarian, New York.

Key, L.M. Librarian, London.

Maplestone, L. T., Production Manager.

Mountford, C. P., Film Director.

Walsh, J. P., Clerk.

Temporary officers - .

  1. Name, (b) Designation.

Alexander, H. B., Editor-Cutter Films Division.

Allan, J. S., Film Producer.

Anderson, A., Cinematographer.

Aston, R., Thai Announcer.

Bagnall, F., Cinematographer.

Baker,I., Journalist.

Band, J., Photographer.

Barrie, Miss S., Journalist.

Barsdell, L. E., Shortwave News Editor.

Bartlett, N., Journalist.

Bee, E., Journalist.

Benson, S., Film Director.

Berry, A., French Announcer: .

Bennie, K. G., Shortwave Journalist.

Bottomley, C., Photographer.

Boys, L., Journalist.

Bridges, J., Press Attache, Washington. .

Briears, J., Journalist, New York.

Brown, S. S., Editor.

Buggy, H:, Shortwave Editor.

Casey, G. S., Director, New York Bureau.

Clarke, A.L., Journalist, New York.

Corbett, J., Journalist.

Collings, G. F., Film Producer.

Craigie, Mrs. L. L., Secretary, New York.

Cranstone, E. L., Cinematographer.

Cronin, W. T., Film Booker.

Dicker, K., Photographer.

Dow, H., Shortwave Journalist.

Drake, R., Shortwave Journalist.

Dunbabin, T., Director, London Bureau.

Duncan, Miss C, ResearchAssistant.

Cast, S., Journalist.

Eastman, D., Cinematographer.

Father, H. W.,’ Trade Information Officer, New York.

Edwards, R. G., Cinematographer.

Evans-Jones,Miss M., Journalist.

Feldmann,J. Films Division Research Assistant

Finley, D. J., Films Officer, London.

Fisher, F. W., Photographer.

Fitzpatrick, S., Photographer.

Ford, C.,’. Shortwave Journalist.

Fraser, J. R., Journalist.

Gadsby, V. G., Photographer.

Gallagher, J. P., Photographer.

Gamon, G. A., Technical Supervisor, Films Division.

Gardner, C. H., Shortwave Journalist.

Gerrard, A. S., Clerk.

Gibbs, G. A., Shortwave Journalist.

Glen, Miss, Stenographer, New York.

Goodwin,W. P., Journalist.

Goss, N. F, Press Attache, Rio de Janeiro.

Hamilton, I., Journalist, London.

Hardham, G. B., Journalist.

Hawes, S., Producer-in-Chief, Films Divi- . sion.

Hawken, N., Sub-Editor.

Hewitt, E. J., Press Attache, San Francisco.

Heyer, J., Film Producer.

Heyer, T. P., Director Shortwave Division.

Hood. W., Journalist.

Horne, R. I., Press Attache, Paris.

Hunger ford, Mrs, D.M., Journalist.

Ingle-Hall, A., Shortwave Journalist..

Jesser-Coope, W. A., Translator - Malay.

Johnson, J., Journalist.

Keating, ‘J., Press Attache, Delhi.

Kelly, L., Shortwave Journalist.

Kennedy, K. G., Shortwave Journalist. .

Kershaw, A., Shortwave Announcer

Laird, Miss M., Stenographer, New York.

Laurie, K. B., Shortwave Journalist.

Lawrence, Miss M., Journalist.

Leyser, J., Shortwave Journalist.

Logan, Miss B., Receptionist, New York.

Loughlin, J., Journalist.

Lynch, C.. M., Journalist.

Mansell, H. H, Business and Personnel Manager.

Mantle, P. D., Journalist.

Martin, Miss G., Shortwave Journalist:

McFalls, Miss E., Stenographer, New York.

Mclnnes, H., Cinematographer.

McRae, N., Chief . Administrative Officer and Secretary to Film Board.

Mills, H. C, Trade Information Officer, London.

Mitchell, R. S. B., Trade Information Officer, Singapore.

Mulgrue, G. E., Journalist.

Murphy, H. J., Retiring Press Attache, San Francisco.

Murphy, K. P., Chief Publicity Officer.

Murray, J., Liaison Officer, Films Division.

Myles, D, S., Journalist.

Neill, E. . V., Journalist.

O’Connor, A., Journalist, New York.

Oki,J., Japanese Translator and Announcer.

Oudheusden, H. van., Dutch Translator and Announcer.

Pearse, R. G. H., Cinematographer.

Poignant, A., Cinematographer.

Powell, G., Cinematographer.

Pratt, M., Press Attache, Ottawa.

Prehn, W. F. W., Trade Information Officer, Bombay.

Reidy, H. E., Shortwave Journalist.

Robertson, Miss J., Special Editorial Assistant, New York.

Sawer, D., Shortwave Journalist.

Schwinghammer, F. S., Trade Liaison Officer.

Slocombe, C, Journalist.

Smith,. C.M. Journalist.

Stanton, ‘Miss A.,’ Administrative Assistant, New York.

Stivens , D.,Journalist.

Stock, R. S., Special Assistant (Films), New York. Stocklen, Mrs., Secretary(Distribution), New York.

Thomson, E. G., Film Producer.

Tokimasa, D.H., Japanese Monitor.

Tope, H. C. T., Journalist.

Trerise, W., Cinematographer.

Twelftree, C. C, Journalist, London.

Watson, A. P., Laboratory Manager.

Whan, A., Clerk, New. York.

Wigmore, L. G., Retiring Press Attache, Delhi.

Wilcox, W. J. H., Trade Information Officer, Cairo.

Williams, A. C, Journalist.

Williams, R. M., Film Producer.

Wood, R., Shortwave Programme Production Manager.

Younger, R. M., Journalist.

Cite as: Australia, House of Representatives, Debates, 27 March 1947, viewed 22 October 2017, <>.